Among the many things we noted yesterday on the blog about the omnibus appropriations bill was the similarity between war spending in the bill and in the past fiscal year. Spending for overseas contingency operations declined by only $1 billion -- from $93 billion to $92 billion -- between 2013 and 2014, and spending was more than $20 billion higher than what CBO assumes in its drawdown scenario.
Among the elements of the budget deal that passed Congress last month was a small $6 billion change to the way military pensions are calculated for military retirees younger than 62. In the face of lawmakers who would roll back this change, both the Washington Post and Wall Street Journal editorial boards defended the provision in the last two days.
As CRFB has explained in a recent analysis, the Bipartisan Budget Act under consideration in the Senate would replace a portion of the mindless sequester cuts with more targeted reforms. One controversial proposal in the bill would reduce cost-of-living adjustments for working-age military retirees. This blog explains that provision.
On Tuesday, Sen. Patty Murray and Rep. Paul Ryan announced a budget deal that set discretionary spending levels for the next two years, removed some of sequestration's cuts, imposed targeted spending cuts and fee increases, and modestly reduced deficits over the next decade (see our full analysis of the deal).
Replacing the sequester will be an important item on the conference committee's agenda, and it may also be the most difficult. Right now, the two parties differ as to how to replace it, with Republicans advocating for only spending cuts as offsets and Democrats seeking a mix of revenue and spending cuts. When it comes to the defense sequester, which is slated to reduce the defense budget by $490 billion over the next ten years, Democrats may be particularly wary of replacing defense cuts with cuts to non-defense programs.
Although the possibility of a US military strike on Syria is now in question, the possibility has also led to public statements regarding the relationship between defense priorities and the budget.
Over the weekend, President Obama made his widely anticipated remarks on the conflict of Syria, making his case for taking military action against the Syrian regime in response to a chemical weapon attack a few weeks ago. He also stated that while he believed that he had the authority to take action himself, he would leave it up to Congress to vote on.
The sequester has always been a blunt and mindless way to reduce the deficit, and for the Defense Department, its effects are now clearly being seen. On Monday, the Defense Department began furloughs for its civilian workers, which will eventually affect more than 650,000 workers according to the Washington Post. Eleven furlough days are expected to be needed in order to meet targets or around one without pay per week until the end of September.