February 21, 2010
When Defense Secretary Robert Gates presented the Pentagon’s whopping $708 billion budget request for 2011, he tried to strike a balance between the military’s strategic needs and fiscal discipline.
He spoke of the greater demands on U.S. forces to prepare for different adversaries on various battlefields. He vowed to continue cutting weapons systems that are over budget, underperforming or out-of-step with changes in Defense Department strategy. He made clear that Pentagon officials who mismanage programs will be removed.
And yet for all his efforts to boost the relevancy and efficiency of U.S. forces, Gates could not escape a hard budgetary reality: Defense spending continues to spiral upward, even at a time of austerity elsewhere in the federal budget.
While Gates noted that military expenditures as a percentage of the gross domestic product remain relatively low by historical standards, they have been on a decade-long climb. The latest defense budget plan would boost the total by nearly $15 billion over this year’s level. All told, the Obama administration intends to spend $4 trillion on defense (including war costs) in the six years between 2010 and 2015 — about half a trillion dollars more (in 2010 dollars) than the Bush administration spent during the previous six years.
U.S. engagement in two wars has helped fuel the spending surge. But even with war costs factored out, the basic Pentagon budget has mounted steadily since 2001 — an average of more than 6 percent a year in current dollars. Although the annual rate is projected to slow to about 3 percent between now and fiscal 2015, the United States is spending more on defense than it did during the Korean or Vietnam wars.
“Whether one looks at the total [Defense Department] budget, or just that portion not attributable to today’s wars, U.S. defense spending is now stabilizing at levels significantly above Cold War peaks (adjusted for inflation) and far above the Cold War average,” noted a report last month by the Project on Defense Alternatives, a research group based in Cambridge, Mass., that has advocated reductions.
The new budget plan comes after a dramatic first year for the Obama administration in which it managed to terminate or reduce some of the Pentagon’s most costly and complex weapons programs. Most notably, it capped production of the Air Force’s F-22 Raptor, blocked plans for a new presidential helicopter and eliminated a futuristic Army ground vehicle.
But even these changes were not enough to stem the rise of defense spending, and the list of cuts for 2011 is less ambitious, targeting only a handful of Pentagon programs, most of them involving relatively small sums.
Wringing more savings from the military budget is complicated by the expanded set of missions that the Pentagon has taken on. The new Quadrennial Defense Review, released with the budget request, confirmed a shift away from planning mainly for conventional wars against national armies. Now, U.S. troops are being directed to gear up for a much broader array of threats, from present-day terrorism and insurgencies to longer-term worries about potential aggression by China. This requires a wider range of weaponry.
More money is going for the things that count most in the kinds of irregular wars U.S. troops have faced in Afghanistan and Iraq — unmanned aircraft for spying, helicopters for airlifting troops and armored vehicles that can withstand roadside bombs. Special operations forces are being beefed up. So are electronic warfare and cybersecurity capabilities.
At the same time, the Pentagon budget remains dominated by large weapons programs meant for big conflicts. Half the procurement account in the new budget request would go for systems associated purely with modernizing conventional capabilities, including new fighter jets, bombers and submarines, as well as missile defenses.
And it’s not just weapons costs that are up. So is the price of caring for an overburdened all-volunteer force. The bill for military health care programs has soared from $18.4 billion in 2001 to more than $48.5 billion this year, and the fiscal 2011 plan envisions further improvements in medical care and support programs for troops and their families.
Even when the Pentagon attempts to offset some of these costs, Congress can stand in the way. Lawmakers, for instance, have resisted efforts to increase the annual health insurance premiums paid by military retirees — premiums that, as Gates noted at a news conference, have stayed flat for 15 years and are now only about one-third what others pay under the federal employee health care program.
Congressional politics and defense industry lobbying also combined last year to thwart two of the administration’s major cost-cutting initiatives — one effort to halt production of C-17 transport planes and another to kill plans for an alternate engine for the F-35 Joint Strike Fighter. The administration has targeted these programs again this year, and Gates has signaled he will not back down this time, warning he would recommend a presidential veto of any legislation sustaining these programs.
On the troubled F-35, which is facing cost overruns and schedule delays, Gates went further, replacing the current program manager with a three-star general, restructuring timetables to extend development and slow production, and withholding $614 million in award fees from the prime contractor, Lockheed Martin Corp.
The administration’s projections show a dip in overall defense spending after next year. But the forecast is based on a transparent fiction — the notion that war costs will fall precipitously, from $159 billion in 2011 to $50 billion in 2012, as U.S. forces leave Iraq and begin to withdraw from Afghanistan. Gates himself acknowledged in testimony before a House panel that this estimate is unrealistically low.
In all likelihood, the Pentagon’s budget will remain stubbornly high, for all the reasons that have pushed it up in recent years. Even so, it is widely assumed that the Defense Department will eventually face a day of budgetary reckoning. With military expenditures accounting for more than half of all federal discretionary funds, it is hard to see how significant deficit reduction can be achieved without reining in Pentagon costs.
Some defense specialists have urged a more drastic squeeze on the military now, arguing that funds continue to pour into weapons systems of questionable value. In one list of recommended cuts, the Center for American Progress, a left-leaning Washington think tank, suggested terminating production of the Marine Corps’ MV-22 Osprey vertical lift aircraft, slowing production of Virginia class submarines, delaying expansion of U.S. missile defense systems and scaling back the number of U.S. nuclear forces.
Gates himself spoke of the need to continue to make trade-offs in a world of limited resources. But independent defense specialists and lawmakers criticized his Quadrennial Defense Review for not setting priorities among various Pentagon missions.
Until the trade-offs and their associated risks are spelled out more clearly, the critics say, the hard decisions won't get made.