Military no longer protected from budget knife

The February 16 House vote to cut funding for an F-35 alternative engine over Speaker John Boehner's objections was hailed for the unlikely political federation it convened between Democrats leery of expanded defense spending and Republicans leery of, well, spending.

But the larger implication of the 233-198 vote is that it hints at the existence of something that arises only infrequently in Washington: an appetite to reduce the defense budget. Even though the continuing resolution vote only excised $450 million, it bespoke a potential glimmer of cooperation between the parties in a politically dangerous pocket of the largely bipartisan consensus over fiscal restraint.

Cutting Pentagon spending, an uncertain undertaking in even comparatively harmonious Congresses, is made even more so by the historic polarization in today's. Consider that, according to National Journal's 2010 vote ratings, the Senate Armed Services Committee chairman, Sen. Carl Levin, D-Mich., ties as the chamber's most liberal member. Its ranking minority member, Sen. John McCain, R-Ariz., slots with seven others as its most conservative.

The chasm is slimmer in the House, where the Armed Services Committee is chaired by Rep. Buck McKeon, R-Calif., tied as the eighth-most conservative House chairman. Its ranking Democrat is Rep. Adam Smith, D-Wash., who qualifies as a centrist and one of the party's most conservative ranking members.

In the decade after the Sept. 11, 2001, terrorist attacks, for reasons both cravenly political and simply practical, military and national security accounts were held safe from whatever paring budget knives did exist, resulting in almost a doubling of the Pentagon's base budget. Now, the political climes have again blended with obligations and initiatives abroad, this time in the opposite direction.

For fiscal 2012, President Obama has prescribed $553 billion for defense spending outside the Iraq and Afghanistan war budgets, $13 billion below projections, a signal that the expansion has slowed. And Defense Secretary Robert Gates's blueprint for controlling health care costs, including incrementally boosting health care enrollment for troops and families, has met with some openness among House Republicans.

House GOP leadership aides say the totality of the spending reduction appetite overrides the party's traditional insistence on preserving the robustness of the Pentagon's budget. Defense cuts will not come as a first choice, though, they said. And, ultimately, whatever reductions are made won't delve as deeply as they do in other accounts. But, they acknowledge, broader budget disagreements between the House and Senate could throw up roadblocks to decisions on the Pentagon's checkbook.

If the cuts consensus does take hold of the Pentagon, it would mark the third such easing of growth in the last several decades, the post-conflict peace dividends. After its post-Korea atrophy, the defense budget swelled during the Vietnam era, topping out at 9 percent of GDP in 1967 and 1968, according to a Center for Strategic and Budgetary Assessments analysis. Those reductions were fueled by a transition to a smaller, all-volunteer force. During the presidency of Ronald Reagan, as the United States sought to break the Soviet Union, the spending buildup resumed; in 1985 it reached $538 billion in 2011 dollars and 7.1 percent of GDP. It went into a steady decline again, a 15-year comedown that bottomed out at 3.1 percent of GDP in both 1998 and 2000, before the recent upward trend to 4.9 percent of GDP. These latter expansions in the base budget are the ones Gates and others have labeled unsustainable.

Some analysts say the reductions can't come quickly or deeply enough.

"We have huge, fundamental problems that we're not facing and even though Gates has done some laudable things, but he's just picking at the edge of the paint here," said Winslow Wheeler, director of the Straus Military Reform Project at the Center for Defense Information.

"The things he's talking about do not address these fundamental problems," Wheeler said. "We are still nowhere in addressing either the budget deficit problem or the broader defense problem, and the two are connected … People measure defense by its cost, which is one of the reasons we have the disaster on our hands on our size."

Gordon Adams, associate Office of Management and Budget director for national security under President Bill Clinton and now a professor at American University's School of International Studies and a fellow at the Stimson Center, said even the cuts projected through 2015 represent "child's play." He said the defense budget had reached an "inflection point" that mandated more fundamental action.

"You can do this," Adams told National Journal Daily. "We've done it before, we'll do it again."

But while military spending, in total dollars, has never been this high, neither has Congress been so polarized in the modern era. With the political center having essentially vanished, the path to a reduction pact appears rockier.

It could be even more difficult because, some analysts said, the weightiest factors in the recent base budget growth have been personnel-related costs, including pay increases above the employment cost index and Congress's approval of both expanded and new benefits. With the recent influx of veterans from the Iraq and Afghanistan wars, that cost share has grown increasingly unwieldy, as health care accounts for about 9 percent of defense spending, roughly $53 billion per year.

Todd Harrison, a senior fellow in defense budget studies at the Center for Strategic and Budgetary Assessments, called the proposed $5 per month bump in premiums for working-age military retirees, to $520 for families, "pretty modest" but likely to further curb Pentagon costs by encouraging veterans to access health care through their current employers.

While the F-35 cut signaled some willingness to confront defense costs, the more treacherous exercise of pulling back on troop and veterans' benefits meets with far less enthusiasm on Capitol Hill, likely a firewall against a more drastic fiscal disarmament. "They seem to be in flux about it," said Wheeler.

"Some of them take seriously that defense is on the table. Some of them seem to sort of skate around it saying, 'Defense is on the table, let's take out that one military band in Hawaii, but make sure it's not in my state, thank you very much.' We're about to see a sorting exercise, where the true hawks are separated from the phonies."

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