When Congress enacted a ten-year deficit reduction plan last August, nearly all of the cuts it required came in two rounds of reductions to annual appropriations in military, domestic, and international programs. The House majority now wants to reject the military cuts it approved in the deficit reduction legislation, the Budget Control Act (BCA, PL 112-25). In committee and on the floor, the House is approving military programs and spending that bust the caps set by the BCA. The final outcome will test whether Congress can agree to change the way deficits are reduced – and if so, whether human needs priorities will suffer even deeper cuts. So far, the House leadership is intent on sparing the military at the expense of human needs funding.
Two committees in Congress have a major say in setting military policy and spending levels. The Arms Services Committee authorizes which programs will continue and the maximum funding level they can receive. The Appropriations Committee determines the actual amount of funding each program will receive in the fiscal year. This year’s House defense authorization bill, the National Defense Authorization Act for FY 2013 (H.R. 4310), calls for expensive policies the Pentagon does not want. The bill restricts the implementation of the New START Treaty on nuclear arms reduction between the United States and Russia; it requires the Pentagon to maintain 12 ballistic missile submarines, aborting the Defense Department’s plan to reduce the fleet to 10; it calls for a new missile defense site on the East Coast that the Pentagon believes is unnecessary; and it adds $8 billion over the military spending caps in the BCA. On May 18, H.R. 4310 passed 299-120 with the majority of Democrats (77-104) voting against the bill. The Administration has issued a Statement of Administration Policy threatening to veto the House bill unless changes are made. The Senate Arms Services Committee unanimously approved its authorization bill on May 24. It has its own set of issues including funding programs the Pentagon doesn’t want and failing to reduce personnel costs by rejecting an increase in health insurance fees requested by the Administration. No time has been set for the full Senate to debate the bill.
The Administration’s FY 2013 budget in February proposed a level of funding which adheres to the over-all $1.047 trillion spending cap for appropriations in the Budget Control Act (BCA). The Senate will also adhere to that cap. The House sets a lower over-all level of $1.028 trillion, however, it allocates $8.1 billion more than the Senate and $3.1 billion more than the Administration for base Pentagon programs outside of funding for the conflicts in Afghanistan, Pakistan and Iraq, which are not subject to the cap. The House has passed its FY 2013 defense appropriations bill in the Appropriations Committee allocating $519.2 billion in base funding and $88.5 billion for the wars. The Senate has not yet begun to consider its appropriations bill. Democrats in the Senate and the Administration view that additional $8.1 billion in the House bill as a breach of the BCA.
The FY 2013 defense appropriations bills do not assume the second round of cuts scheduled to start on January 1, with all sides counting on the adoption of an alternative deficit reduction plan that will undo cuts to the Pentagon.
The national defense budget, apart from spending on wars, comprises 52 percent of annually appropriated funding (referred to as ‘discretionary spending’) in the federal budget. Since 2000, the Pentagon’s budget has risen in inflation-adjusted terms by 42 percent. It has taken a modest 2.5 percent cut since 2010 compared to the 7.2 percent cut to non-defense programs that include education and training, housing, child care and other services for families and children. The largess of the military budget can be attributed to a culture of spending in which the Pentagon has not been asked to scrutinize its expenditures, prioritize based on need, effectiveness and cost, nor be accountable. (This year the Pentagon agreed to attempt to provide an audit by 2014 after years of not doing so.) In a key report published in 2010, the Sustainable Defense Task Force, comprised of an impressive number of experts across the political spectrum including former high-ranking members of the military, identified a menu of reasonable options for national defense savings totaling $960 billion over 10 years.
In August the Budget Control Act imposed 10-year spending caps on defense and non-defense programs resulting in cuts of approximately $900 billion. And once the Super Committee failed last fall to create a balanced plan with revenues and spending cuts adding up to $1.2 trillion in further deficit reduction, the BCA required that sum to be cut, mostly from appropriations, over the next decade. A cut of $110 billion, half from defense and half from non-defense programs, is set to take effect on January 1, 2013. Defense Secretary Leon Panetta, many Republicans and some Democrats in Congress are decrying the cuts to the Pentagon while less attention is given to cuts to low-income programs for vulnerable people.
In an atmosphere where there is pressure to reduce the deficit, there are alternatives to achieving the $1.2 trillion reduction: cut non-defense programs even more deeply, many of which have already been cut to the bone; cut entitlement programs like Medicaid, Medicare, Social Security, and SNAP/food stamps; raise revenues from fair and progressive sources; or seek savings from wasteful military spending. The SAVE for All Campaign which the Coalition on Human Needs founded has developed a set of principles that makes the case for focusing on the latter two options as both viable and necessary. Thus far there has been over $1 trillion in deficit reduction, all from cuts to programs and not one cent raised from revenues. Tax increases need to be a significant element in deficit reduction going forward. Military spending must also be reined in. Some of the savings could be used to reduce the deficit, but a significant amount should also be used to make critical investments for our nation’s future including education, infrastructure, and health.
House Republicans passed a partisan bill, the Sequestration Replacement Act of 2012, H.R. 5652, which makes draconian cuts to critical programs. It replaces the $110 billion in cuts in 2013 in part by slashing programs that provide nutrition, health and social services to low-income people. (For a full description of low-income cuts in the bill, see the April 30 Human Needs Report. Democrats and advocates also support replacing the cut, but with a balanced approach that includes revenues.
With the January 1, 2013 sequestration looming, the Project on Defense Alternatives, building on the earlier work of the Sustainable Defense Task Force, issued its own report this month outlining modest Pentagon savings of $17 to $20 billion for FY 2013 and more that could be “safely achievable by rethinking national security commitments, strategy, and missions.” Specific recommendations are identified in the areas of personnel, weapons systems, and nuclear weapons. For example, personnel savings could be achieved by reducing active troops to mid-2007 levels and reducing the civilian workforce by an additional 8,000 positions to the 2010 level. According to the report, alternatives for some versions of the F-35 Joint Strike Fighter program (the most expensive weapons system in history and one that has been plagued with cost overruns and development problems) ought to be considered. The report also suggests that plans for modernizing and enhancing the nuclear weapons program could be curtailed based on a diminishing need.
Studies show that Pentagon spending is a much less effective way to create jobs than investments in education, health care, clean energy and other areas. However, parochial concerns about job losses due to scaling back weapons programs or closing military bases are politically charged. Defense contractors accustomed to lucrative cost-plus contacts (as their costs rise they receive additional money beyond the initial contract) hire powerful lobbyists who make the case for continuing unneeded programs. The political power of the defense industry and the lack of oversight for war operations have encouraged waste and fraud. According to a report by the congressionally appointed Commission on Wartime Contracting between $31 and $60 billion dollars were lost to waste and fraud related to the wars in Iraq and Afghanistan.
Achieving cuts to the Pentagon’s budget and program reforms will not come easily. Congress has the power to override Pentagon priorities by continuing to fund programs that have not been requested which results in less flexibility to the Administration to execute its defense strategy and redirect resources based on its priorities. If Congress lacks the will to make even modest cuts in the Pentagon budget, a balanced deficit reduction plan that leaves room for critical domestic priorities will remain out of reach.