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Army Sticks With Modernization Plan, But Budget Trends Are Not Encouraging

By News Creatives Authors , in Business , at March 30, 2022

The Biden administration’s first real budget request unveiled earlier this week is predictably kinder to domestic initiatives than defense spending.

The headline story is that defense outlays have been maintained at a relatively robust level—more than the next ten military powers combined—but recent developments in Europe, raging inflation, and the approach of midterm elections make spending plans for the fiscal year beginning October 1 provisional at best.

Within the proposed defense budget, though, one trend that has been largely missed by mainstream media is that the Army seems to be losing ground, both in buying power and in comparison with the other services.

The Army is in the midst of what service leaders call a “profound transformation” as it continues its migration out of the global war on terror and into dealing with “near-peer” adversaries, meaning Russia and China.

Russia’s invasion of Ukraine underscores how timely that transition is—the Army is critical to security in Europe, in a way the sea services are not—but in fact Army leaders have been laying the groundwork for a new approach to warfare since the beginning of the Trump administration five years ago.

The centerpiece of Army plans is replacement of aging aircraft, artillery, vehicles and networks with a new generation of digitally-designed kit.

For instance, the service plans to gradually replace its ubiquitous Black Hawk helicopters with futuristic rotorcraft that can fly twice as fast and twice as far before refueling.

But the key to executing this plan is to sustain steadily rising expenditures for development and production of new weapons, and that’s not what Monday’s budget release reflects.

Proposed R&D spending for 2023, at $13.7 billion, represents less than one day of federal spending at current rates, and is down about 8% from the 2022 level as enacted.

It is also well below the $14.2 billion spent on R&D in 2021, and that’s before factoring in the loss of buying power associated with rising inflation since President Biden took office.

You could justify a decline in R&D outlays if key modernization initiatives were transitioning from development to production, but that is not what the Army’s procurement expenditures reflect: in 2021 they were $24.1 billion, in 2022 they are at $22.8 billion, and in 2023 the proposed budget requests $21.3 billion.

Even if there were no inflation at all, this would not be progress.

In fact, the Army’s entire procurement budget for 2023 is only about the size of the increase that the Air Force is requesting in its budget for 2023.

If you add up all the requested procurement spending for Army aircraft, missiles and vehicles in 2023, it amounts to a paltry $10.2 billion—nearly identical to what Americans spent on Halloween last year.

In order to fund the six top-priority mission areas around which Army modernization plans have been organized since 2017, items like air defense and long-range fires, the service will require a much higher level of investment outlays going forward.

However, that isn’t looking likely in an overall Army budget that is steadily losing ground from the Trump years in after-inflation terms.

Instead, a rising portion of the budget is going to what might be called consumption rather than investment—pay increases, sustainment of aging equipment, high levels of readiness, etc.

Adequately compensating soldiers, repairing their weapons in a timely fashion and being ready to fight on short notice are all good things, but in a static-to-declining budget, that means skimping on investment in new warfighting technology.

Unfortunately, maintaining a high state of readiness tends to wear out equipment already in the force, which makes the need for new weapons even greater.

Army leaders understand all this, but it isn’t clear that the Biden administration is supportive of the kind of modernization efforts required to preserve the Army’s edge over the militaries of potential rivals.

For instance, the Air Force and Navy departments will each claim 30% of the proposed 2023 budget, while the Army will get only 23%—even though it contains far more personnel than those other services.

Indeed, Army active and reserve-component personnel represent nearly half of all the uniformed personnel in the armed forces (about a million soldiers out of 2.1 million total).

When you have that many people to support but a smaller budget, it’s inevitable there will be less money available for investment.

Even a cursory perusal of Pentagon’s budget overview released this week reveals that the equipment side of the budget request is mainly about air power and sea power, with a growing component of space outlays.

The relative neglect of Army programs might make sense if China were the only near-peer threat the nation was facing, but Ukraine demonstrates that is not the case.

Even in the Pacific, the Army has major contributions to make in deterring or defeating aggression with its air and missile defenses, new long-range fires, rotorcraft that can fly greater distances and so on.

Deploying a single Army armored brigade to Taiwan would probably do more to deter the invasion of that island nation by China than all the preparations the other services are making for Pacific contingencies.

If you read between the lines in the administration’s proposed defense budget, though, it seems policymakers don’t really grasp the value of land power in places like the Pacific, and don’t realize sea power would be largely irrelevant in places like Eastern Europe.

Bottom line: the Army has sound plans for staying relevant in a world of great power rivals, but whether Biden & Company will provide adequate funding to implement those plans remains an open question.

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