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PPAI 2020-CASE 2–1Strategies in Defense of the Defense Budget

CASE 2–1Strategies in Defense of the Defense BudgetOnce the budget justifications and numbers have been prepared, agencies facethe task of marketing the package to the legislature. Conditions vary from yearto year; the tactics applicable in one session may not be at all appropriate in thenext. The changing approaches are described in the following review ofstrategies used by Sec­ retary of Defense Caspar Weinberger in selling thebudget for fiscal years 1982 through 1986. Recall that these years were theones immediately before the collapse of the Soviet Union and the defense buildup may have been instrumental in ending the Cold War.Consider These Questions1.Identify the budget strategies Weinberger used. Is there a common logicrunning through them, or is each independent of the others?2.Would the strategies he used be applicable to the post–Cold Warenvironment? Would the current secretary of defense be able to learnanything by reviewing Wein­ berger’s script? How has the war onterrorism changed the budget environment?3.To what extent would these strategies be transferable outside the nationaldefense budget?4.Use the historical statistics section of the most recent federal budget totrace the pattern of defense outlays and budget authority from 1980through 1989. What pattern do you identify? Compare the patterns therewith comparable data for 2000 to the present. Weinberger Finds His Well­Worn Strategies Always Succeed in Blunting Defense Budget By TimCarringtonWashington—Defense Secretary Caspar Weinberger hasprivately referred to his campaign for a bigger defense budget as Kabuki,a highly ritualized Japanese art form in which all movements are tightlychoreographed in advance. Despite the furor surrounding the Reaganadministration’s push to add $29 billion to the mil­ itary budget for thenext fiscal year, many aspects of the contest seem to follow a set script.And after four years in the fray, the tireless Mr. Weinberger is noth­ ing ifnot well­rehearsed. Since President Reagan launched his military buildup,Congress has provided the Pentagon with about 95 percent of the spendingSOURCE: Reprinted by permission of Wall Street Journal, Copyright © 1985 Dow Jones &Company, Inc. All Rights Reserved Worldwide.Chapter 2: The Logic of the Budget Process 9192 Part One: Budgeting, Budget Structures, and Budget Reformauthority it has sought. A look at the defense budget debate over the past fouryears bears out Mr. Weinberger’s observations that it’s less a political brawlthan one of Washington’s most stylized dramas. And the past could wellforeshadow what happens this year.1982In March 1981, Congress granted the Pentagon a startling 20 percent increase,bringing its budget for fiscal 1982 to $216.5 billion, just below the $222 billionthe administration sought. However, five months later, Mr. Weinberger faceddissent from within the Reagan administration. David Stockman, director of theOffice of Management and Budget, proposed rescinding part of that increaseand scaling back the projected military expansion for future years. The budgetchief had just learned that the fiscal 1982 federal budget deficit was likely torise to $62.6 billion, small in relation to today’s deficits of more than $200billion, but for that time a record. Mr. Stockman recognized that Mr. Reagan’sgoal of showing a balanced budget by 1984 was in jeopardy, and he consideredthe defense buildup part of the program. In staving off Mr. Stockman’s assaulton the planned buildup, Mr. Wein­ berger turned to a tactic for which he hassince become famous, the chart and easel. The defense secretary’s charts,presented in a meeting with the president, showed large soldiers bearing largeweapons, which were labeled “Reagan budget.” They towered above smallsoldiers with small weapons labeled “OMB budget.” President Reagan wentalong with the “Reagan budget.”1983In preparing the fiscal 1983 plan, Mr. Weinberger was again confronted withthe budget­slashing demands of Mr. Stockman. The defense chief had manyallies within the administration but by now government officials began to referto the hegemony of the “majority of two,” Mr. Weinberger and PresidentReagan. With unwavering White House support, the defense secretary shotdown an OMB attempt to chop $20 billion from the proposed defense budget,then offered an unusual set of cuts himself. In what became a recurring featureof the budget process, the Pentagon stripped billions from its budget simply byadjusting the inflation assumptions. Weapons programs remained intact.In defending the budget on Capitol Hill, Mr. Weinberger emphasized “theSoviet threat” and insisted that economic and fiscal concerns shouldn’tinfluence the Pentagon’s spending. But deficit concerns were mountingnonetheless and world financial markets were unusually jittery. When theadministration sought $257 billion for defense in fiscal 1983, Rep. JosephAddabbo (D­N.Y.), chairman of the defense appropriations subcommittee,declared that defense is not sacro­ sanct in the deficit­cutting effort. In theSenate, Chairman Pete Domenici (R­N.M.) opened Budget Committee hearingswith the declaration that “the hemorrhage of the budget deficit must bealleviated.” The committee pressed Secretary Weinberger to suggest modestcuts from the proposed Pentagon budget, but the secretary refused. He said hehoped Congress wouldn’t be “unwise enough” to reduce the budget request atall. Congress, while hammeringaway at the Pentagon to offer up cuts was loath to impose its own set of reduc­tions. When the face­off ended, Congress gave the Pentagon budget authorityof $245 billion, $12 billion less than the $25 billion the administration askedfor but still 13 percent, or $29 billion, more than it got the previous year.1984Preparations of the defense budget for fiscal 1984 brought anotherconfrontation with Mr. Stockman, who demanded that Mr. Weinberger take$11 billion out of his planned $284.7 billion budget. The Pentagon, expert atprotecting weapons programs through what observers call “cut insurance,” wasready to meet these demands almost painlessly. Inflation assumptions werelowered, fuel­price cal­ culations adjusted, and some military­constructionprojects postponed. In addi­ tion, a planned pay increase was dropped. Inpresenting a new budget request for $273.4 billion, Mr. Weinberger declared:“We have reached the bone.” Many leg­ islators expressed outrage at Mr.Weinberger’s refusal to consider other cuts despite mounting economic worriesover the government’s budget deficit. Sen. Don Riegle, a Democrat from badlypressed Michigan, asserted that the United States had a defense secretary“whose basic judgment is dangerous to our coun­ try.” Mr. Weinberger replied:“You have accomplished your principal purpose, which is to launch ademagogic attack on me in time for the afternoon and evening editions.” Thedebate had become more rancorous, but the Pentagon’s tactics still producedresults. When the war of words ended, Congress granted the Pentagon 93percent of the spending authority it sought—a $262.2 billion budget, up 8percent, or $20.2 billion from the previous year.1985Deficit­reduction efforts in early 1984 centered on making a “down payment”against the deficit in fiscal 1985. After another skirmish with Mr. Stockman,Mr. Weinberger agreed to seek a 15 percent increase that would bring the Pen­tagon’s spending authority to $305 billion.House Democrats assailed the plan, but as in the past, they wanted Mr.Weinberger to suggest the cuts, rather than slash on their own initiative politi­cally popular military programs in an election year. Mr. Weinberger refused,say­ ing: “We need it all.” Congress didn’t give him the full $305 billion hesought but again provided 93 percent of that; it approved a fiscal 1985 militarybudget of $284.7 billion, up 7 percent, or $19.5 billion, from the previous year.1986The contest over the fiscal 1986 budget is following the pattern of early years.Mr. Weinberger called for a 13 percent increase in a budget he said had been“scrubbed” down to the basics. After Mr. Stockman’s demands for cutsgathered support from other cabinet members, Mr. Weinberger madeaccounting adjustments to produce $6.2 billion in reductions. Further cuts? Mr.Weinberger asserts that the budget he presented is the “bare minimum.” Whenpushed to suggest some cuts, Mr. Wein­Chapter 2: The Logic of the Budget Process 9394 Part One: Budgeting, Budget Structures, and Budget Reformberger recently resorted to what’s called “the Washington Monumentstrategy”— for “cut my budget and I’ll close the Washington Monument” (orsomething equally visible). During Senate hearings, the defense secretarywarned that if Congress cuts the Pentagon budget, there would be a slowdownin the B­1 bomber project, elim­ ination of two Trident submarines, andcancellation of a multiple­launch rocket sys­ tem—all considered high­priorityprograms. Some participants say the ritual is getting tiring. “It’s the sameKabuki dance,” says one Senate Budget Committee aide, “but Domenici isgetting extremely frustrated with it.”

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