Obama Fights The Big Fights On Defense Spending

Last Updated Sep 30, 2009 6:14 PM EDT

Any new administration comes into Washington claiming that they will work to end the problems with the U.S. Federal budget. We will balance it and end wasteful spending and limit earmarks and so on. Obama was no different then any other. It is a sensible platform to run on as nobody likes fraud, waste and abuse but as has been illustrated many times in the past one person's waste is another person's job.

The Washington Post has an article about the version of the Defense Appropriations Bill coming from the Senate. It uses this to illustrate that while there has been a decline in earmarks they still add up to a lot of money. Over $2.6 billion in the Senate bill alone.

Obama and Gates achieved a lot of what they wanted in this budget even though some of their decisions have been controversial. They ended several large programs that they thought were not achieving and tried to move the money to where they wanted or used it to reduce the budget overall. Of course Boeing saw F-22 and C-17 production end while Navy shipbuilding was restructured affecting Northrop and General Dynamics. They have also thrown all their support to the F-35 with the F-135 engine despite Congressional wishes of keeping the F-136 alternative engine going.

Congress in the end despite their bluster and maneuverings supported these decisions especially the Senate. They agreed to cut funding for the F-22 and the F-136 engine. There is some money left for more C-17 and the House wants to put some money towards the VH-71 helicopter to try and use the nine already purchased by the Navy. That is good news for Lockheed Martin who will at least be able to salvage something from the program. In total though there are still a great deal of earmarks.

The article uses Senator Cochrane of Mississippi to illustrate how earmarks work. He has earmarked money for Mississippi State University (MSU), Raytheon and other companies in his state. His total of about $132 million is not a lot as the average Senator earmarked $260 million but it shows how the money works. The problem with earmarks is that while they may fund good and interesting work they are not requested in the regular defense budget. That means either something the military wants is not funded or the total defense budget is higher causing more debt at this uncertain time. Companies and universities like earmarks as often it is directed to them sole-source and means some investment in what they are working on.

It is hard for any President to control this type of spending as Congress writes the bills. With the removal of the line item veto by the Supreme Court in the Nineties all they can do is veto the whole bill. With the military spending bills so critical due to the current operations in Iraq and Afghanistan this really is not a practical decision as it adds delays to the execution of the money.

Obama can take heart that the basic structure of his budget was adopted. Now as he moves out into 2011 and out he can begin to build the military he thinks is needed accepting a few percent of earmarks each year to get there.

  • Matthew Potter

    Matthew Potter is a resident of Huntsville, Ala., where he works supporting U.S. Army aviation programs. After serving in the U.S. Navy, he began work as a defense contractor in Washington D.C. specializing in program management and budget development and execution. In the last 15 years Matthew has worked for several companies, large and small, involved in all aspects of government contracting and procurement. He holds two degrees in history as well as studying at the Defense Acquisition University. He has written for Seeking Alpha and at his own website, DefenseProcurementNews.com.