Stimson in the News

Russell Rumbaugh is quoted in Inside Defense on the Pentagon modernization spending

in Program

New Weapons Spending Holds ‘Steady’ Across Latest Five-Year Spending Plan

March 12, 2014 The Pentagon’s fiscal year 2015 budget plan forecasts weapon system modernization spending to grow over five years from $153.4 billion to $188.7 billion, according to newly released budget documents, accounting for more than 30 percent of total Defense Department spending across the future years defense plan — an allocation that is essentially flat after FY-16 once inflation is factored in.

The White House Office of Management and Budget, as part of the FY-15 budget rollout, has published tables detailing long-term Pentagon procurement and research and development spending plans, figures that assume the Defense Department will receive $115 billion in additional funding between FY-16 and FY-19 than currently permitted under statutory spending caps.

The OMB forecast calls for weapons spending to jump from $153.8 billion in FY-15 to $177.5 billion in FY-16 — a 15 percent hike — then climb to $181.2 billion in FY-17, $185.2 billion in FY-18 and $188.7 billion in FY-19. As a percentage of the total Pentagon base budget, modernization spending would expand from 31 percent of total spending to 34 percent by FY-19. “Modernization is holding fairly steady,” said Russell Rumbaugh, a defense budget expert with the Stimson Center.

Pentagon modernization spending reflects total spending on procurement as well as research and development. Pentagon procurement accounts grow from $90.3 billion in FY-15 to $108 billion in FY-16, then to $112.6 billion in FY-17, $117.8 billion in FY-18 and $120 billion in FY-19. The research and development accounts begin at $63.5 billion in FY-15 and jump to $69.4 billion in FY-16, dip to $68.6 billion in FY-17 and $67.3 billion in FY-18 before ticking up to $67.9 billion in FY-19.
Along with the FY-15 budget request, the administration is proposing an “Opportunity, Growth and Security Initiative” that includes up to $26 billion worth of Pentagon projects, including at least $3.9 billion in military aircraft procurement. The Defense Department has yet to articulate exactly what it is seeking as part of this package, which would also include funding for readiness and military construction projects.

Were Congress to adopt this $26 billion package, which would likely require the politically difficult task of finding revenue to pay for these programs, it could elevate total modernization spending in FY-15.

After accounting for inflation, there is little real growth in these accounts between FY-16 and FY-19, according to Rumbaugh. Using OMB inflation predictions, the Pentagon’s modernization spending would jump from $153.8 billion in FY-15 to $174.2 billion in FY-16, $174.5 billion in FY-17, $174.8 billion in FY-18 and $174.7 billion in FY-19, according to Rumbaugh.

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