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Pentagon Budget Outlook: Cloudy With a Chance of Slush

It’s an open secret that the Pentagon has routinely been using the war budget – known in Washington-ese as the Overseas Contingency Operations (OCO) account – as a slush fund to pay for items that don’t fit within the caps on its base budget that are currently the law of the land.

If a new report from Bloomberg News is accurate, the committee will propose an increase of over $40 billion in the already slush-filled OCO account, bringing the total to an astounding figure of $90 billion. If the House Budget Committee has its way, it will be, in the words of former White House budget official Gordon Adams, “the most cynical and fraudulent use yet made of the OCO budgetary gimmick.” It is budgetary sleight of hand of the highest order, designed to provide the same level of funds that would have been authorized if the President’s cap-busting budget were to become law.

This outrageous maneuver cannot be allowed to stand. Members of Congress who truly believe in budget discipline must vigorously oppose it, not only by speaking out against it but by voting against any resolution that includes the $40 billion plus-up in the OCO slush fund.

It’s not as if the Pentagon needs more money. At nearly $500 billion per year, its current base budget is one of the largest in post-World War II history. And the president’s proposed war budget of “only” $50.9 billion already contains at least $20 billion in expenditures that have nothing to do with fighting any current conflict.

How is it that the Pentagon can’t make do with well over half a trillion dollars in resources? The argument that it’s because of the costs of dealing with crises like the rise of ISIS and the Russian intervention in Ukraine doesn’t hold water. The president’s budget proposes $5.3 billion for the war on ISIS — less than one percent of the total resources available to the Pentagon. And even if the Obama administration were to reverse course and decide to provide lethal assistance to Ukraine it would barely put a dent in the Pentagon’s current budget .

So where is all that money going? The Pentagon can’t provide a good answer to that question, because the department can’t even pass a simple audit. It doesn’t know how many spare parts it has, or how many private contractors it has hired, or how many companies have overcharged it for basic items that could be purchased for far less on the open market. Before the Pentagon gets more funding, it must demonstrate that it can keep better track of the money it already has.

Then there’s the procurement mess. The unit cost of the F-35 combat aircraft has nearly doubled in the past decade. And the program as a whole is slated to cost $1.4 trillion in procurement and operating costs over its lifetime – the most expensive weapons program ever undertaken by the Pentagon. And even if it can overcome a slew of performance problems, the F-35 will be in many ways inferior to current generation aircraft. It’s not as good at supporting troops on the ground as the existing A-10, and it can carry fewer bombs than other comparable planes. Its stealth characteristics are overrated, and extremely expensive to maintain. A better move would be to scale back the F-35 program and build upgraded versions of existing aircraft as needed. Then the services could try to come up with new designs that actually make sense.

The F-35 is just one of many big ticket items that should be reconsidered, such as the Littoral Combat Ship and the costly new ballistic missile submarine.

Perhaps the biggest source of savings can come from one source: bureaucracy, bureaucracy, bureaucracy. With 800,00 civilian employees and an estimated 700,000 contractors, the Pentagon has plenty of room to cut without reducing needed support for troops in the field. An estimate by the Project on Government Oversight indicates that cutting service contracting by 15% would save over $23 billion, and billions more in savings could be had by rightsizing the department’s civilian work force.

The last major area where savings can be had is compensation. A panel created by the Congress to look at compensation reform has proposed a well-crafted package of initiatives that could save tens of billions of dollars over the next decade.

Implementing even a portion of the above-mentioned changes would allow the Pentagon budget to be reduced, or at least kept at current levels, with plenty of funding left over to devote to critical activities like pilot training.

If Congress is serious about its responsibility to spend taxpayer dollars wisely, it should reject the expansion of the Pentagon’s OCO slush fund.

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