FPI Bulletin: Defense Bill Sets Up Clash with White House

May 10, 2016

In one week’s time, the House will begin consideration of the National Defense Authorization Act (NDAA) for fiscal year 2017. Sixty out of 62 members of the Armed Services Committee voted to approve the draft NDAA, yet the bill has already drawn heavy fire from Secretary of Defense Ashton Carter. The immediate focus of this conflict is a dispute over the interpretation of last fall’s budget pact, yet its underlying cause is President Obama’s insistence that every additional dollar spent on defense must be matched by another dollar spent on domestic programs.

Origins of the Debate

Republicans and Democrats alike have denounced the deep cuts to the defense budget that were triggered by the sequestration provisions of the Budget Control Act (BCA) of 2011. With one voice, the leaders of the U.S. military have testified that these cuts put American lives at risk while undermining the Armed Forces’ ability to execute the nation’s defense strategy. In contrast, there is plentiful discord on the merit of sequestration-related cuts to domestic programs. Republicans want to preserve them, whereas Democrats insist on seeing them undone.

In a series of budget deals over the past three and a half years, the White House has extracted increased spending for domestic programs as the price for giving the Pentagon budgetary relief. Secretary Carter has affirmed the administration’s view that this precedent is binding.  In 2015 he told the Senate, “Because that principle – matching defense increases with non-defense increases dollar-for-dollar – was a basic condition of the bipartisan agreement we got in 2013, the President sees no reason why we shouldn’t uphold those same principles in any agreement now.”

In contrast, Republicans reject the dollar-for-dollar rule as a derogation of the federal government’s constitutional responsibility to provide for the common defense.  Sharing that sentiment, the Washington Post editorial board has argued, “When all is said and done, national defense is a clear constitutional responsibility of the federal government; fully funding it should take priority.” Where Republicans are divided is the question of whether to reject any negotiations based on the dollar-for-dollar rule, or whether the imperative of providing relief for the military takes precedence. Although two-thirds of House and Senate Republicans rejected the compromise laid out by the budget deal last October, the votes of the remaining third were sufficient to ensure its passage.

Parsing the Budget Deal

Last fall, when then Speaker of the House John Boehner announced the terms of the Bipartisan Budget Act (BBA), he stated that President Obama had accepted a partial exception to the dollar-for-dollar rule. Specifically, the deal included a “legislative floor” on funding for Overseas Contingency Operations (OCO), which include the war in Afghanistan, the campaign against the Islamic State, and new deterrence measures in Eastern Europe. If these operations proved to be more expensive than expected, the President would request additional funding only for OCO and not for domestic programs.

In his budget request for FY17, the President asked for $59 billion in OCO funding, precisely the minimum which the BBA had set its legislative floor. In response, Rep. Mac Thornberry, chairman of the House Armed Services Committee, argued that the White House had acted in bad faith, because it acknowledged that the cost of operations had risen, yet refused to ask for additional OCO dollars. Instead, the FY17 request reduced funding for some elements of OCO to cover the rising cost of others.

Thornberry’s draft of the NDAA would shift these funds back to where he believes they ought to be. However, his version of the bill does not increase the total amount of funding for OCO, which means that it does not cover the rising cost of ongoing operations in the Middle East or Eastern Europe. Instead, the bill covers the cost of these operations for only the first seven months of the fiscal year, through April 2017, after which President Obama’s successor would need to seek additional funding.

The secretary of defense angrily criticized this approach as “troubling” and “flawed” because “it’s gambling with warfighting money at a time of war – proposing to cut off our troops’ funding in places like Afghanistan, Iraq, and Syria in the middle of the year.” Carter added, “It’s a step in the direction of unraveling the Bipartisan Budget Act, which provided critical stability that DOD needs now and desires for the future.”

The charge of gambling with warfighter money is disingenuous, since Carter knows that Congress will grant any funding the White House requests on behalf of troops in the field. The real issue is that the White House continues to reject any exceptions to the dollar-for-dollar rule.  In effect, the House version of the NDAA turns the tables on the White House, whose budget proposal sought to exploit ambiguities in the text of the budget deal.

Next Step the Senate

If the House version of the NDAA makes it to the President’s desk, there is good reason to believe he will veto the bill, like he did last year’s NDAA. Yet any discussion of a potential veto is premature, because the Senate may not go along with the House approach.

This week, the Senate Armed Services Committee (SASC) will mark up its version of the NDAA for FY17. One possibility is that the SASC will increase the defense topline by $18 billion, covering the shortfall in the administration’s request and providing full-year funding for OCO operations. This increase would be no less anathema to the White House, since it also dispenses with the dollar-for-dollar rule.

In any case, the final shape of the NDAA will likely remain uncertain until the two versions of the bill go to conference, probably toward the end of the summer. At the moment, it is difficult to foresee any compromise that would satisfy both the White House and the Republican majority in Congress. Thus, it appears as though the defense bill is again headed for an end-of-year showdown, while the readiness and technological advantages of the Armed Forces continue to erode because there no agreement on how to undo the damage inflicted by the BCA.

Mission Statement

The Foreign Policy Initiative seeks to promote an active U.S. foreign policy committed to robust support for democratic allies, human rights, a strong American military equipped to meet the challenges of the 21st century, and strengthening America’s global economic competitiveness.
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