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Analyst: Costs may create hollow force

A Heritage Foundation analyst argued Friday that the military will face a crisis in five to seven years if it cannot reign in growing personnel costs, especially for retired pay and health benefits.

“My chief concern is we have the potential to not provide the quality and quantity of weapons we need,” said Baker Spring, a national security policy research fellow at the Heritage Foundation’s International Studies Institute.

Spring, speaking at a Heritage Foundation discussion about modernizing military compensation, warned of a 21st-century version of the so-called “hollow force” of the 1980s, when severe personnel shortages reduced military capabilities.

But this would be “a different kind of hollow force,” one that has high-quality, well-paid, well-trained people — but outdated weapons. The fear, he said, is the U.S. could lose its technological edge because personnel-related costs would squeeze essential weapons modernization programs out of the budget.

Baker is advocating a benefits system in which the government would set a limit on how much it spent on benefits, particularly deferred benefits for retirees, and let people choose which ones they want. He described this as “rebalancing” benefits, based on his belief that most service members are unaware of the value of their deferred benefits and may not notice much if those benefits were reduced.

He acknowledged that this would be a tough sell, but said any such proposal to limit or reduce benefits would only be made slowly, with current retirees protected. “Any of these proposals would have to have very careful transition,” he said.

House Armed Services Committee professional staff member Michael Higgins, a pay and benefits expert, said he does not see Congress going along with such a radical proposal unless the Defense Department got fully behind it. While Congress shares concerns about rising personnel costs, he did not think lawmakers would become willing to take the lead on a plan to roll back benefits.

Even getting Congress to approve Pentagon initiatives to hold down personnel costs is difficult, Higgins said, noting that lawmakers have been reluctant to adopt a Bush administration plan to raise Tricare fees on military retirees.

Higgins said it is still possible that Congress will allow Tricare fees to increase. “I do see in the future Congress relaxing its hold on Tricare fees,” he said.