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After increasing the Department of Defense (DoD) budget in real terms during seven of the past eight fiscal years, Congress has now pivoted toward restraining spending by passing the Fiscal Responsibility Act of 2023. Approved in early June as part of the debt ceiling deal, the law imposes a liberating limit on defense. It unshackles defense spending from parity with nondefense spending but still caps military budgets at or near current spending levels for the next two fiscal years while brandishing the threat of a lowered defense cap and potential sequestration if Congress delays in passing full-year appropriations for any budget account.
In May 2022, the Pentagon presented its second budget request to the Biden Administration, proposing a $773 billion topline for Fiscal Year 2023. Although estimates of nominal and real growth have varied based on this figure, the question of inflation’s impact on the defense budget looms large. Congress recognizes that accepting the Administration’s request as-is would lead to slim pickings when it comes to funding the DoD’s priorities, but the question remains whether to approve a large increase to avoid a purchasing power gap or to continue the trend of minor budgetary increases.
Future Vertical Lift (FVL) is a force structure recapitalization effort to design and procure a family of rotary-wing platforms capable of operations in future highly contested environments. The Army’s FVL is the leading edge of an effort that has identified the need for a rotary-wing Family of Systems that can deliver five capability sets for joint use across the Services. Due to budgetary limitations and force modernization priorities, the Army is currently pursuing only two of these capability sets, but they still represent a significant effort for the Army, as they are the first new helicopters designed since the mid-1980s.
In May 2021, the Pentagon presented its first budget request to the Biden Administration, proposing a $715 billion topline for Fiscal Year 2022, representing a 0.2 percent real decrease relative to the previous fiscal year. In a shift from previous budgets, the request also included contingency operations costs within DoD's base budget, eliminating the separate Other Contingency Operations (OCO) account that has supplemented the Defense Department's budget for two decades.
On February 24, 2021, CSBA President and CEO Dr. Thomas G. Mahnken testified before the House Appropriations Committee Defense Subcommittee. Dr. Mahnken was invited to appear before the Committee to discuss future defense spending priorities, along with the long-term implications of current budget debates.
This report summarizes the findings of two Strategic Choices Exercises hosted by The Ronald Reagan Institute and CSBA in October 2020, convening a bipartisan group of senior defense and budget experts, current and former policy makers, and industry leaders. The initiative was supported by the National Defense Industrial Association.