There is a lot of confusion surrounding the debt deal and what it means for defense. Things have gotten so complicated with the defense/non-defense security/non-security debate, that even the experts are uncertain.
To be clear on at least the definitions, “security,” as defined in the deal, is defense and non-defense security, including the Departments of Defense, Homeland Security, Veterans Affairs, Intelligence, International Affairs and the National Nuclear Security Administration. This definition applies to the first two years of the budget deal, and its relevant spending caps, only.
For the first two years, the bill is clear on this category of spending. For Fiscal Year (FY) 2012, the bill sets a $684 billion ceiling for “security.” This number is a $4.5 billion overall decrease in security spending from the FY 2011 level of $688.5 billion. The FY 2013 security cap is $686 billion, still tracking below FY 2011 levels.
While the cut is not large, it is significant, since previous cuts have taken reductions from the amount of increases, rather actually reducing the item from the previous year.
However, what we do not know is how these reductions would be allocated between the Pentagon and, say, foreign aid or the nuclear weapons complex. Exact funding levels will be left up to Congress.
Then things get even more confusing. If a longer-term deal is not reached, security spending is redefined as the traditional “050” budget category, meaning the Department of Defense and some defense-related funding within the Department of Energy, Department of Homeland Security, and FBI.
The category does not include foreign aid, homeland security, veterans and other categories of spending.
Of course, even with these definitions, we still do not actually know the extent of future defense cuts. The White House claims that the deal will result in $350 billion in cuts from the 050 account over the next 10 years, but the claim is only an estimate. The bill itself contains no language detailing the cuts over 10 years.
The number proposed by the administration, $350 billion, tracks closely with the $400 billion reduction goal already set out by the President. It does not add to the $400 billion number, but rather replaces it, with the assumption that the final two years, totaling 12, will see more savings.
There is one possibility, however, that could result in large savings, specifically from defense (050). The second part of the bill calls for a joint committee of House and Senate members to fashion a longer-term plan. If the committee fails to come to an agreement or Congress rejects it, sequestration, or automatic cuts, kicks in. In the case of sequestration, everything changes. The plan requires that half of the cuts come from defense (050) and half from non-defense.
Proposed sequestration cuts are based on a formula that would reduce both discretionary and mandatory 050 spending by half of the needed $1.2 trillion in savings. The cuts would be spread over nine years. The administration estimates that a total $534 billion cut from the 050 account would result from sequestration over ten years.
The joint committee will have until Thanksgiving to come up with a deal.
So, what does this ambiguity add up to?
Defense hawks can complain that the cuts in defense are too deep.
Defense doves can complain that the cuts are insufficient.
The rest of the world will remain in the dark.
