If Congress fails to broker a deficit-reduction deal, the Pentagon will be forced to halt information-technology upgrades and shrink military forces, but still will have to boost funding for cybersecurity, warns outgoing Deputy Defense Secretary William J. Lynn III.
The Defense Department faces, at best, upwards of $550 billion in cuts over a decade and at worst -- if lawmakers cannot negotiate a deal -- losses of nearly $1 trillion through automatic spending cuts.
"We need to reduce spending, but it must be done in a careful and considered fashion," Lynn said on his last day in office on Wedenesday during remarks at the left-leaning Center for American Progress. "We should bring troop levels down in an orderly manner.... We need to trim modernization programs, but preserve increases in key areas such as cybersecurity and long-range strikes."
The deputy Defense secretary's comments came on the same day that House Republicans unveiled U.S. network security reforms that propose offsetting all incentives for private network defenses. An estimated 85 percent of the nation's critical infrastructure -- banking, utility, and transportation systems -- that supports civilians and troops is commercially operated.
"I think the overlay of our fiscal reality is something we were very conscious of" while drafting the agenda, said Rep. Mac Thornberry, R-Texas, who chaired the task force of members from the nine committees with cybersecurity jurisdiction.
The recommendations, which the group delivered to House Speaker John Boehner, R-Ohio, urge expanding or extending existing tax credits for companies that invest in cybertechnology rather than creating new tax credits. The task force also suggested the federal government use existing grant programs instead of appropriate new funds. For instance, grant proposals for national-security funding would be required to include certain network-protection activities, such as applying bug patches and scanning for viruses.
The plan calls for studying the cybersecurity insurance market, a nascent industry that proponents say could lessen the government's financial burden. Depending on how it is structured, insurance could bolster network reliability at firms that buy data-breach policies, the proposal stated. "Defining the liability will help develop the market for cybersecurity insurance," said task force participant Rep. Steve Stivers, R-Ohio, a member of the Financial Services Committee.
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