The CBO lies and makes recommendations on false premises


The CBO has recently released its budget options related to discretionary spending, including defense spending, and unfortunately, its recommendations are unacceptable and based on false premises.

The CBO wrongly claims that “defense spending” (military spending would be a more accurate description) constitutes a full 20% of total federal spending. It doesn’t. The core defense budget for FY2011, under the ConRes, is $525 bn, which constitutes a paltry 14.19% of the total federal budget ($3.7 trillion). Even total military spending, including spending on Iraq, Afghanistan, and the DOE’s defense-related programs, totals only $685 bn, which is only 18.51% of the total federal budget ($3.7 trillion). So no, neither defense spending nor total military spending constitutes 20% of it. Not even close.

So the CBO has been caught lying.

The CBO also claims that the US spends more on its military than all other countries in the world combined. That is also false. According to the SIPRI, in 2009 total American military spending (including spending on Iraq and Afghanistan), totalled $663 bn (in FY2010), and accounted for only 43% of global military spending. Note that the SIPRI accepted Chinese and Russian official toplines of their military budgets as real, which they’re not. China’s real annual military budget is at least $140 bn.

The CBO also claims that most of America’s defense budget is related to defending America’s wealthy European allies. That is also false. The vast majority of the defense budget (not to mention the GWOT supplemental) is spent on maintaining the military on a day-to-day-basis – on military personnel, maintaining and operating military equipment, developing and producing new equipment, on bases in the US, and on the DOD’s HC programs. Only a small part is related to military deployments to Europe.

Vide this.

Based on this, the CBO recommends deep cuts of the defense budget, which, however, according to its own numbers, would not even significantly reduce the budget deficit. For example, freezing the defense budget right away would “save” only $600 bn dollars over the next 5 FYs, which would be just $120 bn per year. That would be a dramatic cut for the DOD, but only a tiny reduction of the annual federal budget deficit ($1.65 TRILLION). So the federal government would still be adding $1.53 trillion to the federal debt every FY.

The CBO’s recommendations are utterly ridiculous.

The CBO has ignored some other key facts, too.

Firstly, unlike the vast majority of other federal spending – discretionary and nondiscretionary alike – defense spending is constitutional. Entitlement spending is not. Neither is spending on education, transportation (except post roads), green boondoggles, and “job training”.

Secondly, defense spending has already been cut by $25 bn in real terms from the FY2010 level ($550 bn in 2011 dollars, $534 bn in nominal dollars), and as the Iraqi war and the Afghan war wind down, and as American troops will leave Iraq and Afghanistan later this decade, total military spending will automatically shrink further.

Thirdly, cuts of defense spending would be penny-wise and pound-foolish. They would (as CBO’s own numbers show) save little money in the short term, and no money in the long term. They would weaken the military and embolden America’s adversaries, thus encouraging them to engage in blackmail, or even war, against America or its allies. And then, unless Americans would prefer to just stand by and do nothing, the US would have to rearm at a large fiscal cost and fight a war provoked by a weak defense posture, a war that would be costly in fiscal and human terms. It would be much cheaper in the long run to just maintain the current defense posture and even to strengthen it.

The CBO did recognize that one could argue that America’s adversaries are arming themselves right now, and that most of the military’s equipment is old and worn out and needs to be replaced, so one could argue on that basis against defense spending cuts. But nonetheless, the CBO’s package of recommendations is unacceptable.

Fortunately, National Review’s Rich Lowry has decided to intervene in favor of defense investments, writing that:

“If the United States goes bankrupt, it won’t be because of Libya, unless we add all eligible Libyans to our Social Security and Medicare rolls, and even then — at a population of fewer than 7 million — it will only augment current trends. America’s long-term debt is driven by ever-expanding entitlements. Already, this fiscal year, mandatory spending alone is projected to essentially match all federal revenues. We could eliminate the defense budget altogether, at about $700 billion, and still only cut the deficit in half.

In the late 1960s, defense spending was about 10 percent of GDP, and so was nondefense spending. Since then, defense spending has fallen roughly by half as a proportion of GDP, while nondefense spending has roughly doubled. In our long-term fiscal crisis, guns are a pittance compared with all the butter.

Libya would have to be a conflagration rather than a brush fire to move the fiscal needle. About those Tomahawk missiles: Scott Lilly of the Center for American Progress points out that there are 3,500 Tomahawks in our arsenal. We buy about 200 more each year to maintain our production capability. In short: We can spare a few for Moammar Qaddafi. As for the cost of the ships and the planes involved, they were already deployed in the region anyway.

If we wanted to save costs, we’d have not only to pull those assets back from Libya, but to mothball them entirely. This is the drift of fiscal hawks such as Kentucky’s tea-party libertarian Rand Paul. For tea-party constitutionalists, though, defense should be last on the chopping block, as a core function of government spelled out in the Constitution.

As a country, we haven’t had happy experiences with stinting on defense, whether prior to the War of 1812, World War II, or the Korean War. It may not seem fair that we have to shoot the Tomahawk missiles and fly the B-2 bombers of the Libya war, but would we really prefer that someone else matched our capabilities, or that we didn’t have the hardware to respond rapidly in urgent circumstances?

The world can’t always be counted on to throw up challenges precisely calibrated to our preferences. When someone suggested at the Constitutional Convention that the standing army not exceed 3,000 men, George Washington illustrated the folly of the proposal with a wry countermotion stipulating that “no foreign enemy should invade the United States at any time, with more than 3,000 troops.”

The entire article is available here: http://www.nationalreview.com/articles/263257/triumph-green-eyeshade-rich-lowry

So, remember, folks: defense cuts would be penny-wise and pound-foolish.

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