Army Directs Cutbacks in Anticipation of Budget Shortfall

Army Directs Cutbacks
in Anticipation of
Budget Shortfall
November 28, 2007

Army installation commanders worldwide have been directed to plan for spending scale-backs due to an anticipated budget crunch sparked by governmental wrangling over funding for the war on terrorism, according to an Army news release issued today.

In a memorandum dated Nov. 26, Gen. Richard A. Cody, vice chief of staff of the Army, directed all Army commanders and agency directors to begin planning to curtail operations and related expenses that do not directly support warfighters engaged in the global war on terrorism, the release stated.

Cody's instructions tell Army commanders and civilian leaders to review all operations and to forward recommendations to cut costs back to him by Dec. 4.

"We are only in the prudent planning phase," Cody said in a statement issued today. The Defense Department has instructed all military services to review operational costs at installations as well as to prepare for possible furloughs of government civilian employees.

"It is an imperative of the senior Army leadership that our Army, especially while at war, understands the budget process, the decisions being made and any potential impacts on the total Army family."

Congress has approved supplemental funding for war operations, but such legislation comes attached with timetables for the withdrawal of U.S. troops from Iraq. President Bush has vowed to veto any such legislation that crosses his desk.

Having received no war-supplemental money since the fiscal year began on Oct. 1, the Army has had to use its budgeted operations and maintenance dollars normally employed to organize, train, equip and field forces, as well as to sustain soldiers and their families, to fund war-related operations and activities, according to the Army news release.

During a visit to Killeen, Texas, Nov. 26, Defense Secretary Robert M. Gates said federal legislators' failure to quickly pass an emergency funding supplemental bill would derail military gains made against insurgents in Iraq and Afghanistan. Army and Marine Corps members constitute the biggest ground presence in both Afghanistan and Iraq.

"Without these funds, Army operations and maintenance funds will be exhausted by mid-February, and similar Marine Corps funds about a month later," Gates told listeners gathered at the municipality's Chamber of Commerce.

"We cannot wait until mid-February to figure out how to deal with consequences of these accounts running dry," Gates said.

Cody has instructed Army installation chiefs and other leaders to be prepared to minimize operational and maintenance-funded activities that are "not required to protect the life, health and safety of occupants of Army installations, or required to maintain assets vital to the national defense."

The Army expects to exhaust all operational and maintenance funds by Feb. 23, even after considering a request from DoD to transfer more than $4 billion from Navy and Air Force personnel accounts and the Army's working capital fund, according to today's Army release.

Per current labor agreements and to provide some predictability to the civilian work force, supervisors would have to start notifying Army civilians of any impending February furloughs by mid-December, according to the Army news release.

During a Nov. 20 Pentagon news conference, DoD spokesman Geoff Morrell told reporters that Gates lamented that Congress hadn't quickly passed the emergency supplemental bill containing nearly $200 billion to fund war operations. In consequence, Morrell said, Gates directed the Army and Marine Corps to begin planning to reduce operations at all Army bases by mid-February and all Marine installations by mid-March.

"At that point, the bases will be all but shut down, able to provide only the most basic safety and security measures for those who reside there," Morrell said.

In addition, the Defense Department will begin notifying about 200,000 civilian employees and contractors "we can no longer afford their services and that, absent additional funding, they will be furloughed or temporarily laid off within a matter of weeks," Morrell told reporters.

The Army's planning actions "are absolutely necessary given the uncertain global war on terror funding," Cody stated in today's Army news release. "We will do everything we can to minimize the turbulence for our soldiers, civilians and their families."

Related Articles:
* Gates Asks Congress Not to Derail Iraq Progress
* Lack of Supplemental Funding May Lead to Civilian Furloughs
* Furloughs, Closings Possible Without Supplemental Funding, Gates Warns
From news article by DoD’s American Forces Press Service - Written by Gerry J. Gilmore

Pentagon Ramps Up Fight With Congress

Politco.com brings us this story today and it goes in part like this...
...In the memo, Defense Secretary Robert M. Gates instructs the secretaries and of the Army and Navy to “start appropriate planning to reduce operations at all Army bases by mid-February of next year and all USMC bases by mid-March of next year.”... The plan would leave “bases … all but shut down, only able to provide the most basic safety and security measures for those who reside there,” Pentagon press secretary Geoff Morrell said at a briefing Tuesday afternoon...
Read this story in full HERE

* Townhall.com has this take...
Two anti-war Democrats who hold congressional purse strings offered President Bush a deal on war funding today: give us a withdrawal date and we’ll give you the money... House Appropriations chairman Rep. David Obey (D.-Wisc.) and Rep. John Murtha (D.-Pa.), chairman of the Defense Subcommittee on Appropriations said they would agree to pass a funding bill if President Bush would commit the military to a no-torture policy and agree to a withdrawal all troops from Iraq by December 2008...
The Obey-Murtha Funding Compromise

Furloughs, Closings Possible Without Supplemental Funding, Gates Warns

Thursday, November 15, 2007
There is no "wiggle room" in the Defense Department budget, and Congress must pass the emergency supplemental spending bill as soon as possible to avoid halting operations and furloughing civilian employees, Defense Secretary Robert M. Gates said today.
During a Pentagon news conference, Gates reinforced the message he delivered to Congress yesterday, when he and Secretary of State Condoleezza Rice visited Capitol Hill and briefed members of both houses.

Gates strongly urged Congress to pass a global war on terror funding bill that the president would sign, he said.

The secretary said the president's signing of the 2008 National Defense Appropriations Act into law earlier this week caused some misperceptions. One misperception is that the Defense Department can continue funding troops in the field for an indefinite period of time through accounting maneuvers -- "that we can shuffle money around the department."

"This is a serious misconception," the secretary said.

The Defense Department has significantly less funding flexibility than it had in the spring, he said. In the fall of 2006, Congress provided a bridge fund of $70 billion until passage of the full war supplemental bill, which did not pass until late May 2007.

This year, the Defense Department was operating under a continuing resolution. "Now that the regular appropriations bill has been enacted, we are left with no bridge fund and only our base budget to support normal war operations," Gates said. "Further, Congress has provided very limited flexibility to deal with this funding shortage."

Restrictions on the budget mean that the department can transfer only $3.7 billion, which amounts to just a little over one week's worth of war expenses, he said.

All this leaves the department with only undesirable options to continue operations with the absence of a bridge fund, the secretary said.

"The path we believe is least undesirable fiscally and militarily would involve the following: The military would cease operations at all Army bases by mid-February next year," he said. "This would result in the furloughing of about 100,000 government employees and a like number of contractor employees at Army bases.

"These layoffs would have a cascading effect on depots and procurement," he continued. "Similar actions would follow for the Marine Corps about a month later."

The department must notify certain union employees 60 days in advance of any layoff or furlough, so the department will need to send the notices to affected employees in mid-December.

"If the Congress does not provide bridge funding this week on a bill the president will sign, and given the uncertainty of future action in December, by the end of this week -- as a prudent manager -- I will be obliged to take a series of anticipatory steps," Gates said.

The secretary said he will submit an urgent reprogramming request for funds to Congress. He also will direct the Army and Marine Corps to develop a plan to furlough employees, terminate contracts and prepare bases for reduced operations. "These plans would begin to be implemented in mid-December," he said.

Even if Congress acts, the president signs a bill, and the department receives $50 billion in bridge funding now, this will fund war operations only through about the end of February, Gates said.

"So we would be back in this situation immediately after the Congress reconvenes in late January," the secretary said. "The high degree of uncertainty on funding for the war is immensely complicating this task and will have tremendous consequences for this department and the men and women in uniform."

Gates said the issue before Congress is not one of principle, but pacing. He said Congress asked the president to draw down the troops in Iraq, set a date for when the drawdowns would begin, set a timetable for the drawdowns and then to transfer the security mission to Iraqis.

"The president has moved in all four of these areas: He has announced there will be drawdowns; the drawdowns have already started," Gates said. Army Gen. David H. Petraeus, the commander of Multinational Force Iraq, has announced a timetable at least for the first five brigade combat teams, and the mission of transition begins in December when the first brigade comes out, he said.

"What I told members of Congress yesterday, for those who allege that the views of the generals were not sufficiently taken into account at the front end of the war, now you have a recommendation from the commander in the field, the commander of Central Command, from the Joint Chiefs of Staff, on what makes sense in terms of pacing so we don't put at risk the gains we've already made," Gates said.

"It seems to me that there ought to be some deference to those who are running the war -- the generals -- at the pace at which this drawdown should take place," the secretary said. "However one feels about how we've got to this point, the reality is we have had some significant success due to the efforts of our men and women in uniform and their sacrifices.

"We don't want to sacrifice their success," he continued. "So how do we get the next phase of this conflict right? Because the consequences of getting it wrong are potentially high."

From a news article by DoD’s American Forces Press Service - Written by Jim Garamone

Gates Request $45 Billion Additional Funding To Cover Military Costs - Defense Stocks Hit New Highs

Gates Request $45 Billion Additional Funding To Cover Military Costs In Iraq And Afghanistan In 2008 - Defense Stocks Hit New Highs

CNNMoney.com brings us this report this afternoon and it starts off like this... Defense stocks on Wednesday hit new highs ahead of Defense Secretary Robert Gates' visit to Capitol Hill to request roughly $45 billion in additional funding to cover military costs in Iraq and Afghanistan in 2008... The AMEX Defense Index, which tracks 14 major defense company stocks, rose 14.25 to a high of 1,686.72 in afternoon trading. Since last year, the index has risen roughly 47 percent, outperforming the broader S&P 500 index, which has climbed nearly 15 percent over the same period...
Read story in full HERE

>>> CNNPolitics.com has this report...
Gates to ask Congress for nearly $190 billion war funding

>>> USNEWS.com reports this...
Gates Seeks $50 Billion More for War