Military operations of the past decade have heightened the tensions in the debate over asymmetric counterterrorism-type operations and traditional large-force structure deployments. The distinction is best exemplified through the Pentagon’s simultaneous transition to Asia and expansion of counterterrorism operations in Africa.

The dichotomy between operations in Africa and Asia provide a clear contrast in their scope, objectives, and targets. The defense industry’s future could look significantly different, if one side decisively wins this policy debate.

In Asia, the Pentagon has sought to deploy a new Air-Sea Battle concept with the implicit objective to provide a security reassurance to allies and a greater balance to Chinese military hegemony in the region. The strategy for Asia clearly defines an emphasis on larger conventional force structures and the continued need for naval capabilities and air-force capabilities. For contractors, this would be an ideal defense posture for aircraft carriers, jets, and battleships.

Fiscal restraints, however, may make this type of policy focus unrealistic and eventually turn away from emphasis on conceptual joint air-sea military operations.

In Africa, the Pentagon’s strategy is slightly more complex and non-traditional.

The stated purpose of Africa has been indirect operations with logistical support and cooperation to local governments. The military operations in Africa will undoubtedly contain a greater emphasis on asymmetric operations through drones and special operations forces. Contractors already play a key role in these missions and the Defense Department appears committed to their deployment in sensitive hot spots around the world. Contractors are the next proxy in these asymmetric fights.

This is the area of growth for industry – a tough pill to swallow.

When choosing between traditional forces and light forces, however, it is likely the Pentagon will continue to demand both, even if it may not be able afford it. This debate is not a set-piece battle, however, but it is more like an ongoing conversation, with billions of dollars at stake, about the future of American power. That makes tying down defense companies’ strategic development and R&D investments to a particular narrative very difficult, but not impossible.

Thinking that far ahead is getting harder as the sequestration threat eclipses the industry’s focus on its long-term future. In the mean time, firms will likely continue to consolidate and look outside of traditional programs towards new markets in energy, IT, and cyber security.

While many analysts in the Pentagon and OMB don’t see sequestration as a realistic contingency, the defense industry has not shied from sounding the alarm.

At the House Armed Services Committee (HASC) hearing on Wednesday, Lockheed Martin CEO, Bob Stevens testified that  they “have little insight as to how sequestration will be implemented … no insight into which programs will be curtailed, which sites will be closed, which technologies will be discontinued, or which contracts will be reformed.”

The AIA released a report that nearly 2.14 million American jobs would be lost in total, through both non-defense and defense discretionary spending.
These numbers are high, and should be treated with skepticism. Defense firms have more ability to absorb the shocks than they lead us to believe, and have diverse portfolios which are not limited to defensespending.

There’s no doubt that sequestration would be bad policy and result in job loss. But there are even bigger stakes: the national security strategy of the United States.

The U.S. faces new threats in the post-Afghanistan era, and a strategic defense policy that harnesses the industrial base will be critical in creating effective forces to counter them. Serious reforms and strategic planning appear to be absent at the moment, and have left industry on shaky footing. Threats have transformed, and our capabilities must do so aswell.

The military maxim about the “fog of war” rings truer than ever in the 21st Century’s conflicts.

The same could be said for the industry itself.

Cole is an Adjunct Fellow and Miller is a policy analyst, at the non-partisan American Security Project