The Numbers Don't Add up on Mitt Romney's Defense Budget
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The Numbers Don’t Add Up on Mitt Romney’s Defense Budget Candidate’s Defense Spending Plan Doesn’t Reflect America’s 21st Century Priorities and Is Fiscally Impossible Lawrence Korb July 2012 We know very little about how former Massachusetts Gov. Mitt Romney would reshape U.S. foreign policy or defense priorities if he were elected president. He has not elaborated a long-term vision or outlined the details of his plans. But what little FIGURE 1 we do know from his few public Shooting up Baseline defense budgets under Bush, Romney, and Obama comments is troubling. Bush Obama Romney Sequestration Gov. Romney’s defense plans 900 would be prohibitively expen- sive. He has pledged to set the Pentagon base budget (not 800 counting war funding) “at a floor of 4 percent of GDP,” which 700 would result in at least $2.1 tril- Romney would spend $2.1 trillion lion in added spending over the 600 more over ten years next decade compared to the Department of Defense’s current 500 plan. Gov. Romney has not elab- orated on what specific threats Defense Budget, Billions of FY13 Dollars 400 prompt him to call for this huge Balanced budget inherited by George W. Bush in 2000 increase in defense spending. 300 Gov. Romney has also pledged to increase the Navy’s shipbuild- 200 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 ing rate from 9 per year to 15 per year, add $50 billion per year Source: Defense spending data from Department of Defense. Romney spending plan calculated using Office of Management and Budget and Congressional Budget Office GDP estimates. in spending on modernization, 1 ROMNEY U | The Numbers Don’t Add Up on Mitt Romney’s Defense Budget establish a multilayered ballistic-missile defense system, and add 100,000 personnel to the Army and the Marine Corps above 2010 levels. Again, he has not explained how he would pay for these initiatives or which threats they are meant to address. Meanwhile, Gov. Romney says he would cut marginal tax rates for individuals by 20 percent and balance the budget. He has embraced Rep. Paul Ryan’s (R-WI) budget plan and said he would cap federal spending at 20 percent of GDP but exempt Social Security. To keep these various promises, he would have to cut nondefense programs other than Social Security, such as Medicare and Medicaid, by 59 percent over the next decade.2 Thirty-two years and eight presidential elections later, voodoo economics has returned to the Pentagon’s fiscal course. And while Gov. Romney would FIGURE 2 spend trillions countering threats The deficit: Our biggest national security threat from a bygone era, he hasn’t out- Federal outlays and revenues, 1971–2021 lined a serious agenda to address the two greatest long-term Outlays CBO’s Estimate of the Revenues President’s Budget problems facing the Pentagon: Average Outlays,1971 to 2010 CBO’s Baseline Projection Average Revenues,1971 to 2010 poor management of Pentagon Actual Projected 28 procurement and rapidly growing 26 Department of Defense per- 24 sonnel costs that put the All- 22 Volunteer Force at risk. 20 18 In 2009 Secretary of Defense 16 Robert Gates began a program 14 to change how the Department of 1971 1976 1981 1986 1991 1996 2001 2006 2011 2016 2021 Defense contracts goods and ser- Source: Congressional Budget Office, “An Analysis of the President’s Budgetary Proposals for Fiscal Year 2012” (2011). vices with the aim of saving $100 billion over the five-year program. Gov. Romney seems convinced he could do better but he offers no details other than a vague pledge to find “efficiencies” and introduce “accountability.”3 Similarly, in its fiscal year 2013 budget request, the Obama administration outlined a plan to reform the Tricare military health care program and bring military personnel costs under control. Again, Gov. Romney has failed to engage on this issue. To sum up, focused on Cold War-era threats, Mitt Romney’s plan for the Pentagon would run up the deficit while shirking the tough choices necessary to prepare the U.S. military for the 21st century. We examine what little we know about his defense plans in this brief. 2 ROMNEY U | The Numbers Don’t Add Up on Mitt Romney’s Defense Budget Fiscal and strategic context for Gov. Romney’s plans Following a decade of unrestrained growth in the base defense (nonwar) budget, two costly wars, multiple tax cuts, and the worst financial crisis since the Great Depression have combined to leave the country confronting serious long-term fiscal problems. Adm. Michael Mullen, the previous chairman of the Joint Chiefs of Staff, named the deficit as the biggest national security threat facing the country.4 The nation has historically responded to such circumstances through a combination of spending reductions and revenue increases. As illustrated in Figure 2, the historical balance between revenues and outlays was overturned by the recession and President George W. Bush’s wars and tax cuts. While President Obama’s FIGURE 3 plans would gradually restore this Historical defense cuts balance, Gov. Romney’s spending Defense budgets, fiscal years 1948-2012 and tax-cutting plans would push Millions of FY2012 constant dollars the country further from the path $800,000 of fiscal responsibility. Obama $700,000 (W) Bush We are also coming to the end of Reagan $600,000 a decade of war and rising defense budgets. After 9/11, defense $500,000 (HW) Bush spending increased dramatically, Nixon $400,000 rising from $410 billion in FY2000 Clinton Eisenhower to $738 billion in FY2008, the last $300,000 year of the Bush administration— an increase of $328 billion or 80 $200,000 percent in constant (inflation- $100,000 Korean Vietnam Reagan Wars in Iraq/ adjusted) dollars. This brought War War build up Afghanistan defense spending to levels not seen $0 FY50 FY52 FY56 FY58 FY60 FY62 FY66 FY68 FY70 FY72 FY76 FY78 FY80 FY82 FY86 FY88 FY90 FY92 FY96 FY98 FY00 FY02 FY04 FY06 FY08 FY10 FY12 since World War II, 50 percent FY54 FY64 FY74 FY84 FY94 above peak spending during the Source: Department of Defense, “National Defense Budget Estimates for FY 2012,” March 2011, p. 123-128, available at http://comp- Korean War and 78 percent above troller.defense.gov/defbudget/ fy2012/FY12_Green_Book.pdf. the Vietnam War peak. The United States has historically drawn down the defense budget following major conflicts. Figure 3 presents the history of those drawdowns, overseen by past presidents of both parties. A majority of Americans support cutting the defense budget in line with this precedent now that the wars in Iraq and Afghanistan are coming to an end.5 Against this backdrop, Gov. Romney would vastly increase military spending over the next decade but has said very little about how, exactly, these added funds would be used or why they are necessary. Let’s examine the details of his pledges. 3 ROMNEY U | The Numbers Don’t Add Up on Mitt Romney’s Defense Budget Romney’s defense pledges Sky-high spending: Romney will set “core defense spending—meaning funds devoted to the fundamental military components of personnel, operations and maintenance, procurement, and research and development—at a floor of 4 percent of GDP.”6 Mitt Romney’s pledge to set core defense spending at a floor of 4 percent of GDP would make the United States less secure by undermining the economic health that underpins American strength abroad. His plan ignores fiscal realities and is not based on sound strategy or a realistic assessment of the threats facing our country. In assessing the threats facing the FIGURE 4 United States today, consider that: Way ahead of the pack Global military spending shares, 2010 • The United States and its allies account for an overwhelming 80% 70% share of global military spend- United States ing, far more than any potential 60% 39% adversaries, as illustrated in 50% Figure 4. In FY2011 the United 40% States alone spent significantly 30% 16.5% NATO Allies more on defense than the next 20% 10 countries in the world com- 10% 17% 13% Other US Allies 14.5% bined, most of whom are our 0% allies. We spent 800 percent USA and Allies Current and Potential Foes Other Nations what China spent on national Other US Allies includes Australia, Israel, Japan, S. Korea, Taiwan, and the Gulf Cooperation Council defense in the same year. states: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates. Current and Potential Foes includes China, Cuba, Iran, N. Korea, Russia, Serbia, Syria, and Venezuela. • We have 11 operational aircraft Within Other Nations, India and Brazil together account for 57% of total expenditure. carriers; no other country has “Purchasing power parity” estimates are used for the 15 top military spenders, who together account more than one. for more than 80% of all military spending. • We have more nuclear-powered ballistic-missile submarines and many more nuclear-powered attack submarines than any other country. • We have more than twice the number of modern battle tanks of our closest competitor and more modern armored fighting vehicles than any other nation. • We have three times more fourth-generation tactical aircraft than any other nation and are the only country currently fielding a fifth-generation model. 4 ROMNEY U | The Numbers Don’t Add Up on Mitt Romney’s Defense Budget • Our superiority is complete when it comes to attack helicopters, transport helicopters and aircraft, tankers, drones, and satellites.7 These facts show the United FIGURE 5 States can maintain and An unnecessary buildup Defense spending since 1948 strengthen its military superiority without bankrupting the nation.