As part of the effort to reduce our $1.4 trillion deficit spending and $14 trillion national debt, the defense spending budget is one piece of the pie that needs to be scrutinized for opportunities to reduce cost. The budgetary and spending problems cannot be blamed on defense spending alone. However, it is one component of the U.S. budget that could play a vital role in restoring fiscal conservativeness and still maintain adequate funding for the military.
According to the Congressional Budget Office, defense spending grew 9% annually on average from fiscal year 2000–2009. The defense spending for 2010 was $694 billion, which was 5.4 percent of gross domestic product (still remaining less than the 7 percent average) and 20 percent of the overall budget. Comparatively speaking, defense spending is the second largest expense after entitlements (entitlements will be addressed in a later blog entry).
So, what can be done to reduce the defense spending without compromising our national security? I believe one significant area of focus for reduction in defense spending is the involvement (operations and personnel) with the wars in Afghanistan, Iraq and the recent development in Libya (as part of NATO support). These types of expenses are requested as part of the overseas contingency operations (OCO) in the defense budget, along with any supplemental cost (cost that is above the normal baseline defense budget for military operations). The OCO budget request for fiscal year 2010 was $129.6 billion (already provided) and $33 billion in supplemental funding. The current OCO request for 2011 is $159.3 billion and a supplemental that is yet to be decided. These costs continue to grow with more involvement in military operations overseas.
Given the death of Osama Bin Laden and the dismantling of the Taliban, Afghanistan and Iraq have attained a measure of stability and forward progression in the establishment of their governments. As a result, it is time for us to determine the next course of action for the best use of our troops. Troop reduction in Afghanistan is the next strategic step and presents a real opportunity to reduce OCO and supplemental cost. Between 2009 and 2011, there was a shift in cost from Iraq to Afghanistan due to the increase in troop levels in Afghanistan. In the fiscal year 2011, the Afghan war costs accounted for 71 percent of war costs and Iraq 29 percent. Thus, establishing a priority in the reduction of the 100,000 troops in Afghanistan will prove to be a worthwhile effort towards reducing the overall defense spending.
With the termination of the combat mission in Iraq as of August 2010, reduction in troop levels in Iraq has proven to reduce cost. Iraq’s current estimated troop level is at 45,000 with further reductions planned (conditions based) till the end of 2011. I agree with some of the lawmakers who are advocating for a reduced troop presence of 20,000 (if necessary). Any reduction in troops will be a direct cost saving.
Another new development for the U.S. troops is a third military operation in Libya. Since the start of U.S. involvement in the Libyan crisis, cost for the operation has totaled more than $664 million by mid-May. By the end of fiscal year 2011, the cost for the intervention is estimated to reach $800 million with more than 4,000 military personnel and 175 aircraft involved. In order to continue this effort, we need to clearly define the rationale, level of commitment, and leverage our allies in NATO to play a greater role in stabilizing Libya.
Although troop reduction will help reduce the defense spending, it is critical for our troops, their families and our veterans to receive the support that is needed in equipment, resources and services. Let’s be clear, our troops well being and effectiveness in the field should never be compromised. Overall, I believe a reduced military operation in terms of time and personnel will be beneficial for all those involved, as well as, a greater cost benefit to the tax payer in an effort to reduce the deficit spending and national debt.