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  • CSBA: Caps Will Go Up, But BCA Will Likely Persist

    Todd Harrison, an analysis with the Center for Strategic and Budgetary Assessments, briefs the press on Jan. 30, 2015, on the Fiscal 2016 budget days before its official release. Screen shot image.

    With the 2016 President’s budget submission expected to roll out today, spending limits from the Budget Control Act could finally be lifted, said Todd Harrison, senior analyst with the Center for Strategic and Budgetary Assessments, on Friday. Harrison, however, said hopes should be tempered, as budget trends since 2011 suggest its unlikely a permanent solution is imminent. The President is requesting roughly $35 billion more in DOD funding than budget caps allow, according to reports, some $534 billion that does not include contingency funding, Harrison said.  If Congress appropriated this amount, it would result in a sequester, which would necessitate a change to caps in the law. Over the last several years, the President’s budget has steadily come down and BCA caps have been adjusted up. The two are just now converging, Harrison said. For Fiscal 2016, Harrison forecasted, Congress will likely raise the budget caps but getting votes will not be easy. “If you raise the defense cap by $10 billion, and non defense discretionary spending by $10 billion, how do you offset that?” he asked. Another one- or two-year budget deal makes sense politically, as it will adjust spending upward but not fix BCA permanently. “I would expect another last minute deal,” he said. “And if they’re smart they’ll do a two-year deal, which puts (another decision) off until after the presidential election.” (Watch the event video and slides).

  • The BCA, OCO Funds and the Sequester

    2/2/2015

    Budget caps for defense spending are not cut and dry, Center for Strategic and Budgetary Assessments analysis Todd Harrison told reporters during a Jan. 30 briefing, just days before the Fiscal 2016 budget submission. Portions of defense spending do not count towards Budget Control Act caps, such as overseas contingency operations funds and military personnel accounts. However, Harrison said the OCO budget is not exempt from cuts if a sequester penalty is invoked, which is what happened in Fiscal 2013. The OCO accounts have grown in size since the BCA was enacted, even as the US has drawn down its combat mission in Afghanistan, as it has again become a fund for both Congress and the Pentagon to get around spending limits. In addition to drawdown costs, the OCO fund became the place for the Defense Department to put money that supports other operations, such as the US presence in the Persian Gulf and operations in the Horn of Africa, and it appears DOD will use OCO to circumvent budget caps to pay for new non-combat spending. Last year’s European Reassurance Funds, to build NATO presence in Europe after Russia’s Crimea intervention, were in OCO and it appears they will be again, Harrison noted. That may be hard to swallow for some fiscal hawks in Congress who argue it should be in the base budget, added Harrison. (Watch the event video and slides).

  • What to Watch in 2016 Budget

    Center for Strategic and Budgetary Assessments analysis Todd Harrison told reporters Jan. 30 there are many issues the White House and Congress will likely remain at odds over, but some may still see some movement in the Fiscal 2016 budget, including the newly released report of the Military Compensation and Retirement Modernization Commission. All indications are that the Defense Department will again seek to retire legacy systems like the A-10 in order to find savings and seek another round of base closures, neither of which will likely see much success, he noted. But on compensation, there may be room to deal. The just-issued MCRMC report comes too late for the President’s 2016 budget proposal, but just in time for Congress to debate it. The MCRMC proposal offers more flexibility in retirement and health care, and allows DOD to be more creative and “incentivize” key careers, Harrison notes. New incentives could be introduced, such as retaining remotely piloted aircraft pilots by offering to match 401K contributions up to 10 or even 20 percent, he noted. There’s a chance for DOD to “flatten the growth curve” of personnel costs if some of the reforms are adopted, Harrison said. (Watch the event video and slides).

  • Montana Sunset

    2/2/2015

    Air Frame: SSgt. Ryan Oliver, a special mission aviator with the 40th Helicopter Squadron, inspects the rotor on a UH-1N on Jan. 27, 2015, on Malmstrom AFB, Mont. Oliver completes a preflight inspection prior to each flight to ensure there are no mechanical faults in the aircraft. (Air Force photo by A1C Dillon Johnston) (Click on image above to reach wallpaper version.)

  • A Dark Year for NATO Security

    2/2/2015

    NATO heads of state agreed to halt defense cuts and raise national defense spending back to the statutory two-percent of gross domestic product within the decade, according to the Alliance Secretary General's annual report. "Our security environment has changed fundamentally … 2014 was a black year for European security," including Russian aggression in Ukraine, and renewed terrorist and cyber-attacks, and conflict in the Middle East, NATO chief Jens Stoltenberg stated in his report, released Jan. 30. NATO heads of state agreed at the Wales summit that "as economies recover" they will "make the most effective use of available funds, and strive for a more balanced sharing of the costs and responsibilities of their common defense," stated the report. European defense expenditure has steadily declined since the Cold War. Despite adding 12 new member states, NATO European members spending dropped from $314 billion in 1990 to $250 billion in 2014. The cuts "diminish the options available to the Alliance" at a critical time, Stoltenberg added.

  • STRATCOM, Germany Sign Space Situational Awareness Agreement

    2/2/2015

    US Strategic Command and Germany have agreed to share space situational awareness services and information, officials announced Jan. 29. The agreement, which was signed Jan. 9, enables each country to more safely operate in space. “Space situational awareness requires cooperation and arrangements such as this allow us to partner more effectively,” said Navy Adm. Cecil Haney, USSTRATCOM commander. “As more countries, companies, and organizations field space capabilities and benefit from the use of space capabilities and benefit from the use of space systems, it is in our collective interest to act responsibly, promote transparency, and enhance the long-term sustainability, stability, safety, and security of space.” Seven other nations, including the United Kingdom, the Republic of Korea, France, Canada, Italy, Japan, and Australia already have an SSA data sharing agreement with the United States, as does the European Space Agency and the European Organization for the Exploitation of Meteorological Satellites, states the release.

  • Risk is Part of the Game

    The Defense Department is too conservative in its acquisitions strategy, Undersecretary of Defense for Acquisition, Technology, and Logistics Frank Kendall told House legislators. “I think we’re not taking enough risk,” said Kendall during a Jan. 28 House Armed Services Committee hearing on improving DOD’s ability to respond to the pace of technological change. In new programs, Kendall said, “we’re not going to be able to reduce every risk to zero, we’ve got to be willing to put our programs out there” and assume small margins of risk, if the US is going to be No. 1 in the world in both technology and warfighting capabilities.

  • C-17 Engine Fire at Wright-Patt

    2/2/2015

    A C-17 Globemaster III, which is assigned to the 445th Airlift Wing at Wright- Patterson AFB, Ohio, experienced an engine malfunction leading to a tail pipe fire in early January, according to a Jan. 29 release. No one was injured in the fire and crew members were able to extinguish it within 20 seconds, states the release. The Jan. 7 fire caused some $180,000 in damage to the aircraft. “Our aircrew and ground personnel did an awesome job in making sure the fire was extinguished in seconds. They are trained on engine fire procedures and knew exactly what to do as soon as the fire was discovered,” said Col. Michael Major, 445th AW commander. The aircraft has since been fixed and resumed flying on Jan. 27 thanks to members of the 445th Maintenance Group, technicians from aircraft manufacturer Boeing, and the 445th Logistics Readiness Squadron’s maintenance supply liaison section, states the release.