Biden Defense Budget Fails to Make Bold Reductions Amid Soaring Debt, Deficits

Shortly before Memorial Day weekend, President Biden released his budget for the upcoming fiscal year (FY 2022), which begins October 1. It’s the new president’s first budget proposal, and it includes record levels of spending and tax increases across the federal government. One of several disappointing aspects of the budget is the Biden administration’s lack of fiscal discipline with the Department of Defense (DoD) budget, which is funded at a similar level to DoD funding towards the end of the Trump administration.

The DoD topline is $715 billion, an $11.3-billion (or 1.6-percent) nominal increase from what Congress passed into law for the Pentagon last December for FY 2021. Defense hawks will point out that in real terms the DoD topline is an effective cut (of around $6.7 billion, or one percent), but no matter how you slice it, the Biden team missed a critical opportunity to rethink and right-size the Pentagon budget at an opportune moment with several crossroads: the changing of the guard from one administration to another, America’s withdrawal from decades-long military operations in Afghanistan before September 11, 2021, the country’s emergence from a pandemic that should make us rethink what investments make us safe, and a record level of debt and deficits that should demand sacrifices from all parts of the federal budget.

Instead, the Biden budget unimaginatively and troublingly rehashes many of the failed programs and efforts of prior administrations, including:

  • $12 billion for the F-35 Joint Strike Fighter program, to procure 85 aircraft, even though ongoing issues with spare parts, maintenance, logistics software, engines, and general failure to meet or even approach mission-capable targets, suggests policymakers should pause on procuring more of the world’s most expensive airplane;
  • $6.9 billion for two Virginia-class submarines, even though the Navy has ongoing and serious maintenance delay issues at its public shipyards; the nonpartisan Congressional Budget Office (CBO) recently projected that purchasing five fewer Virginia-class subs (albeit in the 2030s and 2040s) could help alleviate maintenance delays;
  • $43.2 billion for nuclear weapons that doubles down on rushed and outdated programs like the Ground Based Strategic Deterrent (GBSD), which NTU and a cross-ideological coalition of civil society organizations recently recommended canceling; and
  • $5.1 billion for the Pacific Deterrence Initiative (PDI), which NTU warned last year (upon its recommended creation) could turn into just another slush fund for lawmakers to direct unaccountable dollars to in service of a goal (deterring Chinese military aggression) that is otherwise commendable on paper.

DoD proudly notes the $2.8 billion in divestments it proposes making in the budget (0.4 percent of the total budget, or four pennies for every $10 spent), but taxpayers should watch out for two developments in the coming months: 1) how much of those “divestments” lawmakers force back into the budget because they create or sustain jobs in a particular legislator’s state or district, and 2) how many wishes Congress fulfills from the much larger, $17-billion unfunded priorities lists the service branches sent to lawmakers last week. As large as the DoD budget is at the moment, there’s reason to believe it could grow $15 billion or $20 billion larger once Congress finishes their work with it.

There’s a small victory for taxpayers in the budget, with the Biden administration proposing to send exactly $0 to the Overseas Contingency Operations (OCO) account slush fund. Just because the OCO account is gone in name, doesn’t mean the spending spigot is quite running dry. OCO activities that were funded at a level of $68.5 billion in FY 2021 would be funded at $42.1 billion in FY 2022 under the Biden proposal. Take out the $16.5 billion in “OCO for Base,” which the Biden administration just incorporated back into its base budget proposal, and the direct war and enduring costs DoD proposes funding in FY 2022 represent just a 22-percent cut from direct war and enduring costs funded in the current fiscal year.

The Biden administration proposes spending $8.9 billion on Operation Freedom’s Sentinel in Afghanistan, just a 31-percent cut from FY 2021 levels even though America’s troop presence in Afghanistan is going from 8,600 to 0. Funding for Operation Inherent Resolve in Iraq and Syria sees a 23-percent cut from FY 2021 levels, even though troop levels are proposed to drop 57.5 percent. The shadow OCO request also includes $27.8 billion in enduring requirements, just an 18.2-percent cut from FY 2021 levels, suggesting America’s withdrawal from overseas conflicts may not be the budget relief valve that some thought it would be. Though it’s better for these costs to be included in the base budget rather than the OCO slush fund, taxpayers should be concerned that cost reductions are falling far short of force strength reductions overseas.

There will be plenty to monitor as Congress gets its hands on the Biden budget, especially efforts to fulfill the service branches’ ‘wish lists’ and top up the bloated DoD budget with even more spending. In the meantime, we would encourage lawmakers to take another look at NTU’s four-year roadmap to cutting $338 billion from the DoD budget. The country’s fiscal situation demands sacrifices from all parts of the federal budget, and it’s time lawmakers in both parties start including DoD in that discussion.