Congress is probing the Defense Department’s plans to shutter commands and cut service contracts spending by 10 percent a year for the next three years, seeking the hitherto elusive strategic analysis proving those cuts are necessary because the work is unnecessary or better achieved through other means. PSC President and CEO Stan Soloway testified at a House Budget Committee hearing on Sept. 30 to shed light on the industry and economic impacts of what has so far been an opaque DoD budget exercise, particularly with regards to insourcing.
In his testimony, Soloway revealed:
- DoD’s plan to cut contract spending by 10 percent per year appears to be arbitrary since DoD has not provided evidence that it took a comprehensive and strategic look at work within each defense activity being performed by the total force of uniform military, civil servants and contractors.
- DoD’s intentions to close commands because they are, in Gates’ words, “contractor heavy,” ignores the fact that who performs the work has nothing to do with whether the work remains mission essential. The mission, not the badge of the worker, should drive such a decision.
- On insourcing, DoD has given no consideration to the loss of corporate tax and other revenues to local or state governments or the impacts associated with reducing well-paying, private-sector jobs at a time when such jobs are what the economy needs.
Soloway asked the committee:
“What is magical about contracted support services? Why target only contractor-performed work rather than the totality of the work being done by the department? Why does the directive not seek a more holistic approach to all work being performed by DoD in an effort to find areas of redundancy or changed needs, regardless of who is performing that work?”
The committee could give no answers. Nor could DoD, as evidenced at both the House and Senate Armed Forces Committees’ hearings on the issue. At the Sept. 28 Senate hearing, Deputy Secretary William Lynn said, with regards to the decision to close the Joint Forces Command: “This was not a business-case analysis, as some have described it. This was a military decision."
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Watch Soloway’s full testimony and response to congressional questioning here.
