What Do the Debt Ceiling ‘Plans’ Say about the Pentagon Budget? (UPDATED)
Jul 29th, 2011 | 7 responses
UPDATE:
For a more in-depth discussion on how “Struggling with debt, Congress talks defense cuts,” please click here.
Starting with the words, “Taking a stance once unthinkable in a time of two wars, Democrats and Republicans alike are insisting that the billions spent on the military can be significantly cut back over the next decade as the nation struggles to reduce its spiraling debt,” the AP article gives the reader a good insight into the various plans, proposals, ideas and sometimes just wishful thinking being bandied about in the halls and offices of Congress and elsewhere.
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Original Post:
A recent post on a sweeping proposal by the Defense Business Board to drastically overhaul the military retirement system generated some discussion not only on the military retirement system (One reader claiming “the retirement system is killing the budget”)*, but on the DoD budget in general (the same reader: “Right-sizing the military is long overdue, as is, for example… procurement reform.”)
As our legislators wrangle, quibble and continue to act as a dysfunctional family on critical budget and fiscal issues and as “plans” to remediate our fiscal ills are being bandied about, what do these plans say about defense spending?
The reputable Defense News says, in effect, not much: “The two current debt-ceiling plans put forward by the U.S. House and Senate leaderships provide very few specifics on how defense spending would be cut.”
On the plan put forward by Senate Majority Leader Harry Reid, D-Nev.:
Of the plan’s $2.7 trillion in claimed savings, $1 trillion comes from drawing down operations in Iraq and Afghanistan. The plan substitutes the Congressional Budget Office’s much higher placeholder for war spending over the next decade and replaces it with the Obama administration’s lower $50 billion projection. The difference between these two estimates is more than $1 trillion.
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Excluding these savings, it is unclear how much of the remaining $1.7 trillion would come from the Pentagon.
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If you assume that veterans’ spending is not going to be included in the cuts, the Reid plan cuts at most $81 billion from the Pentagon’s budget for [2012 and 2013those two years, Harrison [ an analyst at the Center for Strategic and Budgetary Assessments] said.
Beyond 2013, it’s anybody’s guess what would happen to defense under Reid’s plan, as it only provides a broad discretionary spending cap for each year, with no breakout for security or non-security spending.
How about Boehner’s “plan?”:
Meanwhile, House Speaker John Boehner’s plan provides even fewer details about how the spending caps would be divided between security and non-security.
According to Byron Callan, a senior defense analyst with Capital Alpha Partners, $741 billion of the $917 billion in savings under the Boehner plan results from discretionary spending cuts.
The net discretionary spending caps for 2012 and 2013 are $25 billion and $46 billion, respectively. Boehner’s plan, like Reid’s, excludes funding for overseas contingency operations in its discretionary spending category.
For more “sketchy”—i.e. confusing—details” please click here
* Clarification:
The complete statement by the reader was:
No, the retirement system is killing the defense budget, according to DOD members in the past. Be clear (and correct). Gates has expressed concern about — no surprise — pension and health care costs, as have others at the DOD
7 Responses to “What Do the Debt Ceiling ‘Plans’ Say about the Pentagon Budget? (UPDATED)”
For people receiving military retirement checks, vague is probably good. At least they are not specifically targeted like those on Social Security.
I quoted Pentagon “brass” about the concerns about the costs of military retirement, Dorian. You may not like it, but don’t pretend they didn’t say it.
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Notice the discretionary spending cuts as a fraction or proportion of spending cuts — it avoids entitlements (which are “mandatory” in the U.S. code, though that law could be changed at any time — why don’t they repeal the “mandatory” part and let entitlements compete with everything else in the budget?), and note also the absolute amount of cuts, which hardly amount to being huge. (It’s just the precedent of spending cuts that is huge, to liberal and to liberal-leaning politicians and everyone else of that political slant.)
See “Clarification”
I have done my part, DLS, and posted your entire remark.
Now, can you reciprocate and quote with sources where DoD members (in the past)have said that “the retirement system is killing the defense budget” Thanks
I’ve provided multiple quotes in a previous posting (on another thread), Dorian, that illustrates the concerns Gates and others have with personnel costs that include retirement. Dempsey has said that the current cost structure is “unsustainable.”
Note that the military retirement system is more lucrative than the civilian entitlements (about which another problem arises, double-dipping), not mention the few remaining defined benefit (civilian) pensions. As early as 1984 the GAO discussed reform.
http://www.military.com/benefits/military-pay/retired-pay/military-retirement-system
http://www.military.com/benefits/military-pay/retired-pay/military-retired-pay-overview
Of course, it won’t be an easy problem to solve.
http://www.military.com/features/0,15240,234139,00.html
DLS,
First, you said: “No, the retirement system is killing the defense budget, according to DOD members in the past. Be clear (and correct). Gates has expressed concern about — no surprise — pension and health care costs, as have others at the DOD”
When I questioned you on who said that “the retirement system is killing the defense budget,” you said: “I’ve provided multiple quotes in a previous posting (on another thread), Dorian, that illustrates the concerns Gates and others have with personnel costs that include retirement. Dempsey has said that the current cost structure is “unsustainable.”
For your information and for the record, Dempsey was talking about the entire military personnel system.
“Testifying at his confirmation hearing before the Senate Armed Services Committee to become the next chairman of the Joint Chiefs Oct. 1, Dempsey acknowledged that personnel costs are becoming untenable, particularly as the debt crisis drives down spending. In the Army, he said, manpower costs already consume 42 percent of his budget. It will rise to 47 or 48 percent in just five years if no changes are made, he predicted.”
“That is not sustainable,” said Dempsey. “So the question comes back: What should we do about it and how can we do so in a way that maintains the trust we’ve established with our force over time.”
Again, he was not saying that “the military retirement system is killing the defense budget,” he didn’t even say that the retirement system is “unsustainable”or “untenable.”
Second, DoD budgeted personnel costs (FY2011) are about $150 billion.
Under the accrual method, DoD contributes about $30 billion towards the military retirement system.
Yes, military retirement costs are a significant and important part of the DoD budget (about 5 percent)—something we should try to control—but not something that is “killing” the DoD budget, compared for example to the FY2011 war funding of approx $ 160 billion and $10.7 billion for 2011 continued production of one single type aircraft, the F-35
Have a good weekend
Have a good weekend yourself, sir. Reality:
(Pay attention to the quotes, including the word “unaffordable.”)
http://www.airforcetimes.com/news/2011/07/military-dod-panel-calls-for-radical-retirement-overhaul-072511/