Defense

Defense

War Spending Shouldn't Become a Slush Fund

The resolution setting next year's budget continues this year's levels of war spending, despite the fact that the federal government was supposed to spend much less after reducing troop levels in Afghanistan. It contains war spending at an annualized level $26 billion higher than requested by the President. Even if some funds are spent on operations against the Islamic State terrorist group, billions are still being appropriated above what is needed for overseas operations without a clear purpose.

Broadly, the continuing resolution extends last year's spending level of $1.012 trillion for regular discretionary spending. (See our blog House Resolution Continues Last Year’s Spending, Mostly for the exceptions). In addition, Congress designates an amount for Overseas Contingency Operations (OCO) not restricted by the same discretionary spending caps. The resolution continues OCO funding at the FY 2014 level of $92 billion, $26 billion higher on an annual basis than the Administration's $66 billion request.

Since the resolution only covers two-and-a-half months, continuing spending at the FY14 rate would provide about $5 billion more than requested for the length of the CR. The decision to continue funding for OCO at the last year's levels could be even more significant if Congress continues this policy when revisiting a long-term CR or omnibus bill after this CR expires in December.

Potential ISIS Operation Shows the Value of Fiscal Space

Recent events in Iraq and Syria have raised the prospect of expanding military operations in the region beyond airstrikes. Gordon Adams in a Fiscal Times article roughly estimated that $10 billion-$15 billion per year would be required to expand air operations and provide ground support for a campaign against ISIS, though the estimate is uncertain because it is not clear exactly how the U.S. would respond.  Regardless of the exact number, it is clear that if the military is to expand its operations in Iraq and Syria, it would cost billions of dollars.

Given high and growing debt levels, lawmakers should avoid substantially adding to the debt to fund the operation.

Of course, the "path of least resistance" would be for Congress to fund these new costs by designating them as Overseas Contingency Operations (OCO), which are not subject to the same statutory caps that constrain most discretionary spending. And to be fair, the increased costs would indeed be used toward overseas operations in Iraq. Yet, every major budget assumes OCO spending will decline, and using the OCO designation as a slush fund for any new military operation could significantly worsen the debt situation.

A sensible solution to this concern might be to accompany any new funding for ISIS with a set of OCO caps, designed to limit total funds spent on military operations in Iraq and Afghanistan.

Price Tag for VA Conference Bill: $10 Billion

Note: CBO has issued a more detailed score of the bill. The table has been updated to reflect these numbers.

Administration Releases FY 2015 War Spending Request

The Obama Administration yesterday released the details of its request for war spending (Overseas Contingency Operations, or OCO), with a grand total of $66 billion of funding – $60 billion new funding in addition to $6 billion of State Department/international program funding already in the President's budget.

CRFB to Conferees: Care for Veterans but be Fiscally Responsible

Both the House and Senate have passed bills reforming the VA, and a conference committee must now meet to hammer out differences between the two bills. Yesterday, CRFB President Maya MacGuineas sent a letter to the 28 conferees, calling for the resulting bill to take a fiscally responsible approach and honor our nation's commitment to veterans without adding to the national debt.

CBO Finds House VA Bill Could Cost More, Does Cost Less Than Senate Bill

The Congressional Budget Office today released a preliminary analysis of several sections of the House VA reform bill. Like the Senate bill that we analyzed last week, the legislation would increase VA health spending by allowing the VA to contract with private health providers. In fact, if appropriators fully funded the House legislation, it could cost more than the Senate bill.

Paying for A Fix to the VA Health System

Now that both chambers of Congress have passed bills aimed at improving the Department of Veterans Affairs (VA) health system, they will need reconcile their differences, likely via conference committee.

Senate Vets Bill Could Create New $500 Billion Entitlement Program

The Senate voted 93-3 yesterday on new legislation to expand veterans' benefits by allowing beneficiaries to seek out private (non-VA) health care paid for by the Department of Veterans Affairs (VA).

Are Veterans Benefits Too Generous?

For several years, the Department of Defense (DoD) has been suggesting ways to trim parts of the Defense budget to make room for other military spending. These recommendations have included modest cuts in benefits for active-duty servicemembers and veterans.  However, Congress has repeatedly rejected cost savings that rein in the benefits for servicemembers.

Senator Sanders Proposes Emergency VA Authorization

In response to the recent VA scandal and hospital backlogs, Senate Veterans Affairs Committee Chairman Bernie Sanders (I-VT) has proposed legislation that would address the situation and authorize additional funding for the Department of Veterans' Affairs (VA). Congressional Quarterly's (subscription required) Alan Ota explains:

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