By Eric Vandenbroeck and co-workers

Over the last decade, calls to reform the Department of Defense have grown ever louder. Everyone, from Congress, which convened a special commission on the urgent need for change, Pentagon officials, who have drafted countless internal reports examining how to improve many aspects of the department's ability to function, and pleading defense industry leaders, seems to agree that things need to be done differently. And no wonder: accelerating technological change is reshaping conflict around the world. China is making historic progress upgrading its military, and Russia has redoubled its military modernization despite massive losses of personnel and equipment in its war on Ukraine. The increasingly turbulent security environment offers regular reminders that taking a business-as-usual approach to investing in the U.S. military is shortsighted.

The latest group to call for a shakeup at the Pentagon is the Trump administration’s so-called Department of Government Efficiency, which is turning its attention toward the Defense Department as its next target for reform. “We welcome DOGE to the Pentagon,” declared U.S. Secretary of Defense Pete Hegseth in February. The group, he said, would bring “actual businesslike efficiency to government.”

But the Pentagon is not a business. Inefficient and rigid though it may be, the military represents a fundamentally different challenge for would-be reformers. Not only does it have a mission—protecting U.S. national security—that is shared by no private corporation, but it also has a workforce unlike any in the private sector. Its governance is different, too: it lacks control over its own budget, organizational structure, and some of its most important strategic decisions. Those differences mean that attempts to make the Pentagon run more like a corporation will backfire. If Hegseth and DOGE continue as they have begun, they will fail to achieve their goals—and harm the U.S. military in the process.

 

We Do Things Differently Here

To see why the Defense Department can’t be run like a business, just look at its structure. Like all departments and agencies in the executive branch of the U.S. government, it has a large, unwieldy, and often divided board of directors: the U.S. Congress. All 535 members of the House and Senate have, to varying degrees, the authority to shape the direction of the U.S. military. In contrast, Walmart, the largest company in the United States, has 12 directors on its board. And even though the president of the United States is the commander in chief of the armed forces, the most important decision the U.S. military faces—whether to declare war—ultimately lies outside the chain of command, in the hands of Congress. Nowhere in the private sector would a business lack control over its most meaningful decisions.

The same is true of the Pentagon’s budget. Not only is it larger than that of any business in the United States; the organization also has little control over it. Each year, the Defense Department conducts a robust, lengthy, and often cumbersome process to determine how it would like to spend its money, ideally in line with the administration’s National Defense Strategy. But ultimate control over funding decisions lies in the hands of Congress, whose committees and members rip apart department proposals and reshuffle them according to a wide array of considerations. Sometimes Congress emphasizes a different approach to meeting national security priorities; sometimes its choices are driven more by constituent job concerns. No private business could thrive with such a constrained ability to decide what it wants to purchase when and how.

Worse still, for most of the last decade and a half, Congress has failed to approve these funds promptly. The result has been a series of continuing resolutions and stopgap funding bills that largely renew the previous year’s budget but generally prevent the military from making new purchases or shifting investments in line with new strategies. This challenge became even more acute in recent weeks because, for the first time, Congress’s inability to agree on the size of the defense budget will force the Pentagon to go an entire fiscal year without a full congressional appropriation. That means that today’s military budget is almost exactly the same as last year’s—Congress increased it by less than one percent in a feeble attempt to alleviate the impact of this historic spending problem. It is hard to imagine a private sector company declaring a fundamental mismatch between its strategy and budget, and then, after months of deliberations by its board of directors, ultimately failing to meaningfully change its budget. Short-term efforts to move resources around have also been stymied by Congressional restrictions. The Pentagon cannot reprogram more than $15 million without Congressional approval, which prevents it from shifting funds to purchase newly released platforms or to test and evaluate promising systems.

The department’s workforce also sets it apart from the business world. Its 3.5 million military and civilian employees make up an institution that is 40 percent larger by headcount than the next largest American employer. Those in uniform have, since 1973, volunteered to serve their country anywhere in the world at any time—and to risk their lives doing so. Approximately half the civilian workforce served in uniform before continuing as public servants. Many have undergone intense, years-long vetting to ensure they can be trusted with valuable classified information to protect U.S. security. And about one in eight of these civilians perform specialized military duties. No private sector workforce anywhere in the country is expected to make these sacrifices. Partly as a result, department hiring is notoriously slow. Given the glacial pace of that process, and in light of the specialized capabilities required of staff, especially the need for high-level security clearances, decisions to fire employees must be made carefully. So far, however, DOGE has been anything but careful. It has focused on firing probationary employees simply because it is easier to fire people based on their status than to assess their work and and push out poor performers. Every organization fires and reassigns personnel, but doing so based on time served rather than performance is shortsighted, particularly if workers later identified as essential cannot be quickly hired back.

Above all, the Defense Department differs from a business in the unique product it provides: security for the American public. The need to wholly focus on national security gives the military a special relationship to risk, one that is incomparable to that of a business. If a company fails, as the overwhelming majority of startups do, investors lose money and people lose their jobs. If the U.S. military fails, people die. The military’s singular role in society, to keep Americans safe and to maintain a monopoly of violence on behalf of the state, makes the stakes for risk taking in defense uniquely high. The department’s monopoly status also means that effectively executing its vision is invariably more complex than in it would be for a private company. The military cannot avoid risks, but the decision to run them must always be considered far more soberly and carefully than in the corporate world.

Of course, these differences do not mean that the Pentagon should be immune to reform. There is no shortage of serious ideas on how reform can be accomplished. Some of these involve studying and replicating existing successes. For instance, the U.S. Marine Corps has managed for the second straight year to be the only military service to repeatedly pass financial audits while undergoing a massive transformation in line with the changing security environment and the National Defense Strategy. Another positive example comes from U.S. Special Operations Command, which benefits from special acquisition authorities that allow it to get tools in the hands of warfighters more quickly than other combatant commands can.

On the other end of the spectrum, would-be Pentagon reformers should also learn from the military’s many other recent failed efforts. Realizing that the Defense Acquisition Guidebook, which ran to nearly 2,000 pages of rules, was cumbersome and unwieldy, Defense Department leaders launched a massive effort to update it. The result, in 2022: the department published 12 new acquisition guidebooks totaling a similar number of pages. The acquisition process remains clunky, and diligent efforts to streamline regulations appear to have achieved little. A real challenge for defense reforms is that the insistent desire for change over the past decade has resulted in a discordant cycle in which new reform initiatives pile up before earlier reforms can be implemented or their impact assessed. The Pentagon’s board of directors—Congress—can take some meaningful steps toward reform, as well. Recognizing the harm that endless continuing resolutions do to the military and returning to the regular appropriations process would be a good start. But given that Congress has been unable to break the continuing-resolution cycle, it should consider simply tweaking its most damaging elements by enabling the Defense Department to consistently start new programs and buy new capabilities even without fresh appropriations. (The additional spending flexibility Congress embedded in the latest continuing resolution represents a first step along these lines.)

The Pentagon needs change, but effective reform will require appreciating the uniqueness of the organization. So far, the signs are not encouraging. As Max Stier, president of the Partnership for Public Service, in March, DOGE’s approach has resembled “a kid in a nuclear power plant running around hitting buttons.” At a minimum, DOGE’s tactics will fail to achieve much-needed reform in the Defense Department. But at a maximum, these steps could backfire in terrifying ways, as they did at the Department of Energy, where DOGE forced out many employees who handled nuclear materials, before the Trump administration realized just how critical these positions are and rescinded most of the firings.

Those who serve in the military take an oath to “support and defend the Constitution of the United States against all enemies, foreign and domestic.” Without an understanding of the special role played by the U.S. military, outsiders attempting to make it run like a business will fail. And their failures will represent more than a missed opportunity; they will weaken the United States, benefit its adversaries, and poison the well for more thoughtful plans for change in the future.

The Pentagon can’t be run like a Business. America’s Military needs reform, but not the kind that Musk and DOGE have in mind.

 

 

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