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Quick Analysis

The Danger from Continuing Resolutions

Under the Constitution, (Article 1, Section 7) the House of Representatives has the responsibility for originating all federal spending.  It is a duty that has been performed very poorly.

The mammoth national debt, now standing at over $23 trillion, can be directly attributable to two factors. First, the inappropriate manner in which the Lower House of Congress performs its most important responsibility.  The interest of the American people comes in a distant second to the blatantly political motivations of individual Representatives.

Consider a crucial area that is the key function of Washington: defense.  To get the votes of many leftist representatives for adequate military funding, concessions to wasteful and unsuccessful welfare-type programs must be made.  Many of those programs are little more than excuses to give patronage jobs to political hangers-on.

But there is another wasteful House procedure that harms key national interests and causes wasteful spending: failing to arrive at a consensus budget on a timely basis, Washington indulges in the practice of “Continuing Resolutions” (CRs) and “Continuing Appropriations.” The official definition of this is “Legislation in the form of a joint resolution enacted by Congress, when the new fiscal year is about to begin or has begun, to provide budget authority for Federal agencies and programs to continue in operation until the regular appropriations acts are enacted.”

Rob Wittman, a Virginia Republican, has sounded an alarm about the harm caused by CRs. “In the age of procrastination and irresponsible spending in Washington, continuing resolutions have become a comfortable fall back for Congress. Instead of buckling down, skipping the archaic breaks, and getting spending bills done in time for measured debate, lawmakers look to last-minute, stop gap measures to fund the federal government. The last time Congress was able to maintain regular operations without a continuing resolution was in 1996—two decades ago…continuing resolutions are a short-sighted and irresponsible way to fund important programs…

“With yet another continuing resolution—we’re asking our troops to take on more risk with fewer training hours, longer deployment times, and equipment that is outdated and unreliable. Just yesterday, Air Force Secretary Deborah Lee James said that a long-term continuing resolution would “limit training and readiness accounts across the board for the total force.” In the context of national security, stop gap measures deplete our forces, prevent planning, and can cost lives.

“The government has a spending problem. We all know it. And continuing resolutions exacerbate that problem. The CR rules prevent agencies from recruiting or hiring new staff and implementing new programs (even necessary ones, like transportation projects), AND they prevent departments from cutting programs that are wasting taxpayer money. … Stop gap measures kick the can down the road, create uncertainty for agencies and employers, and negatively impact communities and families.

“If the continuing resolution has a handmaiden, it’s the backroom deal. As public servants, we’re supposed to be responsible stewards of taxpayer money, and that means that we need an open and transparent process. It means we need time for measured and deliberate debate. That’s the way our system was designed, and that’s the way it’s supposed to work. Instead, deals are cut behind closed doors, and the public is left entirely in the dark. Allocations are made for pet projects, and loopholes let certain actors ‘skirt the rules.’

“The continuing resolution is the quintessential ‘must pass’ legislation. It’s the reason that everyone starts shouting ‘“government shutdown.’ … Ultimately, continuing resolutions end up looking like a kind of legislative Frankenstein: lots of unrelated measures stitched together without any real deliberation, debate, or consideration.”

With the federal government deeply divided, there is a danger that no agreement on vital budget areas wil come about. As Rep. Wittman noted the impact on national security will be significant. Reps Mac Thornberry (R-TX), Kay Granger (R-TX) and Steve Womack (R-AR) issued a stark warning to their colleagues today on the damage a full-year continuing resolution would do to America’s military. “Across the political spectrum, folks have rightfully praised our military and intelligence professionals for taking a barbaric terrorist off the battlefield this past week. But it would be wrong to praise them with our lips and damage them with our votes. History teaches us that America will be tested in the coming weeks. Our men and women in uniform will have to face that challenge abroad while the support for their training, weapons, and families remains uncertain here at home. We owe them more and we must do better,”Thornberry said.

We are facing global threats to our interests and our allies. Our highest priority should be keeping the government functioning and the Defense Department fully funded. We cannot afford to short-change our troops or create unnecessary uncertainty for the Department of Defense,” Ranking MemberGranger added.

“When Congress fails to provide stable funding, we hinder our warfighters and neglect our constitutional duty of providing for the common defense. It’s a clear reflection of the broken budget and appropriations process that has plagued this chamber for far too long. We can’t continue to hold our military hostage – and anything less than sustained, predictable appropriations will damage national security. … Womack said.
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The three Republicans issued a fact sheet outlining the damage:

According to the Congressional Research Service, the Pentagon has “started the fiscal year under a CR for 13 of the past 18 years.”  With the exception of FY19, DOD has started every year since 2010 under a CR.  The Navy has calculated that they wasted $4 billion between 2011 and 2017 as a result of CRs.  

CRs are wasteful.  They harm our troops and America’s National Security.  Every day we go without passing a DOD funding bill makes it more and more likely that our troops—who will almost certainly be tested in the coming weeks—will face a full-year CR, with all the damage and uncertainty these stop-gap measures inflict.   That is unacceptable. Here is some of the very real damage a full-year CR will do.  

 Military Personnel: In the wake of news reports of service members and their families living in inadequate and dangerous family housing, the Army would be prevented from building 4,400 new dwellings and forced to delay repair on another 269 homes. Navy families’ moves will be curtailed, bonuses and awards will be eliminated, and the overall size of the Navy will have to be reduced.

 Pilot Shortage: A year-long CR will put additional pressure on our Air Force pilots by perpetuating a critical pilot shortage.  The Air Force is short 2,100 pilots, putting an additional burden on those serving now.  As former Secretary of the Air Force Heather Wilson put it, “with 2,000 pilots short, it’ll break the force.” A year-long CR will cut $123 million from undergraduate flight training, as well as cutting contractor instructor pilots.  A new maintenance training center won’t open and maintenance for the aging fleet of training aircraft will be delayed.

 Ship Operations:  Following the fatal accidents aboard the USS McCain and USS Fitzgerald that were attributed in part to training issues, a CR would force the Navy to cancel 14 ship maintenance periods, cancel ship underway training, and limit operations of the deployed Fleet.

 Navy Flying missions:  A CR would cause the shutdown of non-deployed Navy aviation, limiting flight training in the US to only those units about to deploy.  It would also temporarily eliminate our nation’s ability to surge additional Navy forces in times of conflict.  Finally, the Navy would incur additional costs to regenerate and recertify flying operations for non-deployed Navy aviation units.   Munitions Shortage: The fight against al Qaeda and ISIS depends on precision guided munitions.  Obama-era spending cuts and repeated CRs forced the Army and Air Force to use these munitions faster than they could replace them, creating a critical shortage.  A year-long CR would perpetuate this problem.  It would significantly reduce the number of munitions the Air Force is able to buy in the next fiscal year.  When the Army and Air Force are able to resume rebuilding the stockpile, it is likely these weapons will be more expensive and much of the progress made over the past two years in ramping up the munitions industrial base will be erased.  Navy will be unable to expand needed production increases in Tomahawk missiles, torpedoes, and other critical weapons.   Leaves Our Troops Vulnerable To Peer Competitors:  The Pentagon needs to field important technologies that protect our troops from peer competitors.  These include a GPS-like system that is impervious to hacking, spoofing, and jamming, mobile air and missile defense systems, long range precision munitions such as hypersonics and extended range artillery, next generation combat vehicles, advanced helicopters and aircraft, improved night vision devices, and improved sensor and network technology.  A year-long CR would prohibit development of unmanned surface vessels, future ship designs, and artificial intelligence development. A delay of a year or more on these systems could make our troops vulnerable and erode our competitive advantage for years to come.

 Disaster Recovery: Key military installations like Tyndall and Offutt Air Force Bases, China Lake, and Camp Lejeune have been severely damaged by natural disasters in the past year.  Funds urgently needed to repair these facilities so that they can resume their critical national security missions will not be available under a year-long CR.  Delaying disaster recovery will hurt critical missions, including F22 training, intelligence and surveillance, and Navy testing.

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Quick Analysis

All Spending is Not Equal

Attempts to corral spending often hit the wrong targets entirely. Recently, Senators Lee (R-Utah) and Paul (R-Kentucky) objected to some provisions of legislation designed to provide continuing funding designed to cover the medical costs of First Responders who developed terrible illnesses from exposure to dangerous substances in the aftermath of the 9/11 attacks. This is an absurd attack on a comparatively minor budget item designed to provide appropriate support for heroes who abundantly deserve it. 

As every family knows, all spending is not equal. Repairing a busted roof, for example, has priority over taking a luxury vacation.  They also understand that timely budgeting and planning are the most efficient ways to use income. It’s a vital practice. The federal government has yet to understand that logic. 

Both Democrats and Republicans, trying not to offend any potential constituency and apparently incapable of coming to an agreement on what the national priorities should be, have engaged in ludicrous procedures that treat vital necessities, such as national defense, on the same par as the latest pork barrel project. 

The most well-known manifestation of that nonsense is Budget Sequestration,  a law and a concept that purportedly seeks to limit the federal budget, but in substance shields Congress from its responsibility to make hard decisions and spend wisely.  It sets a hard cap on spending. The idea is that if Congress enacts annual appropriations that exceed the limit, an across-the-board spending cut is automatically imposed on general categories, affecting all departments and programs equally. The current incarnation of this ridiculous idea came into effect (it has antecedents going back to 1985) is the Budget Control Act of 2011 which came about during the Obama Administration, a period which doubled the national debt with nothing to show for all that spending. Indeed, despite slashing defense spending, and doing little to stabilize key programs such as Social Security and infrastructure repair, and despite excessively high taxes on individuals and businesses, it didn’t stop the doubling of the national debt, from about $10 trillion to approximately $20 trillion.

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The Center on Budget and Policy Priorities reports that “Unless Congress and the President reach a new budget agreement, both non-defense and defense discretionary program areas will face deep cuts in 2020 and 2021, forced by tight funding limits and additional cuts… Since 2013 lawmakers of both parties have broadly agreed that the BCA-mandated caps are too low to meet national priorities in both defense and non-defense areas. To address this shortfall, Congress has enacted a series of temporary budget deals, generally lasting two years, that have increased funding above the sequestration levels. Each deal increased both the defense and non-defense discretionary caps by roughly equal amounts, recognizing that the BCA’s sequestration provision cut defense and non-defense programs by equal amounts. The most recent deal covered fiscal years 2018 and 2019. Unlike prior agreements, it fully reversed the harmful discretionary sequestration cuts and provided additional resources for new investments…”

The irrationality and political cowardice of Congress’s approach to the budget hurts the nation across the board. The inability to timely come to a broad budget agreement in compliance with sequestration results in “continuing resolutions” which, due to uncertainty and a lack of program continuity, results in higher expenses.  The General Accounting Office (GAO) describes the problem: “In all but 4 of the last 40 years, Congress has passed continuing resolutions (CR) to keep agencies running between budgets. Without appropriations or a CR, the government may partially shut down. We testified that CRs, possible shutdowns, or both create uncertainty and inefficiency for agencies. For example, our past work found that agencies have reported delays and rework in contracts, grants, and hiring.”

A Heritage study of this process provides one example: “Continuing resolutions impose a considerable cost on the military’s readiness levels through loss of training time, delayed maintenance, and delayed availability of new ships.”

The point is hammered home by an American Enterprise study: 

“Continuing resolutions negatively impact the military in three main ways. First, because CRs freeze individual appropriations accounts at last year’s levels, tens of billions of dollars will be misaligned. For instance, though the difference between the 2020 requested level of $750 billion and the 2019 spending level of $716 billion is only $34 billion, the actual effect of the CR is greater because the additional funding is misaligned compared to the budget request—and often at a lower level. This misalignment negatively affects all accounts, but particularly creates problems for troop training and maintenance of equipment and facilities—the core of military readiness. Near-term readiness is perishable and must be constantly maintained for the “fight tonight” or it is lost. It takes longer to rebuild readiness than to maintain it. Second, continuing resolutions do not allow the military to start new weapons programs or increase the production of existing weapons. This year, that means hundreds of new programs necessary for regaining the military’s edge against Russia and China will not be able to move forward until the CR is lifted. Third, by injecting uncertainty into every process, these spending freezes create significant sums of financial and personnel waste through duplication of work, higher prices, and contracting delays.”

Illustration: Pixabay

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Quick Analysis

National Security Should Not Be A Bargaining Chip

President Trump and other Republicans have conceded that the $1.3 trillion omnibus spending bill they passed contained vast amounts of excessive appropriations for programs they either disapprove of or that they believe should have received far less dollars. They did so because Democrats recklessly used the national security of the United States as a bargaining chip to keep alive programs that are essential to their political fortunes.

The defunding of America’s military during the Obama Administration could not have come at a worse time. Russia, China, Iran, and North Korea were dramatically building up their conventional and strategic forces while the U.S. slashed its own.  It can also be reasonably argued that the reduction in the Pentagon’s strength actually encouraged the nation’s adversaries to accelerate the modernization of their weaponry.

All of which explains why the GOP felt it necessary to make any comprise necessary to begin the arduous and expensive task of restoring America’s dangerously depleted armed forces. Ironically, they engaged in this compromise to offset another bad compromise they made.  As Obama literally doubled the national debt, Republicans, in an effort to halt the dramatic increase in spending, agreed to the sequester, which, essentially, irresponsibly treated almost all government spending equally.  Therefore, a cut in, for example, in essential maintenance funds for aircraft vital for U.S. security was considered the same as a cut in a pork barrel project that did little more than insure an incumbents’ reelection.

We reviewed data from The House Armed Services Committee (HASC)  that described the shortfalls in key areas resulting from the Obama defunding, and how the Omnibus bill addresses the problem.

The U.S. Air Force has been decimated. It’s smaller and older, than it has ever been, and it faces adversaries in Russia and China who are technologically equal to America. The average age of America’s military aircraft is over 27 years. Less than half of the Navy’s aircraft are capable of getting in the air at all, due to maintenance issues. The USAF is 2,000 pilots short, and those that remain get fewer flying hours than their predecessors did back in the ‘70’s when the military was considered a mere shell of itself. Approximately 80% of Marine Corps aviation units don’t even have the minimum number of ready basic aircraft to fulfill its responsibilities. The Omnibus bill provides $11.5 billion to repair or upgrade old aircraft, $33.7 billion to replace aircraft too old or broken to repair, and $2.2 billion to recruit and train more airmen and aircraft mechanics.
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The U.S. Navy, most analysts estimate, needs at least 350 ships to fulfill its mission.  Even that number is a far cry from the 600 ship number as recently as 1990. But as China moves rapidly towards becoming a major naval power and Russia builds increasingly sophisticated, cutting-edge technology submarines, the U.S. Navy muddles through with 275 or less vessels. It’s not only the numbers that are challenging.  HASC notes that there are “Serious readiness shortfalls, including insufficient time or resources to train Sailors or maintain ships.” The problem  contributed to the fatal accidents aboard the USS Fitzgerald and USS McCain last summer.” In some cases, sailors have been working over 100 hours a week to keep up with training requirements and current operations. Navy ships and submarines remain in port unable to sail and perform their mission due to critical maintenance that cannot be conducted due to budget cuts.  The Omnibus bill provides $12 billion to repair current ships, $23.3 billion for new vessels, and $2 billion to recruit and train sailors.

During the Obama Administration, the U.S. Army, including the National Guard and the reserves, was reduced by 120,000 soldiers. 15 brigade combat teams were eliminated. Of the remaining brigades, only 5 are considered “ready to fight.” The urgently needed funding to upgrade outdated equipment was cut in half during the Obama Administration. The omnibus bill provides $2.7 billion to repair Army equipment, $5.1 billion to recruit additional Soldiers, and $14.3 billion to replace or upgrade current equipment

The actual infrastructure of the armed forces has been crumbling. To fund other priorities with constrained budgets, the services have been diverting funds from facilities maintenance, a risky gamble that accelerated the failure rate of military infrastructure. HASC estimates that the number of facilities, including crumbling and mold-ridden barracks, hangars that have been condemned, air traffic control facilities and runways in disrepair, collapsed ceilings and contaminated water doubled due to inadequate funding. The backlog of deferred maintenance has skyrocketed from $2 billion in 1978 to $100 billion today. The Omnibus bill just passed provides $22.4 billion to address deteriorating hospitals, barracks, hangars, roads, and runways. That includes $13 billion for repairs, upgrades and maintenance, and $9.4 billion for new construction.

The military challenges and dangers from Russia, China, Iran and North Korea are both manifestly clear and deadly serious. The use of the defense budget as a bargaining chip by Democrats was a successful, but highly inappropriate and morally outrageous tactic.

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Quick Analysis

Trump Seeks Change in Defense Strategy Part 2

We continue our review of the Trump Administration’s change in defense strategy. As previously noted, The Trump Administration is seeking a dramatic but little-discussed shift in American defense planning.

Last year, the White House Executive Budget Request noted that  “The surest way to prevent war is to be prepared to win one…” It then altered the strategy that had prevailed since the fall of the Soviet Union, which had largely geared the U.S. military to fight smaller conflicts against less capable forces such as those possessed by Saddam Hussein’s Iraq.

That perspective began to change in the 2018 budget, when the White House noted that “Long-term strategic competitions with China and Russia are the principal priorities…These competitions require both increased and sustained investment, reflected in the Budget request, because of the magnitude of the threats they pose to U.S. security and prosperity today, and the potential for those threats to increase in the future. Concurrently, the Budget requests funding for sustained DOD efforts to deter and counter rogue regimes such as North Korea and Iran, defeat terrorist threats to the United States, and consolidate gains in Iraq and Afghanistan while ensuring these approaches are resource-sustainable. The Budget ensures the United States can maintain a joint force that possesses decisive advantages for any likely conflict, while remaining proficient across the entire spectrum of conflict.”

A prior Heritage Foundation and American Enterprise Institute analyses of each branch of the military revealed the following deficiencies:

Army: The U.S. Army should have 50 brigade combat teams (BCTs); Currently, it has only 32.   The force is rated as weak in capacity, readiness, and marginal in capability.“The Army has continued to trade end strength and modernization for improved readiness for current operations. However, accepting risks in these areas has enabled the Army to keep only one-third of its force at acceptable levels of readiness, and even for units deployed abroad, the Army has had to increase its reliance on contracted support to meet maintenance requirements. Budget cuts have affected combat units disproportionately: A 16 percent reduction in total end strength has led to a 32 percent reduction in the number of brigade combat teams and similar reductions in the number of combat aviation brigades. In summary, the Army is smaller, older, and weaker, a condition that is unlikely to change in the near future.”

What would this mean in the event of a major conflict? According to AEI “…a recent RAND war game found that U.S. European Command could not prevent Russian occupation of Baltic capitals within three days, leaving follow-on forces to fight through the Russian Kaliningrad exclave, which bristles with weapons and troops.”

Navy: The U.S. Navy should have 346 surface combatants; currently, it has only 273, and only one-third of those are considered mission-capable.  The force is rated as weak in capability, and marginal in capacity and readiness. “While the Navy is maintaining a moderate global presence, it has little ability to surge to meet wartime demands. Deferred maintenance has kept ships at sea but is also beginning to affect the Navy’s ability to deploy. With scores of ‘weak’ in capability (due largely to old platforms and troubled modernization programs) and ‘marginal’ in capacity, the Navy is currently just able to meet operational requirements. Continuing budget shortfalls in its shipbuilding account will hinder the Navy’s ability to improve its situation, both materially and quantitatively, for the next several years.

According to AEI combatant commanders have only 62 percent of the attack submarines they need. It also is short of fighter planes. One example: Defense One  reports “The U.S. Navy says it needs about 30 new Super Hornets, but it has only funded two in the Pentagon’s 2017 war budget. It has listed 14 planes as “unfunded priorities” and money would be needed for an additional 14 planes in 2018.”

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According to AEI, budget contractions have resulted in the current Air Force’s dubious honor of being the smallest and oldest in its history…as F-15/F-16 retirements outpace F-35 production. Another recent RAND war game showed it would require more fighter air wings than the Air Force currently fields in total to defeat a surge of Chinese aircraft over Taiwan.

Marine Corps: The USMC needs 36 battalions; it has only 24. It’s rated as weak in capacity marginal in capability and readiness. “The Corps continues to deal with readiness challenges driven by the combined effects of high operational tempo and low levels of funding. At times during 2016, less than one-third of its F/A-18s, a little more than a quarter of its heavy-lift helicopters, and only 43 percent of its overall aviation fleet were available for operational employment. Pilots not already in a deployed status were getting less than half of needed flight hours. The Corps’ modernization programs are generally in good shape, but it will take several years for the new equipment to be produced and fielded…the Corps has only two-thirds of the combat units that it actually needs, especially when accounting for expanded requirements that include cyber units and more crisis-response forces.”

The Nuclear Deterrent: [As the New York Analysis of Policy and Government has previously noted, Russia, for the first time in history, leads the world in nuclear weaponry.] The American nuclear arsenal is rated as weak in warhead modernization, delivery system modernization, and nuclear weapons complex, and marginal in readiness  and lab talent  It is only ranked strong in warhead surety and delivery reliability.  “Modernization, testing, and investment in intellectual and talent underpinnings continue to be the chief problems facing America’s nuclear enterprise. Delivery platforms are good, but the force depends on a very limited set of weapons (in number of designs) and models that are quite old, in stark contrast to the aggressive programs of competitor states. Of growing concern is the “marginal” score for ‘Allied Assurance’ at a time when Russia has rattled its nuclear saber in a number of recent provocative exercises; China has been more aggressive in militarily pressing its claims to the South and East China Seas; North Korea is heavily investing in a submarine-launched ballistic missile capability; and Iran has achieved a nuclear deal with the West that effectively preserves its nuclear capabilities development program for the foreseeable future.”

Russia has a larger nuclear capability than the U.S. China has more submarines and will soon have a larger navy. Both nations pose key threats to the U.S. Air Force, Notes the American Enterprise Institute. (AEI).  “…the [U.S.] Air Force has weakened relative to its adversaries. As China and Russia produce and export advanced air defense and counter-stealth systems alongside fifth-generation stealth fighters, the [U.S.] Air Force treads water, buying small numbers of F-35s while spending ever-larger sums on keeping F-15s and F-16s operational – though those aircraft cannot survive on the first-day front lines of modern air combat…Simply put, the armed forces are not large enough, modern enough and ready enough to meet today’s or tomorrow’s mission requirements. This is the outcome not only of fewer dollars, but of the reduced purchasing power of those investments, rising unbudgeted costs for politically difficult reforms continuously deferred, and a now-absent bipartisan consensus on U.S. national security that existed for generations.

National Review summarized the condition of the U.S. military by quoting U.S. service chiefs at budgetary hearings earlier this year: “General Ray Odierno, the Army chief of staff at the time, reported that ‘readiness has been degraded to its lowest level in 20 years. . . . Today we only have 33 percent of our brigades ready to the extent we would expect them to be if asked to fight.’ The chief of naval operations at the time, Admiral Jonathan Greenert, said, ‘Our contingency response force, that’s what’s on call from the United States, is one-third of what it should be and what it needs to be.’ The Air Force chief of staff, General Mark Welsh, said that if his airplanes were cars, ‘we currently have twelve fleets — twelve fleets of airplanes that qualify for antique license plates in the state of Virginia. We must modernize our Air Force.”

 

 

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Quick Analysis

Trump Seeks Change in Defense Strategy

The Trump Administration is seeking a dramatic but little-discussed shift in American defense strategy, and has made its intention clear in the 2019 Executive Budget Request.

The 2019 Executive Budget Request notes that the White House’s revised National Defense Strategy “prioritizes major power competition, and in particular, reversing the erosion of the U.S. military advantage in relation to China and Russia.” Specifics include increasing end strength for the Army, Navy and Air Force (+25,900), continuing the Department’s Missile Defeat and Defense Enhancement initiative, increasing procurement of preferred and advanced munitions, modernizing equipment for the second Army Armored Brigade Combat Team, buying ten combat ships, increasing production of the F-35 aircraft and F/A-18 aircraft, enhancing deterrence by modernizing the nuclear triad, Increasing funds to enhance communications and resiliency in space, supporting U.S. Armed Forces with a pay raise of 2.6 percent, and  increasing the emphasis on technology innovation for increased lethality.

Following the fall of the Soviet Union in 1991, it was mistakenly assumed that the era of great-power military confrontations was over as the Kremlin’s forces went into virtual hibernation.  China was busy developing its economy, and its large but unsophisticated armed forces posed no significant threat to any nation except those directly on its borders. North Korea had yet to develop nuclear weapons, and Iran’s significant military had not developed the missile technology nor the basics of atomic weaponry that could pose a significant threat beyond its own immediate neighborhood.

In response, the American military changed in character. Following 1991, it was substantially reduced. Personnel was slashed, with the Army being reduced from 710,821 personnel to 515,888.  The Navy went from 570,262 to 319,120. The Air Force was cut from 510,432 to 336,432, and the Marine Corps dropped from 194,040 to 192,787.

The Navy best symbolizes the extraordinary change.  It floated approximately 585 ships in 1991, and now has only 285. China’s navy will soon surpass that number.

The world, however, has changed again. Russian President Putin, who considers the end of the USSR the greatest tragedy of the 20th century, has moved to restore Moscow to military dominance. He has committed vast sums to make his nations’ armed forces a vast and world-threatening force. His nation now leads the world in nuclear armaments. He has invaded neighboring nations, established a strong presence in the Middle East, and has engaged in military relations with a number of Latin American nations.
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China’s rate of military spending has increased faster than either that of the USSR or the USA at the height of the Cold War, and those funds have produced results.  Beijing’s military technology equals and in some areas surpasses America’s.

Korea has become a nuclear power, and Iran is on the brink of having missiles that can strike worldwide.

Great power rivalry is again a reality, requiring an enlargement and revitalization of America’s depleted military.

During the Obama Administration, an American Enterprise Institute (AEI) study describes the state of U.S. defenses as “a force-planning construct that is woefully inadequate for the global and everyday demands of wartime and peacetime… Gone is any plan that foresees conflict taking longer than one year in duration or any contingency with a whiff of stability operations, long-term counterinsurgency or counter-insurrection, or nation building of the type seen in Iraq and Afghanistan… After six years of budget cuts and operational shifts, hard choices have in many cases turned into stupid or bad ones. Fewer resources and the lack of bipartisan consensus in favor of a strong defense have forced commanders and planners across services to accept previously unthinkable risks as they pick and choose which portions of the national defense strategy to implement… Unmentioned is that the risk to the force grows each passing year. It is now at crisis levels and promises unnecessarily longer wars, higher numbers of wounded or killed in action, and outright potential for mission failure.”

Defense One  noted that it’s not just manpower and hardware that’s the problem. America is losing its lead in technology as well.  ‘The Pentagon is worried that rivals are developing their capabilities faster than the U.S. is rolling out new ones. The edge is shrinking.’

The Report Concludes Tomorrow.

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Should National Security be a Bargaining Chip? Part 2

Should national security be a bargaining chip in budget negotiations?  The New York Analysis of Policy and Government continues its examination of this debate.

Writing in Questia, Lawrence P. Farrell Jr. noted: “…any debate about defense spending must address the strategy issue. An assessment of needed military capabilities flows from the national military strategy…Most pundits ignore this critical link, and much of the discussion that takes place in the media fails to note that analysts, in some very significant ways, redefine strategy for the purposes of their arguments. In some cases, this is explicitly defined, but in others, it is implicit and one wonders if the pundits are even aware of the difference between their analyses and the official national strategy.”

A 2015 Heritage analysis by Justin T. Johnson explained: “Instead of arguing the merits of a particular military spending level, much of the debate [revolves] around Democratic opposition to increasing defense spending without proportional increases to non-defense spending. The usual arguments for cutting defense spending will likely pop up as well. But what’s really needed is a more thoughtful debate… The first step is determining the vital interests of the United States. What must we, as a country, protect?…The next step is figuring out what threatens these vital interests…The third step is figuring out how to protect America’s vital interests from both the threats of today and those of the future.

“Once you have a strategy, you need to develop the tools to implement that strategy. For the military, this means figuring out the capabilities and the capacity needed to execute the strategy…Answering questions of capability and capacity will lead directly to a defense budget… [However] Since the imposition of the Budget Control Act in 2011, the base defense budget (excluding war costs) has gone down by 15 percent in real terms, while the threats to U.S. vital interests have, if anything, increased.”

“The prior administration, Congressional Democrats, and Republican budgets hawks adopted the sequester which effectively cut defense spending. The results were disastrous.  When President Obama prematurely withdrew American forces from Iraq, it allowed ISIS to become a regional power. The former president gave in to Moscow’s demands on anti-ballistic missile defense, and Putin increased nuclear weaponry. Obama refused to confront either Russia or China over aggressive acts in Europe and the Pacific, and these U.S. enemies dramatically ramped up their threats worldwide and expanded their armed presence throughout the planet. Obama withdrew, for the first time since the end of the Second World War, American tanks from Europe, and Putin proceeded to invade and threaten his neighbors.”

President Obama hoped to “Reset” Russian American relations by essentially ceding the lead in military power to Moscow.  His New START treaty gave the Kremlin, for the first time in history, a more powerful nuclear arsenal than Washington. He dramatically weakened the U.S. military presence in Europe.
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President Obama’s attempt to “Reset” relations with Russia was actually the centerpiece of his foreign and defense policies.

Writing in the Moscow Times, Sergei Karagonov opined on what he believes was the flawed concept of Mr. Obama’s reset, even from the Russian perspective: (the perspective of American critics is that it gave too much to Russia without gaining anything substantive in return) “…the U.S. proposed nuclear weapons reductions as the primary mechanism of the diplomatic reset…But progress soon stalled with Russia rejecting U.S. proposals…In the hope of breaking the deadlock, Obama signaled his willingness to compromise.  But Putin had little reason to reciprocate, not least because agreement on the issue would have opened the door to further nuclear arms reductions. Moreover, members of Russia’s military and political elite hoped to use some of the country’s oil revenues to deploy a new generation of ICBMs…By focusing on nuclear disarmament and new START, Obama’s reset strategy remilitarized the U.S.-Russia relationship while marginalizing issues that could have reoriented bilateral ties toward the future.  In this sense, the initiative was doomed from the start, and the whole world has suffered as a result.”

What was manifestly evident was Mr. Obama’s desire to downsize of the U.S. military, regardless of external factors. Indeed, despite the reduction of U.S. defense spending as a percent of the GDP and the federal budget to historic low points, and rising, dangerous threats from abroad, the U.S. military was forced absorb massive new cuts.

During the Obama Administration, in 2014, former Rep. Randy Forbes (R-Va.)  outlined how deeply American forces had been cut.  The U.S. Navy was reduced from 546 ships to 285; The U.S. Army was reduced from 76 brigades to 45; and The USAF lost about half of its fighter and bomber squadrons.  Remember, in the intervening years since then, U.S. armed forces have become older, absorbed more years of use, and endured further inadequate budgets.

The bleeding continues, as American aircraft and naval vessels become increasingly unsafe due to a lack of parts and maintenance, and our personnel become exhausted from excessive workloads mandated by the reduced numbers of soldiers, sailors, airmen and Marines. Meanwhile,  the threats from Russia, China, Iran, North Korea and terrorists increase.

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Should National Security be a Bargaining Chip?

The provision of an adequate defense budget for America’s diminished armed forces in the face of rapidly growing international threats has been held hostage to political issues including immigration, increased domestic programs, and spending caps. It is a dangerous act, the governmental equivalent of a family refusing to fix a collapsed roof in their home until they can also afford a new big-screen television.

The current flashpoint is the tactic by Senator Schumer (Dem-NY) and Rep. Pelosi (D-Ca.)  to withhold necessary defense spending  unless Republicans surrender on immigration issues.

it’s not the first time this tact has been taken. In the past few years, the Obama Administration withheld urgently needed budgetary support for the armed services unless Congress authorized increases in domestic spending, despite the former president’s increase of over 40% in some entitlement programs, his $780 billion stimulus program, and other costly (and, some would argue, unsuccessful) domestic initiatives.

In 2016, the Washington Examiner reported, after Democrats had blocked a defense spending bill for the third time, that “The Obama administration reportedly put together a five-page memo about blocking increases for the Pentagon unless they are accompanied by increases on other programs…It is one thing to insist on fiscal probity within the Pentagon, quite another to prevent proper national defense until the majority party caves in and allows further federal overspending on domestic programs.”

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There is a profound difference between the pragmatic worldview of those seeking to provide necessary funds for the Pentagon, and those who view defense as just one more Washington program. The Hill  reported that “Rep. Adam Smith (D-Wash.) said he opposes the administration’s push to expand the U.S. nuclear arsenal because ‘we can’t afford it.’… the congressman argued for ‘a national security strategy that realistically reflects the amount of money that we’re going to have.’”

Rep. Smith’s position fails to pass a logic test.  The world of threats facing America will not respond to Washington’s internecine debates.  The threats are real, not political. Further, it was proven quite rigorously during the Obama Administration that when the U.S. reduces the strength of its military or its military commitments, military dangers increase.

The latest pushback on this extraordinarily hazardous practice came from Speaker Paul Ryan, in a January address to the Center for Strategic and International Studies  :

“…the federal government has a lot of responsibilities, but its first and its foremost responsibility is our national defense… We have to be clear-eyed in laying out for the American people why so much is at stake. Rebuilding our military is essential to confronting the threats we face, threats that are evolving at an alarmingly rapid pace. North Korea is working to build ballistic missiles capable of hitting the continental United States. Iran is marching forward with its quest for regional hegemony by backing terrorism across the globe. And what is left of ISIS is trying to figure out how to expand and influence terrorism in the Middle East, in Afghanistan, and into the West, including by inspiring attacks right here at home…Then there are those countries that want to remake the world order in their authoritarian image…Russia is trying to drive holes through NATO, while threatening some of our closest allies in Eastern Europe; while the Chinese aggression continues to stir instability in the South China Sea. And these threats are particularly serious, because allowing Russia and China to upend the post-Cold War order first and foremost affects us right here at home… We have simply pushed our military past the breaking point. Instead of upgrading our hardware, we have let our equipment age. Instead of equipping our troops for tomorrow’s fight, we have let them become woefully underequipped. Funding for modernizing the Army has been cut in half in the past eight years. Navy sailors are putting in 100-hour work weeks, and less than half of their aircraft are capable of flying. So we’re pushing our sailors to 100-hour work weeks and half of their planes can fly. Roughly 80 percent of the Marine Corps aviation units lack the minimum number of ready basic aircraft. The Air Force is the smallest size in our nation’s history, and the average age of their aircraft is 27 years old. The cost of these readiness deficiencies are really dire, and this is literally costing us lives. Here’s the statistic that gets me the most. In total, we lost 80 lives due to training accidents in 2017 alone. That is four times as many were killed in combat. Four times were lost last year in training accidents versus combat…”

The Report Concludes Tomorrow

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Why America’s Economy is Failing

The federal 2017 fiscal year began this month, and the news about its 2016 predecessor is deeply worrisome.

According to the Treasury Department, Washington spent more than $587 billion than it took in in revenue, a deficit that jumped 34% from last year. The government spent $3.9 trillion dollars, but took in “only” $3.3 trillion, a record high amount.  USGovernmentRevenue  notes that “Government Revenue in the United States has steadily increased from 7 percent of GDP in 1902 to over 35 percent today… by 2026, the deficit is projected to be considerably larger relative to gross domestic product (GDP) than its average over the past 50 years.”

The US Debt Clock notes that as of the time this report was being prepared, the federal debt was $19,703,158,000,000. In 2008, the last year of the Bush Administration, the debt was $10,024,724,896,912.49, as recorded by Polidiotic,  As a sign of the weakening economy, the federal budget deficit will increase in relation to economic output for the first time since 2009.

Relief is nowhere in sight, The Congressional Budget Office reports that “If current laws generally remained unchanged—an assumption underlying CBO’s baseline projections—deficits would continue to mount over the next 10 years, and debt held by the public would rise from its already high level.”

The Obama Administration has almost doubled the national debt. What’s worse, it has nothing to show for all that spending. It cannot blame the 2007—2009 recession (which was the result of federal policies that forced lending institutions to give credit to individuals with a poor prospects of paying it back.) “Even seven years after the recession ended, the current stretch of economic gains has yielded less growth than much shorter business cycles…In terms of average annual growth, the pace of [the post recession period]… has been by far the weakest of any since 1949” notes the Wall Street Journal.

The Obama approach to spending and federal budgeting has devastated the middle class. The Institute for Policy Innovation notes that when it comes to the middle class he “has failed miserably… Median household income is lower today than when he took office.” Senior Citizens have been poorly treated, receiving less in cost of living increases than they have at any time in decades.

Where has the money gone?

America’s infrastructure needs are certainly not being met.

The American Society of Civil Engineers “2013 Report Card for America’s Infrastructure” graded the nation’s infrastructure a “D+” . In 2013, for surface transportation categories:

  • Roads received a grade of D as compared to a grade of D- in 2009;
  • Bridges received a grade of C+, up from a C in 2009;
  • Transit received a D, showing no change from 2009; and
  • Rail received a grade of C+, up from a C-, the greatest increase in the 2009 Report Card.”

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There has been no noticeable improvement since that analysis was completed.

The spending hasn’t gone into defense, either.  In constant 2015 dollars, the Pentagon has been cut from $740 billion in 2009 to $525 billion in 2016, as reported by Heritage. Even crucial needs are going unmet. As Russia, China, and North Korea ramp up their nuclear arsenals, President Obama has actually decreased his funding requests for crucially needed missile defense. The last request by President Bush was for $9.3 billion; the 2016 request by President Obama was $8.1 billion. Nor has the current White House taken any effective action to protect the nation’s electrical grid from an EMP disaster resulting either from a natural occurrence or an enemy attack. Such an incident could destroy the entire U.S. electrical grid, resulting in massive casualties from the lack of power, shut down reservoirs, and the elimination of any means to transport food or provide medical care. Other more conventional military elements, such as manpower, have also been cut.  America’s Army is now smaller than North Korea’s, our navy is the smallest it has been since World War I, and the air force’s inventory of planes is the smallest and oldest it has been in the entire history of that service.

Even comparatively tiny federal programs have been slashed. NASA’s manned space flight effort was virtually eliminated by Obama.  The Space Shuttle program was prematurely shut down. Its planned successor was also cut. NASA will not be capable of putting an astronaut in space until the next decade. At a Congressional hearing earlier this year reported by the Daily Caller.  Rep. Brian Babin,(R-Texas)  chairman of the House Subcommittee on Space stated that the White House “budget takes our human spaceflight program nowhere fast. This budget undermines our space program and diverts critical funding to lower priority items…Orion and [the Space Launch System] are strategic national assets and must be sufficiently funded. Proposed cuts to the planetary science division are equally disturbing.”

The basic, and very expensive,  thrust of President Obama’s budgetary policies has been de-emphasizing a capitalist approach that, despite occasional recessions, was responsible for developing and maintaining the planet’s most robust economy, replacing it with one that more closely resembles the social democrat approaches of other nations, including large welfare programs (the supplemental nutrition assistance program has grown 42% under his watch) and the transformation of America’s medical system into a more federally centered effort. In large part, “Obamacare” is based on federal subsidies. Not unsurprisingly, many report that the quality of care has been reduced.

Mr. Obama’s emphasis on attempting to reduce poverty through vast spending programs has backfired. Indeed, the poverty rate has actually gone up on his watch, increasing from 13.2% in 2008 to 13.5%, while destabilizing the federal budget.

Attacking the engine of economic growth–the free market–with excess regulations and continued high taxes–while initiating massive spending on social programs driven more by ideology and politics than the hope of actually producing a growing economy has caused significant harm both to the federal budget and the overall economic health of the nation.

 

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More Taxes, More Spending, Nothing Resolved

If there is one area that government has been unquestionably successful in over the past several decades, it has been in collecting revenue.  Despite stagnant wages and a moribund economy, the dollars keep rolling in to both Washington and state capitals.

Taxrevenue.com estimates that the “direct revenue” collected in fiscal year 2016 breaks down as follows:  Approximately $3.3 trillion went to Washington, $1.9 trillion to the states, and $1.4 trillion to local governments. Combined, all that totals $6.6 trillion.

The U.S. Census Bureau reported after last year’s April 15 tax day headline that “State government tax revenue increased 2.2 percent, from $847.1 billion in fiscal year 2013 to $865.8 billion in 2014, the fourth consecutive increase… General sales and gross receipts taxes drove most of the revenue growth, increasing from $258.9 billion to $271.3 billion, or 4.8 percent. Severance taxes (levies imposed on removal of natural resources) increased 6.0 percent, from $16.8 billion to $17.8 billion, and motor fuel taxes increased 3.4 percent, from $40.1 billion to $41.5 billion.”

On the federal side, A Freebeacon analysis  reports, “since 1998, tax revenues have increased 30 percent.” In FY 2015, Washington took in approximately $3.3 trillion.

For all that increased revenue, however, Americans have gained very little. Some salient examples:  Social Security remains headed for insolvency. Government pensions are underfunded.  The poverty rate remains virtually unchanged since the War on Poverty began in the 1960’s. In the face of massive new threats from Russia, China, Iran, North Korea and terrorists, the Pentagon has endured substantial cuts.  Infrastructure needs go unmet, with bridges, highways, water systems and other key elements in disrepair. NASA can’t put an astronaut in space other than by hitchhiking on a foreign craft.

And, of course, there is the debt and the deficit.  The federal debt has skyrocketed by over $8 trillion during the Obama Administration, soaring from $10,626,877,048,913 on the day he was first inaugurated to $18,722,746,583,118 currently.
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A CNS News study  found that “the portion of the federal government’s debt that is held by the public…has more than doubled during President Barack Obama’s time in office” up by 113.8 percent.

Although the states, more restricted in their ability to engage in deficit spending, (they can’t print money like Washington) have been more stable than the national government, they too face challenges. The Mercatus organization notes that “there are troubling signs that many states are still ignoring the risks on their books, mainly in underfunded pensions and health care benefits. Even states that appear to be fiscally robust—perhaps owing to large amounts of cash on hand or revenue streams from natural resources—must take stock of their long-term fiscal health before making future public policy decisions.”

Despite all the increased revenue Washington and the states have consumed, and their lack of success in using it to balance their books or improve conditions, there are proposals to increase taxes even more.

A Tax Policy Center  analysis concludes that Bernie Sanders’ tax proposals would increase taxes by $15.3 trillion over the next decade. The Center also concludes that Clinton’s tax plan “would generate $1 trillion in additional revenue for the government over the first decade and an additional $2 trillion over the next 20 years.” The Sanders and Clinton tax increase plans apparently are not aimed at paying down the debt or addressing the many needs noted above.  Rather, they seek to finance new spending programs, including, depending on the candidate, high ticket items such as free college, universal health insurance, or continuing the massive increase in entitlements (such as food stamps) that have been the hallmark of the Obama tenure in office.  That leaves all those essential areas, including social security, defense, infrastructure, still facing massive solvency challenges.

In contrast, the Republican candidates look to cut taxes, but critics note that they don’t provide adequate details on how the lost revenue would be replaced.

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The 2017 Federal Budget: More Deficit, Hiked Taxes

The President has released his 2017 proposed budget. At the unveiling, White House Press Secretary Josh Earnest noted:

Budgets are important because they enumerate priorities.  And when you have something that’s this detailed, there’s no fudging.  It becomes quite clear when you look at the numbers what you believe rates.  And that’s the importance of this exercise.  I readily acknowledge, as I have on many occasions, that there are some priorities that we have that are deeply held that Republicans in Congress do not share.  And there will be differences of opinion about the priorities that are laid out in here.”

The New York Analysis of Policy & Government has reviewed the White House’s statements,  information from the Office of Management and Budget,  and the Congressional Budget Office (CBO)   as well as comments from those both favoring and disagreeing with his general direction, such as the National Priorities Project,  the Heritage Foundation,  and other sources.

Total spending comes to about $4.2 trillion, an increase of approximately 4% over 2016 levels. The President anticipates taking in about $3.6 trillion in revenue, leaving a vast gap of $398.4 billion to add to America’s current debt of over $19 trillion. Analyzing the current budget shortfall, the Congressional Budget Office reports, “At 2.9 percent of gross domestic product (GDP), the expected shortfall for 2016 will mark the first time that the deficit has risen in relation to the size of the economy since…2009.”

CBO notes:

“In 2016, the federal budget deficit will increase, in relation to the size of the economy, for the first time since 2009, according to the Congressional Budget Office’s estimates. If current laws generally remained unchanged, the deficit would grow over the next 10 years, and by 2026 it would be considerably larger than its average over the past 50 years, CBO projects. Debt held by the public would also grow significantly from its already high level… The deficit projected by CBO would increase debt held by the public to 76 percent of GDP by the end of 2016, the agency estimates—about 2 percentage points higher than it was last year and higher than it has been since the years immediately following World War II.”

According to Office of Management and Budget, spending is divided as follows:

Social Security, Unemployment, & Labor, $1.39 trillion, 33% of all federal spending

Medicare & Health, $1.17 trillion, 28% of all federal spending

Defense, $632 billion, 15% of all federal spending

Interest on the National Debt, $303 billion, 7% of all federal spending

Veterans Benefits, $179 billion, 4% of all federal spending

Agriculture & Food, $138 billion, 3% of all federal spending

Transportation, $109 billion, 3% of all federal spending

Housing & Community Development, $90 billion, 2% of all federal spending
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Education, $85 billion, 2% of all federal spending

Environmental and Energy, $51 billion, 1% of all federal spending

International relations, $45 billion, 1% of all federal spending

Science, $32 billion, 1% of all federal spending

Government expenses, $8 billion, less than 1% of all federal spending

As noted above, there will not be adequate revenue to pay for the proposed spending. The heaviest burden of providing payments comes from Individual income, payroll, and corporate taxes. The projections are based on an assumption that the economy will grow at an average rate of 2.5 percent, a continuation of the weak rate that the nation has endured over the past several years.

Here’s where the anticipated revenue is expected to come from:

Individual income taxes, $1.79 trillion, 49% of all federal revenue

Payroll taxes, $1.14 trillion, 31% of all federal revenue

Corporate income taxes, $419 billion, 11% of all federal revenue

Miscellaneous & legislative proposals , $146, (approximately) 4%+ of all federal revenue

Excise taxes, $110 billion, 3% of all federal revenue

Customs Duties, $40 billion, 1% of all federal revenue

A controversial revenue enhancer contained in the President’s budget is a $10 per barrel tax on oil, which observers estimate would result in 22 cent per gallon tax passed down to consumers of gasoline, diesel fuel, home heating oil, jet fuel, and other petroleum liquids.