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Trends and Uncertainty in the Defense Budget

Trends and Uncertainty in the Defense Budget. Todd Harrison. Delays in Defense Appropriations Bills. Average Delay FY77-FY13: 43 days. Average Delay FY10-FY13: 134 days. Budgetary Uncertainty. Budgetary Uncertainty. Budgetary Uncertainty. Budgetary Uncertainty. DoD Budget Cycles.

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Trends and Uncertainty in the Defense Budget

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  1. Trends and Uncertaintyin the Defense Budget Todd Harrison

  2. Delays in Defense Appropriations Bills Average Delay FY77-FY13: 43 days Average Delay FY10-FY13: 134 days

  3. Budgetary Uncertainty

  4. Budgetary Uncertainty

  5. Budgetary Uncertainty

  6. Budgetary Uncertainty

  7. DoD Budget Cycles

  8. Trends in Modernization Accounts Timing of procurement cycles follow overall budget. RDT&E budget has already fallen as much as in prior drawdowns Past two cycles returned to a floor of ~$62B in FY14 dollars.

  9. Trends in O&S Accounts Cost per person has grown faster during previous drawdowns. Excluding OCO, O&M per person has grown steadily at 2.8% annually.

  10. Trends by Service Base + OCO Base Only Navy averaged 33% of the budget from FY72-FY03. Air Force’s average budget share from FY55-FY67 was 42%. Defense-wide accounts have grown even during downturns.

  11. FY13 Sequester % Cut from FY13 Sequester by Title Use of Prior Year Unobligated Funds for Cuts Disproportionately Cut Unobligated Funds from Procurement and RDT&E Various Exceptions Meant Percentages Were Not Uniform Exempted

  12. FY13 Reprogramming Proposed Reprogramming by Title Proposed Reprogramming by Service Except for the Navy, Services Generally Rebalanced Internally Net Flow of Funds from Procurement and RDT&E to O&M Majority of MILPERS Cuts Due to Faster Than Expected Army End Strength Reductions 12

  13. Think Tank Strategic Choices Exercise • In May CSBA held a joint think tank strategic choices exercise • Teams used CSBA-developed rebalancing tool • Database includes more than 650 pre-costed budget options • Options are organized by major capability areas instead of Service • Intent was to look across major capability portfolios (air, sea, land, missile defense, strategic deterrence, etc.) instead of Service stovepipes

  14. Comparison of Think Tank and SCMR Results SCMR: Preserve Capability SCMR: PreserveCapacity Note: Where specific force levels were not provided in Sec. Hagel’s speech, the figures used for the two SCMR options are inferred based on additional commentary and CSBA analysis.

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