The Trump administration’s first President’s Budget (PB) requests a total of $667.6 billion in discretionary national defense funding for FY 2018, including $639.1 billion for the Department of Defense (DoD).
The administration requested $603 billion in base discretionary funding for national defense, an additional $64.6 billion for overseas contingency operations, and $9.7 billion in mandatory spending for a total of $677.1 billion in funding for national defense, known as budget function 050.
According to Secretary of Defense James Mattis, the FY 2018 defense budget is intended to “achieve program balance.” [i] The administration sought to “restore readiness” with a requested $30 billion of additional funding in FY 2017, predominantly in operation and maintenance (O&M) accounts.[ii] Congress provided half of this requested funding, or $15 billion, as Overseas Contingency Operations funding in the FY 2017 Omnibus Appropriations Act.
The FY 2019 defense budget, spanning the FY 2019–FY 2023 FYDP, will be informed by the 2018 National Defense Strategy, now underway, and the accompanying Nuclear Posture Review. Underpinned by a new defense strategy and force sizing construct, the FY 2019 defense budget is expected to both “build capacity” and “improve lethality.”
In on other words, the administration’s position is that a buildup will begin in FY 2019. However, forgoing a request for additional defense spending in its first budget, when a new administration has the greatest chance of making big course corrections, was a strategic mistake. By delaying the ask for a substantive defense buildup until FY 2019, the administration has squandered any honeymoon and allowed Congress to set the terms of the budget debate.
This proposed $603 billion in discretionary base national defense spending would be $51.8 billion dollars more than the $551 billion the Obama administration requested in FY 2017, an increase of 9.4 percent. The requested $603 billion is also $54 billion, or 10 percent, over the caps on national defense spending for FY 2018 established by the Budget Control Act of 2011 (BCA), as amended.
However, the requested $603 billion represents a much more modest $18.5 billion, or 3 percent, over the $584.5 billion in the Obama administration’s PB 2017 projection for the national defense base budget in FY 2018. It is also some $37 billion, or 5.7 percent, below the $640 billion in funding for national defense called for by Sen. McCain and Rep. Thornberry, the Chairmen of the Senate and House Armed Services Committees, respectively.
The Trump administration’s request for $603 billion is below the projected defense spending levels of the FY 2012 Gates budget—the last budget formulated before the BCA caps, widely considered to be the last budget driven by strategy rather than resources—and the level of national defense spending agreed to in the FY 2017 budget resolution adopted by the Congress in January 2017 (see Figure 1-1).
National defense funding comprises funding for the Department of Defense(DoD) (about 95.5 percent of all national defense funding), funding for the nuclear weapons work of the Department of Energy (DOE), and a small amount of funding for other defense-related activities.
One major question as the beginning of the 2018 fiscal year approaches is whether the Congress, deeply divided between the Republican defense hawks, the conservative Freedom Caucus, and the Democrats, will be able to come up with a deal to increase or amend the BCA caps, as they have done in each of the past five years that caps were in force.
Click here for the full report (15 PDF pages) on the CSBA website.