Decoding the Defense Budget

Decoding the Defense Budget by Winslow Wheeler, from The Pentagon Labyrinth, 09 February 2011.


What Is the Defense Budget?

Each year in early February, the Pentagon releases what is invariably called the “defense budget” in press articles. The numbers presented do not address all forms of defense spending; they do not even address all forms of Pentagon spending.

For example, a table included in the Pentagon’s press materials for the 2011 budget shows the “base” (non-Iraq or -Afghanistan war) budget request at $549.8 billion. The materials presented by the Office of Management and Budget (OMB) are more complete. The 2011 budget request for “base” (non-war) Pentagon spending was $554.1 billion. The additional $4.3 billion was for “mandatory” spending (also known as “entitlement” spending) mostly for personnel programs. The number the Pentagon released was for the “discretionary” (new annual appropriations) spending. The difference may be a minor one in this case, but it can be significant; in past years Congress has added scores of billions in new mandatory spending for military healthcare, and retirement and survivors’ benefits.

The more complete exposition of DOD budgets in the OMB materials is not easy to find; it is usually buried in the “Supplemental Materials” to a volume called “Analytical Perspectives” that is released each year the same day the Pentagon releases its version of its budget. Unfortunately, the DOD press corps roundly ignores the more complete OMB materials. To be better informed in future years, track it down.

The same OMB table yields other important information: the additional DOD spending requested for the wars in Iraq and Afghanistan, not just for the budget year but also for succeeding “out-years,” and the non-DOD spending for what OMB calls the “National Defense Budget Function,” which includes nuclear weapons, the Selective Service, the National Defense Stockpile of minerals and commodities, and more. The total for 2011 comes to $738.7 billion in “total” (discretionary plus mandatory) spending.

The same table also yields the budget amounts for the departments of Homeland (domestic) Security, State (for economic and weapons aid and other national security programs) and Veterans Affairs (for what might be called the human cost of wars). Each is clearly related to national security or “defense,” writ broadly. Finally, if you know where to look near the bottom of this long OMB table, you can find some additional spending in the Treasury Department for military retirement and healthcare, and finally the data needed to make a calculation of how much of the 2011 payment for interest on the national debt can fairly be attributed to the Pentagon.

The results of this more complete compilation of the president’s 2011 budget request for “defense” is summarized in Table 1 below.

Table 1: Defense Related Budget Requests for 2011.
(President’s 2011 Budget Request – in $ billions)

    “Base” DOD Budget (Discretionary only) 548.9

    DOD (Mandatory only) 4.3

    DOD War Spending 159.1

    DOD Total 712.3

    DOE (Defense) 18.8

    Miscellaneous Defense-Related Agencies 7.6

    National Defense Budget Function Total 738.7

    Homeland Security (DHS) 43.6

    Veterans Affairs (DVA) 122.0

    International Affairs 65.3

    Treasury Dept. Military Retirement Payments 25.9

    Interest on DOD Retiree Health Care Fund 5.7

    19% of Interest on Debt (DOD Proportional Share) 47.7

    Grand Total $1,048,900,000,000.

The next time someone tries to tell you that the numbers DOD throws at you in its press releases are what you should use to understand monies spent for national security, give him a polite smile; then, go to that obscure table in the Supplementary Materials in OMB’s “Analytical Perspectives.” It is published online the same day as the Pentagon press release. A few minutes of checking can give you a more complete understanding than what the press will report.

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