A Hole in the Strategy

July 1, 1991

THE public at large hasn’t taken much notice of it yet, but the United States has a new defense strategy. As explained by the Joint Chiefs of Staff, the important changes are summarized in three major themes– forward presence, crisis response, and reconstitution.

“Forward presence” is a misnomer. In reality, it signifies a retreat from the concept of forward defense. Fewer US troops will be stationed abroad. At home, smaller forces will be restructured for response to “urgent” problems in “compelling” locales. Beyond that, the new strategy counts heavily on ample warning time, reinforcement, mobilization, and ‘`reconstitution” of forces.

“In the final analysis, reconstitution may well prove to be the linchpin of America’s long-term security,” the Joint Chiefs said in the military net assessment they sent to Congress in March. Reconstitution may also prove to be a hole in the strategy, as it depends in large part on a defense industrial base that may not be there when the time comes.

The Joint Chiefs are well aware of that vulnerability and went to some lengths in documenting it in their report. The decline of the industrial base, a chronic problem through the 1980s, has worsened precipitously. By 1997, the Joint Chiefs estimate, it might take four years to restore production capability to the 1990 level, which in itself was a somewhat discouraging benchmark.

Even as the nation watched the Gulf War on television, many of the firms that had produced the impressive weapons were releasing workers, closing plants, and searching for nondefense business. In many ways the war reflected an industrial base that no longer exists.

The problem is not solely one of sources of supply. The technological superiority of US armed forces is also at risk. Dependence on foreign suppliers is increasing, particularly for computer chips, machine tools, bearings, and optics.

It appears that the government’s main response will be to let the market fires burn themselves out. There are both practical and political reasons for that passive approach.

With defense budgets dropping toward 3.6 percent of Gross National Product, the technology market is dominated by consumer and commercial demand. Defense is too small to call the shots, so the extent to which the problem can be controlled is questionable.

The Pentagon could make direct investments to preserve industrial infrastructure and keep production lines warm, but the funding would be at the expense of other priorities in a budget that has already been cut severely. On the political front, the Bush Administration is adamantly opposed to “industrial policy.” It prefers to let the market sort out winners and losers and wants no part of government-industry combines of the kind made famous by the Ministry of International Trade and Industry (MITI) in Japan.

Within these limits, the Pentagon is engaged in several positive actions. To adapt to the commercial market, it is abolishing all the military-unique product specifications it can. The industrial base is a regular consideration as new systems pass through acquisition review. Manufacturing technology programs seek to stimulate productivity.

The spotlight centers on two other initiatives, both getting a considerable push from Congress. The first is an effort to identify critical technologies and promote US growth in them. The second, which goes by “flexible manufacturing” and other names holds that the distinction between defense industry and other industry is mostly artificial and ought to be eliminated.

These ideas have obvious merit, but basic problems remain. It is not enough, for example, to develop critical-technologies. Without actual production, the supplier-subcontractor base continues to evaporate, and US industry drops further behind in the ability to manufacture what it invents.

We cannot assume generic industries, flexible or otherwise, will be responsive to defense needs. It is equally plausible that they will prefer to stick to the consumer market, where the sales are bigger, the profits better, and the aggravations fewer.

As the situation stands now, government efforts may be able to moderate in marginal ways the decline of the defense industrial base, but they cannot control the drop or determine where the eventual landing will be.

This is not good news for a nation that has just adopted a new strategy in which force reconstitution takes on added importance and is seen by the Joint Chiefs of Staff as the probable linchpin of long-term security.