This paper assesses key issues in U.S. defense spending in the next decade and is intended to serve as a guide to analyzing the fiscal year 2006 budget submission. Wartime expenses aside, the big spending increases of recent years seem unlikely to be repeated far into the future. Persistent federal deficits and growing domestic entitlement programs will constrain the amount of money that can be spent on military preparedness. The defense budget may level off just as it should rise to accommodate high operating costs and mounting requirements for military transformation. If so, budget constraints will compel a concerted effort to spend available defense funds as wisely as possible. Spending patterns and priorities will change, and tradeoffs will be necessary. If pressures on the defense budget increase, the biggest challenge facing the Department of Defense (DOD) will be determining how best to pursue two key transformation goals. The first goal is strengthening ground forces and related joint capabilities for expeditionary operations along the "southern arc of instability" in the near to mid term. The second goal is enhancing strategic dominance over future peer adversaries over the long term through acquisition of new platforms, space systems, and similar high-tech assets. Within this framework, DOD will need to address other weighty issues. Should investments in ground forces increase? If so, what priorities should be pursued? Can savings be extracted from support programs and from the operations and maintenance (O&M) budget to help fund investments? If so, how? Should spending on basic research increase? If so, can development of new technologies be accelerated while controlling costs? How should scarce procurement funds be allocated among new weapons emerging from research, development, testing, and evaluation? What is the best budget strategy for the long haul? Should the U.S. government create an overall national security budget for the interagency community? Careful analysis of each of these issues is necessary, individually and collectively. The budget and program decisions flowing from the analysis will have major implications for future U.S. forces. This study recommends focusing on enhancing expeditionary warfare capabilities, while not denuding long-term transformation. In particular, it argues that, if DOD is to pursue ambitious transformation plans for both goals, it will need to find savings elsewhere.
About the Author: Hans Binnendijk holds the Roosevelt Chair of National Security Policy at the National Defense University and is Director of the Center for Technology and National Security Policy. He previously served on the National Security Council as Special Assistant to the President and Senior Director for Defense Policy and Arms Control (1999-2001). From 1994 to 1999, Dr. Binnendijk was Director of the Institute for National Strategic Studies at the National Defense University. Prior to that he was Principal Deputy Director of the State Department Policy Planning Staff (1993-1994). Richard L. Kugler is a Distinguished Research Professor at the Center for Technology and National Security Policy, where he performs analyses. His specialty is U.S. defense strategy, global security affairs, and NATO. He advises senior echelons of the Office of Secretary of Defense, the Joint Staff, and the interagency community. He has been an analyst and senior executive in the Office of Secretary of Defense for Program Analysis and Evaluation (1975-1984), Director of DOD Strategic Concepts and Development Center (1984-1988), and Research Leader at RAND (1988-1997). He is author of multiple books, journal articles, and official studies on U.S. defense strategy and programs as well as NATO and global security affairs.