THE BLOG
01/21/2015 03:53 pm ET Updated Mar 23, 2015

The State of the Pentagon Budget Is Uncertain

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President Obama spoke about a lot of things in his hour-and-10-minute State of the Union address last night, but there's one thing he didn't mention: the caps on Pentagon spending required by the Budget Control Act of 2011. The president's claim that "the state of the union is sound" may or may not be accurate, but the state of the Pentagon budget is uncertain.

John Bennett of Defense News found the absence of a reference to the sequester in Obama's speech to be a potentially important omen for this year's budget battle:

The commander-in-chief made no mention of striking a fiscal deal that would nix or lessen the remaining across-the-board defense -- or domestic -- budget cuts, a potential sign the White House has given up hopes of such a deal with congressional Republicans.

Republicans like Rep. Michael Turner (R-Ohio) and Senate Armed Services Committee chair Sen. John McCain (R-Arizona) were quick to criticize the president's silence on sequester. Turner complained that given the urgent need to end the budget caps, he expected the president to propose a plan to lift them, but instead "he ignored the issue of sequestration altogether."

What Turner and his Republican cohorts failed to explain is what deal Obama could offer on the sequester that they would accept.

The negative reaction of most Republicans to the president's proposal to increase tax revenues from the wealthiest Americans suggests that revenue increases would be a non-starter for any deal to lift the budget caps.

On the other side of the aisle, the White House and most congressional Democrats oppose scaling back entitlement programs like Social Security, Medicare and Medicaid.

In addition, there are strong currents in both parties that support continuing deficit reduction, indicating that putting additional Pentagon spending on our great national credit card is not an option.

As for trying to steal from domestic discretionary programs to increase the Pentagon budget, the Department of Defense already claims 57 cents out of every dollar of discretionary spending. And there are a number of new domestic programs President Obama wants to launch, most notably a plan to make community college free for every American interested in enrolling.

All of the above suggests that the chances of a comprehensive deal to lift the budget caps are small. Perhaps a partial deal like the December 2013 agreement forged by Sen. Patty Murray (D-Washington) and Rep. Paul Ryan (R-Wisconsin) could be reached, but even if that happens, the Pentagon will have to make some real choices to bring their overly ambitious spending plans into line with budgetary reality.

But there are two developments that indicate that spending discipline at the Pentagon is by no means guaranteed. The first is the war budget, known in Washington as the Overseas Contingency Operations (OCO) account. It is not subject to the budget caps, so it has become a slush fund used to pay for all manner of Pentagon activities that have nothing to do with current conflicts. This year's OCO proposal will reportedly be around $51 billion, tens of billions of dollars more than it will take to support a training mission in Afghanistan and a war against ISIL that costs a small fraction of what the Bush administration's intervention in Iraq did.

As for the Pentagon's base budget, press reports indicate that the president's request for fiscal year 2016 will be at least $34 billion above the level required in current law. This cannot be accomplished unless the budget caps are eliminated, which brings us back to shadow boxing between Democrats and Republicans over taxes and entitlements.

Given all the factors leaning against a comprehensive deal, prudent planning would call for the Pentagon to come up with a budget that adheres to the BCA budget caps, not a wish list far in excess of what is allowed under current law. This issue should be raised during Ashton Carter's confirmation hearings to become the next Secretary of Defense.

Meanwhile, Congress should take a close look at the administration's OCO request with an eye toward ending its use as a slush fund. At a minimum, Congress should demand a detailed accounting of what the OCO budgets of the past few years were spent on, to serve as a baseline for future debates on the size and scope of the war budget. Even with a budget that meets the caps and scrubs the OCO account of unrelated items, the Pentagon will still have more than enough funding to defend the country, provided it spends it wisely. It is the job of the president and the Congress to make sure it does.