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CBO Report: Prepare for Years of Defense Cuts

Mar. 19, 2013 - 10:30AM   |  
By Rick Maze   |   Comments
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The U.S. Defense Department should be prepared for budget cuts every year through 2021 to remain within the spending caps set by the 2011 Budget Control Act, the nonpartisan Congressional Budget Office (CBO) warns in a new report.

The $5.5 trillion, 10-year course for defense spending set by the Pentagon in the 2013 budget would soar $889 billion over the spending caps agreed to by Congress and President Obama, says the report, released late Monday.

Release of the report comes as the House and Senate are debating the 2014 budget, with the Budget Control Act spending caps the highest level of spending under discussion.

CBO warns that “even after the reduction in 2013, the department will have to cut back on its forces and activities a little more every year through 2021 or find additional efficiencies each year to remain within the budget caps.”

Making those reductions could be difficult, the report says, because the planned reduction of 90,000 active-duty members will have ended in 2017, about the same time the services plan to begin purchasing weapons now being delayed for budgetary reasons.

The main purpose of the report is to look at options for coping with reduced defense spending. Additional cuts in force structure are part of the mix largely because current plans call for a 6 percent personnel cut, far less than the 33 percent reduction made after the end of the Cold War.

Other options for cuts are already under discussion, such as capping military and civilian raises, making beneficiaries pay more for health coverage and selectively cutting weapon programs or research.

The report, “Approaches for Scaling Back the Defense Department’s Budget Plans,” suggests several combinations of these options would reduce spending enough to stay within the budget caps. However, if personnel cuts are a primary means of staying within the limits, these reductions would have to begin in 2014 because it would take time to make those reductions and realize the savings.

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