US House Committee presents defense bill of $696.5 billion

(June 27) The House Armed Services Committee has unveiled a new military spending bill of $696.5 billion just a few days after chair Marc Thornberry announced that there was to be a bill of $640 billion.

This new bill is actually supposed to be a cut from the previous bill. The new bill includes $75 billion in funds for Overseas Contingency Operations(OCO) that would have had to be added to the earlier bill. The argument is that the new bill is actually just $621.5 billion. It would have been clearer if it had just been explained that the earlier bill needed to increased by adding in more money for the OCO. The OCO spending is real enough.

President Trump had proposed spending $603 billion before OCO expenditures were figured in, lower than the Armed Services Committee proposes. President Trump was bragging he was the most pro-military president. Yet many Congressmen complained that even more funds were needed and this is reflected in the $696.5 billion now being requested. There will probably be even more amendments to the bill before it is finally passed through Congress adding even more to the total amount.

According to the sequestration amounts the cap on spending should be $549 billion but lawmakers are adept at circumventing the sequestration rules meant to cap overall government spending when they apply to the military. Thornberry has cited sequestration as a reason for why military spending needs to be so large at present. In the past though when caps have been reached often "emergency" spending bills have been introduced helping to mitigate the effects of sequestration and bring military spending above the caps.

The bill would add 17,000 soldiers to the Army, more than requested in Trump's budget request. There would be 10,000 for active duty, 4,000 for the Army National Guard, and 3,000 for reserve. The bill sets a 2.4 percent pay raise as compared to just 2.1 percent requested by the Trump administration.

The bill also provides the US Navy five more ships than Trump had requested including one destroyer, two Littoral Combat ships, one amphibious dock landing ship, and one Expeditionary Support Base. The bill also adds to the 289 aircraft requested by the administration, including 17 more F-35s, 8 more F/A-18s. In all, there would be 87 more aircraft then requested.

The bill also adds $2.5 billion more for missile defense expenses beyond the $9.9 billion asked by the Trump administration. The extra money is to be spent on research, development, and procurement. Congress appears to be more hawkish on military spending than the Trump administration.

In last thirteen years US has spent $1.6 trillion on war-making.

In the 13 years since the September 11 attacks, the Congressional Research Office (CRS) estimates that the U.S. has spent $1.6 trillion on making war. The total is to the end of September 2014 the end of the fiscal year for the US government.

The expenses include the following: ".. the cost of military operations, the training of security forces in Afghanistan and Iraq, weapons maintenance, base support, reconstruction, embassy maintenance, foreign aid, and veterans' medical care, as well as war-related intelligence operations not tracked by the Pentagon. " While the withdrawal of combat troops from Iraq and now most from Afghanistan have reduced expenses, funding continues at very high levels in spite of across-the-board spending cuts in March of 2013. The sequestration cuts came from the Defense Department's regular peace-time budget.

 There is a separate budget for Overseas Contingency Operations (OCO) the new-fangled name adopted for the now out-of-fashion Global War on Terror: A March 2011 Congressional report[186] estimated spending related to the war through fiscal year 2011 at $1.2 trillion, and that spending through 2021 assuming a reduction to 45,000 troops would be $1.8 trillion. A June 2011 academic report[186] covering additional areas of spending related to the war estimated it through 2011 at $2.7 trillion, and long term spending at $5.4 trillion including interest. In the budget for 2015 the US Congress actually gave more for war-making activities than was requested by the Obama administration: "The Administration's FY 2015 request of $71.4 billion should have set the bar for war spending, and appropriators even cut more than $4 billion from two initiatives in the request. Instead of using this $67 billion total, lawmakers increased war spending to $73.7 billion, nearly $7 billion above what otherwise would have been the case." The Congress is even more reluctant to cut military spending than the Obama administration.

 The CRS estimate of costs does not include the costs of medical care for veterans who are disabled, and some other costs. Neta Crawford, of Boston University, puts the potential costs of both the Iraq and Afghanistan wars plus assistance to Pakistan since 2001 at $4.4 trillion. This includes $316 billion in interest costs plus another $1 trillion in costs for veteran's care through 2054. The appended video shows the cost per day, hour, and even minute. Crawford's paper on the costs can be found here.

The Pentagon's limitless slush fund

The Pentagon has issued warnings that with recent cuts it is facing a money crunch made much worse by the new missions in Iraq and Syria.

As a way of saving money the Pentagon does not suggest scaling back on overseas intervention. Instead the military has suggested that military wages should be limited to raises of one per cent and health care coverage should be overhauled. The cost of living adjustments for military retirees will be cut below the level of inflation. The Center for Strategic and Budgetary Assessments(CSBA) in Washington DC estimates that the defense budget could face as much as $300 billion in mandatory budget cuts soon. However, the Pentagon has a way around that problem. The Overseas Contingency Operations(OCO) account serves as a credit card with no limits as apply on consumer credit cards.Todd Harrison, a senior fellow at the CSBA notes: “There is currently no limit on OCO, so there is as much room as they need."
 The operations are mostly part of the war on terror. However, "the war on terror" has been branded as politically incorrect some time ago so now there are just overseas contingency operations. The change was initiated in March of 2009: In a memo e-mailed this week to Pentagon staff members, the Defense Department's office of security review noted that "this administration prefers to avoid using the term 'Long War' or 'Global War on Terror' [GWOT.] Please use 'Overseas Contingency Operation.' "
 The OCO account is separate from the base defense budget and is exempt from spending reductions under Budget Sequestration set to remain in place until 2021 under the sequestration laws. Even with sequestration cuts the 2014 military budget that was originally to be capped at $498.1 billion is now at over $520 billion. This does not include $80 billion additional spent in Afghanistan. Military spending will increase by $22 billion in 2014 and $31.7 over the next years. Of course none of this includes that OCO credit card debt.
 Even some Democrats have described the OCO as simply a slush fund. For example, Representative Barbara Lee a Democrat of California said: "The Overseas Contingency Operations is slush fund. It's a gimmick to avoid the budget cuts that are punishing other critical areas of the budget like education and health. Fundamentally, it is a black box of unchecked federal spending that needs to be eliminated. All DOD programs should be funded from the base-budget which is more than sufficient." Recently, Congress passed a bill that will fund the government through December 11th this year. As part of the legislation the lawmakers put $85 billion in the OCO for the 2015 year. This was $26 billion more than Obama had asked for. The slush fund obviously requires a lot of slush.
 Fighting the Islamic State is costing up to $10 million a day according to the Pentagon. A recent estimate puts the cost at as much as $8.6 billion a year. The CSBA estimates the yearly cost at a lower $2.4 to $3.8 a year but only at the current level of air strikes. Although Obama continues to claim that there will be no boots on the ground in Iraq, there are already 1600 advisers in Iraq. Gordon Adams an analyst with the Stimson Center claims that the Congress will "almost certainly" fund the fight against the Islamic State using money in the OCO.
 While the US taxpayer will ultimately be forced to pay the bill for all these extra expenditures, US arms manufacturers stand to make windfall profits as shown by the recent increase in their stock prices as reported in this article. The recent bombing in Iraq provides a good example of creative destruction that will provide a great stimulus for the military-industrial complex: Ironically, dozens of the U.S. airstrikes have targeted American-made Humvees, mine-resistant ambush-protected vehicles and other armored vehicles that Islamic State fighters captured as they overran Iraqi military bases and airfields during their blitz across northern Iraq this year. The new government in Baghdad is scrambling to rebuild its battered army and will need to buy replacement vehicles.