1998 Military Spending:
Behind the Numbers: How the Pentagon is spending
The Defense Monitor, June 1997, Center for Defense
On February 6,1997, the Clinton Administration released its
budget request for Fiscal Year 1998, which included $265 Billion
for the military. While this represents the thirteenth straight
year of reductions in the military budget since the Reagan Administration's
spending spree, the Administration's multi-year spending plan
calls for military spending to level off this year, and then actually
go up. The "Peace Dividend" envisioned by many at the
end of the Cold War has failed to materialize.
The President's budget calls for $1.6 trillion for the military
between now and the year 2002. During that same period, the Clinton
Administration and Congress have agreed that they will achieve
a balanced budget. The deficit for 1997 is estimated to be $126
Billion. If Congress and the Administration do actually eliminate
this annual deficit, while at the same time increasing spending
for the military, drastic cuts in other federal programs become
a virtual certainty.
Meanwhile, Congress has already indicated its intention to
add nearly $4 Billion to the Administration's FY '98 request for
How Severe is the "Budget Crunch"?
For years Pentagon budget watchers have warned that the current
Future Years Defense Plan (FYDP) -- the Pentagon's multi-year
spending plan based on the U.S. National Security Strategy --
is under-funded. Yet in recent years Congress has added unrequested
purchases of weapons systems to the budget. Many critics feel
these "add ons," which reward defense contractors based
in a lawmaker's home state, have only exacerbated the Pentagon's
budget shortfall. According to Pentagon Comptroller John Hamre,
of the $8 Billion spending overrun by the military in Fiscal Year
1997, $3 Billion of it was due to Congressional "add-ons."
In fact, of the nearly $11 Billion added to the military budget
by Congress last year, $4.6 Billion was for weapons purchases
not included in the FYDP. Some Pentagon officials are concerned
that continuing this practice will have a "bow wave"
effect; it will commit the U.S. to even greater weapons expenditures
in the future, putting extreme pressure on other areas of the
military budget and adversely affecting troop readiness, repairs
and maintenance of existing equipment and facilities, and basic
"quality of life" programs (troop pay, housing, etc.)
For example, during a recent press briefing, Defense Secretary
William Cohen confirmed that between 10,000 and 12,000 U.S. service
personnel and their families are eligible for food stamps.
The United States already has by far the strongest military
force in the world.
The U.S. built its massive military to confront the Soviet
Union and its allies.
The Soviet Union has dissolved and the Warsaw Pact is gone.
The Russian military is a shambles. The U.S. and other countries
are sending Billions of dollars in economic assistance to Russia.
There is no other nation or group of nations nearly as powerful
as the Soviet Union and the Warsaw Pact were, or as the US. is.
New Wars to Justify Old Forces
The United States is the only nation in the world preparing
to wage war anywhere on the globe. In fact, we are actually preparing
to fight two wars.
The Pentagon's "Bottom-Up Review" in 1993 produced
a "new" military strategy to fight two Major Regional
Conflicts (MRCs), at the same time, at short notice, and if necessary
without allies. (Later, the requirement was changed from "two
simultaneous MRCs" to "two nearly simultaneous MRCs.")
Given the rapid pace at which the post-Cold War world is evolving,
last year Congress mandated that the Pentagon conduct an updated
review and created a congressionally approved panel to oversee
the process. The Quadrennial Defense Review (QDR) was completed
on May 15, 1997. The National Defense Panel is expected to release
its own report on U.S. military strategy beyond the year 2015
in December. As expected, the QDR did not eliminate the "2
A Radical Redefinition of "National Security"
Secretary of Defense William Cohen stressed repeatedly that
while the QDR was to be an assessment of what forces are necessary
to meet our National Security Strategy, it had to do so with the
assumption that military spending would remain constant (rather
than increase) for the foreseeable future. Additional warnings
about future budgetary pressures on military spending came from
Pentagon Comptroller John Hamre, who stated in testimony before
the House Judiciary Committee that with efforts to balance the
budget, "DoD budget cuts from [Fiscal Year] 1996 to FY 2002
could range from $110 Billion to $520 Billion."
Such warnings so far seem to have fallen on deaf ears, both
at the Pentagon and in Congress. No one has yet suggested how
to rectify the growing imbalance between Pentagon planning, Congressionally
mandated spending, and the commitment by U.S. political leaders
to balance the budget. It seems clear, however, that without a
radical rethinking of U.S. national security needs and how best
to achieve them, the combined goals of a strong military, the
Clinton Administration's plan to reinvest in domestic programs,
and a balanced budget will be impossible to achieve.
What are we buying?
Tactical Aircraft Modernization: The "Budget Buster"
The U.S. military is now in the process of upgrading its fleet
of tactical aircraft -- aircraft designed for direct combat in
air-to-air or air to-surface (ground or sea) battles. Three aircraft
are now in various stages of development or production, the F/A-18E/F,
the F-22, and the Joint Strike Fighter. In all, the military services
plan to purchase nearly 4,000 aircraft at an estimated total cost
of $350 Billion.
1) F-22 -- An air-superiority fighter which will replace a
portion of the Air Force's fleet of F-15s. The aircraft will utilize
"stealth" technologies, and be able to cruise at supersonic
speed without afterburners, thus saving fuel. The Air Force had
planned to buy 438 F-22s until the QDR eliminated 99. The total
cost of the program was estimated at $71 Billion, for an average
cost of $159 million per aircraft. Revised estimates based on
the QDR are not yet known.
2) F/A 18-E/F -- A larger, more powerful version of the Navy's
current F/A-18 multi-role fighter. The updated version is expected
to carry a larger weapons load, but be as maneuverable as the
current version. The pre-QDR Navy plan was to buy 1,000 aircraft
at a total program cost of $81 Billion, or an average cost of
$81 million per aircraft. Post QDR procurement will be between
548 and 785, depending on the progress of the Joint Strike Fighter.
3) Joint Strike Fighter -- An aircraft currently under joint
development by the Air Force, Navy and Marine Corps. The services
had planned to buy a total of 3,000 between 2005 - 2030; two-thirds
for the Air Force, 640 for the Marines, and 300 for the Navy.
(Post-QDR procurement slipped to 2,852.) The JSF would replace
a variety of aircraft, including the Air Force's F-16 multirole
fighter, the Navy's A-6 long-range attack aircraft, and the Marine
Corps' AV-8B Harrier jump jet. The total cost of the program has
been estimated at $219 Billion, making it the most expensive weapons
program ever developed. The average cost per aircraft was estimated
at $73 million prior to the QDR.
Critics of the various programs are concerned by the monumental
cost of each aircraft, which, given the advanced technologies
yet to be developed, are likely to grow. The cost of the F-22,
for example, may still exceed the current $71 Billion cost estimate
by as much as $15 Billion. The justification for these huge expenditures
has been called into question, particularly given the superiority
of the existing fleet of U.S. aircraft to those deployed by foreign
A study by the Congressional Budget Office (CBO) concluded
that during the development of these new aircraft, aircraft in
the current fleet would have to be kept in service well beyond
the twenty years that the Pentagon had planned to operate them.
Meanwhile the General Accounting Office stated in a 1993 study
that F-22 production could be delayed until 2010 without undue
risk to U.S. air superiority. Thus, the Pentagon could continue
to purchase new models of existing, proven aircraft, at a lower
cost, while maintaining U.S. air dominance.
In a 1997 study the CBO also concluded that the three programs
have already exceeded the projected $350 Billion price tag by
$7 Billion. Further, CBO said that buying all three aircraft will
cost between $14 Billion and $18 Billion each year from 2008 to
2014. This would consume up to 46 percent of the Pentagon's current
annual budget for all weapons purchases, including ships, tanks,
rifles, etc. Tactical aircraft purchases now total only about
6 percent of the procurement budget.
The U.S. is, and will remain for the foreseeable future, the
world's dominant air power. Rather than committing our nation
to huge expenditures for unneeded aircraft, we should continue
to purchase new models of current aircraft, while continuing to
develop the technologies which will be incorporated into the aircraft
of the future.
Ballistic Missile Defense (BMD)
"Star Wars" is still playing in the Pentagon. No,
they haven't added a cinema to the building. Rather the effort
to develop defenses against incoming ballistic missiles continues.
When President Reagan launched the Strategic Defense Initiative
(SDI) in 1983, the goal was to build an impenetrable shield against
thousands of incoming long-range ballistic missiles. The SDI program
was scaled back under President Bush to Global Protection Against
Limited Strikes (GPALS). GPALS was to protect the United States
and its allies from hundreds of incoming ballistic missiles.
In light of the changed relationship with a post-Soviet Russia
and in the aftermath of the Gulf War, President Clinton refocused
the program to concentrate on Theater Missile Defense (TMD). TMD
systems would protect a given theater of operation, generally
meaning U.S. troops deployed abroad, against the more likely threat
of short- to medium range ballistic missiles, similar to those
used by Iraq.
Because of budgetary, technological, and treaty constraints,
defenses against long-range ballistic missiles, referred to as
National Missile Defense (NMD), are now focused on protecting
the United States from accidental launch or from attack by a rogue
state armed with a handful of these missiles. The Clinton Administration's
plan for NMD is commonly referred to as a "3+3" plan.
Currently in a deployment readiness posture, hardware is being
developed so that at the end of 3 years (by the year 2000), a
decision may be made as to whether or not threats warrant deployment
of an ABM-compliant NMD system. Deployment would then take an
additional 3 years to accomplish.
Indicative of the changes in the program, the Clinton Administration
scrapped the name "SDI" and changed it to Ballistic
Missile Defense (BMD). President Clinton's initial plans call
for spending an additional $21.4 Billion on BMD over the next
six years. Last year, the President requested $2.8 Billion for
BMD; he received $3.7 Billion. His FY 1998 request, at $3.5 Billion,
is more in tune with the wishes of the Congress.
Congressional critics find fault with the pace and funding
requests of the BMD program under President Clinton. Many wish
to pick up the tempo of both TMD and NMD regardless of technological
difficulties. (For example, the interceptor being developed for
the Army's Theater High Altitude Area Defense System (THAAD) has
repeatedly failed to hit its targets.) These critics seek deployment
of an NMD system by the year 2000. Although restricted by the
Anti Ballistic Missile (ABM) Treaty to one NMD site with no more
than 100 ground-based interceptors, some argue for a multiple
site NMD system complete with space-based missiles.
Deployment of an extremely limited ABM Treaty compliant NMD
system would cost $4 - 13 Billion, according to the Congressional
Budget Office (CBO). Additional interceptors and improved infrastructure
at a single site would bring the cost to about $29 Billion. Expanding
the NMD system to additional sites and adding space-based components,
as advocated in the 1997 Defend America Act, could bring the total
to $60 Billion. Operating and maintaining such a system could
cost an additional $2-4 Billion annually. These costs would be
in addition to the approximately $80 Billion spent on BMD efforts
since the program was launched in FY 1984.
Current and projected threats do not warrant upping the tempo
of NMD efforts. The only nation which can directly strike the
United States today with ballistic missiles are Russia, which
with the help of the United States is eliminating many of it ballistic
missiles under the terms of the START Treaties; China, which only
has 7 intercontinental ballistic missiles; France, one of our
closest allies; and the United Kingdom, which gets its submarine-launched
ballistic missiles from the United States. North Korea is often
labeled a near-term threat. While this famine-ridden country may
be developing medium- to long-range ballistic missile capabilities,
the missile that intelligence sources point to, which no one has
ever seen, would barely allow the North Koreans to someday strike
one of the uninhabited pieces of rock in the Alaskan Aleutian
Given the lack of threats, high cost, and numerous technological
difficulties encountered, increasing the tempo or funding for
BMD activities is both unwarranted and unwise.
Military Spending How does it Compare to Other Federal Programs?
Despite talk about declining military spending and suggestions
that the military has taken its "fair share" of spending
cuts, military spending still consumes a huge chunk of federal
government funds. And the military budget continues to be kept
"off the table" in budget balancing efforts by both
the President and the Congress.
In the President's proposed federal budget for Fiscal Year
1998, the "National Defense" category of federal spending
(excluding veterans programs and other military-related spending)
amounts to a whopping 60 percent of all discretionary spending,
the money the President and Congress can allocate and spend each
year. The other category of federal spending is mandatory spending,
the money the federal government spends automatically unless the
President and Congress change the laws that govern it. Mandatory
spending includes entitlements, money or benefits provided directly
to individuals such as Social Security, Medicare, Medicaid, Food
Stamps, and Federal Retirement. It also includes interest payments
on the national debt.
A "Leaner, Meaner" Military
Rather than take a bold approach towards redefining how to
meet our national security needs, the Pentagon is determined to
find savings through acquisition reforms, improved financial management,
privatization of certain functions, and reduced infrastructure
in order to fund other priorities such as weapons modernization.
Improving the way the military does business is an important goal,
and should be pursued. Unfortunately, the Pentagon's current spending
practices do not encourage such efficiencies, and the savings
the military will actually achieve are unlikely to be significant.
Controlling Weapons Costs
The Pentagon assumes that costs for new weapons will not increase
beyond their initial projections. In the past, however, the General
Accounting Office has observed that "program cost increases
on the order of 20 to 40 percent have been common on major weapons
Better Financial Management
The Pentagon has faced continued criticism for its poor financial
practices, and hopes to achieve some savings through better money
management. Yet a recent study by the Pentagon's Office of the
Inspector General reported that the Defense Department's accounting
is in such a shambles that effective auditing will be impossible
"most likely until the next century."
The services are counting on significant savings from streamlining
their purchasing systems, through reductions of red tape, easing
of regulations and buying more commercial products. They hope
to save between 15 percent and 30 percent of costs. In addition,
the Defense Science Board reported that $30 Billion could be saved
through greater privatization of support services. According to
the General Accounting Office, in the past such savings have been
"generally less than projected."
The Pentagon had hoped to achieve significant savings through
military base closures, and together with Congress performed four
"rounds" of base closures since 1988. A recent Congressional
Budget Office report concluded, however, that while long term
savings from such closures could be considerable and that additional
closures should be pursued, the Pentagon had over estimated it's
near-term savings. Originally the Pentagon projected that it would
gain $3 Billion annually from the first three rounds of closures,
but current estimates indicate a net loss of $48 million.
What is needed now are not simply the same old attempts at
reform, but deeper reductions in our military forces based on
an accurate assessment of the threats to our national security,
and the elimination of spending on wasteful, unnecessary weapons
programs. As a first step, the Center for Defense Information
has identified twelve Pentagon programs which could be terminated
or scaled back significantly as part of efforts to reduce the
Center for Defense Information
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Washington, DC 20036
CDI's Selected Options for Reducing Military Spending
1. Reduce nuclear delivery systems within overall limits of
2. Cancel the New Attack Submarine (NSSN)
3. Reduce the number of aircraft carriers and Navy air wings
4. Reduce procurement of DDG-51 Destroyers from 3 to 2 per
5. Cancel the purchase of the Navy's F/A-18 E/F fighter and
buy the current model
6. Cancel the Marine Corps' V-22 program and buy additional
7. Cancel the Joint Strike Fighter
8. Cancel the Air Force's F-22 aircraft program
9. Buy no more than 40 C-17 transport aircraft and purchase
commercial airlifters instead
10. Reduce the number of Army light divisions
11. Cancel the Army's Tank upgrade program and lay away production
12. Cancel the Army's Comanche