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July 11, 2011


The Eye of The Storm

by brainoids

NASA enjoys the stablest budget in the Federal government.  Why then its continual state of disarray?

To explore this question, I’ll start with a refresh and update of “Ask and You Shan’t Receive”, where I riffed a NYT “porcupine graphic” to illustrate the differences between Presidential budget requests, and actual Congressional appropriations, for the NASA budget.   I’ve added in some earlier budget years’ worth of data, and turned the crank for DoD as well.

First, an eye-opener from the defense data.   I’ve previously illustrated the magnitude of long term defense cyclicals, which are fairly large in actual, appropriated amounts.   Even more impressive (disturbing?) is the disconnect between administration / defense department long range (5-year) planning, and the actual spending amounts:

Administration 5-year budget planning forecasts (light blue) and actual congressionally-appropriated budget authority (dark blue) for the Department of Defense (OMB subfunction 051). All estimates are converted to FY12 dollars using composite defense deflators.

After 2003, part of the disconnect is attributable towards appropriating the wars in Iraq and Afghanistan outside the baseline DoD budget request, year to year.   However, even prior to that, it was not uncommon for the out-years of defense plans to be hundreds of billions of dollars out of bed with the eventual, actual appropriations.  That’s a lot of plans that never made it to fruition (yet somehow, the nation’s defense capability remained and remains intact and operational).   To call the defense planning and budgeting environment “volatile” would be an understatement of the highest order.

An update to the equivalent NASA data shows a much more “tempered” situation:

Administration 1-year (1978-1989), 3-year (1990-1995) or 5-year (1996-2012) budget plans (light blue), versus actual appropriated budget authority (dark blue). All estimates converted to FY12 dollars using GDP chained deflators.

With the exception of the 1990’s (begun with ambitious requests for Space Station Freedom and the Space Exploration Initiative; ended with aggressive plans for downsizing of NASA), there have been only comparatively minor differences between administration out-year planning and congressional appropriation.   This has certainly been the case through the 2000’s.

To drive home the point further, the same data are integrated over 3-year windows and overlaid for both DoD and NASA:

Further, NASA’s overall budget fluctuates significantly less than most other Federal agencies, year to year.   Comparatively speaking, NASA’s funding is the stablest in the Federal government:

Typical budget variability of various federal agencies and departments, calculated as the average, year-to-year, percentage deviation of appropriated budget authority, from the 1978-2011 mean budget authority.

We thus have a situation where:

  • NASA’s actual year-to-year budget is the stablest in the Federal government
  • Administrations and congresses tend to agree on the right “size” of the Agency in any given year, far more so than DoD (and by implication of the variability above, likely more than other agencies as well)
  • NASA’s programmatic portfolio is nonetheless continually in disarray, both in planning and execution

The last bullet is particularly confounding.

Over the decades various blue ribbon panels have repeatedly exhorted that “NASA is asked to do too much with too little”, however, this rationale is likely true of every Federal agency.   The “finding” is both unsurprising (coming as it does from inside-the-bubble panels) and not particularly helpful; providing advocacy, not advice.

Others observe that since Challenger, NASA has found itself repeatedly trapped between severely divergent, and seemingly irreconcilable, ideological and political belief systems about the next steps in the development and exploration of space.  Aligned with powerful legislative and industrial stakeholder interests, the shuttlecock of civil space bounces back and forth.   Unfortunately, this again is true of most sectors of Federal government.   It suffices as a description for the situation, but fails as an excuse.

Some of this disarray must come home to the Agency itself to roost.  As an agency within the executive branch, it is NASA’s job to balance competing stakeholder interests, fluctuating budgets, midstream replanning, and future uncertainties.  This job is neither unique, nor more difficult than in any other branch of the Federal government that engages in long term development (rather than services or operations) programs.   Put simply, it goes with the turf.

What NASA needs first and foremost, I will argue, is neither new vision, nor the “right” 20-year plan, nor revolutionary innovation, nor bottoms-up reinvention.

Rather, it needs to continue making progress on a long term path towards disciplined management.

As a first step, the Agency desperately needs to re-establish the capability to formulate and implement coherent, integrated, and self-consistent budgets (briefly grasped during the early years of PPBE implementation, but lost more recently for a variety of reasons).   The challenge here will be to restore discipline, while not succumbing to the lure of central planning, since…

… as a second step, the Agency must develop the ability to adjust these budgets rapidly, and flexibly, in response to the winds of change on both sides of the Mall.  Currently, minor (a few percentage points) adjustments to NASA’s budget lead to crippling paralysis in the system.  This is an inevitable outcome of attempting to manage detailed implementation outcomes at too high a level (a trend which continues unabated), and pursuing too many conflicting agendas simultaneously.  Failures to delegate appropriate decisions to appropriate levels, or to manage by budget, are exacerbated by a field center culture which has evolved to treat the institution itself as an entitlement, rather than a tool.

At the end of the day, the budget data speak loud and clear:  Relative to other Agencies, NASA is blown by a light breeze in the eye of the Federal budget storm, not Cat-5 winds at landfall.   As an Agency it has enjoyed – and continues to enjoy – a level of budgetary stability almost unprecedented in the Federal government.  The “complexity” of its situation is ultimately tempered by that simple reality; rationales for failing to quickly adapt to change are few.  The budgetary “safe zone” has been ours to either use, or to abuse and lose.  On our current vector, the risk of the latter seems extremely high.

Selected References

OMB Historical Budget Tables (and Deflators)

Department of Defense Green Books

Older DoD Future Years Defense Plans (see Table 14)

Older SecDef Annual Reports

NASA Budget Estimates

More NASA Budget Data

3 Comments Post a comment
  1. Jul 11 2011

    Dennis – Excellent analysis. I’ve noted the same general conclusion that NASA’s budget has been relatively flat (and thus predictable) for quite a while, averaging about $18B for over a decade. I really liked the extra comparative analysis you did with DoD and with budget projections. All of that was new to me and very informative.

    Your first step isn’t clear to me why you suggest it, based on the top-line data. Are you suggesting it because of how the budget is divided? Is some of the problem you see with formulation due to the move of Strategic Investments back into the OCFO world, in your opinion?

    I agree wholeheartedly with your second step, and I wonder if a corollary is some kind of problem within legislative affairs that has eroded effective communication between the Agency and the Hill. That’s pure speculation on my part, yet I wonder….

    • Jul 11 2011

      Joe – great to hear from you!

      On the recommend, well, I’d rather not air too much internal laundry on a public blog, but as a fellow PA&E alum you probably know where I fall on some of those issues. That said, I think our troubles have less to do with where the function lives (it’s mostly the same people anyway) and more to do with the fact that our planning and execution budgets, once very coupled and aligned, are now temporarily divergent in some areas. That’s not a bad thing – it is every administration’s prerogative, nay, responsibility, to put forward its own interpretation of how to move forward within authorized boundaries. Historically it’s probably more the norm than the anomaly… Though i think we’ve forgotten a little how to operate in that mode. The challenge arises when those planned budgets or policy desirements get confused for execution marching orders. (Witness the sheer chaos associated with planning towards a CSLE account before it was actually approved).

      The second point I feel much more strongly about. HQ is trying to optimize far too many variables at the HQ level, rather than setting policy and program objectives, assigning budget marks, and allowing those further down the chain to manage and execute to those marks. Centers, for their part, often give them ample reason to want to continue this overly “hands on” approach, by playing the passive resistance card. (In fairness, we continually do the same thing at the Center management level internally “to ourselves”, without even realizing it. Delegation does not come easily in NASA’s culture…). The outcome is the same … Sluggishness and paralysis, and a dangerous affinity for intervention with an illusion of “surgical” precision.

      To be sure, I’m not blaming the very hard working folks who staff HQ, nor finding fault with the current administration or political leadership. Constellation lulled us into a somewhat complacent state where there was comparatively little tension in the system between administrative and Congressional priorities, and little variability in year to year planning. We (the agency) owe the political leadership on both sides of the Mall an agency capable of both planning *and executing* nimbly and effectively, in an environment of greater uncertainty than we have been used to. From a seat very close to the sausage making, I think we still have a good ways to go.

  2. Edgar
    Jan 24 2012

    I just happened upon this. A well done write-up, which nonetheless does beg the question then, if budget instability is not likely to blame for NASA’s woes, what is? I might suggest a couple of items that come up in these discussions. I’ve often observed that the macro-level total agency budget is rather predictable, but that many parts of NASA seem to woefully underestimate the likely budgets each of them will be assigned. The James Webb Space Telescope and SLS may be some form of “mega-flora/mega-fauna” effect that then propagates instability through dozens of other parts of NASA, precisely because the top-line isn’t going anywhere to adjust for any part of NASA suddenly seizing more than the expected resources.

    Alone, the prior may not be that much of a contributor to instability of mission, goals or achievements. But if the prior phenom is coupled with leaving the survivors to fight again another day, then eventually the instability never dampens out. An example – Constellation could take over R&Dish funding in it’s day, but the people and centers interested in R&D that’s not chosen to be part of the new system are left around. They seek (and they did so successfully) a stable R&D line being re-instituted (which became space technology). Hence, volatility. The parts that do not grow to become the large scale programs bite at the heels of those that do-and the setup insures this can go on for years.

    Ideally, distinct NASA lines would be stable, and this goes to the issue raised about HQ and the centers. Lacking leadership, the tribes attack each other endlessly rather than cooperating. Yet this again seems inadequate an explanation.

    To create the instability we see, in the relatively stable budget we also see, requires something else. One thought – a vapid “growth” syndrome or meme can be a VERY destabilizing ingredient in an organization with a relatively predictable, to say flatish, budget over time chunks of 5 and 10 years. Couple it with a lack of improvement in productivity and you have a formula for assuring instability on flat budgets, as each part of the organization attacks the other over a perceived lack of resources and stability. Call this “no one want’s to accept limits combined with not wanting to rethink beliefs” instability inevitability.

    The subject would make a great research topic in terms of policy or strategy.


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