Following up on my previous week's post on DOD reform, the House unanimously passed its version of a bill for defense acquisition reform (H.R. 2101) last Wednesday. With the Senate version of the bill (S. 454) having already passed, both houses quickly moved into conference, as President Obama has asked that the legislation be on his desk before lawmakers break for their Memorial Day recess next week. With important differences between the two bills, the conference process will largely determine whether the final product helps create genuine reform within the Pentagon or merely provides lawmakers with another "accomplishment" to tout to their constituents when they return to their respective districts or states. As things look right now, the latter seems much more likely.

The key differences between the two bills are whether the personnel responsible for reviewing program costs will be independent of the Pentagon, and how stringent the criteria will be set for canceling a program due to cost overruns. On the first issue, the House bill would create three advisory positions appointed by and responsible to the Secretary of Defense who would be responsible for program cost, engineering, and performance. The Senate version, on the other hand, would establish a Director of Independent Cost Assessment as an advisor to the Defense Secretary appointed by the president. Obviously, the more independent an advisor is, especially one tasked with telling you that your department is being irresponsible with the taxpayers' money, the better.

On the issue of stringent project termination criteria, although language in the Senate bill, the stronger of the two, would strengthen past acquisition reform, it provides too much leeway that would allow the Pentagon simply to get around the improved measures. As it stands now, if a major defense program experiences "critical" cost growth, that is it sees original costs increase by 50 percent or more, the Pentagon must justify the program's continued existence to Congress. The Senate bill goes further and states that a program that experiences "critical" cost growth must be canceled, unless DOD certifies that the project is "vital to national security." With little incentive within the Defense Department to cancel grossly expensive or obsolete weapon development programs or for members of Congress to pressure such moves, this measure will do nothing to stop the excesses of waste already plaguing the acquisition process. The Pentagon will merely label a cost overrun-plagued program "vital to national security" and continue with business as usual.

Depending on how the conference resolves the above issues, this legislation could be an important first step in reforming the acquisition process at the Department of Defense.

Image by Flickr user createordie used under a Creative Commons license.