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Here is a synopsis of a report from the House Budget Committee about how out of control our military spending has gone.  One interesting note is that we keep spending more money for less weapons as years pass when adjusted for inflation.

http://www.fcnl.org/issues/item.php?item_id=3508&issue_id=19

House Budget Committee Holds Hearing on Sustainability of Military Budget

 

Updated: 2/18/2009

Posted: 2/18/2009

FCNL has long requested that the House and Senate Budget Committees hold a hearing on the military budget, which represents about 40 percent of the federal budget and has historically been given insufficient scrutiny. If the federal budget is a pie, the Pentagon gets to choose its piece first and diplomacy and all other human needs get what’s left over. The fact that the Budget Committee chose to hold this hearing now, in a time of economic uncertainty, suggests that the taboo against questioning the military budget is being lifted, giving the U.S. public an opportunity to talk about rebalancing this nation’s budget priorities.

The House Budget Committee held its hearing on the “Sustainability of Current Defense Plans” on February 4, 2009. The committee chair, John Spratt (SC), opened the hearing by stating that although defense is one of the government’s primary functions and responsibilities, the military budget must be more closely examined in a time of economic uncertainty.

Stephen Daggett, a specialist in defense policy and budgets for the Congressional Research Service, was the first to testify. Key points Daggett made include the following:

• The military budget has increased at an unprecedented rate in the past eight years.


• Projections that military will face a budget shortfall if it doesn’t receive even more funding are incorrect.


• Budget analysts expect growth in the defense budget to slow when the United States begins withdrawing troops from Iraq. Defense Secretary Robert Gates stated before the House Armed Services Committee on January 27 that

  “the spigot of defense spending that opened on 9/11 is closing.”

According to Daggett, the current military budget—which has increased at a rate 20 percent higher than that of inflation since 1985—is too large for six reasons:

1. Cost of employing troops. The average cost of employing a service member is 45 percent higher in FY 2009 (after adjusting for inflation) than it was in 1998. Spending for retirement and disability benefits has increased by about $8,000 per person, but the base salary and housing allowance have also increased dramatically. According to Congressional Research Service research, average military compensation is currently more than the average civilian salary.


2. Operations and maintenance budget. This budget has grown at a rate between 2.5 and 3 percent higher than that of inflation since 1955. Much of this money is spent on operating and maintaining major weapons systems. Growing weapon stockpiles and new, higher-tech weapons are more costly to maintain. Operating and maintaining the growing number of military facilities is also a factor. According to Daggett, this increase in operating and maintenance costs is surprising, since most civilian industries have become more efficient to operate and manage.


3. Major weapons systems. Although the total number of weapons manufactured every year has decreased since 1985, the cost of each weapon has increased dramatically as weapons incorporate more sophisticated technology. For example, Navy ships currently cost between $3.5 and $4 billion each, leading the Navy to consider going back to an older model that is functional and considerably less costly.


4. Underestimated weapons costs. This problem leads to excess spending and inefficient weapons manufacturing. In 2007 the total cost of developing and manufacturing weapons was 26 percent ($295 billion) more than the Department of Defense had estimated. According to Daggett, “Such substantial unplanned cost growth undermines efficiency, further increases costs, and creates a need to restructure acquisition programs across all the services.”


5. Increased numbers of active duty troops. The last Pentagon authorization bill added 92,000 active duty troops to the military. Employing these additional soldiers will cost $13 billion a year and equipping them will cost another $50 billion.


6. Modern global security challenges. Finally, Daggett suggests that our current defense production may not accurately reflect our actual needs or concerns. Daggett divides potential military threats into four areas: irregular (i.e., terrorism), catastrophic (i.e., missile attack), traditional (i.e., conventional bombs and guns) and disruptive (i.e., biological or cyber warfare). Daggett suggests that the amount of money the government spends on these four types of conflict should reflect the likelihood that they will occur. For example, traditional warfare is unlikely to occur in the United States, and this funding could be shifted to higher-priority projects that are of more immediate concern.

Daggett argued that the military could save a lot of money by re-evaluating personnel and equipment needs. Weapons and facility costs could also be cut in the short term, but Daggett suggested that cutting funding for research and development might lead to a “less capable force” in the future.

Daggett saw both drawbacks and advantages to war supplementals, or money appropriated to cover war expenses after the base budget has been set. On the one hand, war supplementals are bad budgeting because they are not subject to budget caps and can lead to wasteful spending. On the other hand, separating war expenses from the regular budget means makes war spending less likely to become part of the base budget year-to-year.

J. Michael Gilmore, assistant director of the Congressional Budget Office (CBO) next shared his agency's most recent projections on the military budget. The CBO projects that military spending spiked in 2008 and will become more constant over the next 18 years, averaging $549 billion annually (in constant 2009 dollars) for budget requests or $652 include unbudgeted expenses such as war supplementals for continuing wars in Iraq an Afghanistan. CBO expects military spending to decline as a percentage of gross domestic product (GDP) to 3.1 percent by 2013 and 2.5 percent by 2026—it’s currently at 4.2 percent. These figures exclude unbudgeted expenses, such as war supplementals. Certain areas of military spending are expected to grow, mainly personnel costs and the rising cost of operating and maintaining military equipment.

Following this testimony, members of the House Budget Committee offered some remarks. These comments suggest that members of the committee are committed to re-evaluating the military budget for wasteful spending. Here are some of the highlights.

 

• The committee chair, John Spratt, pointed out that money spent on Homeland Security was part of the Pentagon budget before 2002. Spratt also asked about nuclear nonproliferation. He said the possibility of terrorists’ acquiring nuclear weapons posed the biggest threat to the United States, and he worried that this country might not be devoting enough resources to preventing this from happening.


• Ranking member Paul Ryan (WI) suggested that rather than set a “floor,” it would make more sense to cap military spending at 3 percent of GDP: “We cannot simply throw money at the Pentagon without proper oversight.”


• Rep. Allyson Schwartz (PA) wanted to know if all weapons spending for the Iraq war was accounted for in the CBO analysis. She expressed a concern about overspending on defense contracts. Gilmore responded that the CBO doesn’t audit Iraq war spending. He also noted that two-thirds of the military budget goes to contractors.


• Rep. Betty McCollum (MN) recalled the “three D’s”—defense, diplomacy, and development—and said the latter two need to be better funded in the Pentagon budget. Daggett agreed, adding that U.S. leaders need to think in the longer term and seek “trade-offs and balance” in the military budget.


• Rep. Earl Blumenauer (OR) said that the military is “not a very good steward” in his state, degrading the environment by building new bases and testing weapons and aircraft.


We at FCNL thank Spratt for holding this committee hearing and hope that the Budget Committee will continue to look for ways to reduce military spending.