Or, “opportunity cost illustrated” redux. From GovExec.com:
Cash-strapped Army plans cuts to future combat program
By Megan Scully, CongressDaily
“The Army is planning significant cuts and other changes in its $160 billion Future Combat Systems program to save $3.3 billion through 2013.
The cuts, outlined in a recent memo from the service’s top acquisition official, are an indication that the Army is beginning to sacrifice some of its planned funding for weapons systems to pay for both increased Iraq war costs and plans to expand the service by thousands of soldiers.
The undated memo, signed by Army Acquisition Executive Claude Bolton, said bluntly that cuts and other adjustments to FCS are “strictly budget driven” and are not due to the contractors’ performance or other issues.
“You should incorporate these changes as expeditiously as possible in order to maximize the availability of current year resources to execute the adjusted FCS program,” wrote Bolton, who did not include dollar figures in his memo. FCS, the most expansive and expensive technological endeavor in Army history, forms the core of the service’s technology transformation.
Among many changes listed in a three-page addendum to Bolton’s memo, the service intends to cancel two of the four unmanned aerial vehicle classes originally planned for the sprawling FCS program, and suspend development efforts on an armed robotic vehicle.
FCS program officials also have been ordered to stop work on development of the XM307 armament system, and instead use existing crew-served weapons. All of those systems are now dubbed “objective requirements” for the FCS program, treating them as goals and not listing them among the primary systems that must be funded by the Army.
The Army also has changed several primary requirements for the Non-Line-of-Sight Launch System to objective requirements, and has placed two small unmanned ground vehicles on the objective requirement list. In addition, the Army plans to scale back experimentation costs for FCS and reduce the number of technology “spin outs” of various FCS technologies from four to three.
Army Chief of Staff Peter Schoomaker on Wednesday downplayed any squeeze on the FCS budget. Schoomaker emerged from a two-hour closed-door meeting with House appropriators Wednesday confident that increased operational and personnel costs would not adversely affect the service’s expensive technology transformation.”
I’m not contending that modularity is necessarily the way to go (see this CBO report for alternatives), but this event is a harbinger of things to come, as the tension between budget deficits, spending in Iraq, other demands (not to mention weapons systems cost overruns [1]) rises. So, while $3.3 billion is not much, but I’m confident that this is only the beginning. Expect other trimming in the Littoral Combat Ship (LCS) program, the JSF, etc. (even if in the short term, spending remains high [2].) Something has to give. I don’t even want to think about what will happen to Veteran’s Affairs funding, relative to increased need to handle the wounded resulting from OIF. But the CBO has considered what the Administration did in the past:
“During the past two years, VHA’s costs have exceeded the amounts initially requested or appropriated. In a hearing of the House Committee on Veterans Affairs on June 23, 2005, Secretary of Veterans Affairs Jim Nicholson stated that VA’s costs for medical care for FY 2005 would exceed the amount already enacted for that year by about $1 billion. At a hearing five days later of the Subcommittee on Military Quality of Life and Veterans Affairs, and Related Agencies, of the House Committee on Appropriations, Secretary Nicholson testified that VA would require between $1.1 billion and $1.6 billion more to administer its medical program in 2006 than had been
requested in the FY 2006 President’s budget submission. In response to the issues raised during those hearings, the Congress included $1.5 billion in supplemental appropriations for veterans’ medical care in the FY 2006 Department of the Interior, Environment, and Related Agencies Appropriation Act (H.R. 2361, Public Law 109-
54), which the President signed into law on August 2, 2005. …
For more comprehensive assessment of the challenges facing defense spending, see CBO, “Long-Term Implications of Current Defense Plans: Summary Update for Fiscal Year 2007,” (October 2006). The following figure shows how the Administration can predict an eventual balancing of the budget. Assume away cost overruns and stuff the remainder in supplementals. (The Administration has indicated that the second 2007 supplemental will be the last; I’ll wait to see if that’s the case [WSJ, 1/18/07].)
Figure 3: Figure 1 from CBO, “Long-Term Implications of Current Defense Plans: Summary Update for Fiscal Year 2007,” (October 2006).
Technorati Tags: Iraq, tax cuts,
transformation,
defense expenditures.
Just submitted a proposal to a Federal science grant program which appears it will get cut deeply by virtue of a funding freeze at last year’s inflation-unadjusted levels. Very frustrating.
The last one of these I did coincided with a deep cut of 60% in that particular program; we did not get that grant either (it was quite highly rated).
But hey, we don’t need math and science anyways. This is America — we can live off of flogging inflated financial assets forever!
The primary responsibility of the federal government is to protect our nation. The federal budget according to the NYTimes is:
Social Security 21%
Medicare 14%
Medicade 7%
Non-Military Discretionary Spending 18%
Interest on the Debt 9%
Military, domestic security 19%
Other 12%
The military is an extremely small portion of the total budget when you realize that it is the primary purpose of the federal government.
Even the War Resisters League web site with its biased redistribution of spending only assigns 30% to military spending.
Granted we need to be prudent in military spending but to elevate it above entitlements and socialist spending is disingenuous.
As an aside Rumsfeld’s primary disagreement with the Pentagon was because he was changing the military from big dollar projects to smaller unit projects such as Special Forces. The Pentagon brass wanted the prestige of the big spending and the interaction with the military industrial complex. It appears that the Pentagon is going to get the last word and much of the waste will continue.
Just for the record you are correct that LTS and JCS have already been scaled back and may be set for more cuts.
It’s a guns-for-guns deal, not a guns-for-butter deal. Could have been worse.
DickF: Wasn’t Rumsfeld a proponent of FCS, though?
DickF,
If there were any reasonable measure by which the US were underfunding its own defense needs in aggregate, then quibbling about military spending cuts would make sense. We vastly outspend every other country in the world. We vastly outspend Europe as a whole. We vastly outspend every grouping of nations that might form a coalition against us. On the assumption that we might face two such coalitions simultaneously, we vastly outspend and two coalitions of nations we might face. Our military spending has overwhelmingly gone toward shaping the world outside our own borders. What we have failed to do recently is pay for body and vehicle armor in sufficient quantities, pay for maintenance and replacement of equipment in the field – the mundane stuff. That is not a result of underfunding in aggregate. It is a function of poor planning.
By analogy, the primary responsibility of the family bread-winner(s) is(are) to provide a subsistence level of food, water, warmth and shelter for family members, so we should look askance when the US family budget is overwhelming spent on things other than subsistence? Not the way I see it. Once the basics have been taken care of – and we certainly spend enough to defend our borders – we are no longer talking about “primary responsibility.” Given the massive power of the US military, relative to the responsibility to protect our nation, we are well beyond primary issues, and it is perfectly reasonable to talk about trade-offs between military spending and other uses of funds.
The very fact that FCS is the most expensive single military project ever undertaken makes me think it may not be the best use of funds.
DickF: Referring to the Preamble of the Constitution, I see:
I don’t see “common defense” ranked first; indeed it is fourth in order. Hence, I think one could reasonably argue that the machinery of the democratic republic established by the Constitution should perform the duties of expressing the People’s preferences.
the inclusion of SSI is a canard. It is not a service. The administration of SSI could be counted, but that amount is minuscule. SSI is not even counted in GDP, because it is a wealth transfer, not real production.
Defense accounts for a massive amount of real productivity and wealth. One nedd only contemplate the number of American scientists and engineers that are preoccupied with defense systems when they could be creating the market products of the future.
In short, DickF, is giving good numbers, only they don’t mean what people think they mean. He is dissembling.
In fact, if you calculate how much money the US would save if it had no military at all, then nearly half (around 48-49%) of all income taxs(Federal Funds) go to defense department and defence offices in other departments.
DickF, under any meaningful sense of the word, you are wrong. Pure and simple. Wrong.
For a critical analysis of DickF’s poppycock, here is the link:
http://www.warresisters.org/piechart.htm
It even shows how he got his worthless 19% figure.
Military spending is socialist. Under a purely capitalist system, we would each pay somebody to protect our own personal plot of land. We don’t do that. We take responsibiilty for the country, in aggregate, and all chip in to protect it. That is socialism.
Why is military socialism ‘OK’, and all other socialism ‘bad’? Why does the military get a free pass?
WarResisters is biased, but the NYTimes is not?
The very same NYTimes that believed that there were WMD’s in Iraq. The same NYTimes that consistenty spews Tom Friedmans pro-ireali neo-con agenda…is unbiased.
Why doe the NYTimes get a free pass?
OK, so you make characterisations, but you, yourself, are far from even-handed with their distribution DickF.
If there were any reasonable measure by which the US were underfunding its own defense needs in aggregate.
Well, I suppose one could argue based on historical percentage of GDP devoted to defense spending.
The 4.0% of GDP spent on defense in FY2005 was indeed the highest level since FY1994, but is still significantly below the spending as a percentage of GDP for every year before that going back to World War II. The cuts under the Carter Administration brought it to merely 4.7% of GDP, which then went back up to 5.8% until the end of the Cold War.
But hey, we don’t need math and science anyways.
Do you realize how much NSF funding went up in 2000-2004? Even with the inflation-unadjusted freeze this year, the NSF budget is well ahead of the 1999 budget in inflation-adjusted terms. The NSF budget went up 7% from 1999 to 2000, 13% from FY 2000 to 2001, 8.4% from FY 2001 to 2002, 10.9% from FY 2002 to 2003, 5% from FY 2003 to FY 2004, before then being cut 1.9% from 2004 to 2005, up only 1.8% for 2006, and then frozen for 2007. (All numbers inflation unadjusted.)
That’s a massive increase in the NSF budget over the first term of the Administration, even as the deficit increased. See the NSF budget site here.
I would suggest that the CBO’s historical information and the NSF’s budget site are both interesting to peruse before commenting too much.
Defense spending is clearly up from 1994, but is still definitely below any level entire Cold War, as a percentage of GDP. For the NSF, the budget was increased incredibly much over inflation in FY 2000, ’01, ’02, ’03, and ’04, (7-13% per year before adjusting for inflation). There have indeed been inflation adjusted cuts since then (notably, when the deficit started swelling), but surely the NSF has not been starved.
The military is an extremely small portion of the total budget when you realize that it is the primary purpose of the federal government.
Do you believe this DickF? The extremely small characterization seems a bit out of line with most people’s notion of extremely small.
Let’s assume that 60% (by your counting) were a decent medium sized portion. Then about 100% of all income taxes would go to military spending. If there were anything left, it would go to interest payments. We would have no:
State Dept.
Human and Health Dept.
Treasury Dept.
Interior Dept,
Energy Dept.
Commerce Dept.
Labor Dept.
….
In fact, we would only have a Defense Dept. and SSI.
Boy, a medium-sized defense sure is expensive!
DickF, I just want to make it clear how completely bogus and insipid your comments were, because there are a lot of people who dont’ have the time to check these things that might actually believe what you say. I want to make it clear that only an imbecile would believe what comes out of your keyboard.
Why not compare our military spending to global GDP, after all, we have a military presense in over a 100 countries. Then you all can get that spending down to a fraction of percent.
That’s a massive increase in the NSF budget over the first term of the Administration, even as the deficit increased
So, what’s your point? The Republicans had absolutley no capacity to spend responsibly?
Take a gander at the spending on the Office of the President from 1999 to 2004. Clearly, we have an administration that is not too concerned with costs.
Menzie-
I had to chuckle at the first sentence you quoted from CongressDaily : “The Army is planning significant cuts and other changes in its $160 billion Future Combat Systems program to save $3.3 billion through 2013.”
By my calculations, that’s about 2% of the nominal cost of the program. That’s a big cut?
vorpal certainly makes up in quantity for what his posts lack in quality. Contrast those with the measured, factual posts by DickF and John Thacker.
Keep fighting the logical, correct fight, DF and JT!
Presidential oath, from Article II, Section 1, of the Constitution (http://www.law.cornell.edu/constitution/constitution.articleii.html#section1):
“I do solemnly swear (or affirm) that I will faithfully execute the office of President of the United States, and will to the best of my ability, preserve, protect, and defend the Constitution of the United States.”
Dr. Chinn, I don’t see any language about instituting The People’s preferences.
Preserve. Protect. Defend.
John T.
I said, as you noted, “reasonable.” Historic norms are not necessarily reasonable for current circumstances. Our defense needs cannot be ignored in any measure that I would consider reasonable. I offered a number of comparisons to the spending of potential adversaries, as an example of the sort of benchmark to which we might want to compare our spending, to assess defense needs. I am happy to accept any argument along the lines of “technology is expensive, and we have the most tech-intensive military in the world” but then we still have to accept that technology doesn’t excuse spending many multiples of what our potential adversaries, taken together, spend.
It might also be worth noting that, back in WWII, our adversaries were among the world’s rich nations. Now, the world’s rich nations are our allies. Relying on historic spending averages, when our likely adversaries are relatively poorer now than they were when the high end of the range was established, is all math and no logic.
No, historical percentage of GDP won’t do as “reasonable” without some further reasoning to justify it.
jg: My response to DickF concerned the proper role of the Federal government, not the duties assigned to the President (which for now is only one of three branches of government).
It might also be worth noting that, back in WWII, our adversaries were among the world’s rich nations. Now, the world’s rich nations are our allies.
However, the numbers were not merely WWII numbers, but include from 1962 to 1994.
Arguably China now is richer than the Soviet Union during the Cold War, and spending an increasing amount of money on their military. Certainly they have a much larger total population.
Also, the world’s rich nations spend very little on defense themselves, for being our allies. Indeed, in many cases it just gives us more territory to defend.
In addition, as a wealthy country, we increasingly fight wars as a rich country fights, spending money on equipment and capabilities rather than on cheap cannon fodder. Suicide attacks are almost always cheap in monetary cost. So too are guerrila warfare and indiscriminate warfare aimed at civilians. The V1 rocket in WWII was also cheap per the amount of destruction it caused. However, we place a large amount of priority on avoiding casualties (our own, and civilian), which necessitates higher spending. You cannot simply say that we’re fighting poor countries and leave it at that. We refuse, for moral reasons and because we can, to fight using cheap, unguided weapons that sacrifice innocent civilians, or to use cheaper weapons that would sacrifice our own soldiers for greater “cost effectiveness.”
I believe that of course reasonable people can disagree, though.
So, what’s your point?
My point about the NSF was merely a response to Aaron Krowne, who seems to believe that science and math funding has been starved recently. It has received much larger funding increases over the period than most programs.
I’ll also add that defense spending decreasing as a percentage of GDP is certainly IMO a reasonable argument that we can afford it, which is a slightly different question than whether it is wise. An examination of the budget over the years to me indicates that it is the steadily rising cost of Medicare and Medicaid as a percentage of GDP that is most notable and most impacts the ability to cut taxes or spend on various other programs, not tax cuts, overall spending, or net interest which are all close to historical norms.
vorpal,
Wow, did I strike a nerve!
You have to understand that after two world wars the US has become the world’s policeman and other nations expect it. That is why the UN complains when we do not join their excursions and why we are criticized for not stopping genocide in Rwanda and Darfur.
If the US had a smaller military other nations would have to increase their military spending to protect themselves. I have even heard criticisms that the US has taken the dignity from other countries because they have no military might.
We are living in Pax Americana. That puts a great burden on the US to use military force judiciously. But when we do use military force we must use it decisively so that the conflict is over quickly. This is the primary criticism of the current Iraq conflict. Most do not believe that we hit hard enough to allow a democratic Iraq to rise from the ashes.
Just for the record I agreed with the limited action of the first Gulf War and I now agree with how the conflict in Afghanistan and Iraq has been handled. When the unpartisan eyes of history evaluate this period in the history of the world the conclusion will be much different the rhetoric of the anti-war propaganda.
When history is writ GWB will be amongst the worst and those who supported him called fools.
When history is writ, it will forget that people like you existed DickF. Just like it has forgotten the the anti-abolitionists, the Anti-Suffrage people, the anti-civil rights people. Remember them?
An important war is being fought, it’s just not the war that beguiles you.
Asian economies are winning the economic war and that is the only one that matters. DickF, you are a dinosaur living in the notions of the second half of the 20th century. You are fighting a military war, while the rest of the world is fighting an economic war.
There are several significant diffeences between the current economic conditions now, and those of the post wwII era.
The last item is more important than it looks, because we owe trillions of dollars to foreign entities. They will want goods, not services. If we are not able to produce the goods, then that could lead to a problem.
So when you compare our military spending in terms of GDP, you are comparing two fundamentally ddifferent economic situations.
BTW: I just noted that kharris stated this same fact a few comments ago.
BTW: I don’t see any disputation of the facts I have posted. I only see vague disparaging assertions.
I’ll also add that defense spending decreasing as a percentage of GDP is certainly IMO a reasonable argument that we can afford it, which is a slightly different question than whether it is wise.
Technically, we can afford just about anything. So, what’s your point? Whether a policy is wise, is really the only question before us.
An examination of the budget over the years to me indicates that it is the steadily rising cost of Medicare and Medicaid as a percentage of GDP that is most notable and most impacts the ability to cut taxes or spend on various other programs,
What programs should we spend money on if not Medicare and Medicaid? For what should we sacrifice the health care of millions of Americans?
You could argue that the cost is too high because health care delivery is unnecessarily inefficient. But most people would come to the conclusion, that making health care delivery more efficient (rather than cut health care) would be an appropriate response. (The people that wouldn’t support this notion would be, of course, the people that were reaping the profit of inefficiency.)
not tax cuts, overall spending, or net interest which are all close to historical norms.
True. So now we should ask ourselves, why hasn’t the defense budget changed since, from a military perspecive, historical norms have changed drastically over the past 20 years. Why hasn’t the military budget reflected these changes?
Overkill vorp. Over kill.
No more State of The Union Addresses for you.
Asian economies are winning the economic war and that is the only one that matters.
Singapore and China – vorpal, thank supply side.
US decline – thank a fiat currency and Keynes.
Overkill vorp. Over kill.
No more State of The Union Addresses for you.
I didn’t even watch it. I can’t stand to watch the Chimp-in-Chief talk. Better off reading Doonesbury.
Sad but true 😉