U.S. military to face growing crises, falling budgets

WASHINGTON Wed Jul 2, 2014 1:00pm EDT

U.S. marines of 1st Battalion, 8th Marines Regiment rest during the Cooperation Afloat Readiness and Training (CARAT) Philippines 2014, a U.S.-Philippines military exercise, on a beach facing South China sea, at San Antonio, Zambales north of Manila June 30, 2014. REUTERS/Erik De Castro

U.S. marines of 1st Battalion, 8th Marines Regiment rest during the Cooperation Afloat Readiness and Training (CARAT) Philippines 2014, a U.S.-Philippines military exercise, on a beach facing South China sea, at San Antonio, Zambales north of Manila June 30, 2014.

Credit: Reuters/Erik De Castro

WASHINGTON (Reuters) - First it was worries over the South China Sea, Afghanistan, Libya, Mali and Syria. Then it was Russia's annexation of Crimea and the hunt for Nigerian schoolgirls kidnapped by Boko Haram. Now the United States and its allies find themselves preparing once again for potential military action in Iraq.

For U.S. defense planners already struggling to implement savage spending cuts, the last year has been one of the most demanding since the immediate aftermath of Sept. 11, 2001, attacks.

Almost every other month a new crisis has erupted, each demanding new military deployments and resources. With the United States already stressed by more than a decade of war, some worry the strain is starting to show.

"North Korea and Iran also haven't gone away," said Kathleen Hicks, a senior fellow at the Center for Strategic and International Studies (CSIS) who until last year was U.S. principal deputy undersecretary of defense for policy.

"For the U.S. Navy in particular, it's a real challenge," she told Reuters in May. "With the size of the force, it's tough to deter in all these places at once."

The end of troop-heavy, multiyear conflicts will almost certainly yield some savings. It is almost impossible not to, with analysts estimating it now costs more than $2 million to keep a single U.S. soldier in Afghanistan for a year.

Still, conflicts and militancy seem on the rise, as do tensions with China and Russia. The latter in particular, took Washington largely by surprise, current and former officials say.

A report last week by the Australia-based Institute for Economics and Peace suggested the last seven years brought a significant rise in conflicts around the world, reversing six decades of improvement since the end of World War Two.

As late as last year, many in Washington still hoped they could at least permanently turn their backs on Iraq. After the lightning advance of former Al Qaeda affiliate the Islamic State in Iraq and the Levant, however, the United States acted fast. It moved a carrier into the Gulf; deployed several hundred military personnel, including special forces; and is still considering airstrikes.

In a major foreign policy speech at the U.S. Military Academy at West Point in May, President Barack Obama said Washington must become more circumspect over the use of force.

The reality, however, is that under Obama, the United States has continued, if not accelerated, its trend of sending forces to more places, albeit often in much smaller numbers.


In a report published Wednesday, think tank CSIS estimated the Pentagon's base budget could fall some 21 percent in constant dollars between 2012 and 2021. Downward pressure would be "unrelenting," it said, with spending instead drawn to health and Social Security programs as the population ages.

When Obama took office in 2009, the Pentagon budget was around $700 billion. The budget request for 2015 stands at $496 billion, plus an estimated $79 billion for Afghanistan.

Uncertainty about the cost of new Iraq commitments had delayed the submission of the separate Overseas Contingency Operations budget to Congress, Pentagon finance chief Robert Hale told Reuters.

That budget covers wars and this year will contain an additional $1 billion to ramp up U.S. military commitments to Europe.

Washington's military spending remains by far the world's largest, more than a third of the global total.

The gap between the United States and some of its potential adversaries, however, is narrowing. Defense spending by Russia has risen 30 percent since 2008, and China's is up 40 percent. Other nations in the Middle East and Asia have also dramatically upped military expenditures.

While most nations focus the vast majority of their military might on their immediate neighborhoods, the United States is spread more thinly.

The U.S. Navy is fighting suggestions to retire one of its 11 aircraft carriers, the USS George Washington, early. Maintenance on another was delayed last year. This could make it harder to meet the apparently growing need for such ships, some officials say.

"Budget constraints have forced us to accept more risks - risks we believe we can manage at this level," Army General Martin Dempsey, chairman of the U.S. military's Joint Chiefs of Staff, told service personnel in March. He did not give details.


More spending restrictions, such as automatic "sequestration" cuts that could return if Congress cannot pass a budget, would increase dangers to the United States and its allies, Dempsey said.

    Some current and former officials say the real challenge is not the number of defense commitments but the growing number of other costs in the Pentagon budget: benefits, pensions and ever-ballooning procurement expenses.

Current personnel costs, both military and civilian, already make up almost half the Pentagon's non-war-related budget, something military chiefs want to trim.

In an interview with Reuters last week, Pentagon finance chief Hale said each type of new weapon traditionally cost three times more than what it replaced, something he said was not sustainable.

Not everything is more expensive. The U.S. Special Operations Command's budget doubled, its numbers tripled and its deployments quadrupled in the decade after Sept. 11, 2001. Yet it remains less than 2 percent of the overall budget.

Still, officials caution that special forces remain a limited resource. Besides deploying to Iraq, they have ramped up their presence in Europe and Africa this year and are on standby to rescue Americans in any situation like the 2012 attack on the U.S. consulate in Benghazi.

"The trend towards a more chaotic world is not going to change anytime soon," said Admiral Gary Roughead, U.S. chief of naval operations until 2011 and now a fellow at Stanford University's Hoover Institution.

"Can we cope with the level of naval and air requirement that produces?" Roughead said. "Now, yes, we can. But over time, it begins to seriously stretch both our equipment and our people."

(Editing by Lisa Von Ahn)

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Comments (19)
GSRyder wrote:
Me thinks that China, having modeled their rise to power after US business practice . Sees how much money can be made waging wars all over the planet, and is good profits . Lending money to the US to make more war/money is foolish . Hence a 40% uptick in Chinas’ military spending .

Jul 02, 2014 1:36pm EDT  --  Report as abuse
EconCassandra wrote:
Crises of our own making to feed the Military Industrial Complex is NOT a sufficient reason to want more funds to continue making the same mistakes.

Jul 02, 2014 1:36pm EDT  --  Report as abuse
REnninga wrote:
Procurement reform would be a very good place to start.

A recent ’60 Minutes’ report about the F-35 Joint Strike Fighter (JSF) jet aircraft program revealed that this Lockheed-Martin program is (get this):
* 7-years behind schedule, and
* $163 Billion over budget.

No, that $163 Billion is not the total cost of the program, it is $163 Billion OVER BUDGET … so far!!! It’s the most expensive military program in the history of the world, and now projected at a total cost of $1.017 Trillion over the program lifetime.
That’s TRILLION, with a capital “T”; a thousand Billion; a thousand, thousand Million.

And what’s worse, Lockheed-Martin was awarded a “cost-plus” contract, meaning that the company is guaranteed a profit despite the shockingly poor schedule and budget performance. And despite this dismal contract service, the US Military just keeps awarding the company even more contracts (another $1.9 Billion just last week for missile-warning satellites).

Civilian control of the military needs to mean “100% civilian control” over its procurement, too. Remove these supply-stream and weapons production contracts from management and oversight by Military Officers in the Pentagon (who use these programs for a). purposes of promotions, and b). going to work for the same contractors they now oversee following their retirement from military service).

Put highly qualified and ‘mean as junkyard dogs’ business executives with MBA’s in the roles of procurement oversight. Run the Pentagon and US Military like a business, and the USA will always have the dominant and most capable and well-equipped Military in the world, … at half the cost to US taxpayers.

Just think what America could otherwise have done with that $163 Billion dollars of cost overruns, in repairing our highway bridges, our electrical grid, and other much needed infrastructure repairs. And think how many living wage construction jobs could have been created (program cost-overruns paid to Lockheed-Martin will add no jobs).

Jul 02, 2014 2:32pm EDT  --  Report as abuse
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