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Missing Pentagon Trillions

On September 10, 2001, Secretary of Defense Donald Rumsfeld admitted that the Pentagon had lost, by the estimate he chose to use for his speech, 2.3 trillion dollars. Many of you good readers know about this, and are asking where the money went. That's a good question, but what really intrigues me is: Where did it come from?

U.S. Department of Defense
Office of the Assistant Secretary of Defense (Public Affairs)
DOD Acquisition and Logistics Excellence Week Kickoff—Bureaucracy to Battlefield

Remarks as Delivered by Secretary of Defense Donald H. Rumsfeld, The Pentagon , Monday, September 10, 2001

The technology revolution has transformed organizations across the private sector, but not ours, not fully, not yet. We are, as they say, tangled in our anchor chain. Our financial systems are decades old. According to some estimates, we cannot track $2.3 trillion in transactions. We cannot share information from floor to floor in this building because it's stored on dozens of technological systems that are inaccessible or incompatible.

We maintain 20 to 25 percent more base infrastructure than we need to support our forces, at an annual waste to taxpayers of some $3 billion to $4 billion. Fully half of our resources go to infrastructure and overhead, and in addition to draining resources from warfighting, these costly and outdated systems, procedures and programs stifle innovation as well. A new idea must often survive the gauntlet of some 17 levels of bureaucracy to make it from a line officer's to my desk. I have too much respect for a line officer to believe that we need 17 layers between us.

Our business processes and regulations seems to be engineered to prevent any mistake, and by so doing, they discourage any risk. But ours is a nation born of ideas and raised on improbability, and risk aversion is not America's ethic, and more important, it must not be ours.

Those who fear danger do not volunteer to storm beaches and take hills, sail the seas, and conquer the skies. Now we must free you to take some of the same thoughtful, reasoned risks in the bureaucracy that the men and women in uniform do in battle.

To that end, we're announcing today a series of steps the Department of Defense will take to shift our focus and our resources from bureaucracy to battlefield, from tail to tooth.