How could the Pentagon have wasted $125 billion?

The Pentagon is reported to have buried a report detailing $125 billion of wasteful bureaucratic spending.

First Look

After discovering some $125 billion in waste at the Pentagon, defense officials moved to hide the findings and declined to make suggested bureaucratic cuts, fearing that evidence of misplaced and excess spending would lead Congress to reallocate millions of dollars in the defense budget to other areas of government, according to an investigation by The Washington Post.  

Pentagon officials initially requested the internal study, which was completed in early 2015, to help them crack down on inefficiencies and unnecessary spending within the Defense Department’s budget of more than $600 billion. But when the study uncovered that wasteful spending was more drastic and widespread than officials had anticipated, they moved to discredit and bury its findings, worrying that the results could lead to significant budget cuts.

“If the impression that’s created is that we’ve got a bunch of money lying around and we’re being lazy and we’re not doing anything to save money, then it’s harder to justify getting budgets that we need,” Frank Kendall III, the Pentagon’s chief weapons buyer, told the Post.

The report found $125 billion that the Defense Department could save over five years by following a plan that relied on using early retirements and attrition to streamline the bureaucracy, getting rid of pricey contractors, and using information technology more effectively. The recommendations did not require laying off civil servants or making cuts to military personnel.

Many military leaders found favor with pieces of the study that showed how the $125 billion could be used for weapons, troops, and rebuilding the nuclear arsenal. They also learned that just by renegotiating contracts and opting to hire more affordable workers, they could save some $75 billion.

The Defense Business Board voted to move forward with the $125 billion plan, expecting positive responses from top officials who had sought to solve some of the department’s financial woes through the plan. But Deputy Defense Secretary Robert O. Work, the Pentagon’s second-highest-ranking official who had ordered the Defense Business Board to conduct the study, became fearful of its repercussions and began a set of moves to suppress the findings, deeming that move in the Pentagon’s best interest.

Officials sealed the study’s data under secrecy restrictions, guaranteeing that no one would be able to reproduce its findings. They also removed a 77-page-long summary report that had previously appeared on a Pentagon website, and officials began to dismiss the report’s findings as inaccurate.

Others remained critical of that move, saying decisions from top officials like Secretary Work set the Defense Department back and ignored smart recommendations to streamline internal operations and better utilize taxpayer money.

“They’re all complaining that they don’t have any money. We proposed a way to save a ton of money,” said Robert “Bobby” L. Stein, a private-equity investor from Jacksonville, Fla., and chairman of the Defense Business Board, told the Post. “We’re going to be in peril because we’re spending dollars like it doesn’t matter.”