Policy & Strategy

OVERNIGHT DEFENSE: Sequester may be new ceiling for DoD budget

The Topline: Sequester-level budgets could be the high ceiling for defense spending over the next decade, according to a new budget report that will be released Thursday.

The report from the Center for Strategic and Budgetary Assessments (CSBA) concludes that the budget caps under sequestration could become a ceiling — rather than the floor lawmakers are fighting to undo — because the deepest part of the cuts have already occurred, according to excerpts from the report obtained by The Hill.

“Now that sequestration has gone into effect and the deepest part of the decline from FY 2012 to FY 2013 has already occurred, the [Budget Control Act] budget caps may be more of a ceiling than floor in the coming years,” the report says.

CSBA defense analyst Todd Harrison is briefing reporters Thursday on the findings of the report, titled “Chaos and Uncertainty: The FY 14 Defense Budget and Beyond.” 

The briefing will be streamed on CSBA’s website.

The report says that so long as the sequester budget caps remain in effect, the Pentagon won’t be able to carry out the 2014 budget it submitted, even if Congress provides more flexibility.

And if sequestration remains on the books through fiscal 2021 as the law is currently written, it would represent a 34 percent drawdown from the peak defense spending level in 2010, the CSBA finds.

Defense observers have warned that each year the sequester stays on the books it will be harder to repeal the cuts.

Democrats showed during the shutdown fight they want to reverse the sequester, and so do most Republicans — so long as the cuts are replaced with reductions in spending elsewhere, like entitlements.

{mosads}But the parties remain deadlocked — as they have for more than two years — about how the sequester would be offset with revenues or entitlement reductions.

The report also takes a closer look at military personnel costs, finding the 2014 budget request includes $177 billion in personnel-related expenses in the Pentagon budget and $235 billion from other parts of the government.

Hagel hints at NATO in Syria: As international inspectors continue their work to dismantle Syria’s chemical weapons stockpiles, NATO troops could be called into the country to support that mission. 

“It may well be that NATO will be asked for some assistance” by the United Nations-led effort to dismantle Syria’s chemical weapon stocks as that work continues to progress, Defense Secretary Chuck Hagel told reporters at the alliance’s headquarters in Brussels. 

Inspectors from the Netherlands-based Organization for the Prohibition of Chemical Weapons (OPCW) have demolished chemical weapons-related equipment at six sites inside Syria.

The inspection teams have also coordinated the breakdown of thousands of metric tons of unused chemical munitions as part of the ongoing effort to eliminate those stockpiles, according to OPCW officials. 

But as inspections continue and investigators secure and destroy more and more of Bashar Assad’s stockpile, the mission could become too unwieldy for the OPCW teams and require NATO support. 

“I think it would probably be something we would assume would occur if we can stay on track and make progress … [and] that other nations would be asked for help,” Hagel said Wednesday. 

Increasing security threats to the inspection teams in Syria also could prompt military support from NATO.

Inspectors have been repeatedly targeted with roadside bombs, the same weapon of choice being used against American forces in Afghanistan, while attempting to dismantle weapon stocks.  

Earlier this month, a mortar attack was launched against the Damascus hotel where the inspection teams were staying, according to recent reports.  

Boeing reports boosted profits due to commercial sales: Boeing reported Wednesday that the company’s profits increased 12 percent in the third quarter on the strength of its commercial sales.

Boeing’s defense business, meanwhile, did see a slowdown, with its profits and operating margin dropping off the last year’s pace.

But overall, Boeing posted a $1.2 billion profit in the third quarter and increased its earnings expectations for the full year.

Boeing’s has a rosy outlook on 2013 despite the spending cuts under sequester, as it is following the trend of other large defense firms that are staying profitable.

While Boeing has stayed profitable on the strength of its commercial business, competitor Lockheed Martin has done so by slimming down. 

Lockheed posted profits up 16 percent from last year on Tuesday despite having a dip in sales.

Smith to weigh in counterterrror rules: Rep. Adam Smith (D-Wash.) on Thursday will weigh in on the current rules of war on terrorism and whether changes are needed more than a decade after the 9/11 attacks that spawned them. 

The House Armed Services Committee’s top Democrat will give his take on the 9/11-era rules of war, known on Capitol Hill as the Authorization for the Use of Military Force (AUMF), and how U.S. counterterror operations have evolved since then. 

During the speech at the Center for Strategic and International Studies, the Washington Democrat is expected to tackle how the Obama White House has used those rules to go after al Qaeda, the Taliban and other militant extremist groups worldwide. 

Smith was part of a bipartisan group of lawmakers on the House defense panel that pushed to roll back AUMF mandates, as part of the Pentagon’s fiscal 2014 budget bill earlier this year. 

The proposals passed in the House version of the Pentagon budget increased oversight on several U.S. counterterrorism operations, including drone strikes and so-called “kill/capture” missions, protected under the AUMF. 

The rules of war under AUMF provide a “frightening amount of power and it is counter to the rights enshrined in the United States Constitution,” Smith said at the time. 

“We have an opportunity, through this year’s bill, to protect constitutional rights and roll back this authority,” he added. However, Senate defense lawmakers stripped out the House provisions on AUMF in the final version of the defense budget bill. 


In Case You Missed It: 

— Lockheed files protest on Raytheon’s Navy contract win 

— Veterans Affairs falls short of claim processing goals

— Hagel: US missiles “pose no threat” to Russia 

— Gitmo lawyers seek CIA “black site” secrets 

Please send tips and comments to Jeremy Herb, jherb@thehill.com, and Carlo Muñoz, cmunoz@thehill.com.

Follow us on Twitter: @DEFCONHill, @JHerbTheHill, @CMunozTheHill 

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