Author: Dennis S. Ippolito
Publisher:
Published: 2001-09-28
Total Pages: 42
ISBN-13: 9781463528324
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The fate of defense budgets is closely tied to the size, composition, and balance of the federal budget. Over the past decade, efforts to reduce the relative level of federal spending and to eliminate deficits yielded disproportionate cuts in defense. Now that the federal budget is in surplus, and expected to remain so for the next decade, the prospects for more adequate defense funding appear more positive. The reality, however, is that fiscal constraints have not disappeared. For the immediate future, defense will be competing with domestic programs for the approximately one-third of the budget allocated to discretionary spending. This is a competition in which defense needs have not fared especially well in the past and where future outcomes are problematical at best. More important in terms of defense planning, however, is the long-term budget outlook. Unless current federal retirement and healthcare entitlements are scaled back substantially, the margin to support discretionary spending will begin to shrink dramatically after 2010. The United States, like other advanced democracies, is facing demographic changes that could generate enormous spending pressures in 10 20 years. The challenge, here and elsewhere, is to minimize fiscal risk by ensuring that policy decisions made today produce budgets that are flexible and sustainable over time. The purpose of this monograph is to provide a fiscal perspective for short-term and long-term defense budgeting. The budget outlook for the federal government is more complex than current surplus projections might suggest. That complexity needs to be appreciated by defense leaders and planners.
