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The Pentagon’s "People System" Still Doesn’t Work


Jordon Fox–does the name mean anything to anyone other than his family and personal associates? Probably not, unless you happened to be listening to yesterday’s news summaries when his name was mentioned.

What about Tyson Johnson III or Robert Loria? No? Not surprising.

They are but three of the more than 29,000 U.S. service members wounded in Operations Enduring Freedom and Iraqi Freedom. They are also among the thousands of separated war veterans who have had to wrestle with a dysfunctional military medical bureaucracy to receive the medical and rehabilitative care to which they are entitled and for assistance navigating the military’s convoluted process that determines whether an injured soldier should be medically discharged and referred to the Veterans Administration for continuing medical treatment.

They are also three of an unknown number of injured service members who have been hit with debt notices from the Defense Finance and Accounting Office (DFAS).

Jordan Fox’s case is but the latest to break, briefly, above the media’s “human interest” horizon–and only because his mother was one of the prime movers behind “Operation Pittsburgh Pride,” a volunteer effort to send “care” packages to Pittsburgh-area service men and women serving in Iraq and Afghanistan. President Bush noted and thanked her for her part in the project. Moreover, when Fox was seriously wounded by an improvised explosive device, Bush sent a letter to the family expressing his hope that the young soldier would recover.

Well, Jordan Fox did recover; so did Johnson and Loria. But they then found themselves struggling with serious financial wounds inflicted by the Pentagon–garnished wages, bad credit reports, and even pursuit by civilian debt collection agencies hired by the Pentagon if the money “owed” had not been completely paid back before the soldier was discharged.

Loria and Johnson’s troubles date back to early 2005. Loria’s pay was not adjusted when he was medically evacuated from the war zone to the U.S.–e.g., combat pay, separation pay, special hazardous duty pay. Johnson, who had received a cash bonus for enlisting for three years, was told he had to pay back the bonus because he had not “completed” the three years specified in his contract. At the time the Washington Post recounted their financial woes (October 14, 2005), DFAS said that it was still seeking to resolve claims against 232 of 331 wounded veterans that DFAS said “owed” Uncle Sam.

In late April 2006, the Government Accountability Office (GAO) issued a report on military pay entitled “Hundreds of Battle-Injured GWOT Soldiers Have Struggled to Resolve Military Debt.” The GAO discovered that 1,300 former service members–including 400 who died in combat–were carried in military financial records as debtors to the federal government to the tune of $1.5 million. GAO pointed to antiquated computer systems in DFAS, lack of software interface between personnel, medical, and financial data bases, and a finance and accounting system more concerned with exact and full completion of enlistment or re-enlistment contracts than with helping the individual .

In its report to Congress, GAO did note that the 109th Congress provided some leeway to the Service Secretaries to cancel wounded and fallen soldier debts, and that $959,000 of this $1.5 million had been written off. But the GAO also raised a cautionary note: this special authority was due to expire December 31, 2007.
It should be noted that DoD is required–as are all federal departments–to enforce a system that, at its roots, is optimized not to help individuals but to enforce bureaucratic accountability and conformity to the provisions of the Federal Claims Collection Act (1966), the Debt Collection Improvement Act (1982), and the Debt Collection Improvement Act (1996). These statutes are optimized for general and “impartial” application across a wide spectrum of contingencies. However, regardless of how wide the spectrum may be, it cannot even begin to deal with the universe of possible causes or the debt–including the mistakes of the bureaucracy. (Anyone who has been audited by the Internal Revenue Service because of a mistake they made will understand my meaning immediately.)

Contrast the $500,000 that DFAS said it was owed in April 2005 with the October 24, 2007 testimony of Peter Orszag, Director of the Congressional Budget Office (CBO), to the Budget Committee of the House of Representatives, on the “Estimated Cost of U.S. Operations in Iraq and Afghanistan and Other Activities Related to the War on Terrorism.”

Within his testimony, Orszag provides the following breakdown of the $604 billion Congress has appropriated between FY2001 through FY2007.

Military Operations and Other Defense Activities: $533 Billion
Indigenous Security Force: $30 Billion
Diplomatic Activities and Foreign Aid: $39 Billion
Veterans Benefits and Services: $3 Billion

Orszag also offered a rough estimate of the cost of keeping 30,000 U.S. troops in Iraq from 2010 to 2017–an additional $570 billion–or of stationing 75,000 U.S. soldiers there between 2013 and 2017–$1.06 trillion. He ended by pegging the monthly “burn rate” for DoD’s wars at $11 billion.

All of which suggests two intermediate revisions to current practices of DoD:

First, that the Defense Department enforce, with the same or even more stringent oversight that it expends on ensuring individual soldiers meet their contractual obligations, the contractual obligations of companies that sign on to provide equipment and services to the Defense Department.

Second, that Congress extend immediately the latitude currently granted to Service Secretaries to cancel putative debts owed to federal government by wounded and fallen soldiers.

But the real, long-term answer is to stop creating more wounded and more fallen soldiers by stopping the wars that create more veterans.

Col. DAN SMITH is a military affairs analyst for Foreign Policy In Focus , a retired U.S. Army colonel, and a senior fellow on military affairs at the Friends Committee on National Legislation. Email at





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