Magazine article National Defense

Despite Defense Budget Increase, Modernization Still Short-Changed

Magazine article National Defense

Despite Defense Budget Increase, Modernization Still Short-Changed

Article excerpt

My comments this month are precipitated by President Clinton's $110 billion proposed increase for the Defense Department during Fiscal Years 2000-06.

If approved by Congress, this funding boost would represent the first long-term sustained increase in defense spending in more than a decade. Further, the administration says that the additional funding will help the Pentagon achieve its procurement spending goal of $60 billion per year by Fiscal Year 2001.

Currently, procurement is running at about $45 billion per year. The chairman of the Joint Chiefs of Staff, Gen. Henry Shelton said "First, this budget will fully fund our critical readiness requirements" and "second, it will enable us to achieve the procurement goals spelled out in the Quadrennial Defense Review."

But, before we get carried away with optimism about the prospect of more dollars for force modernization, we should take a closer look. First, the audit trail:

The Joint Chiefs originally sought a $148 billion increase over the Fiscal Years 2000-06 period. Then the chiefs and the secretary of defense negotiated this level to $112 billion and Office of Management and Budget and the White House agreed to $110 billion.

For Fiscal Year 2000, the Defense Department would receive $12 billion of this increase-$2 billion for Bosnia, $2.5 billion for military pay raises and improved retirement benefits, and $7.5 billion for a variety of other needs such as reliability upgrades to aging equipment, spare parts, as well as modernization programs.

So the Pentagon ended up with 74 percent of the original Joint Chiefs' target and, considering the volatility of budget drills, that's probably not so bad.

The bottom line is that we should also look at were the money comes from, because there's more than meets the eye. First, 68 percent of the increase is for the latter three years of the six-year period. Thus, only 32 percent or $40 billion of the increase will apply to the serious near-term readiness problems facing our forces today.

Perhaps more importantly, 60 percent of the $110 billion proposed increase-or $66 billion-is to be generated from within the current defense budget projections. These funds would stem from internal savings resulting from expected fuel price decreases, projected lower inflation, and other efficiencies such as acquisition reform (Haven't we spent that savings several times before? …

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