Trump's Phantom Defense Budget

The Trump Administration’s first budget blueprint—dubbed a “skinny budget” for its lack of detail—does not begin “the rebuilding of our Nation’s military” as it promises nor does it set the stage for a meaningful restoration of American military might in the coming years. In its construction, it is politically unviable, and it will likely lead to more of the same budgetary uncertainty that has plagued the military for years.

Looking ahead, its devotion to not growing the deficit and the lack of long-term options betray the essential hollowness of the promised rebuild.

At its core, the budget reflects the priorities of its architect, noted deficit hawk and Office of Management and Budget (OMB) Director Mick Mulvaney. It qualifies that, while rebuilding the military may be a top priority, so too is not growing the deficit. The administration has made clear that it is only willing to increase defense spending if it can make commensurate cuts to non-defense spending, but not to entitlement programs and mandatory spending, which now account for about 70 percent of the federal budget. So, if the administration plans to achieve its goal of rebuilding the military in the coming years, it will have to find more and more discretionary programs to cut.

The problem is, given the fervor with which it slashed budgets this year, the White House will be hard pressed to find another $50 billion in offsets. It likely cannot dip back into the same pot; if the State Department lost another $10.9 billion next year, its operating budget in 2019 would be almost 60 percent less than its current one. Where will Mulvaney turn for offsets then, since the president has said entitlement spending is not to be touched? The new money given to the Pentagon in this year’s budget may, in fact, be the very most the building will get in follow-on years if the administration continues to follow this budgetary path.

Without addressing entitlements or further siphoning discretionary funding, the White House would need more tax revenue to fund a deficit-neutral rebuilding of the military. But little new money would likely be available to offset defense increases next year. Moreover, considering that tax revenue does not finance the entirety of federal spending as is, any new money would be pulled between competing priorities, in particular, interest payments on the debt and other mandatory spending demands. Add to that the administration’s pledge to cut taxes, with its likely reduction in tax revenues at least to start and OMB is left with no recourse but to accept a larger deficit if, in fact, it wants to increase defense spending.

The budget blueprint does not, unlike normal budgets or even “skinny budgets” of new administrations in the past, outline a plan for the coming years or provide much in the way of specifics. But it does reveal a fundamental tension within the administration between those who support rebuilding the US military and those who care more about the deficit. Right now, with the way the budget process is likely to play out, it looks like the deficit hawks are in charge, but their victory is the military’s loss.

For the coming year, the men and women in uniform will be not only deprived of needed resources but also whipsawed by yet another round of budgetary uncertainty, which upsets its planning processes and unnecessarily stresses senior military leaders. The military will continue to struggle with serious readiness shortfalls and a lack of funding for long-term recapitalization efforts. 

The administration must realize that it cannot pay to rebuild the US military by cutting discretionary spending. The budgetary contortions it achieved in this year’s blueprint are not replicable going forward; if Trump is serious about rebuilding the military, he must abandon the animating fiction behind this budget, commit to repealing the Budget Control Act, include entitlement spending as part of the budget package, and embark on a serious, multiyear path of steady, increased funding for the armed forces.

Gary Schmitt is a resident scholar and co-director of the Marilyn Ware Center for Security Studies at the American Enterprise Institute and James Cunningham is a senior research associate in the Marilyn Ware Center for Security Studies at AEI.