Future of military depends on revamping Pentagon budget

Future of military depends on revamping Pentagon budget
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In 2017, Defense Secretary James MattisJames Norman MattisOvernight Defense: Air Force outlines plan for biggest force since end of Cold War | Trump admin slashes refugee cap | Mattis accuses Russia of meddling in Macedonia's NATO bid It’s long past time to tie the president’s hands Mattis warns of Russian meddling in Macedonia's bid for NATO: report MORE and General Joseph Dunford, chairman of the Joint Chiefs of Staff, testified that the Pentagon budget would need to grow, and keep growing, just to maintain our current military capabilities. To meet even that modest goal, they said, the armed forces would need to get annual spending increases above inflation of 3 percent at least until 2023. As for building the force to levels that the Defense Department deems necessary to ensure national security, Mattis estimated it would take annuals increase of 5 percent over inflation.

That will be even more challenging than it sounds. The Pentagon currently projects inflation for defense expenditures will run around 2 percent a year. So effectively, the Pentagon leadership was talking about annual increases of between 5 percent and 7 percent. The Trump administration plan for the defense budget through 2023 does not reach the described minimum of 5 percent sustained growth. The Bipartisan Budget Act would provide substantial increases in both 2018 and 2019, then settle for roughly inflationary growth levels in the years following.

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If Congress chooses to follow the Defense Department budget plan, our armed forces will be losing purchasing power in the coming years. In 2020, the defense budget would be $41 billion dollars short of what Mattis deemed necessary to build our armed forces. It would match what Dunford described as the the “floor necessary to preserve” the “relative competitive advantage” in defense that America has today. But in the years thereafter, the gap between the Pentagon outlook and the stated need just little over a year ago would rapidly expand.

At the end of the projected period in 2023, the gap between a trajectory of sustained annual 7 percent growth and the current planned budget would be $168 billion. When the Pentagon submits its 2020 budget request this coming February, lawmakers should ask the big questions. What has changed? In 2017, the Pentagon needed continuous 5 percent growth. In 2019, it is willing to settle for simple inflationary growth until 2023. What has driven such a radical reassessment?

Furthermore, the Pentagon has suggested it may not request an increase in the 2020 budget. Instead, it may opt to find savings and efficiencies to fund new initiatives and priorities. That is fine if it can be done, but that is a mighty big if. The debate over the appropriate defense budget topline is on the scale of tens of billions of dollars. Current savings efforts have reached levels in only the hundreds of millions. According to a recent department letter to staff, the Pentagon will save $300 million this year through reforms in information technology and logistics.

Meanwhile, the debates in Congress about increases in the defense budget were in the $80 billion range. This disparity in scale illustrates that the discussion on the topline of the budget and on savings and efficiencies take place on very separate planes that are both equally important. It is imperative to pursue reforms and improvements to how the Defense Department conducts business, but these initiatives are wholly inadequate to meets the budget needs of the Pentagon.

As Congress begins to shift its attention from the 2019 defense budget to the 2020 budget request, it will be important to note whether the Pentagon follows its assessment more than a year ago or settles for the inflationary growth described in the current budget request. The future of our military rebuild and national security depend on it.

Frederico Bartels is a policy analyst specializing in defense budgeting with the Center for National Defense at the Heritage Foundation.