DEFENSE SPENDING

February 2, 1999
		In his State of the Union address, President Clinton proposed increasing defense spending after a decade of decline. William Lynn, the Comptroller and Chief Financial Officer at the Department of Defense, Rep. Duncan Hunter and Rep. Barney Frank debate the proposal.

Feb. 1, 1999: Details of the president's fiscal year 2000 budget proposal. Feb. 1, 1999: OMB director Jacob Lew and Sen. Pete Domenici debate the president's year 2000 budget proposal. Jan. 28, 1999: The Clinton administration proposes funding a national missile defense system. Jan. 4, 1999: Is the military properly equipped for battle? Oct. 15, 1998: House Majority Leader Dick Armey and Gene Sperling discuss the budget agreement. Browse the NewsHour's coverage of the budget.   The president's budget propsal for fiscal year 2000 Office of Management and Budget Senate Committee on the Budget. The Department of Defense	JIM LEHRER: Now, two federal budget fallout stories. The first is on increasing military spending. Kwame Holman begins our look. PRESIDENT CLINTON: It is time to reverse the decline in defense spending that began in 1985. KWAME HOLMAN: President Clinton's State of the Union pledge to boost military spending was one of the few announcements that drew broad bipartisan approval. PRESIDENT CLINTON: My balanced budget calls for a sustained increase over the next six years for readiness, for modernization, and for pay and benefits for our troops and their families. (Applause)
	A sustained increase.
	KWAME HOLMAN: The budget the president presented yesterday would increase military spending to nearly $320 billion in five years. Secretary of Defense William Cohen and Joint Chiefs of Staff Chairman Henry Shelton spent a good part of today explaining the president's military budget to members of the House Armed Services Committee. WILLIAM COHEN, Secretary of Defense: Mr. Chairman, this does in fact represent a turn in the direction that we were headed. It does represent an increase in defense spending since the end of the Cold War, a sustained increase. The president does make available $112 billion resources. It's an $84 billion increase to the budget top line and $28 billion from savings from lower inflation, lower fuel prices, and the other economic adjustments. REP. FLOYD SPENCE: You deserve much credit for convincing the administration to at least begin confronting defense shortfalls and the need for increased spending. The bottom line, however, is that this budget falls well short of adequately addressing the services unfunded requirements. KWAME HOLMAN: Cohen said the planned spending increases would begin to address concerns about readiness, caused by record-low recruitment, low retention of military personnel, and the need for new equipment. WILLIAM COHEN: We have been living off the increases that were voted back in the 80's, and now we have come to the point where we've got to start replacing it, if we're going to have the technology and the people to really run that technology out in the future years. And so if you look at it, this technology we've been using,, the Tomahawk Missile, for example, that's 70's technology. We developed that back in the 70's, and we're still using that, to great effect. KWAME HOLMAN: But several members questioned whether the president's proposed increases were enough to meet the military's current demands. REP. JAMES TALENT: General Shelton testified that he could use effectively I think about $20 billion this year. And that's the figure I'd like to be going for. And if it means increasing the cap, I mean, our men and women out there are putting a lot more on the lines than political reputations. And if that's what we have to do to get the caps increased, we owe it to they will and the country to do it. KWAME HOLMAN: The joint chiefs of staff recently told congress they need $150 billion more for their services over the next six years. The president proposes spending $38 billion less than that. WILLIAM COHEN: You may recall in the past we've had caps and we've also had walls. The walls are down this year. Now, that presents a unique challenge to this committee and to the congress because you could go to your colleagues and say let's take some money out of domestic and put it over here so we don't have to worry about whether we get the savings or not, and let's plus up the defense part of it by another $8 billion. So it's going to be a political challenge for all of us. KWAME HOLMAN: Secretary Cohen also said billions can be saved if congress approves two more rounds of military base closings, something lawmakers are reluctant to do.
	Is it time for an increase?
	JIM LEHRER: Margaret Warner takes it from there. MARGARET WARNER: Is it time to increase defense spending after more than a decade of decline? For more on that, we're joined by William Lynn, the comptroller and chief financial officer of the Department of Defense; and two members of congress who are critical of the president's proposal from different perspectives, Republican Congressman Duncan Hunter, a member of the House Armed Services Committee, and Democratic Congressman Barney Frank. Welcome, gentlemen. Mr. Lynn, after, as we just said more than a decade of decline, the cold war has been over for a long time, why does the United States need to start spending more on defense? WILLIAM LYNN, Defense Department Comptroller: Well, Margaret, as your setup piece indicated, this would be the first sustained increase in defense spends since the end of the Cold War. It's needed because we have forces deployed across the globe at this point. Korea, they're maintaining their relentless vigil against aggression from the North and Southwest Asia they continue to monitor Saddam's activities there. In Bosnia, they're working in the humanitarian area to bring permanent peace to Bosnia. In Honduras they're trying to help the residents recover from a natural disaster. We're engaged at a very high tempo. We're seeing some strains in the force. To meet those strains we think we need an additional $112 billion to improve the personnel package that we offer people, to improve readiness and modernize for the future. MARGARET WARNER: Duncan Hunter, you were quite critical of the administration at today's hearing. Why? REP. DUNCAN HUNTER, House Armed Services Committee: Well, Margaret, first the Secretary's presentation that says that President Clinton is adding $112 billion is simply false. The President only has two years left. So all he can do, all he can control in terms of his administration is this next couple of years. And what he -- what happens in the year 2005 is going to be done by another president who hasn't been named yet. So all about $100 billion of that $112 billion is a to whom it may concern letter of recommendation to somebody who as of yet is unidentified. So what can the president do now? The president has offered $4 billion in real spending increases. Now, we are in trouble. The chiefs have told us that we're 18,000 sailors short, the Army is $1.6 billion worth of ammunition short, the Marines 193 million short. We have people getting out of the services in droves and we are not replacing the equipment that we bought in the 1980's. So it's getting older and older. The Navy accident rate - including a number of accidents -- has doubled in this last year over the year before. So we have to spend, according to the chiefs, and they came before us and did something pretty gutsy. They said in front of the congress and they contradicted their commander in chief Bill Clinton, they said in front of the congress and they said we needed $20 billion more per year than what the president's budget gives us. Now, the president even if you add up some of the things that look a little shaky, even if you add up all of his adds to the budget come up to $12 billion a year for the next two years, $12 billion from $20 billion leaves an $8 billion shortage. So we're still going to have an ammunition shortage, we're still, in my estimation, going to have people leaving the services in droves and we're going to be doing a disservice to the people that serve in the uniform. MARGARET WARNER: Mr. Lynn, is that right, that this increase will not be enough to answer the problems that Congressman Hunter just outlined? WILLIAM LYNN: This increase meets about three-quarters of the needs that the chiefs have identified. They identified a list of $150 billion. It would meet the full range of requirements. This meets about ¾ of those. It meets the most pressing needs. It meets the needs to provide better compensation for our forces. There's a pay raise, the largest pay raise since 1982. There's a return to a 50 percent retirement benefit from what was established in 1986. We've restored it to 50 percent. There's pay table reform. There's added money for readiness and we have retained the ramp to modernization so we can replace the forces. Did we meet absolutely every need? No. There's more to be done. As your lead-in piece indicated, the first step in getting the additional money should be additional base closure rounds.
	The nature of the threat.
	MARGARET WARNER: Congressman Frank you have been critical from the other perspective. Outline it for us. REP. BARNEY FRANK, (D) Massachusetts: It's true there's been a decline in spending since the Cold War but there's been a greater decline with the nature of the threat. With the collapse, fortunately, of the Soviet empire, we're in a new situation compared to the 50 previous years. There are bad countries out there. There are people who run countries who shouldn't be allowed to drive cars. But they are not remotely comparable in terms of fire power to the Soviet Union. With the collapse of the Soviet Union, we have a new situation. There is not now for the first time since the rise of Hitler a group of heavily armed people -opponents of freedom -- capable of seriously threatening the physical security of the United States. Now, I want us to be the strongest nation in the world, and I want us to have an active role. But there's a qualitative difference. And, yes, there's been a decline, but there has not been a decline in spending comparable to the decline of the threat - and congress has been part of the problem here. Congress has insisted on buying weapons and wasting tens of billions of dollars for which there is no need. By the way, the B-2 bomber, which was put into that budget and tens of billions were spent over the opposition of a lot of people, is going to turn out to be a waste of money. And, yes, there are shortages and we ought to be paying the personnel more. But we can do that by ramping down where we don't need to spend. Secondly, we have this continued commitment to Western Europe, which made a lot of sense in 1945. By commitment, I don't mean being their ally, I mean, being their source of welfare. The United States continues to subsidize our wealthy European allies and it doesn't make any more sense. I agree that we have a burden to bear in Korea and we have a burden to bear in Iraq. But I do not think American ground troops ought to go into Kosovo, and I don't think American ground troops ought to be staying in Bosnia. There is no reason why Germany and Britain and France and Italy and that wealthy complex of nations close to their own borders can't do that basic peacekeeping. What we've decided we want to pay extra billions so we somehow can claim to be more influential, so if we in fact ramp down to take advantage of the fact that we don't have that overall threat of the Soviet Union - example -- the congress insisted we maintain many more nuclear weapons than we need. We ought to get down to the START III level. The Soviet Union has collapsed. They are not in the same league as us. We should maintain an overwhelming superiority but it's a lot cheaper to do that. And, finally, what we haven't done is reexamined the strategic context. We're still committed to winning an all-out nuclear war with a Soviet Union that doesn't exist and fighting two full-scale conventional wars at the same time. As long as that's our goal, yes, we'll fall short of it. MARGARET WARNER: Okay. Mr. Lynn, respond to the overall theme of Mr. Frank's remarks, which is there's a mismatch now between the nature of the threat of today and the resources and the ways the defense department is spending this money. WILLIAM LYNN: We reviewed the threat comprehensively in the quadrennial defense review just 18 months ago. We are not posturing ourselves against a Soviet threat. We're posturing against the threats that we see today. Those threats run the spectrum from cyber terrorism all the way up to major regional conflicts in Southwest Asia and in Korea. We've developed a force structure to deal with the high end of those -- those two conflicts in Southwest Asia and Northeast Asia, as well as to deal with the more unconventional threats coming -- whether they be from terrorists or rogue states, weapons of mass destruction, cyber terrorism, the whole range of threats, we've redesigned the force and it's substantially smaller than it was in the Cold War.
	The B-2 bomber example.
	REP. BARNEY FRANK: Could I ask a question about that? How in that do you figure on the B-2 bomber, where does it play a role there, and how about the many more thousands of nuclear weapons we're maintaining, which costs us money way above the START III level? Do those fit into your strategic conception? MARGARET WARNER: Go ahead. WILLIAM LYNN: The B-2 bomber has been terminated. We bought the 20 that were on the books from the prior administration. REP. BARNEY FRANK: And how much did you spend for that? MARGARET WARNER: Congressman, just let him answer, please. WILLIAM LYNN: We've ended the B-2 bomber. We are not buying anymore. We are reducing the nuclear weapons. We're down 50 percent from Cold War levels. We would like to go lower. The problem there is the arms control agreements with the former Soviet Union. But we're reevaluating where we stand with that. MARGARET WARNER: Okay. Let me get Congressman Hunter back in this. Congressman Hunter, do you feel -- I know you want to spend more money -- but do you feel confident that the way the Pentagon's spending the money now, whether it's this amount or mores does respond to the new nature of the threat? REP. DUNCAN HUNTER: Well, Margaret, there's two major wars that the Pentagon is always looking at -- that we're looking at. We've fought both those wars. One war was in Korea, the other war in the Middle East. And we fought both of those. And our worry is that we might become bogged down in war against Saddam Hussein and see the North Koreans take advantage of that and invade the Peninsula going to the South. So we have to have the ability we feel to be able to fight and win two major regional conflicts. MARGARET WARNER: All right. Let me stop you there and just get Mr. Frank because he doesn't agree with you. REP. BARNEY FRANK: Yes. In the first place - MARGARET WARNER: Congressman Frank, why do you think that's unrealistic to have to think about winning and fighting those two wars? REP. DUNCAN HUNTER: And that does not involve the Soviet Union. REP. BARNEY FRANK: First of all, let me just make clear that it's been the kind of congressional pressure to spend what you don't need. Mr. Lynn kind of implicitly conceded the B-2 bomber was kind of a waste of money. Tens of billions of dollars went into the B-2 bomber, it's never been used; it'll probably will never be used. And that's the kind of waste that you get into. And if congress would stop that, you could pay the sailors and soldiers and Marines a fair wage. Secondly with regard to Iraq, we went to war with Iraq. The imbalance is even greater now between the U.S. and Iraq than it was then and that war was over in a week. There is a South Korean government as well. South Korea is larger and more powerful than North Korea. We are aiding the South Koreans in a war against North Korea. We are not in the position of being the only force there. And the notion that we are likely to have to fight Iraq and South Korea at the same time is remotely possible. The question is -- when you have limited resources, are you going to put all your money into fighting that unlikely full-scale war against North Korea without presumably South Korea and Iraq or are you going to use your resources more wisely?
	What the troops need.
	MARGARET WARNER: Okay. Congressman Hunter, go ahead. REP. DUNCAN HUNTER: The real question, Margaret, is are you going to give the troops what they need. Now, right now they are 18,000 sailors short. We're not facing the Soviet Union. But that's looking at a conventional threat. We're $1.6 billion short with respect to army ammunition, $193 million short with respect to Marine Corps ammunition. And, incidentally, if we get gas on those airfields in North Korea or South Korea and we're not able to send tactical air in, we're only going to have B-2 bombers. And if we don't have B-52 bombers that will be 80 years old when we're still using them. So, Mr. Frank's idea of what is good and what is bad are purely his own ideas. And my point is that we're not giving our troops what our joint chiefs that we rely on now tell us we need as a bare bones minimum. They're not asking for a big increase in force structure. They're asking for this half of a military. We've now cut the military almost in half since Desert Storm. We're down from 18 divisions to 10; we're down from 546 naval ships to 325 - MARGARET WARNER: All right. REP. DUNCAN HUNTER: We're down from 25 air wings to 13. The half we have left is not ready. And the Clinton administration is not making that half ready. MARGARET WARNER: Congressman Frank on the readiness issue, yes. REP. BARNEY FRANK: In the first place there is no - yes, I think there is a problem with readiness in the future. Up till now, by the way, it hasn't manifested itself. We haven't fallen short in any mission. REP. DUNCAN HUNTER: We're 18,000 sailors short right now. REP. BARNEY FRANK: Excuse me, Duncan, you just filibustered. MARGARET WARNER: Let him finish, please. REP. BARNEY FRANK: Let me respond. REP. DUNCAN HUNTER: But we're short right now. REP. BARNEY FRANK: Duncan, come on now. You just filibustered. Let me respond. That's silly. Duncan, come on! MARGARET WARNER: Congressman Hunter, do let him finish. REP. DUNCAN HUNTER: Okay. Go ahead and finish. REP. BARNEY FRANK: I think, you know, part of the problem is he knew what I was going to say, which is that it has frankly been he and his colleagues who have foisted on the pentagon unnecessary spending, wasteful spending for the C-130, because it was in Speaker Gingrich's district, four ships under Trent Lott's district, four extra planes elsewhere, the Pentagon, four more nuclear weapons than the Pentagon wants. I agree we should be dealing with readiness and the less glamorous aspects, but unfortunately congress has over the past few years voted in pork, and John McCain has cited $5 billion worth of what he calls pork - unnecessary spending generated by political needs domestically. If you hadn't done that, then we would have had that money available. And I'm prepared in the future to make the money available for the troops and for the ammunition but the waste and the B-2 bomber continues to be a great white elephant which has never been used, is almost certain never to be used, and at the cost of tens of billions of dollars. REP. DUNCAN HUNTER: You know, Margaret - you know, Margaret - MARGARET WARNER: Gentlemen. REP. DUNCAN HUNTER: The liberals made that argument in the 1980's and we used all of that so-called pork equipment like the Apache helicopter and M-1 tank to win the war in Desert Storm. And the problem is you only achieve peace through strength and we have lost that strength under the Clinton administration. MARGARET WARNER: All right, gentlemen, we have to leave it there. Thank you all three very much.