National Guard's Cost Efficiency; Response to the Skewed 2008 Rand Report

References:  2008 Rand Study (link below)

http://www.rand.org/content/dam/rand/pubs/monographs/2008/RAND_MG757.pdf 

Terms.

AC = Active Component, RC = Reserve Component, NG = National Guard, NCNG = North Carolina National Guard (a national leader in large scale domestic emergency response operations).

Rand Paper’s Argument(?):  Using strategic reserves as an operational force equates to loss of a cost efficient alternative. Paper explores other options for maintaining a reserve capability that may be more cost efficient.

What are some flaws in the argument?

1)      The Rand base model posits a 1:6 RC deployment ratio as a continuous reality, but the reality is a 1:5 RC deployment ratio, and only when needed (see number 2 below).

2)      The Rand study looks at the idea of operational reserve from the perspective of deployment frequency – not deployment readiness. Therefore, they assume that the new surge of operational need occurring between 2003-2008 is a constant and will always be required.

A Counter Argument to the Rand Monograph.

No restructuring is required to maintain a cost efficiency advantage in the RC. Removing parallel critical combat capabilities from, specifically, the National Guard is not a solution for cost efficiency, nor does the report assert this; as this COA would both 1) eliminate an operational reserve option from high OPTEMPO surge periods, and 2) removes in entirety options for a strategic reserve combat capability.

Maintaining cost efficiency is both about predictability (which the force generation models have provided), and increasing the number of options available to deal with multiple geographic threats. Transitioning or converting units and assets from the Guard to the AC eliminates predictability and options and only offers options after no less than 5 years after the need arises (creating RC units in time of need, Option C, p.32).

	Peace AC	Peace RC	Peace -  Guard	War AC	War RC	War - Guard
Cost per Month	100%	25%	26%  adjusted to add for FTM (10%) assigned	100%	38%	41%  adjusted for 1:5 deployment readiness
Units Required	3.0 (12:36)	8.0 (9:72)	6.7 (9:60)	3.0 (12:36)	8.0 (9:72)	6.7 (9:60)
Cost per Unit BoG	300%	200%	174%	300%	304%	274%
Relative Cost of RC	67%		58%	101%		90%

 Table 1, Relative Cost per Unit BoG (Adjusted from Rand Study Table A.1 to reflect National Guard reality)

The table above is adjusted to reflect the most conservative reality of units deploying every five years in support of the federal mission. It also increases the cost per month by accounting for FTM assigned to the unit which is not the norm in the other reserve components, but exists in the Guard.

Despite adjusting for more conservative assumptions (based on recent reality), the table still fails to account for apparent cost efficiencies (despite high OPTEMPO surges) that occur over long term application of 1:5 deployment readiness goals. The table above only accounts for a 5-yr relative cost/cost efficiency comparison. The next graphic applies the more conservative estimates from the table above, combining the peacetime and wartime costs, over a long term application (like average equipment life cycle of 20 years), which is more realistic to the ebb and flow of OPTEMPO and global deployment requirements:

20 Year Cost Average	Normal Ops AC	Normal Ops RC (3 deployments)	Normal Ops Guard (3 deployments)
Cost per Month	100%	37%	38%
Units Required	20.0 (12:240)	8.9 (27:240)	8.9 (27:240)
Cost per Unit BoG	2000%	329%	338%
Relative Cost of RC	16%		17%

Table 2, Relative cost combining peacetime and wartime costs adjusted over 20 years

Conclusion. While it is necessarily important to continually explore new options for greater efficiency and predictability, a paradigm shift is not required, nor is it recommended in order to maximize relative cost efficiency of the Reserve Component. Whether the RC is considered Strategic Reserve, or an Operational Reserve is not relevant to the argument; as long as they are available when needed, they may be referred to as either, and may appropriately toggle between the two roles (Table 2) while still maintaining both readiness and cost efficiency over a longer study period. However, the Rand Study overtly omitted some important additional considerations that cannot be overlooked when considering cost/benefit analysis:

1-      The wartime readiness cycle (1:5) which ensures that the RC is properly resourced and individually ready for T10 war, also doubles as the guarantee to US Citizens that those same units and forces (National Guard) will be ready for catastrophic natural or man-made homeland disasters. This mission is exclusively, by US Code, a National Guard mission. It must survive or the alternate environment is federal troops conducting homeland missions. No thank you. I respectfully oppose that notion.

2-      Critical combat capabilities must be included and paralleled, in the RC – if only in part - in order to ensure the nation is committed during T10 conflict (Abrams Doctrine). The National Guard is the best host of these parallel combat capabilities as a result of its community culture and state alignments combined with its unique autonomous T32 mission of domestic operations.

3-      Critical high intensity skill sets must be captured of those leaving the AC. This conclusion does not argue for career bonuses or monetary rewards. These skill sets must be fostered through appropriate parallel force structure in the RC, specifically the National Guard.

The considerations listed above far outweigh the Rand study’s criticism of the cost inefficiency in their challenging calculus. This short response has shown that with assessing the value over the long term, and considering some non-negotiable points, the benefit far outweighs the cost literally and metaphorically, even when experiencing temporary periods of high OPTEMPO, and is non-negotiable for organizations like the North Carolina National Guard (NCNG) when considering the exclusive domestic response mission to protect the lives and property of American Citizens, and protect our American way of life.