How about we start cutting with BS overbudget programs and equipment we don't need and fix the acquisitions process instead of going right for the heart of our military. But hey, Congress is already locked in to breaking the retirement promise, so we'll see what that does for retention anyway.
You smart guys should be in charge.
I have heard a few very senior officers recognize this very problem and assure that they are working it. The thing is, you can't just undo a contract by saying "thanks, but we'll be taking our billions of sunk cost back now" or "yea, we signed this contract that awards your staff 6-figure salaries for this project, but we'll be changing the terms now." I would also say that for those of us in the Navy, the ability to acquire new ships and aircraft is at the very heart of our capabilities.
The change in acquisition and the way DoD contracts are awarded is going to happen very slowly. There's a ton of institutional inertia, lessons learned can only be applied to future contracts, and contracts aren't directly awarded by military personnel, and those are not the only issues senior officers face. I'd guess that given the choice, the Generals would rather have more experienced, capable mid-grade Officers around for operational flexibility than a gigantic stash of M1 Abrams that is collecting dust, but even the Army CoS doesn't get to make that call. In the meantime, current retirees under 62 get to see their annual CPI increases cut -- there was no 'contract' for that one.
Reading about the exchange between Gen Franks and Donald Rumsfeld, I cannot imagine a more frustrating position than being told by your civilian boss that you are out to lunch when you have 30+ years of experience. It's the system in which we operate, and I think it's unfair to crucify a group of people who, when push comes to shove, have very little real control over how federal dollars are allocated and spent.
I get the overall impression that "smart guys" are in charge. There is just a big mountain to move and a lot of people who need to sign off on moving it, and a lot of those guys are more interested in their own careers as legislators, nepotism, and keeping constituents employed than doing what needs to be done to untangle the big-picture financial mess.