Was talking to a person last night at a gathering for Jay Fawcett - the guy who should have won CO CD-5. There was an amazing amount of very good discussion on the military, what they need, what they are getting and what can be done.(What do you expect in Colorado Springs?)
As a naif in the conversation, I asked why the Congress doesn't do one simple thing - cap the percentage of the monies that can be spent in a theater of operation on outsourced costs? The Republicans have always been good at the "we'll tell you how much you've got, you figure out the answer" politics. Why not take the same approach?
More below:
First, look at the situation in the Iraq. You may have a reserve private driving a truck full of supplies, getting $35,000 a year. You have a contractor sitting next to him getting $125,000 a year plus the overhead costs of the corporate incurance, general and administrative cost and other. Figure, that makes the contractor cost about $275,000 per year.
Why doesn't the reserve just go to a two tier pay structure - airlines use it for national versus regional carriers. Pay the reserve guy his normal pay for his two weeks and a weekend a month. Pay him a little more for hurricane or disaster relief in the US. Pay him HALF of the contractors cost - $75,000 a year - if he has to go overseas to a combat theater and give the reserve person (I have used "He" for convenience) the same first $70,000 tax free the contractor gets. All of a sudden, the total labor cost of that truck cab is $150,000 - the same as it is now and the overall cost is significantly lower because the overhead costs are already in the reserve infrastructure. BUT you want to bet the reserve recruitment might be just a little stronger? You also might find that fewer reservists really resent the deployment.
The problem is that regular military members aren't getting paid that. But, hey, look - this is the same thing as having a swing "temp" staff for seasonal surges - like tax prep companies have. The private sector pays a lot more for a Kelly or Administaff hire than they do for a regular employee. Also, the retirement and security values regular military get are significantly better than the reserves - there is a trade off here. I am sure there are issues and I am sure regular military people will tell me why it can't work but we need to get outside the box.
Second, why not set a limit on percentage of costs outsourced? In a military operation, the support and logistics train should be mission defined. The big problem is that a lot of the support has been outsourced to the reserve - why? How about because it lowers fixed costs. Well, that's fine only if the surge costs (like Iraq) don't chew up all your savings when they happen. How do you control surge costs? By keeping the resources in house (so you don't have to pay "what the market will bear" pricing when you are in a bind) but only paying for the high cost efforts at the time there are real needs.
Come on, having this two tier system ensures that the reserve and guard remain a viable resource for domestic purposes. The enlistee knows that they will get their supplemental style income for performing US domestic duties but when they have to take real military theater - not just front line but theater - risks, they get an attractive payment.
Finally, the control on outsourcing also controls the single greatest conflict of interest I see in the military - that shoving money out the door to an outsourcer may have a lot of potential personal gain for the individual doing the shoving after their career is over. I am not accusing anyone of doing so but it appears to be a potential. BY forcing the military to come up with a percentage allocation of cost to the support function and the capping the percentage of outsourcing as part of the total budget it creates competition between the military resources and the outsourcers to control costs to get access to the pie. If this administration talks so much about free markets, then force competetion through the budget process, not just the contract process.
Anyway, my SWAG at a solution - I'm sure the comments will show the gaping holes. But something has to be done.