Inflation Driving Congressional Fight to Hike Defense Budget

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The U.S. Capitol building is lit up with sunlight in Washington, D.C.
The U.S. Capitol building is lit up with sunlight in Washington, D.C., Jan. 29, 2021. (Joe Legros/Army National Guard)

Concerns about inflation cutting into service members' pocketbooks and the Defense Department's buying power are coloring the congressional debate over next year's defense budget as lawmakers consider giving the Pentagon even more than the $773 billion it has asked for.

Republicans, who have been hammering the Biden administration for months over spiking inflation as they home in on a message for November's midterm elections, are pointing to increased costs for labor, fuel and materials as they argue the Pentagon's historically high budget request for fiscal year 2023 is not enough.

Progressive Democrats, meanwhile, hold that the military does not need such a high budget at a time when some of the country's biggest threats are non-military, such as the ongoing COVID-19 pandemic and climate change.

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While the congressional debate will play out over the coming months, progressives lost the fight to cut the defense budget for fiscal 2022 as moderate and defense-focused Democrats joined with Republicans to approve about $29 billion more than the administration asked for. With the balance of power in Congress unchanged since then, and a war in Ukraine that defense hawks can use as their justification for more defense spending, a similar scenario appears primed to repeat itself for next year's defense budget.

In a statement Monday, the Democratic chairman of the Senate Armed Services Committee, Sen. Jack Reed, R.I., alluded to the likelihood of Congress making changes to the budget, calling the administration's request "an outline and a starting point."

On Monday, the Pentagon unveiled a $773 billion budget request, part of the administration's overall $813 billion request for defense needs in fiscal 2023.

The request included a 4.6% pay raise for troops, which would be the largest pay bump service members receive in 20 years.

But inflation is currently hovering above 7%, the highest it has been in decades, driving up the cost of living and threatening to negate the pay raise.

Pentagon comptroller Michael McCord said Monday the Pentagon's request, despite being $30 billion more than Congress approved for fiscal 2022, represents just about 1% in real growth when accounting for inflation.

Even before the budget was released, Republicans in Congress had been calling for at least a 5% increase over inflation.

In letters released Tuesday, the top Republicans on the Senate and House Armed Services committees pressed Defense Secretary Lloyd Austin, Chairman of the Joint Chiefs of Staff Gen. Mark Milley and the secretary and chief of each service on the assumptions about inflation that went into crafting the budget.

"Put simply, the inflation we are experiencing is effectively a 5 to 8 percent cut to the Department's buying power, which could amount to between $20-$30 billion in unfunded costs in fiscal year 2022 alone, not to mention lost buying power in fiscal year 2021 and potential lost buying power in fiscal year 2023," Sen. Jim Inhofe, R-Okla., and Rep. Mike Rogers, R-Ala., wrote in the letter to Austin.

Both Inhofe and Rogers had already panned the request Monday, with Rogers saying in a statement the budget "fails to account for the record high inflation that is wreaking havoc on our nation" and Inhofe saying in his own statement that he is "particularly concerned about service members losing buying power, just like all American families."

In their letters, Inhofe and Rogers asked the officials for information on how inflation is affecting military pay, as well as civilian salaries, the basic housing allowance, fuel, maintenance, procurement and more.

Other Republicans are echoing Inhofe and Rogers' concerns. Sen. Roger Wicker, R-Miss., who is in line to be the top Republican on the Senate Armed Services Committee when Inhofe retires at the end of the year, called the budget "strategically unsound," while Senate Minority Leader Mitch McConnell, R-Ky., said the budget appears to have been "crafted in fantasyland."

"Even under the administration's wildly optimistic projections about inflation, their budget proposal would only flat-fund our Armed Forces," McConnell said in a floor speech Monday. "And in the more likely event that Democrats don't magically have inflation plummeting in just a few months, then President Biden's policy would amount to an actual cut to our defense spending."

Republicans made similar arguments last year that the administration's fiscal 2022 request was actually a cut when accounting for inflation, but are leaning even harder into the argument this year.

Pushing back on the calls for more defense spending are progressive Democrats.

"If budgets are value statements, today's White House proposal for Pentagon spending shows that we have a lot of work to do," the Congressional Progressive Caucus said in a statement Monday. "It is simply unacceptable that after the conclusion of our longest war and during a period of Democratic control of both chambers of Congress, the President is proposing record high military spending."

House Armed Services Committee Chairman Adam Smith, D-Wash., is also insisting that the budget takes into account "the real cost of inflation for our military," saying the focus on the topline dollar figure rather than how the money is spent "misses the point entirely."

Reed, in his statement, recognized the need for "belt tightening" by retiring older weapons systems. But those efforts are often blocked by lawmakers in both parties who are fiercely protective of weapons made or based in their districts.

"To appropriately support our long-term strategic competitiveness, every department's budget can, and should, be argued on its merits," Reed said. "Taxpayers should not have to pay for programs or systems that are wasteful or ineffective, and Congress should not shirk its responsibility to get rid of outdated weapons systems in favor of more advanced, effective technologies and capabilities."

-- Rebecca Kheel can be reached at rebecca.kheel@military.com. Follow her on Twitter @reporterkheel.

Related: Troops Slated for Largest Pay Raise in 20 Years Under Pentagon Budget but Inflation Looms

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