Winslow Wheeler: Defense Cuts, Defense Flim-Flam

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Winslow Wheeler

There are numerous misleading and misinformed assertions being made about the defense spending parts of the debt deal.

The White House’s “fact sheet” asserts a $350 billion savings in the “base defense budget.” The $350 billion in defense savings that the White House declares apparently uses a different “baseline” (basis of comparison) and pretends that a two year cap the bill establishes on “security” spending will extend to ten years.  Most misleading of all, it assumes that all savings in the “security” category (which includes DOD, DOE/nuclear weapons, all State Department related spending, Veterans Affairs, and Homeland Security) will occur only in DOD spending.  In fact, the “security” category was designed to broaden the base for “defense” cuts and to lessen the impact on DOD.  The undocumented $350 billion in “security” savings will actually translate into lesser reductions in DOD spending, but the amount is unknown.  The actual amount will be decided by Congress in the future.
Others have found $500 billion — or even $600 billion — in defense budget reductions, if the new bill’s sequestration procedures are implemented.  The bill is specifically designed for that not to happen — even if betting on inaction from this Congress appears a safe bet.
If the sequestration process is started by the failure of the new joint congressional committee to achieve targeted savings, the reductions would occur in the quite different National Defense category (DOD, DOE/Nuclear Weapons, and defense related cats and dogs in other agencies).  They could be $500 billion, but, remember, this sequestration process is specifically designed to be as unattractive to Capitol Hill as possible.  While gridlock in Congress is surely a good bet, it is also likely that the joint congressional committee to be established will recommend a selection of cuts that do not hit DOD as hard.  In other words, the amount above and beyond the unknown DOD cuts in the “security” category are also unknown if the new joint committee does its job.
There will be reductions under this debt deal to the level of spending that President Obama has in his pre-existing ten year DOD budget plan, but the actual figure is also masked by the fact that the debt deal is compared to a ten year CBO “baseline” (2011 spending levels adjusted according to arcane rules and inflated by a highly unreliable projection of long term future inflation).
There will not be $850 billion in reduction in the Pentagon budget as a result of this debt deal.  The actual amount is unknown.  The actual amount will be determined by this and future Congresses; while the political winds now favoring the Pentagon relative to other forms of discretionary spending may change, the most likely alterations to DOD spending appear today to be significantly less than the much touted $850 billion.
The debt deal kicks the defense budget can down the road for this and future Congresses.  People should not read precision and certainty into a political deal specifically designed to be uncertain and indistinct.
Phi Beta Iota:  Three big things are converging toward a 50% cut in Defense over the next ten years.  First, “defense entitlement” is now a meme, it cannot be put back in the box.  The idiot platitudes about “national security” are increasingly understood for what they are, and defense waste is very much on the table.  Second, diplomacy, and especially intelligence-driven diplomacy as a primary driver for conflict avoidance, is on the rise.   This is not visible to most, but Ron Paul and others will press for the redirection of at least $100 billion a yearfrom Program 50 to Program 150, and this competing and “better value” option is not going away.  Third, “true cost” economics and an Open Source Agency (OSA) are on the horizon.  The more truth is placed before the public, the more defense pork will be cut.