[Peace-discuss] Obama's War Budget

[C. G. Estabrook]

[The budget makes it clear that, far from reversing the last administration's 
war policy, this administration is continuing and expanding it. It's an 
indication of how moribund the anti-war movement is that there's no concerted 
national attempt to defeat this budget. --CGE]

	President Obama's War Budget: Analyzing the Numbers
	By Jeff Leys
	May 4, 2009

President Obama’s 2009 supplemental spending request to fund the wars in Iraq 
and Afghanistan is currently before Congress. The House Appropriations Committee 
will “mark up” (finalize its version) of a war funding bill at a committee 
hearing on May 7th. The full House will likely vote on the bill the following 
week. The objective is to have the bill finalized and to Obama for signature by 
Memorial Day.

President Obama is seeking an additional $75.8 billion in war funds for this 
fiscal year. It is possible that Congress will add to this amount before final 
passage. If Congress enacts Obama’s request, total war spending will come to 
$144.6 billion for Fiscal Year 2009 (which ends on September 30, with Fiscal 
Year 2010 beginning on October 1). This compares to the $186 billion war 
spending in 2008. Obama’s proposed war budget for 2010 is $130 billion.

At first glance, it is easy to conclude that the proposed 22 percent reduction 
in war spending from 2008 to 2009 represents a significant shift in war strategy 
and is indicative of a drawing down of the twin wars in Iraq and Afghanistan. 
Sadly, such a conclusion would be wrong.

What follows is a discussion of the three main components of the war budget: 
Personnel costs; Operation & Maintenance costs; and Procurement costs. This 
discussion is based upon data and material produced by the Department of Defense 
Comptroller; the Congressional Research Service; the budget justification 
materials of the branches of the military; and the Fiscal Year 2009 Bridge Fund 
appropriations passed by Congress last June. (Please see the end of this article 
for the source material used in preparing this analysis).

This discussion includes total war funding for 2009, including both that amount 
appropriated by the Democrat-controlled Congress last June and the amount being 
requested by Obama in the currently pending supplemental spending request. It 
should be noted that the war funds approved by Congress last year were contained 
in the bill crafted by the Democratic Party leadership.

It should also be noted that while funding levels are reduced from 2008 to 2009, 
in each of the three categories, President Obama is in fact seeking new funding 
to the tune of $75.8 billion. That said, Personnel costs are reduced by $1.7 
billion in 2009. Operation & Maintenance costs are reduced by $1.9 billion. 
Procurement costs are reduced by $37 billion. Even so, a closer look at the 
numbers behind the numbers reveals that the reductions are not as significant as 
they may appear to be at first glance.

PERSONNEL COSTS:

Personnel costs will decline by $1.8 billion in 2009. The Army, Air Force, and 
Marine Corps will all reduce personnel costs. A portion of these cost reductions 
will be offset by small increases in Personnel costs for the Navy as well as for 
the Marine Corps Reserve and for the Reserve and National Guard components of 
the Army and Air Force.

The Army’s personnel costs will drop by $2 billion, declining from $13 billion 
in 2008 to $11 billion in 2009. While this is a 15 percent decline, it also 
illustrates that all is not as it seems when reviewing top line budget numbers.

Two significant factors account for nearly all the reduction in the Army’s 
personnel costs, neither of which is related to the Iraq and Afghanistan war 
effort. “Active Overstrength” costs are reduced by $1.4 billion and “Recruiting 
and Retention” costs are reduced by $0.8 billion.

“Active Overstrength” refers to the number of soldiers in the Army 
over-and-above the number provided for by Congress in the regular baseline 
Department of Defense budget. In 2008, Active Overstrength consisted of 43,632 
soldiers. This declines to 15,658 soldiers in 2009. All this means—and all the 
$1.4 billion reduction in associated costs means—is that the soldiers’ pay of 
27,974 soldiers is now included in the baseline budget of the Army rather than 
being included in the supplemental spending bills.

Meanwhile, personnel costs for the Army Reserve and Army National Guard increase 
by $1.1 billion in 2009, reflecting the increased number of Reserve and Guard 
units being deployed to one of the two wars.

The Army’s reduction in “Recruitment and Retention” costs is perhaps best 
explained by the current economic depression and the lack of other job 
opportunities.

OPERATION & MAINTENANCE

Operation & Maintenance funds decline by $1.9 billion in 2009 (down to $91.6 
billion compared to $93.5 billion in 2008). This category contains funds for 
U.S. military operations. It also contains funds for the training and 
development of the military and police forces in Iraq and Afghanistan. As fate 
should have it, it’s a decline in funding for Iraq’s military and police forces 
that results in the cost reduction in 2009.

Of the U.S. military services, only the Air Force receives a slight increase in 
Operation & Maintenance funding this year, increasing by $0.5 billion. The 
Army’s O&M budget is reduced by $1 billion; the Army National Guard by $0.5 
billion; the Navy by $0.8 billion; and the Marine Corps by $0.1 billion. The Air 
Force Reserve and Air National Guard together will receive $0.4 billion less in 
O & M funds (thus offsetting the slight increase in the Air Force budget).

Notably, funding for “Operation and Maintenance – Defense Wide” increases by 
$2.5 billion in 2009 (up to $8.3 billion from the $5.8 billion n 2008). Funding 
for the US Special Operations Command (SOCOM) is included in this category, as 
is funding for the Defense Security Cooperation Agency (DSCA). If Obama’s 
supplemental spending request is approved by Congress, total funding for SOCOM 
will be $2.4 billion in 2009 and for the DSCA, $1.7 billion.

Overall, the Operation & Maintenance funding for U.S. military forces comes out 
essentially the same this year—$84.2 billion in 2009 compared to $84 billion in 
2008.

The cost savings in the overall Operation & Maintenance budget is to be found in 
those funds designated for the development and training of Iraq’s military and 
police forces. President Obama seeks no additional funds for the Iraq Security 
Forces Fund and only an additional $415 million for the Iraq Freedom Fund. In 
2009, funding for the Iraq Security Forces Fund is cut by $2 billion and for the 
Iraq Freedom Fund by $3.4 billion—for a total cut in funding of $5.4 billion.

Resources are shifted to the Afghanistan Security Forces Fund, which will be 
increased by $2.9 billion (to a total of $5.6 billion in 2009). An entirely new 
Pakistan Counterinsurgency Capability Fund is created with Obama’s supplemental 
and will initially be funded with $400 million for this fiscal year (which 
notably ends on September 30). Spending on the Afghanistan Security Forces Fund 
and the Pakistan Counterinsurgency Capability Fund account for a $3.3 billion 
increase in war funds.

So what is left after all of the cost shifts discussed above? The U.S. will 
spend $84.2 billion on the Operation & Maintenance budget of its own military in 
2009—essentially the same as the $84 billion spent in 2008. This compares to the 
$75 billion spent in 2007; the $60 billion spent in 2006; and the $48 billion 
spent in 2005. The Operation and Maintenance numbers in Obama’s war budget do 
not provide significant evidence of a significant shift in the overall strategy 
for the wars in Iraq and Afghanistan.

PROCUREMENT

Procurement funding drops by $36.9 billion in 2009—from $64.9 billion in 2008 to 
$28 billion in 2009. Yet it would be inaccurate to conclude that this 57 percent 
reduction in procurement funding represents a truly significant shift in funding 
for the Iraq and Afghanistan wars. The $28 billion funding level still remains 
well above the $22.9 billion appropriated in 2006 and the $18 billion 
appropriated in 2005. Indeed, of the $28 billion in total 2009 funding, $21.9 
billion is contained within the supplemental spending request submitted by 
Obama—in and of itself still above funding levels in 2005 and on a par with 2006.

Significantly, the year 2006 provides one explanation for the reduction in 
procurement funds in 2009 when compared to 2008 and 2007. In October 2006, 
Deputy Secretary of Defense Gordon England greatly expanded the parameters on 
the type of procurement spending that could be included in emergency 
supplemental spending requests. Prior to October 2006, the DOD financial 
regulations aimed to limit requests for supplemental spending requests to only 
cover the incremental costs of the two wars. In simple form, this meant that if 
a Stryker fighting vehicle is destroyed in Iraq then the Army could request a 
new Stryker as a replacement. The Air Force could replace Joint Direct Attack 
Munitions expended in the Iraq and Afghanistan wars. Used ammunition could be 
replenished. Yet even with this limitation in place, the Congressional Research 
Service and others questioned whether many of the items acquired by the military 
through the supplemental process were indeed incremental costs of war to replace 
lost equipment – or whether at least some portion of the procurement monies was 
being used to upgrade existing equipment previously scheduled for upgrade, to 
acquire new equipment for the new modular structure of the Army, and to buy next 
generation weapons systems (each of which should have been funded through the 
regular baseline Department of Defense budget).

In October 2006, England directed the military to submit spending requests to 
not only cover the incremental costs of the wars in Iraq and Afghanistan, but 
also to include any new costs attributed to the so-called “long war on terror”.

Procurement appropriations exploded, jumping from $22.9 billion in 2006 (the 
fiscal year immediately prior to England’s directive) to $45.4 billion in 2007 
(the first fiscal year under the new directive), and then to $64.9 billion in 2008.

Thus, it is likely that the reduction in Procurement monies to be appropriated 
in 2009 simply reflects a reversal of England’s directive, with a shift back to 
a more normative budgetary process which seeks to limit new “emergency” 
procurement requests to those incremental costs directly related to the wars in 
Iraq and Afghanistan, rather than being reflective of significant shifts in the 
direction of the overall war strategy.

It is also possible that the reduction in procurement monies in 2009 reflects 
that previously appropriated procurement funds still remain available to be 
spent. Normally when Congress appropriates funds, those funds must be spent in 
that fiscal year or be lost. However, procurement monies remain available to be 
spent for up to three years after being appropriated by Congress. This often 
results in procurement funds being carried over from one fiscal year to the 
next. According to the Congressional Research Service, as of October 1, 2007, 
the Department of Defense carried over $45 billion in war justified procurement 
appropriations into the new fiscal year.

The sharp reduction in procurement funds in 2009 may also be a result of the 
prior front-loading of procurement requests by the military. That is to say, in 
2007 and 2008 the Department of Defense may well have requested surplus 
procurement funds as a buffer against future reductions in procurement funds. 
The Congressional Research Service notes that: “The FY 2007 and FY 2008 war 
requests both appear to include an extra year of Army and Marine Corps reset 
requirements. According to statements by Army Chief of Staff, General Peter J. 
Shoomaker and other military spokesman, Army reset is estimated to be $12 
billion to $13 billion a year as long as the conflict lasts at the current level 
and ‘for a minimum of two to three years beyond’”.

With the passage of Obama’s war supplemental, the Army will be slated to receive 
a total of $13.5 billion in procurement funds in 2009—essentially what General 
Shoomaker projected. So again, the question arises: does President Obama’s war 
budget for 2009 reflect a potentially significant shift in war strategy or does 
it merely reflect a return to a more normative budget pattern?

Last, as regards procurement, it ought to be noted that fully one-third of the 
reduction in 2009 Procurement funds will be the result of a $12.4 billion 
reduction in funding for the Mine Resistant Ambush Protected (MRAP) vehicles. In 
2008, Congress appropriated $16.8 billion to rapidly acquire and deploy MRAPs 
for use in Iraq. In 2009, the $4.4 billion is included in total spending for a 
new version of MRAPs to be designed and produced for use in the different 
terrain and environment of Afghanistan.

THE AFGHANISTAN – PAKISTAN WAR

Obama’s 2009 war budget sheds light on the expansion of the war in Afghanistan 
and Pakistan. While overly broad conclusions perhaps should not be drawn from 
the available data, the trends are indeed troubling.

In its summary “Fiscal Year 2009 Supplemental Request” the Department of Defense 
states that funding for the Afghanistan war will increase to $46.9 billion in 
2009, a 31 percent increase over the $35.9 billion in 2008 and the $32.6 billion 
in 2007.

This $11.3 billion increase includes an additional $2.8 billion for the 
Afghanistan Security Forces Fund; $400 million for the Pakistan 
Counterinsurgency Capability Fund; and $4.4 billion for MRAPs designed for use 
in Afghanistan. Increased troop levels will also account for a portion of the 
increase.

Military construction projects in Afghanistan are expanded under Obama’s war 
budget. In the 2009 supplemental now before Congress, Obama seeks an additional 
$620 million to fund Army construction projects and $240 million to fund Air 
Force construction projects. The Army projects include construction and upgrade 
of air facilities at various bases to accommodate the CH-47 Chinook helicopters 
and to construct additional troop housing to accommodate the increased troop levels.

The supplemental spending request also points towards the increased use of the 
MQ – 1 Predator and the MQ-9 Reaper drones in the war. Obama seeks $57.4 million 
to acquire 742 Predator Hellfire missiles and $196 million for ten new MQ-9 Reapers.

Funding is included to upgrade the MQ-1 and MQ-9 systems in order that a second 
remote split operations site can be established to control the drones. This 
second site is necessary since the current site is reaching its operational 
capacity for the control of the increasing drone flights. As noted in the 
justification materials submitted by the Air Force: “Both Predator and MQ-9 
Reaper conduct their missions through ‘Remote Split Operations’ whereby a 
minimum number of operators and maintenance personnel are deployed forward for 
launch and recovery of the aircraft. After launch, the aircraft is ‘handed-off’ 
to CONUS-based mission crews for actual mission prosecution. For this mode of 
operations, the command and control and full motion video (FMV) is currently 
relayed through a single forward communications site. This site is nearing 
capacity with the current increase in Predator operational tempo…This project 
procures satellite terminals and video dissemination equipment to establish a 
second remote split operations relay site.”

WHAT THE FUTURE MAY HOLD

President Obama is seeking $130 billion to fund the Iraq and Afghanistan wars in 
his budget request for 2010. This is a mere $14 billion less than overall 
funding in 2009. It won’t be possible to determine the direction Obama seeks to 
take war funding until the Department of Defense releases its justification 
materials to lay out how this $130 billion will be spent.

Yet the reality that Obama’s Fiscal Year 2010 request is only $14 billion less 
than the 2009 war budget is not at all encouraging. Quite likely some minor 
reductions will take place in the Personnel costs of the budget, as the 
remaining Army Overstrength numbers are absorbed into the baseline military 
budget and as, perhaps, fewer National Guard and Reserve units are deployed to 
Iraq and Afghanistan. Perhaps some small reductions will take place within the 
Operation & Maintenance budget as brigade combat teams are withdrawn from Iraq, 
though savings may well be eaten up by increases in the O & M costs in 
Afghanistan as a troop buildup continues and military operations potentially 
intensify. Procurement costs may be slightly reduced, though that may simply 
indicate a shift of procurement funds into the baseline military budget of the 
Department of Defense.

All of which is to say that our work to end the wars in Iraq and Afghanistan is 
really only just beginning anew. We should not allow ourselves to be deceived 
into believing that a shift in war strategy and policy is underway simply 
because of a reduction in appropriations for the war. The top dollar line is 
itself deceiving.

SOURCE MATERIAL:

“The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 
9/11” (Updated October 15, 2008), Congressional Research Service. By Amy Belasco 
(Specialist in U.S. Defense Policy and Budget Foreign Affairs, Defense, and 
Trade Division). Available at: http://www.fas.org/sgp/crs/natsec/RL33110.pdf

U.S. Department of Defense. Fiscal Year 2009 Supplemental Request. Summary 
Justification Material. April 2009. Available at: 
http://www.defenselink.mil/comptroller/defbudget/fy2009/Supplemental/FY2009SupplementalRequest/pdfs/FY2009SupplementalRequest04-08-09.pdf

Office of the Secretary of Defense. “Fiscal Year (FY) 2009 Supplemental Request. 
Exhibits for FY 2009. Military Personnel. Operation and Maintenance. 
Procurement. Research, Development, Test and Evaluation. Military Construction. 
Revolving and Management Funds” (April 2009). Available at: 
http://www.defenselink.mil/comptroller/Budget2009.html

Fiscal Year 2009 Justification Materials produced by each branch of the military 
are available on-line at:

Army, http://www.asafm.army.mil/budget/fybm/fybm.asp#sup

Air Force, http://www.saffm.hq.af.mil/budget/

Navy and Marine Corps, 
http://www.finance.hq.navy.mil/fmb/09pres/supplemental/FY2009OverseasConOpsSup.pdf

Public Law 110-252 - June 30, 2008. Available at: 
http://thomas.loc.gov/cgi-bin/toGPObss/http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=110congpublic_laws&docid=f:publ252.110.pdf
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