Back to drawing board for Stockman, Congress
In announcing relatively small cuts in defense spending plans, Ronald Reagan fulfills one campaign pledge, but makes it much more difficult to honor another.Skip to next paragraph
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Scaling back the Pentagon budget by a modest $13 billion, instead of the $20 billion to $30 billion that White House officials had been talking about, means that admirals and generals will enjoy real spending increases in coming years. But it also means that the President and Congress will have to probe wider and deeper -- squeezing out more butter to make room for guns -- if they are to balance the federal budget by 1984.
Remember the struggle to cut $35 billion from the 1982 domestic budget? According to White House Budget Director David A. Stockman, another $62 billion now will have to come from nonmilitary sources between now and 1984. This could be considerably more difficult given the current grumbling of even some Republicans and the continued skepticism of Wall Street and the many millions of average Americans who invest in stocks and bonds.
Top Defense Department officials from the armed services meet today (Sept. 14 ) to discuss the impact of the Sept. 11 White House announcement on military spending. Generally, cuts will involve a "stretching out" of some programs and a modest scaling back of a few others. This is likely to include:
* Stockpiling somewhat less ammunition in Europe and Southwest Asia.
* Taking a bit longer to increase troop levels.
* Retiring a few more ships than earlier planned and building a few less.
* Slowing down a planned buildup of reserve forces.
* Waiting until 1985 to buy some fighter aircraft.
Plans for the administration's "strategic package" -- the MX missile, a new manned bomber (as well as the super-sopisticated "Stealth" bomber), and the Trident II missile -- remain untouched. So does the pay raise for military personnel that will take effect next month.
The $13 billion trim in defense spending, in fact, is a minuscule sum when compared with overall Reagan administration military projections. As a portion of the administration's five-year, $1.46 trillion defense plan, $13 billion represents less than 1 percent.
Some here question whether Mr. Reagan will be able to hold to his pledge to raise military spending each year by 7 percent (not counting inflation). The White House has not been clear about which year's budget would be the base for this increase, so some "creative accounting" may come into play.
But there is no doubt that defense expenditures will continue to rise at a much faster rate than would have been the case if Jimmy Carter had been reelected. To meet the $13 billion goal, defense outlays will be trimmed $2 billion in 1982, $5 billion in 1983, and $6 billion in 1984. But this still leaves a Pentagon budget that will rise from $178 billion in 1981 to about $220 billion in 1982, as well as similar increases in the immediate years beyond.
The decision to nick the defense budget rather than make substantial cutbacks represents a victory for Defense Secretary Caspar W. Weinberger over Budget Director Stockman and other White House officials. Stockman had argued that military cutbacks of as much as $50 billion would be necessary to reach a balanced federal budget by 1981. White House chief of staff James A. Baker III and Council of Economic Advisers chairman Murray Weidenbaum agreed with him.
But Mr. Weinberger's warnings about Soviet military buildups prevailed with Mr. REagan, who had promised to substantially been up US defense forces.
The Congressional Budget Office last week warned that rather than a balanced budget in 1984 there may be a deficit of $50 billion. Many Wall Street economists agree and thus have been less than enthusiastic about the PResident's budget and tax-cutting achievements on Capitol Hill.