November 23, 2014

Poorly Designed Defense Caps Could Pose Problems

  • Defense spending accounts for roughly half of the portion of the budget referred to as discretionary spending, which is determined through the annual...

The Pentagon is warning that budget caps scheduled to take effect after next year could mean cuts to readiness, modernization and force structure that would increase national security risks.

The future spending caps are based on sequestration-level funding. After next year, military leaders say in a new report, the caps would require cutting $115 billion from their 5-year budget plans by 2019, with $66 billion coming from procurement and research and development.

Those cuts could be even larger if Congress again rejects Pentagon efforts to save money through reasonable changes in compensation.

Possible cuts outlined in the report would mean a larger maintenance backlog, fewer new vehicles, ships and aircraft, and less funding than what military leaders consider adequate for readiness and training.

All federal departments must manage limited resources in the coming years, and difficult cuts will have to be made. But this Pentagon report is a reminder that unrealistically low caps and indiscriminate cuts are not the best approach.

Uncertainty over whether Congress will actually allow the low caps to take effect also makes it difficult for managers to plan ahead and use tax dollars wisely.

That's why Congress should replace the sequestration-level caps now scheduled for 2016 and beyond with comprehensive fiscal reform, including better targeted spending cuts where they are appropriate.