Congress Punts on Reforming the Pentagon Budget—Again
There’s good news and bad news about the recently enacted $674 billion fiscal year 2019 defense budget.
The good news is that for the first time in a decade, the defense appropriations bill was passed before the start of the fiscal year. This will allow the Pentagon to spend its money in an orderly and efficient way and will prevent them from having to hand out 114 contracts worth $7.5 billion as they did on the last working day of the 2018 fiscal year.
The other good news is that congressional Republicans have rejected President Trump’s request to freeze pay for the federal government’s civilian workforce, instead agreeing to raise their pay by 1.9 percent on January 1, 2019. This will help the Pentagon recruit and retain the 730,000 civilians who are an integral part of their total force and perform critical functions.
The bad news is that the budget, which in real terms is higher than at the height of the Reagan buildup, is based upon several faulty assumptions and contains provisions that will actually undermine national security.
The first misleading assumption is that the $133 billion increase in defense spending over projected levels in Trump’s three defense budgets was necessary because there was a readiness crisis. Yet as General David Petraeus and the top enlisted leaders of the four military services pointed out before the election, our military forces were not only not suffering a readiness crisis, in Petraeus’s words, they were “awesome.”
In addition, the Trump team claims that this crisis was caused by the Budget Control Act (BCA), which reduced projected levels of defense spending by $403 billion over five years. However, they ignore the fact that Congress actually lifted the budget caps five times, giving DOD $200 billion in relief. They also ignore that the Pentagon, according to its controller, used half of the Overseas Contingency (OCO) account, meant for war fighting dollars, for another $200 billion worth of items not related to the wars in Iraq and Afghanistan. This meant that the BCA had almost no impact on the size of the defense budget.
Moreover, Congress and the administration continue to underestimate the real size of the national security budget and to inflate the OCO account. The $674 billion budget includes $602 billion in the base budget and another $69 billion for OCO. But as Todd Harrison and Seamus Daniels point out, this amount does not include several programs that are related to defense: over $200 billion for veterans, $92 billion for the amortization of unfunded military retirement liabilities (which used to be part of the DOD base budget), $24 billion for tax-related defense expenditures, and $21 billion in the Energy Department budget for nuclear weapons. Adding these items puts defense spending for fiscal year 2019 at over $1 trillion.
Furthermore, the Trump administration continues to use the OCO budget as a slush fund by inflating the real cost of the wars in the Middle East and Afghanistan and placing items in it that have nothing to do with war. The cost per troop in Afghanistan is projected to be double what it was a decade ago.
Defenders justify the massive increase by saying it’s necessary to deal with the increasing military threats from Russia and China. This ignores the fact that even before the buildup, the U.S. was already spending 10 times as much as Russia and three times more than China on defense. If China and Russia are increasing their advantage over us, it is not because of how much we spend but what we spend it on.
Congress compounds these problems by adding funds neither requested nor needed by the services. It recently appropriated funds for three additional Littoral Combat Ships (LCS) even though the Navy says that it already has more than enough. Congress also authorized 16 more F-35 fighter jets even though that program continues to be plagued by over 1,000 design flaws. It also accounted for an additional 16,000 troops to the services even though the Army could not meet its recruiting goals for its current smaller force and the Air Force has a pilot shortage of 2,000. Finally, it funds two new tactical nuclear weapons that are not only unnecessary but actually increase the likelihood of nuclear war.
And by allocating more than $1 trillion a year to national defense while simultaneously cutting taxes, Congress increased the federal deficit and annual interest payments on the debt to unprecedented levels. As a result, within a decade the United States will be spending more on interest payments than it does on the Pentagon. Admiral Mullen, the former chairman of the Joint Chiefs of Staff, has noted that the debt is a significant threat to national security. He advocates for slow, thoughtful cuts to defense spending to deal with this problem.
This budget also weakens national security by placing the military services on a path that is fiscally unsustainable. The Pentagon’s own current five-year plan assumes continued relief from the budget caps and that the budget will rise by only 1.2 percent a year in real terms for the next four years as opposed to the 10 percent real increase it has received since Trump came into office. This will not be enough to maintain the readiness and modernization of the 2019 funded force. In fact, acquisition funding is projected to decline by 2 percent between the fiscal years 2020 and 2023. And if the BCA is not updated or the Democrats win control of the House, the budgets for the next four years will be even lower. For example, the BCA caps for fiscal years 2020 and 2021 are over $100 billion below the Pentagon projections. And Congressman Adam Smith, the ranking member of the House Armed Services Committee, said that if the Democrats win control of the House, the budget will come down.
The services are compounding the problem by proposing unrealistic numerical targets for their future force. The Navy wants 355 ships, the Army 490,000 soldiers, and the Air Force 386 operational squadrons.
Finally, this massive budget also undermines national security by signaling to the Pentagon that it doesn’t need to eliminate waste. For example, neither Congress nor the administration requested another base closure process this year, even though there is 20 percent excess capacity. Nor has the Pentagon implemented the projected savings of $25 billion a year proposed by its own Defense Business Board. Instead, it fired the board’s head, as well as its new chief management officer.
This is a budget that costs far too much yet won’t increase our national security nearly as much as it could.
Dr. Lawrence J. Korb is a senior fellow at the Center for American Progress, and served as assistant secretary of defense from 1981 through 1985.