How Much Does an Army General Cost Taxpayers?

Will getting rid of 50 of them really save that much?

Defense Secretary Robert Gates announced plans to cut the Pentagon budget

Defense Secretary Robert Gates announced plans on Monday to limit the growth of the military budget. The measures include closing a command center, cutting down on the use of contractors, and reducing the number of generals and admirals by 50 over the next two years. How much do generals and admirals cost U.S. taxpayers?

Millions. In terms of salary, benefits, and staff, generals (an Army position) and admirals (the analogous title in the Navy and Coast Guard) are basically equivalent. A brigadier general (the lowest rank for a general) with 20 years of experience earns $137,000 in annual salary, plus a $20,000 allowance—a largely untaxed subsidy for food and housing. Top generals max out at $180,000 in base salary. If we fired every one of the 963 generals and admirals from the armed forces and didn’t replace them or pay their retirement benefits, we could save at most $200 million in direct compensation annually, or .03 percent of the $663 billion defense budget for 2010. If we simply demoted them all to colonel or captain—the next-highest ranks—the salary savings would be at most .01 percent of the budget.

The real cost of generals, however, isn’t their salary but their entourage. They need a driver, a security detail, someone to manage their communications equipment, and a coterie of assistants, all of whom are high-ranking military officers themselves. (It was the loose lips of Gen. Stanley McChrystal’s 10-member traveling staff that led to his downfall.) And generals typically don’t fly commercial, because of security concerns. There’s no precise estimate of the average general’s total cost to the taxpayer, but it is certainly well over $1 million annually. In contrast, most colonels fly coach, drive themselves around, and answer their own cell phones.

Retirement pay is also a concern. A four-star general who retires in 2010 with 30 years of service would cost the government more than $3.8 million in pension if he managed to live 20 more years. If the same person retired as a colonel, it would save Uncle Sam $1.4 million.

Federal law places a cap on the number of active duty generals and admirals. The current limit is 658—that’s 230 for the Army, 208 for the Air Force, 160 for the Navy, and 60 for the Marines—but the secretary of defense can add up to 324 more if some of them are assigned to multiservice or multinational operations that prevent them from devoting their full energies to their own branch. We currently employ 963 generals and admirals, just 19 short of the statutory limit.

Why do we have so many generals? When the secretary of defense wants military brass to take a new position seriously, or he wants to give added leverage to an existing position, he makes it into a general-level job. That way, the appointee won’t have to worry about being bossed around by superiors when conflicts arise. Former Defense Secretary Donald Rumsfeld used this trick a lot. More than 100 general- and admiral-level positions have been created since the Sept. 11 attacks.

Secretary Gates is not planning to fire 50 generals and admirals. Rather, he will authorize a review of the total positions staffed by top-level officers, eliminating unnecessary jobs and demoting the rank of those positions that can be accomplished by a less well-appointed officer. The generals who hold those positions will be reassigned (it takes wrongdoing and either a court martial or presidential action to knock a general down to colonel) or forced into reasonably well-paid retirement.

Bonus Explainer: What’s the difference between a brigadier general, a major general, a lieutenant general, and a plain-old general? The number of stars on their uniform. As Daniel Engber explained in 2006, brigadier generals are the lowest-ranked generals, with only one star. Major generals get two, lieutenant generals three, and generals, the highest-ranked, get four stars. The corresponding ranks in the Navy, from low rank to high rank, are rear admiral lower half, rear admiral upper half, vice admiral, and admiral.

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Explainer thanks Mackenzie Eaglen of the Heritage Foundation and Todd Harrison of the Center for Strategic and Budgetary Assessments.

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