Prevailing wisdom on defense spending in the past decade asserts that despite the large amount spent, we did not modernize our weapons systems. In reality, the military services did take advantage of increased procurement funding to modernize their forces, although not always as expected. This paper analyzes procurement funding of the last decade and demonstrates that though each of the services has followed a different approach in allocating these funds, they share a similar result: the services capitalized on funding to modernize their forces, especially the major weapons programs that constitute the heart of the services’ capabilities.

In the last decade:

• Procurement funding grew dramatically – from $62.6B in FY01 to $135.8B in FY10.

• Supplemental war funding significantly enhanced the resources available for procurement, making up 22 percent of all procurement funding.

• Most procurement programs already have been almost completely funded.

• The Army had its next-generation acquisition programs cancelled, but that freed resources – enhanced by significant supplemental war funding – to expand and upgrade its primary combat vehicles and supporting capabilities, giving it a fully modernized force.

• The Air Force modernized its force by fielding the next-generation systems of the F-22 and C-17, and also introduced an entirely new capability – unmanned aircraft. The Air Force bought fewer fighters than it projected because it made a conscious choice to pursue high-end and expensive next-generation systems.

• The Navy achieved the modernized force it projected at the start of the decade, and relied on the dramatic expansion of procurement funding to achieve that force.

There will always be debate over what forces and equipment our military should pursue, but we should not ignore significant advances. Over the last decade, we spent roughly $1 trillion on defense procurement and the military services used that funding, including that provided in the supplemental war funding, to modernize their forces.