Understanding how Congress allocates spending in the defense budget requires a comprehension of obscure terms, opaque practices, and sometimes complex ruses.  The explanation below of the gimmicks in Congress' 2006 Department of Defense Appropriations Act is based on over 30 years of experience in congressional appropriations.  Some of that experience was in crafting the very same dodges explained below; there did, however, come a point during the author's Hill career when the focus shifted to opposing the same.

"Defense Budget Tutorial #1" established that Congress appropriated $454.5 billion for the Department of Defense in H.R. 2863, the DOD Appropriations Act, which is now Public Law 109-148.  The amount constitutes most, but not all, of what the Defense Department will get in fiscal year 2006.  The question here is, how did Congress distribute that money, and what does that say about the nature of Congress' exercise of its "power of the purse?"

Appropriations Bill Basics

To understand the defense appropriations bill, it is necessary to briefly review its basic contents.  These bills are typically divided into eight categories, or "Titles," as follows:

• Military Personnel: funds the pay, benefits, and pensions for people in the military services, both active duty and the reserves; also included are housing allowances, some travel costs, and social security contributions.  The amount appropriated for 2006 was $97.0 billion, $1.2 billion less than what the president asked for in his budget request.[1]
• Operation and Maintenance(O&M): a very diverse account that includes the costs to operate forces (i.e., gasoline, food, clothing, logistics, and more), upkeep for military facilities, weapons maintenance at DOD depots, training and military exercises, most transportation costs, spare parts, ROTC, all civilian salaries in the Pentagon, and almost anything else that doesn't fit in the other parts of the budget.  For 2006, Congress appropriated $123.6 billion, $3.3 billion less than the president's request.
• Procurement: the purchase of major hardware items for all military services (procurement of "minor" items, such as some spare parts, occurs in the O&M budget).  Congress appropriated $76.5 billion; $100 million less than president's proposal.
• Research, Development, Test and Evaluation (R&D):  the development and testing of all hardware.  The 2006 appropriation was $72.1 billion, $2.7 billion more than the White House request.
• Revolving and Management Funds: the financing of transactions between components inside the Department of Defense and to support some shipbuilding.  The 2006 appropriation was $2.3 billion, $800 million less than the request.
• Other DOD Programs: constituting the Defense Health Program (89 percent of this category), plus chemical munitions destruction, and the DOD Inspector General.  Congress increased the request by $400 million to $22.7 billion.
• General Provisions: a hodge-podge, varying from adding pork spending for Alaskan military bases, fisheries, and natural gas pipelines, in addition to protection for American producers of steel plate and anchor chain from foreign competition, support for specific military retirement homes, road building projects, museums, and other more significant purposes, described in detail below.

The Lure of "Emergency" Spending

In the last few years, these "Titles" have been supplemented by an additional Title IX, often called "Additional Appropriations."  This year, it amounted to $50 billion, none of it requested by the president.  Its declared purpose is to pay for ongoing military operations in Iraq and Afghanistan. 

This money has a unique characteristic.  It is "emergency" spending, which has had a specific legislative meaning since a 1991 budget agreement between Congress and President George H.W. Bush.  "Emergency" spending is appropriations that do not count in the "spending caps" Congress imposes on itself for appropriations.  For example, the 2006 congressional budget resolution imposed a "cap" on the DOD Appropriation bill at $402.3 billion.  The $452.8 billion Congress appropriated for that bill was, of course, way over that limit.  However, $50 billion for Iraq and Afghanistan in Title IX and $5.9 billion in Hurricane Katrina and avian flu expenses in other parts of the bill, were all exempted from being "scored" to the cost of the bill because they are designated as "emergency." Thus, the $452.8 billion bill fits under the $402.3 billion "cap" with room to spare. 

More to the point, the "emergency" (budget restraint exempt) characteristic of such Title IX's provide Congress, and its budget gamers, an incentive.  If Congress can find a pretext to move programs from the regular part of the bill, where the spending counts, to Title IX, where the money does not count, then Congress can advertise itself as saving money.  That is precisely what is going on.

The Procurement Dollar Shift

The stunt is readily apparent in the procurement accounts of both the regular part of the 2006 bill and in Title IX.  Peppered throughout the small print of the procurement accounts of both are programs labeled "transfer."  For example, in the account for "Aircraft Procurement, Army" on page 249 of the regular part of the 2006 conference report, one can find the notation "Transfer to Title IX" for $11.2 million deducted from the president's regular annual request to purchase "aircraft survivability equipment."  The money is added back in on page 477 in Title IX, where the money becomes "emergency" spending.

Why not? One might ask.  Surely aircraft survivability is a legitimate requirement in Iraq and Afghanistan.  Certainly, but the point here is that Congress took spending the president requested for normal peacetime procurement costs and moved it to the "war" account, where by the way, the money was not increased for the additional likely war expenses over and above peacetime requirements to purchase such equipment.

The author counted 17 of these transfers from the peacetime procurement account to the "emergency" war spending account for a total of $654 million.

There appear to be additional shifts that are not identified as "transfer" in the small print.  The author counted four that move an additional $107 million in spending.  That makes a total of $762 million that Congress moved from spending accounts where the money is counted to measure "budget restraint" to accounts where it is not counted.

However, Congress reduced the president's $76.6 billion procurement request by only $100 million.  The $762 million transfer out of the bill is not reflected.  What happened? Congress simply added spending, but only enough to preserve a $100 million "savings."  The money was spent on many programs, including one F-15E fighter-bomber ($65 million), two "Littoral Combat Ships" ($440 million), and a host of other much smaller purchases, numbering in the hundreds. These are the projects that mean more spending for the states and districts of the senators and representatives adding them.[2]  The "congressional add-ons" (pork) are broadly touted in press releases to the folks back home.  Some members of Congress send out numerous such press releases to separate regions and cities in the states and districts.[3]

It's a pretty clever...