For Some, $48-Billion Defense Boost Is a Bust

When Pentagon comptroller Dov Zakheim was finished telling the financial managers of the armed services that President Bush was seeking the largest increase in Pentagon spending since 1967, one of them couldn’t resist suggesting it wasn’t enough.

“Do you want to see our unfunded list?” he asked, according to a senior defense official who attended the meeting.

Pentagon financiers are notoriously hard to please. But many are concerned that the whopping $48-billion increase will be so swallowed up by pay raises and other measures that the military won’t even be able to replace planes, tanks and other equipment as quickly as it wears out.

Bush said Tuesday in his State of the Union address that the additional funding would help replace the nation’s “aging aircraft” with the pilotless aircraft and the futuristic gadgetry of the war on terrorism. But the procurement budget, the portion that funds new equipment, will get just $8 billion of the $48-billion budget increase, according to military strategists with knowledge of the budget that Defense Secretary Donald H. Rumsfeld plans to outline Monday.

That brings spending on new weapons to $68 billion--far short of the $103 billion the Pentagon says it needs to replace equipment that wears out each year, according to a July internal study for the Joint Chiefs of Staff.

Although critics suggest that figure is based on flawed and outdated assumptions, military strategists contend that, even after the Bush buildup, future frontiers in the global battle against terrorism are likely to continue featuring Eisenhower-era B-52s dropping 21st century “smart” bombs, and helicopters from the 1960s depositing elite soldiers equipped with lasers and night-vision goggles.

“The Marine Corps is flying a lot of Vietnam-era helicopters. So is the Army. Neither of those services have asked much in terms of aircraft modernization. They didn’t ask for much because they knew they weren’t going to get it,” said Loren Thompson, a military analyst at the Lexington Institute, a conservative think tank based in Arlington, Va. “Their expectations have been so consistently confounded that now they only ask for what they need in the short term.”

The math goes something like this: The proposed budget would take Pentagon spending from about $331 billion a year to $379 billion, about a 14% increase. Of that added $48 billion, Bush is asking for $10 billion to be set aside for a war contingency fund to cover the cost of battling terrorism in Afghanistan--or Somalia, Yemen, Iraq and other potential fronts.

That leaves $38 billion. Military analysts estimate that two-thirds of that will be needed to cover rising costs in “consumption” accounts such as military pay raises of about 4%, increased health care and housing benefits, daily operations and maintenance. That would leave about $13 billion for additional investments, of which $8 billion goes to procurement and the rest for research and development.

The study for the Joint Chiefs found that the Pentagon has been replacing 282 tanks annually compared with 1,629 needed to replace those that wear out; 24 helicopters compared with 176 to hold current levels; 42 tactical aircraft compared with 71 needed; and 228 missiles compared with 419.

Just what it would take to make up the gap is a matter of ongoing debate. The Congressional Budget Office put the figure at $91 billion. The private Center for Strategic and International Studies came up with $123 billion.

“The experience in Afghanistan showed the effectiveness of unmanned aircraft. But it also revealed how few we have and what their weaknesses are,” Rumsfeld said Thursday at the National Defense University in Washington. “The department has known for some time that it does not have enough manned reconnaissance and surveillance aircraft, command-and-control aircraft, air defense capabilities, chemical and biological defense units, as well as certain types of special operations forces.”

Put into perspective, the Bush defense buildup for 2003 still would leave military spending at a lower level than during all major conflicts from World War II to the early 1990s. In constant 2002 dollars, the nation spent $561 billion in 1946 after World War II; $461 billion during the Korean conflict in 1953; $449 billion in 1968 at the peak of the Vietnam War; and $428 billion in 1987, the peak of President Reagan’s buildup, according to inflation-adjusted figures compiled by the nonpartisan Center for Strategic and Budgetary Assessments.

Some budget watchers scoff at the suggestion that a 14% increase in the Pentagon budget is insufficient to replace aging equipment, saying that claim relies on seriously flawed assumptions. First, they argue, it doesn’t make sense to maintain current levels. Modern warfare no longer requires the number of tanks used during World War II.

Second, they say, those studies assume that new planes and tanks would be replaced on a 1-to-1 ratio with updated equipment. But one of the selling points of new planes is that you need fewer of them. Advocates of the F-22, for example, say each copy can do the work of perhaps two F-15s, which it is slated to replace.

“If all of the systems are more advanced and more capable, we must need fewer of them,” said Cindy Williams, former assistant director for national security at the Congressional Budget Office, who now is a defense analyst at the Massachusetts Institute of Technology.

If Bush continues the defense buildup as expected, he can make up any existing gap, said Michael Vickers, a defense analyst with the Center for Strategic and Budgetary Assessments. Vickers expects the Pentagon to release a five-year plan that brings procurement into that range. “I think they’re well on the way.”

Some analysts contend that Pentagon strategists unnecessarily inflate costs by buying new equipment without making hard choices that could save them money.

“The Joint Chiefs of Staff number sounds like Christmas in July: ‘If we could have everything we wanted,’ ” said John Isaacs of the Council for a Livable World. “If they are arguing that they still don’t have enough procurement money, it might mean they do have to make some choices in the procurement program.”

Rumsfeld has said his Pentagon will make those hard decisions.

“While transformation [of the military] requires building new capabilities and expanding our arsenal, it also means reducing stocks of weapons that are no longer necessary for the defense of our country,” Rumsfeld said. “Just as we no longer need a massive, heavy force designed to repel a Soviet tank invasion, we also no longer need many thousands of offensive nuclear warheads we amassed during the Cold War to deter a Soviet nuclear attack.”

He has portrayed the 2003 budget proposal as a first step toward one of his top priorities: a departmentwide transformation of the nation’s military machine. The budget plan includes money for precision-guided bombs, pilotless surveillance and bomber jets, and technology of the type that special operations soldiers have used in Afghanistan to direct warplanes to their targets. Future steps would free up money by closing superfluous military bases and dumping aging planes and ships that drive up maintenance costs, in favor of more agile, advanced craft.

“The way the Department of Defense runs, the budgeting system, the planning system, is broken,” Rumsfeld said. “It is not serving the department or the country well. And yet it is inexorable. It just rolls along, like the freight train coming from San Francisco with the wrong things for New York.”