Inside Defense
Feb. 1, 2010 -- Defense Secretary Robert Gates did not prevail in his bid last fall to convince the White Office of Management and Budget to grant 2 percent real growth to the Pentagon's base budget that he argued was required. But he came pretty close, securing a 1.8 percent hike -- after accounting for inflation -- in fiscal year 2011, or $18 billion more than the enacted FY-10 base budget.
In addition, the Obama administration -- which has pledged to freeze non-security, discretionary spending for three years -- has advised the Pentagon to plan on annual future increases that average 1 percent greater than the rate of inflation through FY-15, according to budget documents.
"We're well aware of a freeze on domestic spending, and that we'll be one of a relatively small number of agencies that will get real growth in their budgets," said Robert Hale, the Pentagon comptroller. "We feel strongly that the department needs modest real growth to train, equip and sustain a military at war."
The Pentagon's new five-year defense plan, that projects the implications of the FY-11 into the future, assumes 3 percent nominal growth, and 1 percent real growth. According to budget documents, the FY-11 base budget request of $549 billion would increase to $566 billion in FY-12; $582 billion in FY-13; $598 billion in FY-14 and reach $616 billion in FY-15, growth that averages out to 3 percent in nominal terms, and 1 percent after factoring for inflation.
As a percentage of the total size of the economy, the Obama administration's FY-11 spending request is 4.7 percent of gross domestic product, according to Pentagon budget documents. By comparison, defense spending made up 34.5 percent of GDP during World War II, 11.7 percent during the Korea war and 2.9 percent in the FY-00 budget, before the Sept. 11, 2001, terrorist attacks, according to DOD budget documents.
Testifying on May 14, 2009, to the Senate Armed Services Committee on the FY-10 budget request, Gates warned that the Pentagon investment plan required a 2 percent annual increase above inflation.
“Based on the briefings that I've gotten,” the defense secretary said last year, “for us to hold steady the program that we have in front of you for FY-10, to hold that steady in the outyears, we will need at least 2 percent real growth in the defense budget.”
The modernization accounts -- weapon system research, development and procurement -- were poised to be pinched as other parts of the Pentagon budget continue to rise, including operations, health care, payroll and benefits, DOD officials said.
This fall, the Pentagon worked up a detailed proposal for how the military would spend 2 percent above its original fiscal plan for FY-11 if the administration would provide the extra funds, according to service officials.
After Thanksgiving, the Pentagon received word that additional funds would be forthcoming.
"This budget is 1.8 percent real growth, and I can tell you," Adm. Michael Mullen, chairman of the Joint Chiefs of Staff, told reporters this afternoon at the Pentagon referring to the FY-11 request, "that each of the services' budgets has grown."
While the promised sum is on average half of what Gates in May said the Pentagon required, Hale said today that the Defense Department could "absorb" the difference in the near term.
"We can accommodate 1 percent annual growth in the short term and still maintain the current forces, and we're doing it, frankly, to try to be mindful of a serious economic problem and make our contribution to that by holding down our growth," Hale told reporters. "In the longer run, I think we'll have to look at it again." -- Jason Sherman
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