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How Would You Spend $716 Billion?

Words: Seamus P. Daniels
Pictures: Jimi Filipovski

I’m a defense budget analyst by trade. As you might guess, that line of work doesn’t make for great happy hour conversation. For some reason, most people would prefer to discuss something other than “Overseas Contingency Operations,” “sequestration,” and “budget caps” over drinks. I can’t imagine why.

But I don’t blame them. Defense budget analysis is consumed by technical language and thousands of pages of federal appropriations legislation, which may understandably discourage some.

When I do end up in conversations on the defense budget, they usually take one of two trajectories: either the United States is spending too much on defense or it’s underfunding the military. I’m not saying that these opinions are invalid; far from it. Healthy debate on the fiscal priorities of our nation is essential to ensure that taxpayer dollars are being spent responsibly. But as a politically neutral commentator on the defense budget, one-off, oversimplified statements can often take on a cringe-worthy partisan tone that distracts from vital conversations on the resourcing of defense priorities. They are symptomatic of a larger issue in that debates over defense spending are often divorced from discussions of military strategy and our national security priorities.

Strategy is inherently based on the alignment of ends, ways, and means. Which is just what it sounds like: the development of a successful defense strategy rests on the effective coordination of a country’s security priorities with the resources available to it. This requires policymakers to make tradeoffs as they establish goals for our national security policy. When those tradeoffs aren’t clearly delineated, questions arise as to the efficacy of that strategy and how it will be implemented. The grounding of strategy in fiscal reality is particularly important in the current Budget Control Act era, which caps federal spending.

Defense budget analysis can often be complex and confusing, and some may take advantage of that complexity to push a particular agenda.

However, the current debate on defense spending is dominated by politicized sound bytes that accuse one side of neglecting our military while remonstrating the other side for neglecting domestic priorities. We are in need of more informed, productive discussions on how to best align resources with national priorities, regardless of political affiliation. Those conversations must weigh defense spending levels with the defined strategy and our national security goals more broadly. Advocates of higher defense spending need to specify why additional funding is necessary in the context of strategy and note whether that additional funding will come from offsetting cuts, higher taxes, or higher deficits. Similarly, supporters of smaller defense budgets need to recognize the strategic implications of reducing commitments and specify what programs should be cut.

But you don’t have to live the exciting life of a defense budget analyst to have a more informed discussion on defense spending levels and strategy. Here are a few useful tips to approach conversations about defense spending:

Know the numbers. $716 billion. $674 billion. $686 billion. $1 trillion. All of these numbers can refer to the U.S. defense budget for the 2019 fiscal year. But each figure refers to a different scope and definition of the defense budget. The plethora of ways to quantitatively describe the budget can be confusing if not properly delineated. Most people describe the defense budget in terms of “discretionary funding,” which Congress appropriates annually. Total discretionary funding for national defense is $716 billion in FY 2019. That amount includes $686 billion for the Department of Defense (including $69 billion in war funding, or OCO), $22 billion for atomic energy programs under the Department of Energy, and roughly $8 billion for other defense-related programs in other parts of the federal government. Throw in “mandatory spending”—which is automatically appropriated annually without Congress having to do anything—and the budget is up to $727 billion. If you decide to add veterans benefits and all other defense-related expenses in other parts of the federal budget, total discretionary and mandatory funding for all defense-related budget functions passes the $1 trillion mark. To make this more confusing, the defense budget is broken up among different appropriations bills passed by Congress. The defense appropriations bill, for example, does not include all DoD funding.

Think in context. Don’t look at the defense budget as a single number. Remember: analyze spending levels in the context of changes in strategy and the threat environment. The Department of Defense publishes 5-year projections for defense spending called the Future Years Defense Program (FYDP). Check whether the budget is expected to rise, fall, or stay the same—and in what areas. Looking backward can be as helpful as looking forward, too. Assess defense spending in a historical context to see how the budget has fluctuated with force structure over time. And always be sure to check whether you’re looking at past budgets in inflation-adjusted dollars.

Be wary of biased arguments. Defense budget analysis can often be complex and confusing, and some may take advantage of that complexity to push a particular agenda. Look out for the misuse of technical budget terms like sequestration that have been used to overstate the impact of the Budget Control Act on defense spending. Additionally, be sure to double check the evidence used to support arguments on defense funding levels. Some advocates for higher defense budgets may point to falling defense spending levels as percentages of GDP and total federal outlays as a sign that defense spending is declining. In reality, defense as a percentage of GDP and of total federal outlays has decreased as a result of a growing economy and increases in overall government spending.

Having a firm understanding of the defense budget—without worrying about all its nuts and bolts—can better inform debates over defense spending and strategy. If you follow these tips, you can make your next happy hour discussion on the defense budget a more productive one.

Basically, I’m just trying to help you help me fit in.

Seamus P. Daniels is a defense budget analyst in the International Security Program at the Center for Strategic and International Studies (CSIS) in Washington, D.C. His research focuses on defense funding and military readiness issues.

Seamus P. Daniels

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