The $57 Billion Question

By Jason Sherman / September 24, 2008 at 5:00 AM

Why would the Pentagon add a whopping $57 billion to the FY-10 budget request? Defense Department Spokesman Geoff Morrell, speaking to reporters at the Pentagon today, refused to discuss specific figures. However, he sketched out the budgetary dilemma that Defense Secretary Robert Gates is working to address during the FY-10 budget endgame in the coming weeks:

"We are looking at ways to reduce our reliance on supplementals. And so that is the discussion -- that is the work that is currently being conducted among the budgeters in this building. How far we'll go I'm not prepared to say, because I think that's an ongoing project."

He added:

"We are going to be involved in persistent conflict for some time to come -- the secretary's talked at length about that; that's the reality of the world we now live in -- and we need to budget for it. So whether that's done in the supplemental or in the base in the years to come, we're going to need monies to fight these conflicts. But I think there is an effort under way to see if we can move away from supplementals and increasingly on base budgets to fund these conflicts."

While shifting predictable war costs from supplemental appropriations to the base budget is part of the calculus, there are much larger allocations being considered for buying new weapons and ensuring all of the military services can sustain high operational tempos. Pentagon officials are considering a "range of possibilities" for boosting the FY-10 budget proposal, which will ultimately be the responsibility of the next administration to advance. At the upper end of the increases being weighed is a $57 billion hike. Here's how an internal Pentagon document we obtained would spread the windfall, across three categories:

The first category is called "capitalization and accelerations," to be used for buying new weapon systems, which would get $14 billion -- $2 billion more than expected earlier this summer.

Another category is titled "fact-of-life/inflation," which covers higher fuel prices, a weaker U.S. dollar, health care bills and shifting select recurring war costs funded through supplemental appropriations into the base budget. This area is penciled in for a $12 billion boost, $2 billion lower than a plan earlier this summer.

Finally, $31 billion is set aside for the "Long War," a catchall category that includes new funding for recruiting and retention; projects to build partnership capacity -- a category that stood on its own in an earlier budget drill; funding for the Joint Improvised Explosive Device Defeat Organization; and funding for efforts broadly described as "presence."

The Air Force and the Navy are in line for a combined $12.7 billion boost -- the lion's share of the modernization spending in "capitalization and acceleration" -- to buy aircraft and ships. The Navy and Marine Corps would receive a combined $8 billion hike, the Air Force a $4.7 billion increase. The Army's portion of this category would be $600 million and U.S. Special Operations Command would see $400 million, according to the chart.

Additional funding for "fact-of-life" allocations includes: $1.6 billion for the Army, $1.5 billion for the Navy and Marines Corps; $900 million for the Air Force; and $6.2 billion for defense-wide accounts. This category also includes $1. 8 billion the Office of the Secretary of Defense, a sum that the Pentagon official familiar with ongoing budget discussions says is being withheld to apply to last-minute needs.

Under the "long war" category, the Army would receive $2.5 billion and the Navy and Marine Corps $300 million for recruiting and retention. The Army also would receive $1.4 billion to pass on to the Joint Improvised Device Defeat Organization. And the Office of the Secretary of Defense would deal defense-wide accounts $5 billion for building partnership capacity activities.

Nearly $22 billion, the bulk of increases in the "long war" category, would fund a broad range of activities -- none of which yet are assigned line items in the budget -- for "presence-" related activities, programs required to set all of the services on a solid footing to sustain the high tempo of operations around the world associated with fighting terrorist networks.

The "presence" funding would include $11 billion for the Army; $3.9 billion for the Navy and Marine Corps; $4.2 billion for the Air Force; $1.2 billion for SOCOM; and $1.5 billion for defense-wide accounts.

In total, the Army would receive $17.1 billion, or 30 percent; the Navy and Marine Corps $13.7 billion, or 24 percent; the Air Force $9.8 billion, or 17.2 percent, SOCOM $1.6 billion, or 2.8 percent; and defense-wide accounts $12.7 billion, or 22.2 percent. The Office of the Secretary of Defense would hold back $2.1 billion, or 3.7 percent, to make last-minute allocations for unforeseen needs.