Defense spending cut in debt deal unclear

Despite the White House's claim that the new debt deal would cut $350 billion from defense spending over the next ten years, there are no specifics in the bill on defense cuts  -- and no way to tell what the final cuts will be.

"The deal puts us on track to cut $350 billion from the defense budget over 10 years," the White House said in a fact sheet today. "These reductions will be implemented based on the outcome of a review of our missions, roles, and capabilities that will reflect the President's commitment to protecting our national security."

But if you look at the text of the bill, there is simply no language on how much the defense budget will actually be cut. What the bill does is set spending caps for "security" spending, which the administration defines as defense, homeland security, intelligence, nuclear weapons, diplomacy, and foreign aid. There's no breakdown that defines which of these agencies get what, so there's no way to be sure that all the cuts would come from "defense."

Moreover, the spending caps are split between "security" and "non-security" discretionary spending only for fiscal 2012 and fiscal 2013. After that, the spending caps don't make any distinctions between budget accounts. In the end, the actual fiscal 2012 spending numbers will be set by congressional appropriators in the House and the Senate, hopefully before the fiscal year ends on Sept. 30.

So how does the White House claim that it is cutting $350 billion from defense?

"From the discretionary caps in first tranche of the bill, there is approximately $420 billion in security savings. Of that, $350 billion is from defense (function 050) savings," an administration official told The Cable today.

But former officials and budget experts said that those details are not in the actual bill and are subject to the whim of future Congresses.

"There's actually no way to tell. It's not possible to calculate," Gordon Adams, former OMB national security chief in the Clinton administration, told The Cable today. "The whole deal is designed to be opaque about the things you really want to know, such as how much defense will be cut.... This is classic Washington Kabuki theater."

The defense budget was $529 billion for fiscal 2011 and the entire "security" budget was $688.5 billion. The debt deal caps fiscal 2012 security spending at $684 billion, which means a cut of about $4.5 billion compared to fiscal 2011 levels. That money could come from defense, or it could come from the State Department, the Department of Homeland Security, the National Nuclear Safety Administration, or another department. Nobody knows.

The fiscal 2013 security cap is $686 billion.

The caps will prevent security spending from going up, but the details are still in lawmakers' hands and therefore anything could happen, said Gordon.

"It's more disciplined because now there's a cap. Now they have to duke it out at the [committee] chairmen's level," he said.

And those committee chairmen are already working on it. We're told that defense hawks, including House Armed Services Committee Chairman Buck McKeon (R-CA), huddled with House GOP leadership this afternoon to demand answers to exactly how much the deal would impact defense.

"I will support this proposal with deep reservations. Our senior military commanders have been unanimous in their concerns that deeper cuts could break the force. I take their position seriously and the funding levels in this bill won't make their job easier. Still, this is the least bad proposal before us," McKeon said in a late afternoon statement. 

McKeon may have secured some assurances from the House leadership about the specifics of the security cuts, Gordon speculated. A spokesperson for McKeon did not respond to queries by deadline.

What McKeon and other defense hawks are really worried about is the trigger mechanism, which would automatically cut $600 billion from the base defense budgets over 10 years if the new joint committee can't make a deal on $1.2 trillion of additional cuts. After "mechanical adjustments," which are ways to predict the real value of the cuts considering other factors, that $600 billion cut is estimated by the administration to actually be about $534 billion.

While it's unclear whether McKeon got assurances on today's deal, it is clear that his primary concern is about the joint committee and the trigger mechanism, not the security spending caps that he is voting for today.

"What is clear is we have cut what we can from the Department of Defense, and given what's at stake it is essential that the joint committee include strong national security voices. There is no scenario in the second phase of this proposal that does not turn a debt crisis into a national security crisis," he said. "Defense cannot sustain any additional cuts either from the joint committee or the sequestration trigger."

By the way, the White House didn't mention today that it had already promised to cut $400 billion from security spending, although there are no details on that plan either.

Interestingly, if you add the $350 billion in defense cuts announced by the White House as part of today's deal with the $534 billion in defense cuts in the trigger mechanism, it totals $884 billion. That number is suspiciously close to the $886 billion in defense cuts proposed in the plan put forth by theSenate's bipartisan budget group the Gang of Six, which President Barack Obama has already endorsed.

"It just happens to lead you to [Gang of Six leader Sen. Kent] Conrad's number," said Gordon. "I suspect it's not a coincidence."