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Thursday, February 14, 2008
CBO: Emergency War Spending Requests Lack Detail, Procurement Portion Increasing
When asked by Senate Budget Committee Chair Kent Conrad (D-ND) to analyze the massive growth in war spending, CBO could point to general expensing areas of supplemental budget requests, but because of lack of detail in such requests, it could not provide a detailed accounting. However, CBO did find a slew of expenses, like acquiring next-generation aircraft, that the Defense Department would undertake in the absence of the wars.
When federal agencies request funding during the normal appropriations process, they submit what are known as "budget justification" documents, which explain an agency's budget request in quite some detail (see e.g., the Education Dept.'s FY 2008 budget request justification materials). However, the emergency supplemental requests made by the administration for war spending do not include similarly detailed documents. Although the detail in such documents improved in 2007, specific data on war spending for earlier years is simply not available, severely limiting the ability of CBO to analyze and report on war spending.
The supplemental budget requests submitted between 2002 and 2006 contained little detailed information on war expenses. DoD provided detailed justification materials for its regular budget request but did not submit similarly detailed information for its war-related expenses. In February 2007, DoD expanded the quantity of justification material submitted with its requests for war funding. In addition to providing more informative summary material, it prepared budget justification materials for each appropriation, similar to those provided for the regular budget....[B]ecause similarly detailed information is not available for 2005 or for earlier years, a detailed analysis of the changing patterns of spending is impossible.
...Although the procurement documents provide details on each program, large portions of the operation and maintenance request fall into one, undifferentiated category. About 75 percent of the Army O&M request is identified as "operating forces, additional activities," a classification lacking enough explanation to be helpful in this analysis. Also, certain detailed documents that accompany the regular budget request—which would contain information on fuel costs, travel expenses, and civilian personnel costs, for example—are not provided with the request for war-related appropriations.
CBO also found that the composition of the war funding requests have been evolving into broader Defense Department spending initiatives, such as acquiring next-generation aircraft and replacing aging aircraft - replacements that would have been made anyway regardless of combat losses. Procurement, which includes not only replacing equipment destroyed in combat but also upgrading existing weapon systems and filling in equipment gaps that existed before the wars rose from $10 billion in 2003 to $72 billion in 2008.
The Army has seen its funding to modernize tanks and armored vehicles triple from 2005 to 2007. It has also received a fourfold rise in funding to increase the quantity and quality of its communications and intelligence-gathering systems.
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Appropriations for aircraft procurement for all the services also have grown significantly, from $1 billion in 2005 to $10 billion requested in 2008. Initially, appropriations were provided to replace, with equipment of the same model, aircraft that had been destroyed in combat...However, in 2007 the department requested and received appropriations to replace losses of older systems...with next-generation systems that are currently in production or development, such as the CV-22 tilt-rotor and the F-35 Joint Strike Fighter. Acquiring equipment with that degree of technological improvement is significantly more expensive than replacing a current system with an updated variant of that same item.
These findings, however, should not be surprising. Under the regular annual appropriations process, Congress not only holds spending to pre-determined limits - limits established with much input and debate -, but it requires agencies to be specific in justifying their requests. Emergency supplemental funding, on the other hand, dispenses with these transparency and accountability hurdles increasing the likelihood of reckless spending. When Congress is pliant and generous with its spending authority, one would expect any administration to take what it can get. And that's exactly what CBO's report has found - unjustified and extraneous appropriations.
Posted by Craig Jennings
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