U.S. Rep. Elaine Luria, D-Va.

U.S. Rep. Elaine Luria, D-Va. Pool via Getty Images / Oliver Contreras

Defense Business Brief: Defense budget proposal slammed; Shanahan appointed to CAE board; Spring conference season is upon us; and more.

It’s been four days since the Biden administration released its $773 billion fiscal 2023 Pentagon budget request, and there’s seemingly uniform agreement from the left, right, and center that “it sucks,” to quote one lawmaker.

Democrats and Republicans pulled no punches in their criticism of the proposal. The top three complaints: The spending plan lacks detail, it doesn’t realistically account for inflation, and it retires too many weapons without adequate replacements.

“I have delayed putting out a statement about the Defense Budget because frankly it would have been mostly full of words you might expect from a Sailor, but here goes: It sucks,” Rep. Elaine Lauria, D-Va., wrote on Twitter Tuesday, one day after the administration sent the spending request to Congress.

A Friday Zoom get-together of four of Washington’s defense think tank analysts might as well have been Festivus, as there were plenty of grievances aired. We’ll start with inflation. The Pentagon’s budget assumes 2.2 percent inflation growth in 2023, which the experts say is a low-ball estimate.

“That does not seem realistic at all,” said Todd Harrison, director of defense budget analysis at the Center for Strategic and International Studies.

The consumer price index currently estimates inflation at about 8 percent. On Tuesday, Pentagon Comptroller Mike McCord said the defense officials estimate that the budget request is 1.5 percent “real growth,” meaning above inflation, from the budget Congress enacted for 2022.

“That is knowingly misleading, because you know that inflation is not going to be 2.2 percent,” Harrison said.

Since there’s so much inflation uncertainty, largely driven by the coronavirus pandemic, Harrison said, “I don't think we should be trying to talk about the defense budget in precise real terms right now.”

The Pentagon also shot itself in the foot by not releasing any justification documents—tens of thousands of pages that give specific details of how the $773 billion will be spent. The documents also give five-year spending projections, the so-called future years defense plan or FYDP. These important documents are typically posted the day the budget request goes to Congress. They weren’t this year, and it’s not clear when we’ll finally see them.

“It's just … incomplete,” said Frederico Bartels of the Heritage Foundation. “There is some information, but not too much.”

Stacie Pettyjohn from the Center for a New American Security called the request “an incomplete budget since we don't have the FYDP and we don't know what the planned spending in the future is.”

Now, not all the blame should be on the Pentagon, as Congress didn’t pass the Defense Department’s budget until mid-March. Pentagon officials say this is why the documents that it did release don’t actually include enacted spending levels for 2022 (they include the amount the Biden administration requested, which in many cases was increased by Congress).

But then there’s the seemingly yearly, administration-agnostic, plans to retire weapons, something rarely received well by Congress. This year, the Pentagon proposal to retire planes and ships—including brand-new Littoral Combat Ships—without ready replacements is not going over well.

“You only have to read, you know, three defense authorization bill report languages to find out that there's one thing that the Hill will not accept, which is giving away the bird in the hand for the promise of two in the bush that is not yet ready, or there's no bridge capability,” Mackenzie Eaglen of the American Enterprise Institute said. “And yet, the services continue to make those choices.”

The big question is what does Congress do with the request? It’s an election year, and Democrat control of the House and Senate is in jeopardy. Still, that Democrat-controlled Congress added $27 billion to the Pentagon’s budget this year to account for inflation, so it seems likely that might happen again.

“I think that they'll probably add $30, maybe even $40 billion, to the DOD request,” Harrison said.

If that happens, we’ll have the first-ever defense budget over $800 billion, which is something that’s not likely to sit well with Progressive Democrats who already believe the Pentagon’s budget is bloated.

“The Biden administration’s FY 2023 proposal for national defense far exceeds what is needed to provide a robust defense of the United States and its allies,” Bill Hartung, a senior research fellow at the Quincy Institute for Responsible Statecraft, said in an emailed statement.

You can find more of our budget coverage below.

Another detail that came up during budget week is that Air Force Secretary Frank Kendall is recused from all decisions involving Northrop Grumman, a company he had “involvement with” following his tenure as the Pentagon’s top weapons buyer during the Obama administration. Kendall, during a March 25 briefing with reporters in advance of the budget release, brought up his recusal when asked about the Northrop-led Ground-Based Strategic Deterrent, a program to replace the Minuteman III intercontinental ballistic missile.

Next week: There are trade shows aplenty, so make sure you check back to Defense One throughout the week for updates. We’ll have reporters at the Navy League’s annual Sea-Air-Space conference in National Harbor, Maryland, and the Space Symposium in Colorado Springs.

Lastly, training and simulation firm CAE has appointed former Deputy Defense Secretary Patrick Shanahan to its board of directors. Leidos named Shanahan a board member in February.

From Defense One

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