tag:blogger.com,1999:blog-381917167978264683.post8594690204180272801..comments2023-10-30T06:31:05.501-07:00Comments on MilPub: Spot on predictions in 1970FDChiefhttp://www.blogger.com/profile/10607785969510234092noreply@blogger.comBlogger17125tag:blogger.com,1999:blog-381917167978264683.post-6500591246982914612014-04-08T05:33:52.749-07:002014-04-08T05:33:52.749-07:00" The Army's per entrant costs of recruit..." The Army's per entrant costs of recruiting in 2012 were $22,300. How many employers in the civilian market pay $22,300 per recruit for inexperienced high school graduates?"<br /><br />How many employers in the civilian world are hiring under anywhere near the same circumstances?Barry DeCiccohttps://www.blogger.com/profile/04735814736387033844noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-90636069521370955862014-04-08T01:48:58.727-07:002014-04-08T01:48:58.727-07:00PFK-
It doesn't take a PhD in math to raise t...PFK-<br /><br />It doesn't take a PhD in math to raise the question, and obviously, the two COLs were on the right track back in 1970, although neither claimed the wisdom to predict when the line would be crossed, just that someday it would be. Both men were concerned that the Gates Report effectively made assumptions about the costs involved that were based on assumptions that had no precedents from which to extrapolate.<br /><br />Reducing BAH rates (housing allowance) is, at least, a relatively gentle way to do things. Your current BAH is frozen until you PCS, so a troopie would not take a hit immediately, and could plan for his housing budget at his next duty station based on the BAH in effect for that locale at his estimated time of reporting in. <br /><br />What should be of concern is the unpredictable effects of the combination of a draw down and pay/benefit cuts. If it has a negative impact on recruiting and retention, it could easily disrupt the force. <br /><br />Every RIF in the Army during my watch stimulated a number of good people getting out voluntarily "ahead of schedule". They just didn't wish to deal with the turbulence and/or uncertainty. If voluntary exit programs are used, it's difficult, under current law, to control who and how many decide to exit. How do you refuse voluntary exit to your best performers?<br /><br />Just as the AVF took us into uncharted water, the first ever combined RIF and reduction in pay and benefits will take DOD into uncharted waters. And, unlike the civilian world, there are no equivalent employers to "steal" experienced personnel from in the case of exits causing skill shortages. It's all going to have to come from within.Aviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-10339087393186150582014-04-07T15:32:20.239-07:002014-04-07T15:32:20.239-07:00Aviator,
http://www.warcouncil.org/blog/2014/2/7/...Aviator,<br /><br />http://www.warcouncil.org/blog/2014/2/7/l8kh5385sv6nk2g2vlca2lqp43rb4b<br /><br />Someone is asking the same questions as you...PF Khansnoreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-38380391471024991612014-04-06T03:18:04.361-07:002014-04-06T03:18:04.361-07:00http://www.armytimes.com/article/20140224/BENEFITS...http://www.armytimes.com/article/20140224/BENEFITS02/302240023/DoD-budget-seeks-cuts-BAH-commissary-Tricare-benefitsAviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-77391585312774320262014-04-05T21:55:21.978-07:002014-04-05T21:55:21.978-07:00What is significant today, is that costs are not o...What is significant today, is that costs are not only being addressed by force size, but several measures are concurrently on the table to reduce per capita force costs. It is the drive to decrease per capita costs that is a significant change in policy.<br /><br />And it is not just a matter of selecting one or two measures, but to implement all.<br /><br />-Reduce the retirement benefit for current and future retirees<br /><br />-Cap active duty pay increases to less than inflation<br /><br />-Shift more health care costs to dependents and retirees<br /><br />-Reduce the level of housing allowance<br /><br />-Reduce the commissary benefit<br /><br />It's not just a matter of savings via fewer troops, but also having to make each those fewer troops less expensive to have on the rolls. That's not a road with which the US has had experience. The logic behind the AVF in 1970 was that military compensation and benefits could "easily" be competitive enough to man the "necessary force", and policy makers are now having to come to grips with what is really "easily competitive" as well as what defines "necessary" - cost or capability. Aviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-66504850052067346582014-04-05T02:21:08.119-07:002014-04-05T02:21:08.119-07:00Sven-
As I posted above, the ratio of officers,...Sven- <br /><br />As I posted above, the ratio of officers, by grade, to enlisted in the force is fixed by law. There has been no change in this ratio for a very long time. The structure cannot become increasing "top heavy" as you allude. As I posted, the law limits Lt Cols to 1.9% of the total force, and COLS to 0.8% and Generals to just 0.07% of the overall force.<br /><br />Rand Corp figures were based upon average RMC of each of the two groups. If each officer's RMC increased by 25%, then the total officer RMC (group) also increased by 25%. <br /><br />To put it in simple numbers:<br /><br />A "Full Colonel" with over 20 years service is paid about 10 times more than a new Private just out of Basic Training.<br /><br />If 1.2 Million enlisted each receive a raise of $25/mo, it results in a $360 Million/yr payroll increase.<br /><br />If you gave the 38,780 "senior officers", LT Col through General, (2.77% of a 1.4 million force) 10 times that much of an increase ($250/mo), it would total up to $11.6 million in increased cost, or about 3% of the combined total increase.<br /><br />In short, the Senior Officers are not the major payroll expense you make them out to be.Aviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-35068041351544058192014-04-04T23:14:13.341-07:002014-04-04T23:14:13.341-07:00Corrected a typo in the Original Post. CHAMPUS beg...Corrected a typo in the Original Post. CHAMPUS began in 1966, not 1996. Prior to CHAMPUS, military dependents had no health care insurance for outpatient civilian care. If you didn't have access to a military treatment facility (MTF), you paid out of pocket. Dependent inpatient medical care could be covered pre-CHAMPUS, but required pre-approval by the nearest MTF, and was directly paid by the approving MTF. Thus, your dependents' care was at the discretion of the local MTF commander.Aviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-74691042885453564192014-04-04T12:18:40.960-07:002014-04-04T12:18:40.960-07:00Ael -
Instead of exhausting itself trying to sta...Ael - <br /><br /><i><b>Instead of exhausting itself trying to stay on top of a very greasy pole, the US government should be seriously thinking of managing the transition while it *has* the advantage.</b></i><br /><br />A level of rational thinking that has yet to be seen since the fall of the Soviet Union, and totally counter to the notion of American exceptionalism.Aviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-46815831838616833532014-04-04T11:56:17.438-07:002014-04-04T11:56:17.438-07:00The USA military has a serious medium term problem...The USA military has a serious medium term problem.<br />Today, it outspends the next 10 countries combined (more actually). However, maintaining this relative advantage is unsustainable as its competitors get richer.<br /><br />Instead of exhausting itself trying to stay on top of a very greasy pole, the US government should be seriously thinking of managing the transition while it *has* the advantage.<br /><br />Aelhttps://www.blogger.com/profile/10788190394672505925noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-8759163786030420972014-04-04T11:40:18.251-07:002014-04-04T11:40:18.251-07:00"n the Army, the same groups have been rotati..."n the Army, the same groups have been rotating into and out of Iraq and Afghanistan, pretty much together, for 10 years. Has a notion of "responsibility" to one's comrades pressured Soldiers to remain in service even when they would prefer to do otherwise?"<br /><br />This is only partly true from my experience. Coming back from a deployment, soldiers are pretty quickly dispersed. It's the rare bird that stays in the same battalion for more than 3 years (at least for combat units). In most cases, for officers, you'll get 2 years on the line (presuming a new LT), then transition to another battalion HQ/XO position in another battalion. Same applies for sergeants. Once you get to captain and senior enlisted, you might be expected to be around for 3 years in the same battalion, but not always.<br /><br />Honestly, the Army does a pretty serious job of breaking up groups of soldiers. 6 months after returning from theater, the number of soldiers who had deployed with my unit was down to below 50% and within a year was down to more like 30% or so. Not sure if that was how the handled it in 2005-2006 but that's how it was when I was around. A couple dozen key leaders stay, but everyone else goes elsewhere.PF Khansnoreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-50747671079724259182014-04-04T06:59:50.463-07:002014-04-04T06:59:50.463-07:00You're unable to actually refute what I wrote ...You're unable to actually refute what I wrote until you fill in the missing variables:<br />* change of share of officers<br />* difference in individual pay between officers and enlisted<br />for those 25 and 40% are about per head, not for the groups.<br /><br />qty of officers * average cost or pay per officer<br />qty of enlisted * average cost or pay per enlisted<br />The former product grew by a higher percentage than the latter. That was my assertion.<br />S Ohttps://www.blogger.com/profile/03359796414832859686noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-80167038893149390012014-04-04T06:46:47.012-07:002014-04-04T06:46:47.012-07:00jim-
There are so many human factors involved in ...jim-<br /><br />There are so many human factors involved in the "stress" and reaction to same. Mrs Av questions the easy access to videophone and the "stress" whining wives can put on soldiers totally unable to help them with leaking faucets, bills, etc. Back in RVN, the women generally just "kept the home fires burning" and we had to assume they were doing OK, which we generally did.<br /><br />As to the quality of the "protoplasm", I would be hard pressed to accept that the lowered admission standards haven't brought in a fair dose of people that would have difficulty with life in Hometown, USA, no less the rigors of any form of deployment. As I said above, we are running these folks through a meat grinder. A friend of mine said many years ago that one of the benefits of the draft was a good peppering of older, more self-sufficient people in the lower ranks. Also, the percentage of junior enlisted with dependent families has increased dramatically, and one of the driving forces behind ever increasing pay for folks in their first 2 to 4 years of service is to made married life affordable. In short, a wealth of socio-demographic changes since 1973, yet the Gates Report really addressed none of these.Aviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-27390941392608672112014-04-04T06:07:33.274-07:002014-04-04T06:07:33.274-07:00Sven
I quote from you link:
"Because nomina...Sven<br /><br />I quote from you link:<br /><br /><i><b>"Because nominal wage growth for a large fraction of workers has been held to zero, a somewhat higher rate of inflation would grease the wheels of the labor market by allowing real wages to fall"</b></i><br /><br />From the Rand Corp: <i><b>Basic [military] pay grew 45 percent from 2000 to 2011, more than the Employment Cost Index (ECI) (up 33 percent) and the Consumer Price Index (CPI) (up 31 percent). Regular military compensation (RMC - total of basic pay, allowances for meals and housing, tax advantage of allowances and market value of free health care for deopendents) grew even more. After adjusting for inflation, RMC grew an average of 40 percent for enlisted members and 25 percent for officers. RMC growth was higher because of increases in the basic allowance for housing. RMC is above the benchmark of 70th percentile of civilian pay and stands at the 80th percentile or higher for enlisted personnel and officers with a bachelor's degree and the 75th percentile for officers with more than a bachelor's</b></i> <br /><br />I would invite your attention to the figures that show that the compensation of enlisted personnel increased 60% more than officer personnel, refuting your claim of "high-ranking officers skewing the average personnel costs".<br /><br />Aviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-16227647411309479332014-04-04T04:50:24.979-07:002014-04-04T04:50:24.979-07:00Al,
You don't mention suicide when discussing ...Al,<br />You don't mention suicide when discussing stress of military service. There is a new DOD study on the topic and the result/conclusion is that the rate is so high because we recruit folks who should , or would've been unfit for the draft army. This seems a reasonable concept, except why not discharge them when they become clinical?<br />But that's just a tangent on your essay.<br />Strangely the other day i came to the same conclusion as you in that we have painted ourselves into a corner,and in so many different ways.<br />jimjim at rangerhttp://rangeragainstwar.comnoreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-59918847633855841112014-04-04T02:57:07.376-07:002014-04-04T02:57:07.376-07:00http://www.frbsf.org/economic-research/publication...http://www.frbsf.org/economic-research/publications/economic-letter/2012/april/strong-wage-growth/<br /><br />Look at figure 2.S Ohttps://www.blogger.com/profile/03359796414832859686noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-49847101639500334572014-04-04T01:47:59.111-07:002014-04-04T01:47:59.111-07:00Sven- "(3) a trend towards top-heaviness, wi...Sven- <i><b>"(3) a trend towards top-heaviness, with high-ranking officers skewing the average personnel costs"</b></i><br /><br />Under US law, officers in the grade of Colonel cannot exceed 0.8% of the total manpower, Lt Col, 1.9% and all flag officers (generals and admirals), 0.07%.<br /><br /><i><b><br />"Wages display a very strong downwards rigidity in the market economy as well. The idea that you can reduce pay rather freely in a market economy is at best of anecdotal relevance."</b></i><br /><br />Entry level wages are far more elastic in the market, especially in the US, where collective bargaining (unions) is a negligible force (under 7% of the private sector). Military wages are set by law, and have never been reduced when there was a "surplus" of available entrants, but enlistment "bonuses" have. The Army's per entrant costs of recruiting in 2012 were $22,300. How many employers in the civilian market pay $22,300 per recruit for inexperienced high school graduates?<br /><br />However, the point of my post was not the "rights or wrongs" of military service, but the spot on predictions of these two officers on the direction and size of the personnel account, which in 1970 was not a limiting factor. Nor was the potential for the personnel account to so severely limit the force structure ever addressed in the "Gates Report".<br /><br />Yes, reducing personnel will reduce costs. However, since the military is a labor intensive task, reduced personnel means reduced capability. As it is, many support tasks have been contracted out to avoid the immediate ancillary personnel costs (medical, mess, training, housing, etc) as well as long term personnel costs (pension, veterans benefits). <br /><br />I am not advocating any level of capability, but it is clear that our Congress is in a quandary over having the level of military capability they want and being able to pay for it, something that was clearly evident to these two COLs (one of whom, BTW, rose to Chairman of the Joint Chiefs), but totally overlooked by Nixon et. al.<br /><br />As the size of the force diminishes, unless our country chooses to be less "adventuresome", the nature of the military task will become even less desirable than you describe and will demand even more personnel costs to recruit and retain. Unfortunately, our elected officials cannot, or choose not to see this. <br /><br />"American exceptionalism" bars us from reassessing our place in the world. Thus, we have those who simply think we should take military action everywhere and anywhere.<br /><br />Aviator47https://www.blogger.com/profile/05585964386930142907noreply@blogger.comtag:blogger.com,1999:blog-381917167978264683.post-3047519246700369182014-04-03T18:58:42.729-07:002014-04-03T18:58:42.729-07:00"If we were going to pay "competitive&qu..."If we were going to pay "competitive" wages that recruited and retained, the COL said, we would be locked into an ever increasing upward spiral. When the economy is strong, higher wages will be needed, but when the economy is weak, there would be no way to decrease wages. Thus, from a "market standpoint", the odds are that DOD would be always paying a premium wage. And his prediction was pretty much spot on."<br /><br />Actually, no - that's nonsense.<br />Wages display a very strong downwards rigidity in the market economy as well. The idea that you can reduce pay rather freely in a market economy is at best of anecdotal relevance.<br />And he'd still be wrong even if there was no downward rigidity of wages in the market economy, as there would be no need to increase mil pay as long s civ pay hasn't catched up; the scenario is about "competitive" pay, after all.<br /><br />Military bureaucracies tend to require large budgets for personnel because<br />(1) many of the jobs suck, and neither rank nor pay is specific for a specific job<br />(2) very large militaries need to pay much because they need to pay at the marginal rate, and that one is increasing with size<br />(3) a trend towards top-heaviness, with high-ranking officers skewing the average personnel costs<br />(4) wastefulness (especially in countries where a special prestige allows the military to get away with administrative incompetence)<br />(5) hardships of deployments and cruises<br />(6) inability to quit as easily; basically the military is paying for the ability to deny the people the freedom to quit the jobs within weeks<br />(7) risk premium<br />(8) relative uselessness of job experience for later career stages in the civilian world<br /><br />A great cost-saving more would be to aim for less personnel, and with a slimmed-down head.S Ohttps://www.blogger.com/profile/03359796414832859686noreply@blogger.com