Under Secretary of Defense (Comptroller)/Chief Financial Officer Mike McCord delivers remarks at a Business Executives for National Security industry discussion at the National Defense University, Washington, D.C., April 11, 2022. (DoD photo by Lisa Ferdinando)
WASHINGTON — President-elect Donald Trump’s stated plans to tee up the firings of thousands of federal employees has shaken many in the career workforce and is damaging productivity, the Pentagon’s chief accountant warned today.
Mike McCord, the Pentagon comptroller, also predicted the current continuing resolution would stretch until March and the fiscal 2026 budget will not arrive before April or May.
Near the end of his first term in office, Trump signed an executive order reclassifying thousands of government employees — often the type who typically remain in place regardless of presidential administration — as new “Schedule F” staff without employment protections, essentially making them at-will workers who are easier to fire. Critics lambasted the move as politicizing the bureaucracy and an attack on civil servants amid calls by Trump to purge the “deep state.”
Now, as Trump prepares to return to the White House, critics fear the policy could make a return after it was quickly rescinded by President Joe Biden. Trump has campaigned on reviving the Schedule F approach.
“I would certainly hope that the next administration can resist the temptation to [impose] self-inflicted wounds on the workforce with the Schedule F-type approach,” McCord said today in a keynote address at the Professional Services Council Vision 2024 Federal Market Forcecast conference.
“I can tell you that the career workforce is worried — those that I talked to already in anticipation of what might happen,” McCord said. “It’s not helpful for productivity.”
“There’s a lot of hard-working, dedicated people in the Defense Department, and if you work with them instead of trying to stomp them, I think that we will get to a much better place,” McCord said.
Budget Woes
Based on the results of the November election, McCord also said he anticipated the current continuing resolution (CR) for the 2025 fiscal year, set to expire in December, would be stretched out to March as a new Republican congressional majority asserts its influence — though he characterized any gains the GOP could make on its priorities as marginal.
“There’s a time value of money we all know in our personal life, and having a bill in December and a two percent better bill in March would be a bad trade for most of us, but that’s not how things tend to get looked at here,” McCord said. “So I think we’re headed toward, probably, the two percent different bill in March than what we’d like to see in December.”
The Defense Department, along with the rest of the federal government, is well-acquainted with CRs, which military officials have long complained set back modernization efforts by freezing spending at prior-year levels and preventing the start of new programs. By McCord’s count, there have been 15 CRs over the last 16 years, averaging four months a year.
“A third of the year wasted in CRs consistently over 15 straight years,” he said. “Ridiculous.”
Despite the current CR and uncertainties ahead of the November election, Pentagon officials still put together an FY26 budget through the regular process, McCord said. That budget has almost been finalized, he said, details of which can then be shared with the incoming administration.
However, McCord noted Trump officials have still not signed transition documents, largely preventing current officials from communicating with their successors. Even when those documents are signed, the process of bringing on new staff from the incoming administration and formulating a new budget likely means the Pentagon’s FY26 spending plan won’t be released until April or May, he added.
Freed from constraints of the Fiscal Responsibility Act, which capped defense toplines for both 2024 and 2025 — though Congress circumvented those limits in April by passing a $95 billion supplemental defense bill anyway — McCord said the DoD would recommend getting back to the levels of topline growth defined by budgets in years like FY23 and FY24.
“This year, we’re working to a higher [topline],” McCord said of the FY26 proposal. “But there’s no agreement, and there is going to be a new decision from the new team about what their topline looks like that will help inform their look at what program mix we’ve left for them.”