Ouch: An Undisciplined Defense: Understanding the $2 Trillion Surge in US Defense Spending

[unhappycamper]

An Undisciplined Defense: Understanding the $2 Trillion Surge in US Defense Spending
Carl Conetta

The rise in US defense spending since 1998 has no precedent in all the years since the Korean war. It most readily compares with two earlier, but lesser spending surges: the 1958-1968 surge of 43% and the 1975-1985 surge of 57%. The post-Cold War retrenchment of the US military reached its limit in 1998 with DoD’s budget settling at an ebb point of $361.5 billion (2010 USD). If we treat the 1998 budget level as a “baseline” and project it forward to 2010 (adjusting for inflation), we find that the total amount of funds that have been given to DoD above this level during the years 1999-2010 is $2.15 trillion (in 2010 dollars). This figure constitutes what we call the post-1998 spending surge. (All told, DoD budget authority for the period was $6.5 trillion in 2010 dollars).

The rebound in annual defense spending reached its recent peak in 2008: $696.5 billion (2010 USD) – which is 92.7% above the 1998 level. The portion unrelated to contingency operations (the so-called “base” budget) was $503 billion that year – which is 41% higher in real terms than in 1998. Total DoD budget authority receded slightly in 2009 and 2010. But it now seems likely that 2011 will set a new high – somewhat over $700 billion in DoD’s authority to spend. Looking forward, the Obama administration’s 2010 budget plan allocates an average of $545 billion (2010 USD) per year to the DoD base budget for 2011-2017. In addition, it set aside a “place keeper” sum of $50 billion per year for military operations, recognizing that actual war costs will vary. (And , indeed, the Pentagon already is expected to request at least $163 billion for contingency operations in 2011.)

Whether one looks at the total DoD budget, or just that portion not attributable to today’s wars, US defense spending is now stabilizing at levels significantly above Cold War peaks (adjusted for inflation) and far above the Cold War average, in real terms. Measured in 2010 dollars, average DoD budget authority was:

# $423 billion for the period 1954-2001;
# $517 billion for the Reagan years; and,
# $495 billion for the Vietnam War “high tide” years 1966-1970.



unhappycamper comment: This is why we have no money for social programs.