Order Code RL32151
CRS Report for Congress
Received through the CRS Web
DOD Transformation Initiatives and the Military
Personnel System: Proceedings of a CRS Seminar
November 12, 2003
namere dacted
Specialist in National Defense
Foreign Affairs, Defense and Trade Division
Congressional Research Service ˜ The Library of Congress

---

DOD Transformation Initiatives and the Military
Personnel System: Proceedings of a CRS Seminar
Summary
On April 9, 2003, the Congressional Research Service sponsored a seminar for
the purpose of examining the Department of Defense’s transformation plans,
assessing the impacts these plans might have on the military personnel system, and
discussing what issues these impacts might raise for Congress.
This report
summarizes that seminar and provides a transcript of it.
The impetus for this seminar was the Department of Defense’s ongoing efforts
to “transform” the U.S. military. There are a number of competing definitions of
precisely what “transformation” is, but the term generally refers to a dramatic change,
a “quantum leap” ahead, in military power due to technological advances, new
operational concepts, and organizational changes.
Much of the discussion about transformation has revolved around the advanced
technologies — especially information technologies — that allow the U.S. military
to detect, track, and destroy enemy targets more rapidly and with greater precision.
Significant attention is also being directed towards developing new warfighting
concepts in order to employ advanced technologies for maximum effect. Yet often
overlooked in the public debate has been the organizational aspect, which some
believe to be the most important and challenging component of transformation; and
central to any discussion of organizational change is the military personnel system.
The panelists for this seminar were Dr. David Chu, the current Under Secretary
of Defense for Personnel and Readiness and Dr. Bernard Rostker, Senior RAND
Fellow and Under Secretary of Defense for Personnel and Readiness during the
Clinton Administration. Robert Goldich, a specialist in national defense policy with
the Congressional Research Service, served as a respondent on the panel.
In their presentations, the participants generally agreed that the personnel system
needed to be made more flexible, efficient, and productive, although they did not
always agree on the best way to do this. Among other things, Dr. Chu advocated
increasing the length of time that military personnel — especially senior officers —
serve in a given assignment, raising the maximum age for active service, and
modifying reserve obligations to provide for a “continuum of service.” He also
favored major revisions in the current DOD civilian personnel system. Dr. Rostker
also favored increasing the length of assignments, but he emphasized instituting
greater selectivity in bringing people into the “career force,” increasing the typical
length of service for those who are part of the career force, eliminating “cliff vesting”
for retirement to compensate those not selected for the career force, and accepting a
higher ratio of senior officer and enlisted personnel. Mr. Goldich added a cautionary
note by arguing that recruiting a sufficient number individuals to serve in the military
should not be taken for granted, and that a great challenge for the military in the
future will be sustaining a training system which can effectively convert citizens into
military personnel. None of the opinions, positions and policy recommendations
expressed by the panelists reflect the views of CRS, which does not take positions
on public policy issues.

---

Contents
Key Comments of Dr. David Chu . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
General Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Specific Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Key Comments of Dr. Bernard Rostker . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
General Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Specific Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Selected Comments of Robert Goldich . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
General Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Appendix A: Transcript of the Seminar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

---

DOD Transformation Initiatives and the
Military Personnel System:
Proceedings of a CRS Seminar
On April 9, 2003, the Congressional Research Service sponsored a seminar for
the purpose of examining the Department of Defense’s transformation plans,
assessing the impacts these plans might have on the military personnel system, and
discussing what issues these impacts might raise for Congress.
This report
summarizes that seminar and provides a transcript of it. Conversational language
was retained so as to assure authenticity.1
The impetus for this seminar was the Department of Defense’s ongoing efforts
to “transform” the U.S. military. There are a number of competing definitions of
precisely what “transformation” is, but the term generally refers to a dramatic change,
a “quantum leap” ahead, in military power due to technological advances, new
operational concepts, and organizational changes.
Much of the discussion about transformation has revolved around the advanced
technologies — especially information technologies — that allow the U.S. military
to detect, track, and destroy enemy targets more rapidly and with greater precision.
Significant attention has also being directed towards developing new warfighting
concepts in order to employ advanced technologies for maximum effect. Yet often
overlooked in the public debate has been the organizational aspect, which some
believe to be the most important and challenging component of transformation; and
central to any discussion of organizational change is the military personnel system.
The panelists for this seminar were Dr. David Chu, the current Under Secretary
of Defense for Personnel and Readiness and Dr. Bernard Rostker, Senior RAND
Fellow and Under Secretary of Defense for Personnel and Readiness during the
Clinton Administration. Robert Goldich, a specialist in national defense policy with
the Congressional Research Service, served as a respondent on the panel. Key
comments made by the participants are summarized below. Additionally, at the end
of each comment is a page number in parentheses. This refers to the page number
in this report where their verbatim comments have been transcribed.
1The seminar was planned, organized, and managed by Dr. (name/re dacted), Specialist in
National Defense in the CRS Foreign Affairs, Defense, and Trade Division. Dr. Kapp, an
officer in the U.S. Army Reserve, was ordered to active duty effective October 12, 2003, and
has been unable to participate in the final editing of the transcript and its preparation for
publication; Mr. Goldich performed these duties.

---

CRS-2
None of the opinions, positions and policy recommendations expressed by the
panelists reflect any views of CRS, which does not take positions on public policy
issues.
Key Comments of Dr. David Chu
General Comments
! Transformation is a process, not a fixed end-point. Transformation can also
be viewed in the historical context of assessing whether forces and doctrines
developed during the Cold War era are appropriate for the future or need to be
modified. (p. 7)
! Transformation revolves principally around doctrine, organization, and
people; hardware and technology are generally of secondary importance. (pp.
7-8)
! Highly motivated, quality people are critical to the success of our military
establishment. The force needs to be “above average” and compensation
needs to be set at a level high enough to attract above average people in a
competitive market economy. (pp. 8-9)
! Personnel policies are not just important for the active duty military, but also
for the reserve component and DOD’s civilian workforce (both civil service
personnel and civilian contractors). (pp. 9-10)
Specific Recommendations
! Reduce the frequency of moving active duty military personnel, and especially
senior officers, into different assignments. Allow them to serve longer in their
positions in order to master their responsibilities and maximize their value to
the organization. (p. 11)
! Extend the maximum age of active service slightly to accommodate longer
careers for senior officers. (pp. 11-12)
! Reassess the military’s “social compact” to keep up with changing social
circumstances in American life; for example, look at ways to improve career
opportunities for military spouses and to provide more privacy for junior
enlisted personnel in their living quarters. (p. 12)
! For reserve personnel, a shift from the traditional model of reserve service —
one weekend a month and two weeks per year — toward a more variable
service obligation which is more intense during periods of national emergency
and less intense at other times. (p. 13)
! For civilian personnel, a revised personnel system that provides for more
flexible hiring mechanisms, “pay banding” instead of the current pay grade
system, and collective bargaining at the national level as opposed to the local
level. (pp. 13-15)

---

CRS-3
Key Comments of Dr. Bernard Rostker
General Comments
! The military’s current personnel system is largely derived from the system
developed near the end of World War II and reflects a 1950s, draft-era
mentality. (p. 15)
! More than half the defense budget is dedicated to personnel;2 therefore,
reforming the personnel system should be a high priority. (pp. 15-16)
! The rapid turnover in positions which is common in the military arena
severely limits the ability of leaders to effectively manage or reform the
organizations they lead. (pp. 15-16)
! The comparatively short length of military careers allows talented people to
leave when they are still very useful to the military. (p. 16)
! The Goldwater-Nichols Act added three to five years of joint “career
content”but the typical career was not lengthened to accommodate this. (p. 17)
! The retirement system essentially forces large numbers of people to stay in the
military until they reach 20 years of service. (p. 17)
! The Defense Officer Personnel Management Act’s emphasis on equity in
promotion opportunity for all officers undercuts the productivity and
efficiency of the force. (pp. 17-18)
Specific Recommendations
! A stringent system of selection for the “command track.” Those selected for
this “command track” would be eligible for a military career. Most of those
not selected would be separated from the service, although some would be
allowed to serve full careers in technical tracks. (pp. 18-19)
! Severance pay and vested pensions for those separated early. (pp. 18-19)
! Longer careers, lasting into the individuals late 50s and early 60s. (pp. 18-19)
! Lower turnover in job assignments. (p. 18)
! A greater number of people in the most senior grades. (p. 19)
2The percentage of the defense budget devoted to manpower is dependent on definitions of
what is included in the category “manpower costs.” Using DOD’s definition of “total pay
costs” — which would exclude some costs related to manpower that are not compensation
for individuals — indicates that in recent years about 40% of the total DOD budget has gone
to manpower. This estimate would not necessarily contradict that of Dr. Rostker, therefore,
because it would reflect different definitions. National Defense Budget Estimates for FY
2004. Office of the Under Secretary of Defense (Comptroller), March 2003: 121.

---

CRS-4
Selected Comments of Robert Goldich
General Comments
! One should not assume that the military will always have a sufficient supply
of young people willing to join the military. (p. 20)
! The military lifestyle is inherently demanding and it is difficult to find people
who are willing to endure it. (p. 20)
! The military has to be aware that identifying and appealing to those people
who might be attracted to the military lifestyle is absolutely crucial. (pp. 20-
21)
! Caution should be exercised in developing policies which appeal to individual
self-interest — for example, replacing barracks with private quarters — as
they may undercut the sense of military community. (p. 21)

---

CRS-5
Appendix A:
Transcript of the Seminar3
DR. KAPP: Without further ado, let’s get started. Again, for those of you who came
a little bit later, my name is (name/re dacted). On behalf of the Congressional
Research Service, which is conducting this seminar, welcome. The principles that
guide the work of CRS all derive from the Service’s role in keeping the Congress
informed. Throughout the legislative process, CRS provides comprehensive and
reliable research, analysis, and information services that are timely, objective,
nonpartisan and confidential. This seminar, as with all CRS events, is based on the
concept that good policy evolves from discussions that present diverse points of view
so that congressional audiences can have a balanced view of the pros and cons
associated with public policy issues. Today’s program is titled DOD Transformation
Initiatives and the Military Personnel System: Potential Issues for Congress. This
seminar is being simultaneously broadcast via the Web to the various offices of the
United States Congress and in order to preserve the confidentiality of attendees,
cameras will not show the faces of anyone in the audience, nor will they be identified
by name.
The streaming video that will be produced will be a one-time live presentation,
followed by video and audio clips, that will be made available on the CRS website
within a short period of time. The basic outline of the seminar is as follows: I will
start off with some short opening remarks on the topic and I will be followed by our
panelists, Dr. David Chu, Dr. Bernard Rostker, and Mr. Robert Goldich, in that order.
Dr. Chu is currently serving as the Under Secretary of Defense for Personnel and
Readiness in the Department of Defense. Dr. Rostker is currently a Senior Fellow at
RAND and he was the former Under Secretary of Defense for Personnel and
Readiness during the Clinton Administration. Mr. Goldich is a Specialist in National
Defense issues with the Congressional Research Service, where he serves as the
senior military manpower analyst in the Foreign Affairs, Defense, and Trade
Division. Mr. Goldich will devote most of his time to commenting on the remarks
of Dr. Chu and Dr. Rostker. Following the presentations of these gentlemen, I’ll open
it up to the audience for questions and answers. We’ve set a fair amount of time aside
for this, so please, don’t be bashful. This is a great opportunity for you to ask
questions of some of these distinguished experts in the military personnel field, and
I really hope you take full advantage of that. So, let’s get started.
The Department of Defense has currently embarked on a long-term effort to
transform the U.S. military. While there are a number of competing definitions of
precisely what transformation is, the term generally refers to a dramatic change or a
quantum leap ahead in military power due to technological advances, new war-
fighting concepts, and organizational changes. Or perhaps, more precisely in this
context, transformation refers to the process whereby the U.S. military seeks to
remake itself by incorporating these new technologies or finding concepts and
3Transcript produced by EEI Production, Alexandria, VA. Technical corrections made by
(name/re dacted) and (name/ re dacted), Congressional Research Service.

---

CRS-6
organizational changes, with the ultimate goal of generating dramatic increases in
military power.
In recent decades, scholars have identified numerous instances in history where
military forces have transformed themselves and thereby secured military advantage,
at least for a time. Some commonly cited historical examples include the
transformation of the 14th Century English military to take advantage of the longbow;
the transformation of the French military in the late18th Century, when the manpower
and material of the nation were harnessed to an unprecedented degree through the
levee en masse; and the German military’s transformation during the period between
World War I and World War II to allow it to fight a blitzkrieg or “lightning war.” The
transformation of the German military during the inter-war period is a particularly
interesting example because it shows how these separate facets of transformation —
technology, war-fighting concepts, and organizational changes — can interact in a
synergistic way to bring about these dramatic changes in military power. For
example, from the perspective of new technology, blitzkrieg relied on the maturing
of three relatively new technologies — tanks, aircraft, and radios. From the
perspective of war-fighting concepts, blitzkrieg relied on new operational doctrines
which allowed commanders of the German panzer [armored] divisions to direct close
air support by way of radio. From the perspective of organizational change, blitzkrieg
concentrated armored forces in major units — the Panzer divisions — rather than
dispersing the tanks throughout infantry units in order to provide them with fire
support as the French originally did. Then, digging a little deeper into the
organizational change, we can discern some of the impacts that this new way of
fighting — this blitzkrieg — had on the German military personnel system: an
increased demand for people with new skills — mechanics, electricians, large
numbers of supply people to deal with the panzer divisions’ incessant demand for
fuel; pilots and navigators for the aircraft and so forth; increased demand for a large
number of people intelligent enough and motivated enough to efficiently operate a
complex system like a tank or an airplane; and a need to change the ratio of officers,
noncommissioned officers and lower enlisted grades. For example, German aircraft
were usually navigated and piloted by noncommissioned officers, and a German tank
company had a higher proportion of officers and NCOs relative to the lower enlisted
ranks than an infantry company did. There was also a need for new career paths for
these people serving in the aviation and armor fields and so on.
So, bringing the discussion back to the present, the U.S. military is currently in
the midst of a process to transform itself; and, during this process, much of
transformation has revolved around the advanced technologies, especially
information technologies, which allow the U.S. military to detect, track, and destroy
enemy targets more rapidly and with greater precision. Some significant attention is
also being directed towards developing new war-fighting concepts in order to employ
advanced technologies to maximum effect. We’ve seen a fair amount of discussion
of that during the current operations in Iraq and how those new war-fighting concepts
are working out in practice. Yet often overlooked in the public debate has been the
organizational aspect, which some believe to be the most important and challenging
component of transformation and central to any discussion of organizational changes
is the military personnel system. So to enhance the public debate on this topic, we’ve
assembled this panel to look at what DOD’s transformation plans are, to assess what
impact those plans might have on the military personnel system, and to discuss what

---

CRS-7
issues this might raise for the Congress. What types of capabilities are envisioned for
this transformed force? Which military occupational specialities will be in higher and
lower demand in the future? What types of physical, psychological, and intellectual
abilities will people need in order to fill the military specialities required by
transformation? How will the military recruit and retain these people? What types of
pay and benefits package will be most attractive to qualified individuals? In what
ways will the training needs of a transformed force be different than it is today? How
should career path be structured to enhance the effectiveness of the transformed
force? What types of assignments will be more or less crucial in the future than they
are today?
To answer these questions our first speaker will be Dr. David Chu. Dr. Chu was
sworn in as the Under Secretary of Defense for Personnel and Readiness on June 1,
2001. He is a presidential appointee confirmed by the Senate and he is the Secretary
of Defense’s senior policy advisor on recruitment, career development, pay and
benefits for 1.4 million active-duty personnel, 1.3 million Guard and Reserve
personnel, and 680,000 DOD civilians. He is also responsible for overseeing the state
of military readiness. Dr. Chu earlier served in government as Director of, and then
Assistant Secretary of Defense for, Program Analysis and Evaluation, from May
1981 to January 1993. Dr. Chu received a Bachelor of Arts degree magna cum laude
in economics and mathematics from Yale University in 1964, and a doctorate in
economics, also from Yale, in 1972. Please welcome Dr. Chu.
DR. CHU: It’s a great pleasure to be with you this morning and to have the privilege
of participating in this panel, because I hope both for my fellow panelists and from
your question intervention, to take back with me a wide range of views as to how we
might confront the important issue in front of us. I would at the very beginning like
to echo something that Larry hinted at, and that is how I would argue we should view
transformation. Transformation in the end, as I think the present Secretary of
Defense would emphasize, is a journey, not a destination. There isn’t a fixed point
out there — an answer at the back of the calculus textbook that we can look up and
say, “Aha, if I just do the following things I will have achieved this goal.” It does, of
course, historically arise as an issue because with the end of the Cold War, the
question that the Congress especially emphasized, that the Department of Defense
had to answer, was “Is the same set of forces, the same doctrine, the same set of
practices that characterize the Cold War for the better part of a half century
appropriate to the challenges the United States will face in the decades ahead?” I
think most people agree probably not — that there will be some changes, perhaps
some very substantial changes, in all of the above as the Department moves forward.
One of the critical corollaries, I would argue, is that transformation is not, let me
underscore not, exclusively, perhaps not even principally, a matter of hardware
changes, although that tends to be the focus. There’s a lot of interest in what will
technology do for us, and how might that change the way the Department functions.
I would argue in general, that’s secondary; that the issues of doctrine, organization,
and ultimately people, really are the primary issues in front of the Department.
Technology can have a marked effect, sometimes a sharp shift — as the examples
Larry suggested might argue — sometimes more gradual in character.
I think most of you are aware of the present Secretary of Defense’s favorite
example of transformation, and that is the vignette of the special operations soldier

---

CRS-8
calling in precision air strikes from a strategic bomber using a satellite telephone on
horseback in Afghanistan. And a more wonderful collage of ingredients would be
difficult to imagine. In fact it calls to mind that old saying about how you should
dress for a wedding — something old, something new, something borrowed,
something blue. The old of course is clearly the horse, the new you might argue is the
degree of precision that air munitions attacking ground targets have achieved, the
borrowed you could argue is the satellite telephone, the blue, if I can keep this
analogy going here this morning, I would contend is the sense of true blue, that is to
say that ultimately whether or not this all worked depended on the qualities of that
soldier on horseback. We could have all the marvelous technology, the engineering,
and the scientific community could conjure up on the shelf. If that soldier could not
put it together, did not know how to use that technology in a way that was
appropriate to the moment at hand, and that would enable the pilots in the strategic
bomber actually to attack the targets with precision munitions, everything would have
been for naught. I do think that is a wonderful guide to thinking about the issues that
Larry has posed for us this morning. Indeed it would be in my judgment the first of
a set of assumptions that one might make about how one approaches the
transformation issue as far as people are concerned.
A second assumption, I would argue, is that highly-motivated quality people are
critical to our success. (The first assumption is that transformation is not just about
hardware. It’s principally about doctrine, organization, how we operate.) Although
I don’t think this is a new idea, I do think we sometimes are a bit forgetful that there
are continuing returns to quality. This is demonstrated by research that colleagues of
Bernie and me at RAND undertook some 20 years ago, in which people in various
Army and military occupation specialities were put into simulated situations that
were very consistent with what the real world would present and they were graded
on their performance. And the performance was tracked back to their underlying
qualities — their preparations, their aptitudes, etc. One of the things that was
interesting about these experiments is that there wasn’t any tail-off to quality or to
returns to quality about this. For example, if you have a Patriot [air defense missile]
operator — take a very appropriate example in present day, this was back when
Patriot was brand new — the person with the higher aptitude skills identified more
targets correctly, tracked more targets correctly, engaged more targets correctly,
which as we’ve seen from various instances which have since occurred is truly a
critical parameter. It doesn’t flatten off somehow. There’s no sort of de minimus view
of what’s good here. I think you see the impact of that kind of finding on the way the
Department of Defense over the last three decades has gradually racheted up its view
of what is the minimum quality we want in the force today. Some of you, Mr.
Goldich among them, are old enough to remember the near failure of the volunteer
force in the Seventies when Congress actually legislated minimum quality standards
which by today’s view of what’s good are laughably low. So Congress, if I recall
correctly, Bob, in that era said two-thirds of the male non-prior service enlistees had
to be high school diploma graduates. Now we view anything less than 90% as a
failure. In that era, if you recall, the nadir in the late Seventies, I believe in the worst
year the Department had something like just over half of the male non-prior service
enlistees were high school dropouts. I don’t want to pretend that a high school
diploma is an indicator of all goodness in terms of personnel qualities, but it certainly
is the case that if you cannot get along with your high school principal, you are not
going to like your drill sergeant. And so, as we’ve all seen in reams of research

---

CRS-9
through the years, possessing a high school diploma — successfully navigating an
American high school — is a strong predictor of whether you get to the end of your
first term of enlisted service. The aptitude scores are strong predictors of whether you
can cope with the instructional material we give you to take you from your civilian
status to a fully trained apprentice in a military occupational specialty. Likewise, in
the Seventies, Congress set standards for what’s now called the Armed Forces
Qualification Test, that again, by today’s view, are low relative to our current
ambitions. So one of the lessons the Department has taken away from all this
research — research has really had an impact here — in its own experience with the
force is [that] high-quality counts. We are Lake Wobegon. We aim to be above-
average. This goes explosively to an issue which I know always makes the budgeteers
a little queasy, which is our compensation level, and the compensation package in the
Department of Defense needs to be competitive with that agenda. It’s not enough to
match national averages. We have to do better than national averages, other things
equal. That is, I think no great surprise to anyone who has actually served in the
military. I think we can see the payoff to that quality in the operations currently
taking place in Iraq. You see it in the ability of our young people under fire to
improvise, to cope with a new situation, indeed just to find their way around a foreign
city. I think it’s amazing that these units have navigated through places like Baghdad
without any big issues being raised of whether anyone’s lost or otherwise not in the
right place. That’s not an accident. That’s the result of insisting on high-quality
standards of entry, high-quality standards in training, and high-quality standards to
stay in the force.
One of the corollaries I think of this proposition — this goes directly to
something I know that those in the labor movement have always been fearful about
— is that the sometimes view that substituting capital for labor or moving to a more
capital-intensive force, which is clearly where the American military is headed over
the decades, is not a prescription for somehow dumbing down the task. Indeed it’s
somewhat the opposite, in its effect that these are machines that require higher
aptitude, better qualified people. These are, as the labor movement would say, good
jobs. These require a high education level. Increasingly this is a force, as many
people here are aware, that has some degree of college experience, either acquired
before it enters service or during the course of its military career.
The third big assumption that I’d like to emphasize as the starting point for
debate is that the issue of what kind of people we need is a total force issue. I would,
if I might, carp a little bit about our title here tomorrow. It’s not just about military
personnel which is often taken to mean the active force. The total force issue in the
sense of active versus reserve — I’ll come back to this in just a second — it’s also
total force issue in terms of what’s the civil component of our force because the
civilian component is equally important to the success of this enterprise. The fact
that all those tanks work in Iraq despite extraordinarily bad environmental conditions
is a tribute to the maintenance they’ve received, attributed also to the underlying
design of that equipment. That’s largely done by a civil workforce, whether contract
or serving in the United States government. Let me switch then, if I might, to a little
stock taking. Where do we start from in this transformational journey? Where are
we in terms of the Department’s people? First of all I think one of the great
transformations — and I’m sorry it wasn’t on your list, so I’m urging you to put it in
your future talks — that the United States military has gone through has been the

---

CRS-10
notion that we would people this force with volunteers completely. That is truly a
revolution. When the United States — and I think that Bernie is writing the history
of this at the moment, and can speak to it more thoroughly than I can — but when the
United States undertook to move to a volunteer force in the early 1970s, no nation
had ever attempted a comparably sized effort, both absolutely and relative to
population. The British did have a volunteer force much smaller in absolute size
[and] relative to the population, as I recall the numbers. It was a rocky start. It
almost failed, as the examples I’ve described tend to suggest. Indeed when I first
came to this Department — Mr. Kapp was kind enough not to mention how long ago
that was — the senior military leadership tried to talk to then Secretary of Defense
Caspar Weinberger out of continuing our volunteer force. There was great internal
dislike of this concept. It was a very different concept from before. You couldn’t
just draft people and tell them what to do. You actually had to get them to be
enthusiastic by your leadership as to their task at hand.
The fact that today it is
something that every major country I would argue seeks to emulate; even the
Russians are moving toward a volunteer force. Even the French are moving to a
volunteer force, which I think is an extreme compliment in the military department,
[and] is, I think, a tribute to the success of this venture. It did take 30 years and it
took a lot of help from the Congress. The Congress has been very attentive to the
volunteer force in my judgement, even when the Executive Branch — it’s certainly
true of the 1970s — was a little laggard in terms of pay. It was the Congress that
came in and said, “No. You’ve got to do better by these people. You’ve got to take
care of them. You’ve got to be more competitive with your pay scale.” That is not
to imply that we can rest on our laurels in this regard. I’ll come back to this in a
second. It really is a situation where I think the Department needs to be in a process
of continuous improvement. We must at all times be seeking to better our situation.
We need to be strategic in doing so, and we must recognize that the world around us
constantly changes. We are not in some kind of continuing equilibrium. There are
a lot of forces pushing us into disequilibrium with which the Department needs to
contend — to which it must react. I want to comment on those in just a second.
Second, in terms of taking stock, I think one of the lessons, one of the take-
aways from the present situation, the mobilization of the reserve forces in the United
States, is that the reserves are today a complete volunteer force too. The mind set
that people may once have had about the reserves — these were somehow people
evading military service, which was a hallmark of the draft era; people who were
reluctantly serving there as opposed to on active duty — that’s not true of the
reserves today and you can see it in the fact that we have mobilized well over
250,000 Americans, often on short notice, invariably at great personal difficulty in
terms of suddenly being uprooted from their family and civil life, sometimes at
substantial financial sacrifice. We have not had, I’m proud to say, any significant
issue raised by reserves being called to active duty. Speaking frankly, we’ve had
more issues with grumpy employers writing and saying, “Gee, I’m a little unhappy
my person is being called up.” I’ve actually had situations where the person is
pleading, “Don’t let my employer stand in the way of my serving the country. I
trained for this. I want to do this. It’s my duty.” Terrific story in terms of the
responsiveness of our people. Even a situation where we’ve extended their service
unexpectedly, called them to do more, they have answered that call. I think we need
to keep in mind the reserves are a volunteer force and we need to treat them that way.

---

CRS-11
Third, I think we need to be willing to praise our civilian workforce. It is a
terrific workforce. If you look at various polls, whether it’s Paul Light’s survey or
other instruments that have been used, the Department of Defense civil workforce
generally scores better in terms of how satisfied it is with its situation. [That] doesn’t
mean it’s perfect, and there are a number of issues out there, but we have a strong
workforce, a happier workforce, particularly when it is in one of our so-called
demonstration programs. The Congress has given the Department of Defense — and
we’re grateful for this — latitude over the last three decades to experiment with other
types of civil workforce arrangements than the standard Title 5 paradigm. I think the
record on that is clear. OPM’s done a big study on this, which was published, I think,
last year, that in general these are much more satisfied workforces when they are
under these demonstration rules than those under the Title 5 civil constraints. I
would use the word “constraints” advisably. Title 5, as you all know, is the modern
day analog of the civil service reforms of the 1880s. They were a great set of reforms
for the 1880s. They settled the struggle, dating back to the early 19th Century, as to
what kind of federal workforce should we have. Should we have one in Jackson’s
view that’s responsive to political direction, which someone kindly called the spoils
system, or should we have one that emphasizes merit principles? Those favoring the
merit principle won that battle. But that battle has long since — that fight has long
since been settled. We need to move on. Title 5 rules don’t let you do that. They are
ripe for revision in my judgement and I think the judgement of most in service. Put
another way, the excellence of our civil workforce is achieved despite Title 5, not
because of its current structure. What does this all imply in terms of changes for the
future for transformation as Larry would have phrased to start out this session?
First of all for the active force, it implies that one of the big issues that we need
to take on is [that] we need to be more rational about how we assign people to their
posts of responsibility. Specifically, we need to move away from the high turbulence
world that so much characterized the Cold War — the view that every year or two
you change jobs. Partly in the officer corps, because that was used for preparation
for more senior responsibility, partly because we had a high fraction of force overseas
so you had a rotation base issue with the force as a whole. We need to come back to
this question of how long someone spends in a job from the perspective of what’s
best for that individual, and for the organization, in terms of tenure in a particular
post. I think the conclusion of a review like that which we have begun is that
typically people should spend more time in a particular post, in order for that
individual, especially in a technologically demanding age, to master the
responsibilities and to be able to give back to the organization. It certainly is true of
the most senior leaders. If you look at the behavior of private corporations, on which
RAND has done some excellent research for the Department of Defense, what you
find is that typically CEOs spend an average of eight years on the job, and that senior
executives typically who are placed in the position with the agenda of changing the
organization — of reshaping the organization — generally spend at least four or five
years in a particular post, not the 18 months to two years that characterizes many of
our officer assignments, especially including, unfortunately, our senior officer
segments. A lot of this is a matter of administrative changes in the Department,
managerial changes, to have people stay in senior posts longer and at senior levels
of responsibilities longer, than is now true. Congress has already enabled the
Department in this regard. It gave the Department some years ago the authority to
keep four-star officers for 40 years. The Department rarely did that in the past — in

---

CRS-12
the recent past. It gave the Department the authority to keep three-star officers
through 38 years of service. Again the Department rarely did that. We are going to
see more of that, in my judgment. We are going to be seeking from the Congress
some facilitating changes to raise the maximum age for active service a bit from the
current level of 62 years of age, in order to make this all work in the normal
circumstance. You can see the first glimmerings of this sort of change already in the
decision by the President to invite General Jones to move from being Commandant
of the Marine Corps to being Supreme Allied Commander in Europe, and
Commander of the United States European Command.
It’s very historical in
character. Generally once one has been the Chief of Staff of a service — there are
a couple of counter-examples over history — one sort of steps down and retires. So
four years and you’re out. Well, that’s not going to be true for General Jones — four
years and he’s on to another senior post.
With the force as a whole, I think, one of the things we have to be thoughtful
about is how we respond to the changing social circumstances of American life.
What that implies, I would argue, is that we must constantly be asking ourselves:
“[What] is the social compact — the set of understandings between us, our people,
and their families — as to what this is all going to be about?” What we’re going to
ask of them and what we’re prepared to do for them in return, needs constantly to be
reviewed. And I do think there are a number of our practices in this regard that are
not consistent with modern, American realities. One of the most important of which
is that, typically now in most households as you know — true in the military as well,
although again this mix of research demonstrating military spouses are at some
disadvantage in this regard — and that is that both spouses work. And often it’s
more than work. It’s a desire by the spouse for a career. Frequent moves are not
consistent with fulfilling that desire. One of the reasons it’s attractive to us to rethink
the question of assignment length is that a side benefit is, you give the spouse some
more stability. But more broadly, it will be incumbent upon us in the Department to
think about how do we advantage spousal careers in a situation where most spouses
are going to want to work and want to develop their career skills over time? To just
take another example of a social change the Department will need to confront. As
you know, the Department’s intellectual outlook on housing for single junior
enlistees is that they should live in the barracks. Some of this is because we own the
barracks, and we’ve got business keys backwards where we own the building, we
want to fill it, as opposed to asking ourselves, what do we want to offer our people,
and, therefore, what kind of housing should we have? It is to me unclear why once
they’ve completed training of the initial sort, why junior enlisted personnel — who
are, after all, typically going to be college aspirants who would [rather] live off in
private sector housing other than our choosing — why we should compel them to live
in barracks? I know that military leadership will speak to good order and discipline,
and we’re all in favor of that, but of course we allow married personnel, which is the
majority of our force, to live in housing of their choice. Why not something similar
for junior enlisted personnel? In fact if you look at survey materials on how
American youth sees us, and how their parents see us, one of the great negatives in
those surveys is “living in the barracks,” the lack of privacy, the lack of a sense that
you have a space of your own. So therefore I think as we look at this social compact,
one of the things that we ought to look at is why do we have these practices as far as
housing, if indeed we are aiming at a college-bound generation in terms of how we’re
seeking to populate the enlisted force of the American military.

---

CRS-13
So much for the active force. Quite briefly, let me move quickly to the reserve
force. What we seek to create there is a continuum of service. Recognizing it is truly
a volunteer force, and that we are advantaged by having those volunteers on active
duty at times that make sense for the country as a whole, and we need to arrange
things so that it also makes sense to them. As you appreciate the paradigm [with
which] we operate the reserves, it could not be more different from that — at least
officially. Officially reserves are people who serve 39 days a year. One weekend a
month, two weeks in the summer. That’s it. Now that’s not the reality, particularly
in the Air Force which has been more continuous in its use of reserves. But why is
it that way? Why should it be two weeks in the summer? I’ve tried asking senior
Adjutants General, “What would you do if we suddenly gave you 39 days a year and
you could use them as you would like?” At least one of them would say, “I’d do three
weeks in the summer if I could because two weeks is too short. I don’t need all those
weekend drills during the year. I need more time when the unit comes together with
a major training range at its disposal when it could really take advantage of it.” Now
the issue would be, would the employers sit still for that? A lot of practical problems
to solve in that regard. Indeed for some kind of specialists, do I need to see you very
often at all? Let’s take a trauma surgeon. Once you’ve received basic military
instruction of some kind, do I really need you to come to my hospital to practice
trauma surgery or am I better off letting you go to downtown Washington, DC or
downtown Baltimore to practice trauma surgery in your civil capacity, and have a
relationship with you that allows me when I need you — which is today, to be
specific about this — to call you up? A compact — so we’re saying to you that your
service is going to be variable over time; more intense in periods of national
emergency, less in other periods of time. All our rules, all our administrative
practices in the Department militate against this kind of arrangement. We are starting
to try to reinvent those rules. One of the first objectives, first pilot [projects] in this
regard, is to see if we can recruit a set of civilian experts in spectrum management
to serve in the Individual Ready Reserve, where the understanding with them will be
exactly the kind I just described — that we will ask of you intermittent service in the
military, but not a stylized, flat, 39 days a year. One of the things this required in
order to make this all work well — this is where we’re going to have to come back
to Congress and engage in appropriate dialogue with the members and the
committees — is the statutory requirement that you have a certain number of weeks
of training before you’re sent overseas. If you’re already trained as a spectrum
manager and I suddenly need you in southwest Asia, do I really have to send you
through 12 weeks of training in the United States or 16 weeks, whatever it is, a rule
that derives from sad experience with inductees during the Second World War? So
with reserves, the continuous service for actives, more rational pattern of
assignments.
For civilians, as my comments would suggest, what we would seek in the
Department of Defense, the Secretary has said publicly, is a national security
personnel system. We need to recognize the Department of Defense has a set of
missions. They’re somewhat different from some others in the government. There
may be good government reasons for revisiting the Title 5 constraints in those
departments too, but in terms of the Defense Department there is a real national
security agenda that needs to be satisfied. An operating mission needs to be fulfilled.
I think the three big elements of such a system that we would like to see the Congress
enact — and I’m hopeful we’ll be sending legislative language to the Hill, perhaps

---

CRS-14
even this week on this subject — are, first, more flexible, rapid, agile hiring
mechanisms than we have today. It takes us, the Department of Defense today,
typically 90 days to hire somebody. That is not competitive in today’s job market.
You go up against high-technology companies that are offering at college job fairs
offering jobs on the spot, subject only to due diligence checks. We instead say,
“Here are our forms. Please take our test. We’ll let you know.” That won’t cut it.
Particularly with the wave of retirements coming in the federal civil service system,
we’re not going to succeed in repopulating that system with the quality we have today
if we can’t get more flexible hiring authority. Congress has given the Executive
Branch some broad authorities in this regard, with the Homeland Security Act.
We’re eager to have some of those authorities for the Department of Defense.
Second, we’re convinced after looking at the 20+ years of the [China Lake, CA]
experiment, and other demonstration projects Congress has authorized in the civil
personnel system, that pay banding, as opposed to the stylized grade system that now
describes most federal jobs, is the way to go. As you know, instead of having grades
[GS]1-15 in the federal service, what pay banding does is say for a broad career field,
you have a small number, maybe four, pay bands. So there’s the apprentice pay band,
there’s a journeyman pay band, there’s an expert pay band, there’s a senior pay band.
Once someone’s qualified in that band, it’s the supervisor’s decision, not some
grading specialist in the Human Resources Department. It’s the supervisors decision,
based upon the marketplace, that he or she confronts what to pay that individual.
You adjust the pay as responsibilities undergo change. You don’t have to rewrite the
job description, recompete the job which is the Title 5 structure today. So I’ve had
in my office a lady who is actually doing some additional responsibilities, and [I]
wanted to enlarge her job description. She pleaded with us, successfully, not to do
that, because if we recompeted it, she might not win that job. That creates a “not in
my job description” kind of federal civil service. That’s not the kind of place we
need to be. It’s not the kind of place that we want to be. I don’t think it’s the kind
of place the country wants us to be. But that’s the import of the rules under which
not only DOD but most federal departments operate today. We need to change that
mentality and pay banding is part of that. I know that many unions are suspicious of
pay banding. Mr. Harnage has already issued his press release denouncing this idea.
I think the actual practice demonstrates that it’s not only sound, but the workforce
will be happier with it. OPM has done a set of surveys on the federal government,
including Defense, and if you break those surveys down for Defense between those
workers who were in demonstration projects with pay banding and those without, the
ones in pay banding are happier, but we have a union vote to continue that practice
at its particular location. It’s a much more flexible system. It does tend to tie
rewards and performance and that’s the hard point I think with some of the union
leadership. They’re worried that we will not be fair in doing that. I think the
evidence is to the contrary and I think we can propose rules and mechanisms that will
meet their concerns.
The final element that we would like to see in managing the civil service in a
more modern fashion is bargaining at the national level on key human resource
issues. At the moment the Department of Defense must bargain at the local level.
We have 1,366 local unions at the Department of Defense and what that implies is
that it takes a long time to get anything changed. We started under Dr. Rostker’s
tenure two years ago to get to a result to where if you abused your charge card or your

---

CRS-15
travel card we could collect from your civil service salary. We still have 200 unions
to go in getting that change made. That is not the kind of agility that transformation
is all about. Let me conclude by saying that I recognize that what we’re going to
send out here is a set of ideas, a set of principles; we’ll have drafted legislative
language I hope to Congress this week.
I don’t want to argue that we have
necessarily found the best way to solve the challenges — to meet the challenges
ahead of us and solve the problems we face in every instance. I welcome the
dialogue and debate with the Congress and others including members in this panel
this morning as to what’s the best way to do this. I think together we can shape a
personnel system for the civilians, for the reserve forces, for the active force in the
United States that truly will meet the needs of the 21st Century.
DR. KAPP: Thank you so much for your comments, Dr. Chu. Our next speaker is
Dr. Bernard Rostker. Dr. Rostker is currently working as a Senior Fellow at RAND.
He has also held several government positions.
Most recently he was Under
Secretary of Defense for Personnel and Readiness during the Clinton Administration.
Prior to this position, he served as the 25th Under Secretary of the Army, and before
that was Assistant Secretary of the Navy for Manpower and Reserve Affairs. While
in this role he was also named Special Assistant to the Deputy Secretary of Defense
for Gulf War Illnesses. During the Carter Administration, Dr. Rostker was the
Principal Deputy Assistant Secretary of the Navy for Manpower and Reserve Affairs,
and then Director of Selective Service.
As Director of Selective Service he
formulated the Selective Service revitalization plan which resulted in the first mass
Selective Service registration since World War II. Almost 4 million young men
registered. Welcome, Dr. Rostker.
DR. ROSTKER: Thank you very much. I want to associate myself both with
Lawrence’s remarks and with David’s remarks. The only problem with David’s
remarks is I’d like to see the Administration go further and faster and I would like to
explain why. First of all, [the sign] says Dr. Rostker. There are many times I think
that is really incorrect, in that I should address you as Trojan warriors, and the name
here should be Cassandra, because Cassandra was Priam’s daughter and was cursed
with the ability to see the future but that no one would listen to her, and I would tell
you that for the six years I was in the Clinton Administration, I was concerned about
the need for transforming the military. We had had a revolution in military affairs.
We had had a revolution in business affairs. We had no revolution in personnel
affairs. The personnel system that was developed at the end of World War II to
largely correct the abuses of the seniority system, a personnel system that had seen
the Cold War was still in place. World War II was over. The Russians were gone,
but we still managed our personnel in a system that largely reflected the draft and
largely reflected the 1950s. At least three times in my tenure — once in the Navy and
twice in correspondence with the senior leadership at DOD — I wrote papers arguing
for a revolution in personnel affairs, and I got nowhere. The only senior executive,
the only Secretary of Defense or Deputy Secretary of Defense who got it was Don
Rumsfeld and you see Rumsfeld’s insights in some of the initiatives that David is
suggesting. You might ask why is this true? More than half of the budget is tied up
in personnel, and reform of that portion of the DOD budget should be a high priority.
I’ve reflected on that and I have come to believe in the problem that Richard Danzig,
a colleague and the second most recent past Secretary of the Navy, has spoken about
and has written about. And that is the difficulties of changing a mature institution

---

CRS-16
that on the surface appears to be operating well. You don’t want to tinker with
success. There is no question that we have success. We have an outstanding
personnel system and the kinds of changes that Secretary Rumsfeld is pushing, that
David talked about in terms of the senior leadership, the senior uniformed leadership,
is pushing to a new plateau, and it’s difficult for people to risk that. That difficulty
comes in several flavors if you will. The senior executives are bewildered by the
personnel system, by the rules and regulations. They don’t understand it and they’re
scared of change. That is reinforced by the career personnel managers who have
become experts in managing a set of outdated rules and can’t possibly think of the
world in terms that are not captured by those rules. They’re experts because they’re
in the box, but that box is their constraint and any thought outside of the box is
absolutely terrifying, because it comes from a new world that they don’t understand.
When Secretary Rumsfeld came in, and David alluded to this, certainly in a meeting
that he and I had as a transition, he really raised three points which I thought got to
the heart of what Lawrence is talking about in terms of transformation.
As David has alluded to, the first is the fact that we have this rapid turnover in
jobs. At one point in my tenure as Assistant Secretary of the Navy, Fred Pang, who
was the Assistant Secretary of Defense had us down to meet with Paul O’Neill. Paul
at the time was the President of Alcoa. He also was Chairman of the Board of the
RAND Corporation. This is the same Paul O’Neill who would later be Secretary of
the Treasury. Paul told us that Alcoa was the most productive aluminum company
in the world, and that the key to that was plant managers, and you had to find the best
people to be plant managers and leave them in place a minimum of ten years. They
had to be able to understand their environment. They had to be able to change it, see
the effects of changes, and make adjustments. Ten years. Paul thought that our base
commanders must be the analogy of the plant managers — that we needed to leave
our base commanders in place for ten years. Regardless of whether he got the most
important or not most important people in our family, that was his view. I said, “But
we had a slightly different paradigm. We left our base commanders in place no more
than two years.” He said, “How can they create a program and execute the program
and adjust if they’re only in place for two years?” I said, “Well that’s not the
paradigm we work in. Their job is to execute a budget that they didn’t create and
create a budget that they wouldn’t have to execute.” He said, “How can you run an
institution like that?” I said, “It beats the hell out of me, but that’s exactly what we
do.” David alluded to, and you know, that our Chiefs of Staff spend four years. I’m
reminded of the former President of General Electric that said it took him about eight
years to figure out the job and then GE took off. But what’s important is not just the
CNO or the Chief of Staff who spends four years. What’s important are the [deputy
chiefs of staff] and the heads of our institutions, and they spend on average less than
two years. There’s no way that you can master your institution in that time, to say
nothing of reform your institution. So that was one of the things that Secretary
Rumsfeld understood.
The second was the issue of tenure. He was faced at the time of our brief
meeting, with the retirement of the senior enlisted serviceman in the Air Force at
about age 42, I think. He said, “Here we found a truly superb person, and at 42 we’re
going to let him go, to say nothing of then paying him for the rest of his life on a
pension.” No company in the United States would look towards taking its senior

---

CRS-17
managers and letting them go at such an early age, and yet we systematically built
this.
The third thing that we didn’t talk about, but it is clear in his pronouncements
that has an impact on our personnel system, and here I’m going to reflect mainly on
the officer personnel system, is the emphasis on jointness. You see it in the
application of force in Iraq. This is truly a joint force. Jointness comes about
because of Goldwater-Nichols and the requirements of Goldwater-Nichols. It adds
a minimum of three to five years of career content as you master your service skills
and then have to master your joint skills, and yet we try to operate that with no
additional headroom in a career where we let people leave at 20 years, but more
importantly we force large numbers of people to stay to 20 years because we have a
cliff vesting system rather than an accrual system, rather than a transferable annuity-
type system, which is what every other employee in the United States has. And then
we say, “Once you have become a senior executive in the service that you have
limited tenure and you have to be gone in your mid-fifties at 35 years of service.”
When Congress in its wisdom — and I truly mean that, sometimes it’s referred to in
the derogatory — but in its wisdom gave the Department the opportunity to extend
flag and general officer careers, it was universally rejected by the individual service
personnel planners. They couldn’t possibly see how, in the box they had been
working with, how they could use this additional tenure. Their problem was that if
I have on average my senior flag officer staying a little longer, that would reflect a
reduction in the promotion opportunity from colonel or [Navy] captain (O-6) to flag
and that’s not fair. Everybody needs the same promotion opportunity. It says so in
DOPMA. DOPMA dominates by putting the emphasis on equity for the individuals,
not on the productivity of the force and the efficiency of our force. What David has
done in his flag initiatives is to change that. Effectively what they have been able to
do is say, “We’re going to have turbulence in the lower flag ranks until we find the
stars — and I don’t mean that by stars on the shoulders — and then we’re going to
keep them longer. If that means that a year group or two or three will have less of an
opportunity to get those senior positions because they are encumbered by a Jim Jones
or a Vern Clark, so be it. The important thing is the management of the force and the
quality of our leaders, not letting everybody have a little chance. When we give
everybody a little chance, that may prevent us from having some failures — some
people who don’t work out — but it’s the same tenure that we give to our stars. We
give them a little bit of time and we then take that job and we send it down the line
for the crapshoot of who the next guy is going to be. Can you imagine running
World War II and saying to Eisenhower, “Well you had your year as the Supreme
Commander in Europe, it’s now time to give it to somebody else because we really
want to be egalitarian?” It doesn’t happen that way in war. It shouldn’t happen that
way in peace. It doesn’t happen that way in the civilian world. There are cohort
problems. There are generational problems, and some people walk out and get
promoted early on, and some very qualified people are in generations that are clogged
up. And you know what, that’s just the way it is. Life is never meant to be fair.
DOPMA unfortunately decided that life had to be fair at the expense of the
productivity of our force.
These are not just theoretical problems. I guess the only solace I had in my
recent tenure in the Pentagon in the sense of feeling there was somebody who was
listening to my cries was the taskforce of the Defense Science Board. They said —

---

CRS-18
and I’m going to quote them — “Unless the Department makes changes in its
personnel and compensation systems, the force will be unprepared for 21st Century
needs. Quality people will not stay in sufficient numbers, and those who do will lack
necessary skills and expertise. A new personnel system is needed — one unlike any
DOD has had before.” I completely subscribed to that. I guess I should have because
I actually had a footnote at one critical point, and said the points made here were
presented to us by the Under Secretary of the Army, Bernie Rostker, so I sort of
polluted their conclusions. I was glad to have this report because I endorsed it and
built my personnel plan, my efforts as Under Secretary of Defense, around
implementing their recommendations, and I know David shares the enthusiasm for
their views.
But I must tell you my predecessor thought this was all too radical and how
could he get away from implementing or addressing any of these recommendations.
His criteria was stability. He wanted to have stability in the personnel system and not
make changes. Making changes creates winners and losers. Just as the person who
may now be a star and be promoted to a four-star job and spend eight years as a four-
star is a winner, so a person who now doesn’t have that opportunity is a loser. That,
again, is the way life is. But there are people who think that that is really quite
terrible and what we need to do is work toward stability. One of our services kind
of got it. That is the Army in their OPMS XXI system. The impetus for the Army
moving to this system was largely the observation that in their command tracks —
and most of their junior officers came up through their combat arms — in their
command tracks, if they were going to have free flow with these promotions, with
the DOPMA promotion opportunities, they were witnessing massive turnover in
personnel. Instead of being a battalion commander for two years plus, it was a year
because they had to run so many people through this system. So they built a
personnel system which has a stringent selection into the command tracks and take
officers who are not selected for the command tracks or opt not to go into the
command track and give them the opportunity to retrain in a softer — in a different
kind of job and then stay. Some of them will stay for 20 years. Some of them will
stay forever.
I like that system with one very important change. I would take most of the
people who don’t qualify for command, are not selected for command, and I would
send them home. I would not have anything like a 20-year retirement. They frankly
don’t want to be there. They’d much rather have a vested pension and start a new
career than have to stay in the service for another eight years just so they can collect
their pension. Some may want to transfer over and I would want them to spend a full
career, not a truncated career of 20 years, but a full career like you or I have into your
late 50s or early 60s where you learn expertise, you learn your job, you learn how to
do things. I would get away from the rapid-turnover force. That was a force that
reflected both the draft and the needs for a mass army a la post-World War II. It is
not a force structure; it is not a personnel system, that reflects the needs for highly-
qualified experts to man the full range of systems and jobs that we have. So basically
what I would like to see us do, certainly in the officer force, is turn DOPMA on its
head. Instead of 70% or so or 90% or so of the captains going on to be majors, I’d
cut that number way down to a number commensurate with a much more continued
career system with longer tenures. I’d thank them for their service, and I’d give them
severance, transitional pay and a vested pension. But those who I would invite into

---

CRS-19
our career force, both in the technical specialties as well as in our command
specialities, I would expect to have less of an “out” in the “up or out” system and
more of a “stay,” and much longer tenures.
In my first life, actually my second life in the Pentagon as Principal Deputy, the
Navy had instituted a revitalization of its warrant officer program. We took the best
of the senior enlisted, really stellar performers, and we made them warrant officers
and then the next year we threw half of them out because we had a 50% promotion
opportunity between the Warrant Officer grades. Jim Watkins who was a wonderful
personnel manager for the Navy said, “This is nuts. We’re going to have a 100%
opportunity to promote to the next grade. The only reason you’ll be relieved is for
cause, because you’re not doing the job.” But here we’ve taken the best people, the
survivors, the most skills and to satisfy some notion of a pyramid, we’ve told half of
them to go home. We would have been better off leaving them in the enlisted ranks
and they would have then served for another decade of useful service to the Navy.
That notion needs to purvey our new personnel system. After the requirement — the
need — for a large number of junior officers, when we are talking now about our
seniors, we should be very selective — much more than we are today — and once
we’ve made the selection, we shouldn’t be using arbitrary rules to force people out
just to maintain pyramids. That would require the Congress to be more flexible in
terms of worrying about how many colonels or lieutenant colonels we have. Much
more looking at the productivity of the force and the experience of the force. It
would be a structure that would increase markedly the productivity, the experience,
the expertise of our military and drive that down.
Monday — and this will be my last remark — I had lunch with the CNO, Vern
Clark. I would tell you that Vern has terrible personnel problems. He’s got too much
retention. Too many people want to stay. How do you accommodate these superb
performers in the current top six regulations? How do you think about a Navy where
the recruit depot is reducing accession requirements? He’s got to figure out how to
reconceptualize his whole recruit training program, get people out of that institution
— that infrastructure — as he gets more and more tenure in the system. That’s the
payback for the higher wages and the higher pay of people more senior in the system.
It’s a whole different way of thinking. If we were successful in not forcing people
— his senior enlisted — out at 30 years of service, and got another five years of
service, it’s really amazing — we could even jot requirements down further. But that
takes a whole new mind set, a whole new set of relationships with Congress, a
willingness to see more senior numbers, more senior people, more senior
compensation, different kinds of retirement systems. It’s all possible but the first
thing we should do is tear DOPMA up, and tear the enlisted regulations up, and build
the system based upon what our forces need today in terms of skills and capabilities,
and reap the benefits of an enlisted force that wants to be there, and stays in large
numbers despite today despite the rules we put in their way to making the military
a true long-term career. Well, I’ve probably rambled on long enough, Lawrence.
DR. KAPP: Thank you very much for rambling on that long! Our final panelist today
is Mr. Robert Goldich, a Specialist in National Defense with the Congressional
Research Service. Bob works primarily in the fields of defense manpower and
personnel, defense organization, Army and Marine Corps ground force structure and
doctrine, overall U.S. defense policy, and military history. Since he joined CRS in

---

CRS-20
1972 he has published a large number of CRS reports and analyses on fields as
disparate as military compensation, benefits, and retirement, conscription and
volunteer force issues, the reserve components and military education and training.
Mr. Goldich.
MR. GOLDICH: Thank you. First I would associate myself with probably what
almost everything of what David said and although this may surprise him, a fair
amount of what Bernie said. I think there would be a lot more agreement among the
three of us than disagreement. But what struck me in listening to what both David
and Bernie said is that they seem to almost take for granted a supply of personnel
who, if the proper personnel management and compensation policies were in place,
would automatically accrue to the military. But the main problem with that is that
if you don’t have enough young people in the country who are willing to join the
military whether or not the tangible benefits in monetary terms and in terms of career
satisfaction are there, then it doesn’t really matter.
I was thinking — this made me think about what we’ve been seeing on TV and
reading about in the newspapers the past several days. What we’ve seen a lot of is
that what combat, particularly ground combat, still needs and what there appears to
be no doubt that it will continue to require are some of the following: physical
courage, physical fitness — both strength and endurance — stoicism in the face of
suffering, aggressiveness in the face of danger, and bluntly the will to kill. These
things apply to both what the Army would call combat support or combat service
support — support rather than combat forces, and we can see this in Private First
Class Jessica Lynch and her adventures and the fellow soldiers she was with who
were very much combat service support and very much not combat soldiers. What
war in general requires still, even if one is not in the theater of war and not in a
combat position, are absolutely brutally long work schedules demanding a great deal
of physical endurance, and a focus on mission accomplishment above personal and
family considerations. It’s very hard to find people who are willing to endure these
things, and in fact to get great satisfaction in coping with them. And if you do not
get people whose mind set is such that they are willing to endure these things, then
it doesn’t really matter what your tangible benefits are.
So what I would suggest that we need to think about are — or at least one form
of transformation is the transformation from civilian to soldiers and the inculcation
of soldierly attitudes, and I refer to people in all the military services not just the
Army when I say soldiers. The gap between the things I just enumerated, and the
more commonly known privations of the soldier in the field and the living standards
and conditions of life of modern middle-class Americans, places a greater and greater
burden on the training system to reorient the soldier toward life in the field or aboard
ship, and toward life in the military generally. The reason for this is that there’s in
many ways a gap in sociological terms.
The civilian is oriented toward the
individual, the soldier toward the group. The civilian tends to be oriented toward
self-interest, the soldier toward group-interest.
The civilian tends to be
entrepreneurial, whether in public service or in private industry, the soldier is more
committed to the collective mission. And what I think the military has to be aware
of with all of its personnel policies, is that it is absolutely crucial that they be able to
identify and appeal to people that have these attitudes — that look for a lifestyle that
incorporates these things.

---

CRS-21
I would suggest that one of the ways in which we need to do that may well be
to reinforce perhaps the transformation of the civilian to the soldier. This might be
going against certain aspects of conventional wisdom. It might for instance mean
that you might want more rather than less military housing, perhaps military family
housing.
You might want more rather than less military base services and
infrastructure.
Why?
Because this reinforces the idea of the military as a
community. It reinforces the military ethic — the concept of a band of brothers, and
now sisters. This is frequently criticized because people feel the problem — this
would create a military more and more isolated from civilian life. I would suggest
that this is not so. The military and the people in it are bombarded with civilian ideas
and thoughts and concepts 24 hours a day. The problem, I think, is resisting some
of this pressure so that we have an effective armed force. I would urge all of you,
when you’re thinking about all of the concrete aspects of pay and benefits and
personnel management and what we should or should not do with DOPMA, the
Defense Officer Personnel Management Act, also think to yourselves, how will this
identify and how will it enable the military to find and keep individuals who like,
who hunger for this very special military lifestyle, because I suggest that there is in
many ways probably a fixed quotient of people out in the population who are really
willing to experience this. If we develop the right ways of finding these people and
keeping them once they are enlisted or appointed in the military, find ways in which
to maintain and retain them, that those policies will in many ways make our life
much easier in terms of dealing with recruiting and retention. In short, I think our
problem is not as much one of fine-tuning matters to deal with people who may or
may not be interested in the military. The problem is finding people who we know
will be interested in the military for a full career and bringing them in. Thank you.
DR. KAPP: Thank you Bob, for those comments. That concludes the presentation
portion of the seminar, so why don’t we just take a quick five minute break here.
[BREAK] Okay. Dr. Rostker has asked me for the privilege of rebutting Bob’s
previous comments, so I am going to give him a few moments to rebut and then we
will go to the question and answer.
DR. ROSTKER: I would just take issue with Bob’s comments on two or three levels.
Number one, I am not at all concerned that there are not young men and women who
want to join the military and I don’t think it’s that hard to find them. As we take
these other changes and can reduce the requirements, that means we’re having to go
after less and less people. The personnel system is interesting. We have historically
gotten into what’s often been described as death spirals. We have shortages. That
puts strains on people. They leave. That creates new shortages and we spiral down.
Today we’re spiraling up because we have outstanding opportunities, we have good
readiness.
We have a well-structured force and people want to stay with us.
Unfortunately that puts pressure on, self-correcting pressure, because it reduces the
number of promotions that are available and therefore it sort of damps down. So I’m
not too concerned about — as Bob seems to be — that there’s not people who want
to be in the military. I am concerned about some of the more almost egalitarian —
Bob refers to them as group think — of our military people [compared to other
groups in our society]. We have a series of behaviors [about military personnel
management] that don’t really reflect the [personnel management practices of the]
majority of institutions in this country. The Marine Corps, for example, was the
service [which] most rejected the notion of early promotions and accelerated

---

CRS-22
promotions. They wanted everybody to be promoted at the same time — they want
to stress the group dynamic. That’s fine when they’re looking out [for] their soldiers.
It is not fine when you’re thinking about the long-term management of this force.
We want to identify people who have leadership, real leadership potential, and get
them into real leadership positions, and differentiate and distinguish them from the
rest of the group. That does run counter to some of the inclinations of our military
managers. I think that is something that has to be fought and we have to persevere
because it is too important to let mediocrity be the norm for our military.
DR. CHU: If I could just add one thought to the point that Bob raised. It is a critical
assumption that we will have a sufficient supply of young men and women who are
willing to put on the country’s uniform. Obviously some compensation is directed
toward ensuring that that assumption is valid. More broadly, I think Bob implicitly
is pointing to a period in the nation’s history when that assumption was nearly
violated. And that is the 50s when the birth cohorts we’re dealing with were the ones
out of the Great Depression in the 1930s and they were very small relative to the
nation’s military needs. You could argue, therefore, that in that period it was —
quite apart from the other elements leading to the same conclusion — essential to
have conscription. Indeed that’s one of the things I think that helped lead the country
to a volunteer force as the Baby Boom generation matured and came to 18 years of
age. We suddenly had a superfluity of young people relative to what conscription
would have implied, which is [when] everybody was drafted, which was true in the
50s. Basically all males who could pass any kind of minimal mental and physical
screen were drafted in that period of time because the nation’s military was large
relative to the size of the birth cohort. That all said, Bob is pointing at one of our
challenges going forward. The nation’s military as you know from poll results is one
of the most respected institutions in American life today. That’s been true roughly
since the last Persian Gulf War. It was not always true. It certainly was not true in
the Vietnam period. I used to attribute it to the men who are in the Armed Service
that they made it into one of the most respected institutions in our society.
That all said, when you ask parents and what Bernie knows we like to call
influencers — in other words, people who advise young people as to what they
should do in terms of a first position out of high school or college, whatever the case
may be — as to whether they’d say, “Yes, the military’s a great choice,” you don’t
get that same enthusiastic response. So one of our challenges, and Congress has been
very helpful on this point with various pieces of legislation saying that the military
should have equal access to our high schools, to our colleges and universities for
recruiting purposes, and we’re very grateful for that legislative encouragement. You
need sometimes the hammer that has come with it. But we will need to do more.
Hopefully you’ll see soon, we hope, a sophisticated public diplomacy campaign will
begin to remind the nation’s parents and the counselors in the high schools and
colleges that military service actually adds to people’s values and adds to their
lifetime competence in a way that goes far beyond the immediate skill. In other
words, it’s not just that you’ll learn how to be a great mechanic, you’ll learn what it
takes to do a great job whatever your position in life might be, and what it takes to
be a good citizen, whatever role you might play in the economic fabric of our society.
I think that’s crucial. We need to convince the parents, the guidance counselors, the
uncles, the aunts, the big brothers and sisters, that when the young person comes to
you and says, “I’m thinking of enlisting,” you don’t say, “Oh, no. You don’t want

---

CRS-23
to do that.” We want them to say, “That’s a great choice. I’m proud of you for
making that choice, and it’s something that you ought to think seriously about.”
DR. KAPP: Okay, let’s open up for the question and answer session, but let me just
make two brief comments. A reminder that this seminar is being broadcast via the
Web, so let me reiterate that in order to preserve confidentiality — of you — that we
will not be showing any faces, and you will not be identified by name. Secondly, we
do have a wireless microphone here; we will bring that over to you when you talk,
so that not only the panelists can hear you, but the people listening on the Web can
hear you as well. So do we have any questions? Yes, ma’am.
QUESTION: Can you hear me? Not to pile on even more conceptual burdens on
reorganizing personnel issues, but the question I have is not only outside the box but
sort of outside the universe of I think how we look at foreign policy and particularly
military engagement. My question regards how are we going to expand the concept
of jointness from the military to the other foreign policy agencies? I will just give you
a personal anecdote because that’s how I’m understanding and also watching the
news. The job of the military — in the last ten years certainly we’ve been seeing this
more — has been expanding from just a combat role to essentially one of social
stewardship. Certainly the Iraq conflict that we’re involved in right now illustrates
this every day on the news, but as well in Afghanistan, one of the big problems right
now I see in terms of how we organize our foreign policy professionals is that the
only concept of readiness is within the military. We don’t have it, for example, for
the State Department; we have experiments like the Office of Transition Initiatives,
or we have disaster relief, which is like the Office of Foreign Disaster Assistance, but
we don’t really have a combined joint effort of the military and the civilian. I would
argue that younger people get this intuitively. I think it’s probably not as pervasive
intellectually as you go up. I have a friend right now who’s the liaison with the civil
affairs in Afghanistan, yet we only have one active civil affairs unit and now it’s in
Iraq. It really, I think is going to be a detriment to our on the ground policy in
Afghanistan, particularly when you have these really interesting innovations like the
provisional reconstruction teams. My question then is do you see the military,
especially here on the Hill, going to bat for this kind of much more pervasive
readiness concept? Because you really don’t want to have your military doing
everything. I think it threatens not only the professional culture of the military, but
it’s also not how you want to conduct your foreign policy abroad because it’s
severely imbalanced. I would argue that our foreign policy right now in funding, and
in actual implementation, is severely imbalanced, when you look at traditional
instruments of power that any officer could tell you that the United States needs to
engage with.
DR. ROSTKER: You’re raising really two issues if I might. One, you use the term
jointness which would imply to me how do you get people in uniform understanding
the importance of some of these other functions and having opportunities within a
career to serve with the State Department, for example. And we need to expand
things like foreign service officers and the like. The problem we have had is to do
that within the confines of a normal military career. So once we have trained
somebody like that and if they get to the rank of full colonel, they have to leave at
[age 52]. So that’s — a longer career would give us the opportunity to in fact do that.

---

CRS-24
The second part of your statement implied that you really didn’t want to have
people in uniform having some of these functions, because it is too military, if you
will, and that there is a need for a new class of federal officer who might not be quite
the military but could serve these additional functions. I would say that’s right, and
we’d have to think our way through. But that’s not jointness. That’s a new class of
people.
We have in homeland defense a situation today, where we have a
Department of Homeland Defense and an Assistant Secretary for Homeland Defense.
One of the things that we’re going to have to sort out is what the role is that the
military will have, and I would suggest that’s a sorting out that is not necessarily
going to be done at NORTHCOM with the military talking to itself. There has to be
a dialogue with the other agencies of government, so that all are comfortable with
when and where the appropriate role for the military is. But all of that is enabled
further if we have a longer career where people have time to learn these additional
skill sets.
DR. CHU: If I could just reinforce your message to all. It would be a great advantage
I think, to try to get attention paid to the issue that you’ve raised. As you know, Mr.
Rumsfeld has been particularly critical of the inability of the United States and its
allies to extricate themselves from the Balkans promptly in the military sense — that
basically there was a failure to devise a strategy for the prompt reinvigoration of the
civil government. Just as you say, the military should not indefinitely be in this kind
of role, and I think that’s certainly the agenda going forward in Iraq as well. I do
think that — I would urge a little caution, that by implication you are implying we
should have most of our civil affairs capability in the active forces of the United
States. The reality is, as I suspect you are aware, is that much of the talent in terms
of knowing how to administer a civil government almost by definition resides in our
civil sector. Some of the great advantage I think of the reserve civil affairs structure
is we can call on local police chiefs, local judges, local administrators, who actually
understand how to make a water system work and a sewage system function, both
from the technical perspective and in terms of how you organize it administratively.
I would be very cautious about throwing that advantage away. I think we’re much
better off having access to such units promptly, and such talent on a more continuous
basis, as we’re trying to do. Final thought. The good performance of American
military units in these kinds of roles is not, as I know you’ll appreciate, accidental.
One of the things we haven’t touched on this morning much is how should training
be transformed. We’re on a similar path in the Department in that regard that
emphasizes jointness and emphasizes jointness both in the sense across American
military branches but also in the sense of working with coalition partners and in the
sense of working with civil agencies, which is critically important as you suggest.
As you are aware, I think, when we send American military units into these situations
we try our very best to have them practice the roles that they’re going to fulfill. So
they don’t just show up suddenly in a peace-keeping or peace-enforcement situation
hoping they’ll figure out what to do. They have actually trained for that particular
mission and gone to school on how to do that before they leave. I think that’s a
critical part of making the United States government effective and I think one of the
things we need to figure out is how we work with our sister agencies in broadening
the scope of personnel prepared to undertake these tasks.
DR. KAPP: Bob, did you have a comment?

---

CRS-25
MR. GOLDICH: Very brief comment to continue with what David said. I think it’s
important to keep in mind, though, that one of the reasons American forces have been
effective in this role is precisely because they are a good military force in the
generally accepted sense of the word. I think while doing as much as we can to
facilitate their training in this regard, we need to make sure that in fact it does not in
any way detract from their attaining the maximum amount of readiness for
conventional military roles. Not only would that damage their capabilities for
warfighting, it would also — paradoxically, from what most analyses have shown —
damage their abilities to be effective peacekeepers and the like.
DR. KAPP: Next question? Ma’am? Let’s get the microphone over there if you
don’t mind.
QUESTION: This is for Dr. Chu. You talked about how the reserve force are really
truly volunteers now, but you also referred to the grumpy employers, and I’m
thinking that the coercion now may be more on the employers who have no
alternative under the law but to let the people go. Is the Department looking at all at
the costs to employers of our increased use of reserves?
DR. CHU: We’re just starting to get into that issue in the way that we should. We
have, after much effort, succeeded in getting a legal ruling that we can actually ask
people who their employer is. You’ll be interested to know in this era of various
concerns that the Department has previously been precluded from saying I need to
know who your employer is so I can address the question you’ve raised. If I admitted
a slightly out of school comment that’s also an advertisement, at least from evidence
I’ve seen, the employer that tends to be at the grumpier end of the scale is actually
the sister federal agency. We have set up, recognizing the unusual nature of this
mobilization, a process in which employers could write in saying: “My person is truly
critical. I forgot to color the post key or critical,” which you are allowed under the
law to do, which means the individual must transfer out of the Ready Reserve into
a stand-by capacity, which of course people don’t [usually] want to go [into]. But
recognizing the unusual nature of this situation, since September 11, 2001,
employers could write in and say “I should have done this. Didn’t do it. This is my
key Arab linguist,” to take the kind of thing that would qualify. I am amused to
report that actually the private employers have been generally terrific about this.
Very few inquiries from private employers. The bulk of the inquiries come from
government employers, and especially federal agencies, including agencies of the
Department of Defense. So I think the employer attitude, in general, I would
emphasize, is pretty good, particularly in the private sector. Many private sector
companies are stepping forward and continuing health plans even though our health
plan is pretty good, it’s just one less thing for the family to worry about if the
employer continues the one the family’s already on. We’ve taken steps to improve
our health plan making everybody eligible essentially for Tricare Prime including
Tricare Prime Remote, a power that Congress gave us last year. Some employers
have stepped up and made up any difference in salary. I would emphasize I think the
salary issue has been over-emphasized to the press. We have done surveys. We’re
going to do a new survey soon of this issue. The surveys indicate — the older survey
indicates that, regarding reservists mobilized for service in the Balkans, 1/3 indicated
they were making more than in civil life, 1/3 about the same, 1/3 less. More recent
surveys narrowing the scope of spouses — interesting difference here — half the

---

CRS-26
spouses say they’re making more as a family, as a household, with the person in
military service [than] they were in civil life, 1/3 still say it’s less in that
circumstance. So it spans a spectrum. Therefore I’m not sure there’s a big employer
or compensation problem there to solve. I think we would plead with the Congress,
let’s complete the study it has asked for all reserve compensation, which is due later
this year in August [2003], before we make big, new changes in how we manage that
aspect of the system.
DR. KAPP: Sir?
QUESTION: My question has to do with end strength in the services. Given we have
open-ended commitments in the Balkans, in Afghanistan, Iraq, an ill-defined military
role in homeland defense and I’m sure some battles yet to be fought in the global war
on terrorism. Do we have sufficient forces at the current level to maintain the
operational tempo?
DR. CHU: The short answer as we believe is yes, but not if we have to operate under
all the rules now applicable to Department of Defense. I want particularly to
highlight the civil service rules in that regard. We would like a modernized civil
service system specifically, because if you look at the individual posts with the
Department of Defense there are approximately 300,000 people serving in active
[military] service doing things that a civilian — either civil servant or contractor —
could perform. In many cases these should be posts that civil servants ought to
occupy. It is very hard, under current rules, to get the same kind of flexibility, if we
try to move within the civil service, that we have with military personnel, which is
why people all love military personnel and military units as the answer. So you have
various kind of national emergencies. Take for example what happened in the
airports after September, 2001: the National Guard in the airports — not previously
thought to be a military mission — probably wasn’t really a military mission, to
speak frankly about it. But a great, flexible force, responsive to need, did the job.
We now have TSA in the airports instead. My point is that we need the flexibility
that these proposed changes would give us in order to be able to start looking at the
active ranks, and saying, this doesn’t really need to be done by military person, it
could be done by a civilian and it ought to be an officer of the United States
government and therefore a civil servant — not necessarily a contractor in every case.
So we want to convert some of those posts. If we can get that flexibility, get these
kinds of rules changes, no, there’s no need for additional active end strength. We
have to manage it differently. That would be the headline. We’ve got to change our
practices. This includes changing how U.S. forces are deployed around the world
and how U.S. forces react to deployment. So one of the kinds of things I’ve not
spoken about that we are looking at, energized by the Secretary’s concern on this
point, is why does it take, in order to have one unit forward, why does it take three
or four back in the United States? Part of that mind set of course is out of the Cold
War as Bernie knows where you physically had to have a unit forward all the time.
With modern transport and modern prepositioning concepts, it’s not actually
necessary to have the unit sitting there physically all the time in order to be
responsive. So if we can manage more modern way of getting from here to there,
again, we think we can manage with the end strength we have.

---

CRS-27
DR. ROSTKER: There are also issues of individual rotation and unit rotation. We’ve
used unit rotation in the Balkans and yet we’ve used individual rotation in Korea.
Unit rotation turns out to be very destabilizing. Once a unit is notified that it’s going
to be moved, it has to cross-level with people whose end of tours are up, all kinds of
other things. That creates massive instabilities in much larger numbers of units.
Then you try to stabilize for a period and the like. The argument is, well they’ve
come together, they know how to work together and all of these things and I think
that’s to be applauded. On the other hand, you have the disadvantage in the Balkans
that the whole unit rotates at once and now you have to get to know, the local mayor
has to get to know a whole new set of people who are coming in with all of those
friction points and opportunities for danger. Yet one of the most difficult hot spots
for us now is Korea and we have done largely individual replacements. I personally
come down on trying to manage this with individual replacements. The one area
where I think we do need end strength relief, where I think we have gone way too far
in cuts, is civil service. I don’t know about you all, but I’m sure you may well have
had experiences where you call up the military office and you find you’re talking to
a contractor. The work’s getting done. The contractor probably is a retiree who’s
there because we forced him out of the military. I think many of those functions by
logic, by right should be done by a federal employee and not by someone who has
potentially different incentives in terms of profit maximization and the like. I think
we’ve gone way overboard in the notion that the contractors can be more flexible.
It will certainly be helped if we can have the kind of civil service reform that David
argues for but I think that I’m uneasy with the extent to which we have contracted out
of functions.
DR. KAPP: If I can actually follow up on the original question, if military end
strength is pretty much considered to be stable, yet at the same time we’re looking
to add special forces personnel, add military police personnel and so forth — those
are some of the winner occupations. What are going to be the loser occupations?
Where are we going to take the transfers from?
DR. CHU: I think you’re going to see two kinds of transfers in the months and years
ahead. One as I’ve suggested is to look hard at the degree to which civilian personnel
— most especially including civil servants — could perform functions that are now
discharged by uniformed personnel. We for example have a significant uniformed
content in our laboratories, particularly in one service. Is that really appropriate? We
have various support agencies, including support agencies to other agencies in the
United States government, that are military. That might at one time have been the
right answer. The question we’re raising is, “is that the right way to do it today?”
Second, and we haven’t touched on this much, but there is being kicked off now a big
review of what you might call the active-reserve mix. In other words, what units
should be in active, the active components, and what units and capability should be
in the reserve components. I think you’ll see some tradeoffs that put our capabilities
that are now reserved more exclusively for the active force and the reserve
community and some capabilities that now have been disproportionately in the
reserve community moved to some degree of active status to facilitate the early
mobilization stages. I do think if we can get more of what I call a continuum of
service here, this issue whether it’s active or reserve is less important. If you have
people who are willing to volunteer for a status that on short notice — maybe like
hours — and the Air Force does this already to some extent, we may call you up in

---

CRS-28
order to be the port embarkation team or the aerial point of departure — port of
departure — whatever the case might be. This question about whether you’re active
or reserve becomes moot. It becomes more of a technical question, not something
that governs how you actually serve the United States.
DR. ROSTKER: I think you also have to look at the threat and where we are today.
[In] this war, two weeks ago, the press was concerned that there wasn’t enough
combat power in Iraq. The radio on the way in [this morning] was talking about
Baghdad falling. It’s still the one heavy division and the one light division — the
101st [plus elements of the 82nd]. That’s two divisions out of ten. I think the Army
is going to have to come to grips with what kind of force structure is commensurate
with the threat, and, as you suggest, there are other missions that may take different
kinds of troops, but the all too easy answer is increase end strength. There’s too
much to go on to before you can justify that, and unless the budgets go up, there still
is the implied capital-labor tradeoff and most of the services would rather see more
money for modernization. The Navy, for example, is both retiring ships and the
replacement ships for a smaller Navy will be manned at much lower levels, so I don’t
think, based upon the traditional metrics, one could use that to argue for an increase
in end strength.
DR. KAPP: Sir?
QUESTION: Gentlemen, you’ve spoken at length about the importance of
identifying, grooming, and then holding onto DOD senior executives. Integral to that
is the development of those senior executives early in their career and that would be
professional military education. I’d like to hear your thoughts on transforming
professional military education in terms of jointness, duration, developmental
opportunities. Thank you.
DR. ROSTKER: Well, we have a superb system of professional military education.
My only concern is that we don’t have reasonable payback periods for those who go
through it. I mean we’ll send somebody to ICAF, get a great education, we expect
them to serve two more years in the military because we’re forcing him out either by
incentives or by tenure. I think we do a superb job, but I think it’s the payback that
concerns me, and that payback would be ensured by a longer career structure. We
don’t do as well on the civilian side. It was one of the initiatives of the last
administration to have a more robust training program, and it was an initiative of the
Deputy Secretary [of Defense] John White.
There was only one service that
supported that. He pushed it through. But that was the Navy, and that was when I
was Assistant Secretary of the Navy. There is not an ethos of release time for
training and career planning in the civilian side of the Defense Department as well
developed as there is on the military side, and that’s unfortunate.
DR. CHU: I would argue that one of the problems with our professional education
is that we are still trying to conduct it in a manner that is best suited to the interwar
period, and by that I do not mean Persian Gulf wars, but back to [the period between]
World War I and World War II. That is to say that the officer must take a year out
of his or her career, move to a location where the educators sit, and receive
instruction, often in a classroom mode. There’s good benefits to that convening
function, but one problem is that, as a result, only a small fraction of the force can

---

CRS-29
benefit from what those institutions have to offer. I’m very intrigued with an
initiative that the President of Naval War College has gotten Admiral Clark to
approve, which is instead of making the fleet come to him, which creates all the
problems I’ve just described, he’s going to take his instruction to the fleet. In other
words, he’s going to send his educational team to San Diego and they’re going to
conduct in a different way — which will be more the way some of the continuing
education master’s degree programs are run — a Naval War College course in San
Diego. We’ve long done this to some degree for the reserve forces and it’s a very
interesting issue to me. If it’s good enough to get a reserve officer — who was after
all not serving full-time — up on the step in terms of joint procedures, why can’t we
think about similar paradigms for active officers? We’re very eager to learn in this
regard from the best practices in the civil sector. We’ve talked to firms like IBM —
how do they do it? I’m not sure we want to emulate all aspects of their models. At
least in the case of one firm, I asked exactly the question Bernie’s raised because this
firm — it’s about the size of the Marine Corps in its employment — essentially
requires something similar to our requirements. When you become a manager you
have to go through a one-year course of instruction. But they do it almost entirely by
distance learning. They have only one week in which they convene the group, which
in my mind is too little. But I did ask how does the individual find time for this in
his or her work day and the answer was not encouraging: It’s your first managerial
challenge. That’s not the right way to do it. So we need to find, I think, a middle
ground between the way at least those private sector examples accomplish this, and
the way that we’re doing it now, that again takes advantage of modern technology,
keeps the best of what we have, but moves forward.
DR. ROSTKER: We have a superb system of voluntary education. Every base has
a vol-ed office. Universities are aggressive in placing instructors at our bases and on
our ships. You go out with the fleet and instructors are flown out for two or three
weeks and people take courses while they’re at sea. You can do that for a variety of
civilian universities. I think picking up on David’s point, I don’t see one of those
universities being NDU or the War Colleges and that’s the way you get your training.
You get your education through the same kind of thing. So if you can do a master’s
because you think that’s a box that has to now be checked, and you can do that in
release time in vol-ed, why can’t you do your professional military education in
substantially the same ways?
MR. GOLDICH: I think, though, that it’s important to understand that the various
types of distance learning which you have mentioned are of unquestioned
applicability to perhaps the lower, maybe even the intermediate aspect of professional
military education. When you start getting up into the war colleges, the senior
service colleges, and perhaps to a certain extent the middle level, it is the interaction
among officers from different services and other countries that is at least as
significant as the actual course work, which in many ways is really true of what
happens in civilian education too. A professor once said that the most important
things that happened to him in college happened in the dorms, not in the classrooms,
and most of them happened after midnight. A certain amount of the same thing is
true at the senior level, so I think we need to be very careful about trying to put
something which is very much study at a high level, and applying a kind of
mechanistic model to it that might work very well at something which is more based
just on facts.

---

CRS-30
DR. ROSTKER: The professional military system is still pre-Goldwater-Nichols
dominant. For all of your joint schools, it’s still pretty stove-piped, and the odd naval
officer who finds himself at Fort Leavenworth, it doesn’t really get the Navy to
understand how they need to support land warfare, or the Army officer who finds
himself at the Air University is not going to solve this air-ground integration
problem. There needs to be a lot more exchange.
DR. KAPP: Okay, I think we have time for about two more questions, so why don’t
I do you, sir, and then follow up with you and that will conclude our seminar.
QUESTION: As you gentlemen probably know, the federal government’s facing a
potential human capital crisis, with regard to the fact that by 2004 almost 50% of the
federal government will be eligible for retirement.
With this in mind, the
government is implementing and expanding programs such as pay-for-performance,
federal student loan repayment programs. What incentives, if any, do you think the
military needs to implement in order to increase or maintain the attractiveness to
candidates, while still maintaining that quality level of applicants to the military?
DR. CHU: You’re speaking to those who applied for uniformed services or are you
speaking of the civil system?
QUESTION: The uniformed services.
DR. CHU: The uniformed services. I think first of all it’s critical that we keep our
complete compensation package, taking into account allowance and fringe benefits
competitive with what people of similar qualities could enjoy in civil occupations.
We are taking as a guide the results of the 9th Quadrennial Review of Military
Compensation as a way of thinking about how much is enough, the answer to the
classic question “How much is enough?” One has to obviously think about not only
what people might enjoy this year, but what they might enjoy in future years. I think
increasingly we are concluding that the kind of people that we’d like to attract will,
as Bernie remarks, I believe, look not just at the immediate compensation they
receive but what their lifetime or at least their next five years or so compensation’s
going to look like. What you think you can look forward to. What are the prospects
for me if I join this system? That’s one of the reasons, as you know from our proposal
to Congress, we tried to get away from this view that there’s a single across-the-
board pay raise that’s the right answer for every grade in your service cell on the pay
table every year. We are increasingly moving to a philosophy, at least in terms of the
executive branch proposal, that we will target the pay pot for military personnel
against those areas of greatest needs, and this year as you know it’s the mid-career
enlisted force, continuing a trend [of] the last several years.
It’s not by the way, interestingly enough, consistent with some of Bernie’s
observations, E-1s, where we’re posting just a 2% increase for E-1s because — put
it this way, if you don’t move out of E-1 in the first six months or so, you’re probably
not the person we want to retain in the military service. That’s a training period in
which you’re earning that salary. It’s a training stipend more than anything else. We
think we’re very competitive in that range, but we’re not as competitive as we need
to be for the E-5, the E-6, the E-7, and looking forward and one of the reasons we’ve
been aggressive about E-8 and E-9 pay as well is that’s what the ambitious E-5

---

CRS-31
should be looking forward to. That’s what I could become. That’s what I want to
aim for.
I do think that it’s the whole lifestyle that counts in terms of military families.
The military likes to observe that the retention decision is made at the dinner table
and I’m increasingly convinced that one of the dinner table issues that we have to do
a lot better on in the military is the quality of the public school system in
communities around major military bases. To speak plainly, it’s not often where it
should be. This is not, I should emphasize, necessarily an issue of rural versus urban.
There are some urban areas with school systems that, when I visit a military base, and
ask people, what’s the school system like for your child, I do not get the kind of
confident, happy answers I’d like to hear. I get sort of “Well, it’s okay, sir,” or they
make some polite remark to me and then my military assistant is told the truth on the
side that it stinks. That’s not acceptable. I think it’s one of the issues in which we’d
like to have a stronger conversation with the Congress: how do we use existing
federal programs to try to strengthen the schooling opportunities for the children of
our military personnel? My instinct is that counts for many families very heavily in
their decision do you want to make this a career. I’ll just give you one vignette as an
example. There is a long waiting line for military family housing at Quantico, not
because the houses are highly desirable but because for historical reasons we run a
school on base that Defense pays for — not a business we want to expand I should
emphasize — that your children can only go to if you live on that base. So people
are standing in line to get in.
DR. ROSTKER: But the reality is we may have to reconsider the Title 6 and start
paying because of this. This is an absolutely critical question. It was so bad in Guam
that we took over the Guam school system.
DR. CHU: If I may interrupt, I do really want to urge a fire break against the solution
being Defense takes it over. That’s not a good answer, but at the same time simply
handing out federal money without any performance standards because you have
federal employees in the region is also not a good answer. We need to get a more
performance-oriented culture developed here where we expect schools to meet these
kinds of standards. Sorry.
DR. ROSTKER: You’ve now found one point where David and I disagree. A couple
of very quick things that relate to the QRMC. When David and I started in this
business, and I would own up to the fact that we signed into RAND the first day
together in 1970, so that’s how long we’ve been at this shoulder to shoulder. When
we first started, there were issues about compensation, and the classic economist
answer was that compensation was there to attract and retain people. Through some
absolutely stellar work of colleagues of ours, the right answer today is attract and
retain and motivate people because we’ve come to understand that it’s the structure
of the pay table. That view permeates the recommendations of the last QRMC.
What we have effectively done is make the pay line much steeper. Actually it
doesn’t cost us very much, because there’s not a lot of people at the top, but it
becomes the goal for everybody in both their performance behavior and retention
behavior, it’s something they can strive for. So we get a lot of return for those dollars
that we give to the most senior people. Increasingly the most senior people are those
who’ve gone through the voluntary education program and have bachelor’s degrees

---

CRS-32
and master’s degrees and sometimes more than one master’s degree. The Chief Petty
Officer of the Coast Guard has a Ph.D. Now what other enlisted force has that kind
of education?
The largest challenge we have in bringing people into this military is the fact
that so many of our high school graduates are going to college. We have not yet
learned how to recruit for the enlisted ranks people going to college, or even people
who have not succeeded in college but are in a community college or they’ve
dropped out of college and the like. The paradigm that we recruit you out of high
school is only half true. If you look at the statistics, about half of the people we bring
in, we bring in before age 19 or lower. That means there is another half that’s been
out in the job market, out in the college market and are coming to us as second or
third jobs. Something hasn’t worked out well for them and so we may not be the
employer of first choice but they see something in us and we have the benefits of
seeing their performance. So we have to learn how to structure our entry programs
not to the high school graduating senior, but to another group of people. We have a
grade structure which is largely neglected but I think offers great potential for the
future and that’s our warrant programs. If you said to me, “How am I going to recruit
computer specialists, systems engineers into the service — kids who have training
in microsystem NT have a certification from a 2-year college. What do I offer them
today?” A little bit of advancement on the enlisted rank? I’d like to see them granted
warrant commissions much like the Army does with pilots, with helicopter pilots,
and recognize there’s a whole range of technicians in the civilian sector who may not
aspire to be Chiefs of Staff and would not necessarily be particularly good candidates
or have the skills we’d like to see in the commissioned ranks, but certainly have more
than we offer in the enlisted ranks. I’d like to see us have many more programs to
bring warrant officers into all of our services. Enough for me.
MR. GOLDICH: One small point that’s very related to what Bernie said is that over
the past 20 to 25 years, in a stupendous achievement that the Congress has been very
important in bringing about, for the first time in American history and maybe the
history of any modern country’s military force, we’ve raised the pay for our career
officer corps to the point where it’s no longer genteel poverty, where in fact if you
get into the field grade officers, you’re doing fairly well — very well in some cases.
And it’s not only important to keep that, it’s equally important when you’re talking
about having done that; let’s keep that, and move on to other aspects of compensation
such as David was talking about. Things that might be more difficult to measure but
which are important in terms of what people look at in terms of lifestyles.
DR. KAPP: Our last question for you, sir.
QUESTION: Its on the educational programs, like the vol-ed. I wanted to know, to
what extent does DOD consider those programs a benefit versus some kind of
performance enhancement because when some of these service members get the
education, they become more competitive and therefore may tend to leave for the
private sector.
DR. ROSTKER: We found exactly the opposite. If we can meet their educational
aspirations, they’ll stay in service. We get better retention. We get less discipline
[problems] and faster promotions from service members who are active in the

---

CRS-33
voluntary education program, so that the rewards increase by staying in the service
through promotion, and they don’t feel that the only way I’ll get my college degree
is if I leave because I can’t earn it in service. So it’s become a very important part
of our program and the myth that if we train them, they’ll leave turns out to be
untrue.
DR. CHU: Let me just add, I agree with what Bernie has to say on this point. I
should also add we’re not actually saying keep everybody for 20 or 30 years. So we
are delighted if people want to stay five or ten years, and that may be part of the
community that you’re speaking to with your question. That’s fine with us. It’s not,
as Bernie’s emphasizing, we do not see it as a loss if people take their skills and go
to the civil sector. Among other things they may become a civil servant or contract
employee for the Department of Defense.
DR. ROSTKER: We would like it to be that when they do leave, they not leave
because we’ve put barriers in their way to succeed in the military. We would like to
have the selection of the best wanting to stay and we being selective, instead of the
best wanting to leave and we only can take those who don’t have opportunities on the
outside. But the voluntary education programs are really valued by the services
because they have had positive returns to our discipline, to our retention, and our
productivity.
DR. KAPP: Well, that concludes our seminar and I would like to thank all of you for
taking your time out of your busy days to come here and to thank you for your
thought provoking questions. I believe some of our panelists may have to leave
immediately, but I’ll certainly be staying if you’d like to ask me any questions or if
you’d like to call me later my extension is 77609; and thank you again for coming.

---

EveryCRSReport.com
The Congressional Research Service (CRS) is a federal legislative branch agency, housed inside the
Library of Congress, charged with providing the United States Congress non-partisan advice on
issues that may come before Congress.
EveryCRSReport.com republishes CRS reports that are available to al Congressional staff. The
reports are not classified, and Members of Congress routinely make individual reports available to
the public.
Prior to our republication, we redacted names, phone numbers and email addresses of analysts
who produced the reports. We also added this page to the report. We have not intentional y made
any other changes to any report published on EveryCRSReport.com.
CRS reports, as a work of the United States government, are not subject to copyright protection in
the United States. Any CRS report may be reproduced and distributed in its entirety without
permission from CRS. However, as a CRS report may include copyrighted images or material from a
third party, you may need to obtain permission of the copyright holder if you wish to copy or
otherwise use copyrighted material.
Information in a CRS report should not be relied upon for purposes other than public
understanding of information that has been provided by CRS to members of Congress in
connection with CRS' institutional role.
EveryCRSReport.com is not a government website and is not affiliated with CRS. We do not claim
copyright on any CRS report we have republished.

---