Situation Report

The cliff that could happen

How the election shook up committees on the Hill, The national security team that might have been, Billability versus vulnerability: law firms and the cyber threat, and more

A roadside bomb in Helmand Province in Afghanistan killed 18 Afghans this morning, BBC reports.

ISAF commander Gen. John Allen, just now: " These attacks are the most recent examples of how insurgents intentionally target, kill and injure those who want a brighter future for Afghanistan."

With the election behind the White House and Congress, the focus of effort in Washington will be the sequester and its impact on defense spending, some $500 billion over the next 10 years that worriers warn would hollow out the Defense Department. And while President Obama said sequestration won’t happen, there are those who argue that sequester is increasingly likely.

The Center for a New American Security’s Dave Barno, Nora Bensahel Joel Smith and Jacob Stokes, writing on FP this morning: "[I]t’s time to admit there is a strong possibility that sequestration will take effect — because both the president and Congress could benefit politically."

The three options as they see it:

The grand bargain (unlikely): This would require an agreement between Democrats and Republicans over taxes and government spending that is not likely given current gridlock and a tight deadline of Jan. 2, 2013. "Barring an unforeseen change, the cumulative effect of partisan gridlock and a lack of time should squelch expectations for a grand bargain in the lame duck."

An agreement to delay (also unlikely). The bargaining over a possible delay could resemble a scaled-down version of trying to reach a grand bargain, Barno and Bensahel argue, and would face a "difficult and contentious, if not impossible, path."

A drop off the fiscal cliff (increasingly likely, they argue). If a grand bargain doesn’t happen and pushing the deadline back doesn’t work, then there is no other option than to make the massive defense cuts designed under the Budget Control Act, the two write. This could result in widespread furloughs or layoffs among the DoD civilian workforce and cuts to military healthcare.

The Pentagon might mitigate the cliff by asking for reprogramming authority, to shift from lower priority accounts to other, higher priority ones, and thus soften the blow. Or, it might defer cuts to the fourth quarter of fiscal 2013, assuming that Congress would first find a way to reverse the sequestration cuts. Of course, if Congress failed, the effects would then be devastating.

Read more of their argument on FP:

Speaking of CNAS, Nate Fick is leaving it. Fick, the former Marine officer who rose to become the CEO of the Center for a New American Security, will step down at the end of this month to become the CEO of Endgame, Inc., "a leading venture-backed provider of advanced cyber security solutions." Want Fick’s old job? CNAS Chairman Richard Danzig wants to hear from you. Apply here:

Welcome to the Wednesday edition of Situation Report, where we’re headed to Milwaukee to talk to a group of retired Marines and Naval Academy grads. Follow me @glubold. Or hit me anytime at And sign up for Situation Report here: or just send me an e-mail and I’ll put you on the list.

The election brought changes to the House and Senate Armed Services Committees that will contribute to a new dynamic between the Hill and the Pentagon. Sens. Joe Lieberman (I-CT), Jim Webb (D-VA), and Daniel Akaka (D-HI) are all retiring. And term limits dictate that Sen. John McCain (R-AZ) will have to give up his seat as ranking member on the Senate Armed Services Committee, giving Sen. James Inhofe (R-OK) a spot along side committee chair Sen. Carl Levin (D-MI). But Sen. Claire McCaskill (D-MO) was able to hold on to her seat, which means the panel retains one of the biggest voices on contracting and oversight.

The House Armed Services Committee lost conservative Rep. Roscoe Bartlett of Maryland, who lost his seat in a newly redrawn district, but, as the E-Ring’s Kevin Baron points out, Bartlett, known for marching to his own beat, had sometimes been an ally to the Obama administration, supporting the Defense Department’s efforts to develop alternative energy initiatives. And Rep. Todd Akin (R-MO), who was the fifth-ranking member of the committee, lost his seat when he gave it up to run against McCaskill. That means the Sea Power and Projection Forces Subcommittee chairmanship he occupied is now open, critical at a time of the move to Asia. Others on the HASC lost their seats, including Rep. Allen West (R-FL) and Rep. Bobby Schilling (R-IL), and Rep. Todd Russell Plats (R-PA) is retiring. Committee assignments for new members will unfold over the next few weeks. Read Kevin Baron’s full story:

Military Times reports there will be six fewer veterans in the Senate as a result of Tuesday’s election, bringing the total number to 20. Little change in the House so far, as some races are not yet determined, but three incumbent veterans lost their seats on Tuesday, and 12 veteran challengers won. There are currently 92 vets serving in the House.

Panetta told the troops they should remain "squarely focused" on their mission, now that the election is over. "America’s elected leaders, in turn, now have the responsibility to do everything possible to ensure that we succeed in our mission. As the country moves beyond the 2012 election, DoD personnel should take heart in one thing that will always unite the American people, and that is their strong support for the millions of men and women in uniform who put their lives on the line to defend, to keep our country safe."

The Romney national security team that could have been. The Romney team had been planning a transition from the Obama national security apparatus to a Republican-led one that was called "Project Readiness," reports The Cable’s Josh Rogin. Numerous people were involved, including former DHS Secretary Michael Chertoff, former New Jersey Gov. Tom Kean, former State Department official Philip Zelikow, former Navy Secretary William Ball, Harvard professor Meghan O’Sullivan, and the Foreign Policy Initiative’s Jamie Fly.

"Confidence in Romney’s victory persisted until the last minute and the planning was extensive," Rogin writes. "In recent weeks, preparations included the drive to prepare drafts of agency transition plans and policy papers coordinated by interwoven task forces that focused on specific issues." Those drafts were due on Election Day, multiple sources told Rogin.

The transition team for the Pentagon included three co-equal co-chairs: former senator Jim Talent, who was thought to have a good chance at being named Pentagon chief, and former Navy Secretary John Lehman, who was also in the running for SecDef, as well as former Pentagon policy chief Eric Edelman. Roger Zakheim, who works on the House Armed Services Committee for Chairman Buck McKeon (R-CA), was the Pentagon transition team leader. Rogin’s story here:

How much are you paying your law firm? Cyber villains may be invading your company through your law firm, Killer Apps’ John Reed reports. Companies with top-notch IT security may think they’re all good, but hackers may be slipping in through subsidiaries, suppliers, and even law firms that "don’t practice good network defense," Reed writes.

Richard Bejtlich, chief security officer with cyber security firm Mandiant to Reed: "The bad guys have really switched to things like going after third parties, places where the company’s data is stored or manipulated. That’s why we’ve seen, over the last couple of years, [hackers targeting] law firms. You can’t get the data from the original source, so get it from somebody that has a copy or is processing it."

On tap today: Marine Commandant Gen. Jim Amos appears at CSIS this morning to talk the future of the Marine Corps.

Wonk world fun: count the number of times Amos says the words "littorals," "amphibious operations" and "Asia."

Members of the Pentagon press corps aren’t good at picking a winner but our own Kevin Baron won the Tuesday Election Day Prognostication Game on electoral tallies for each candidate. "Kevin clearly has the best political crystal ball of a group that by and large had absolutely no clue who was going to win the election," Game Master Julian Barnes of the WSJ told Situation Report. Kevin was also the only person to correctly guess each of the tiebreakers: the victors in four battleground states and in two Senate races. Second place: Andrew Tilghman, Military Times. Third place: Gopal Ratnam, Bloomberg.


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