The 2009 Future Years Defense Program: Implications and Alternatives

Abstract : I appreciate the opportunity to appear before you today to discuss the long-term implications of the Department of Defense's (DoD's) plans. My testimony describes the Congressional Budget Office's (CBO's) most recent projections (in this case, through 2026) for the implications of the 2009 Future Years Defense Program (FYDP), which specifically addresses fiscal years 2009 through 2010. The 2009 FYDF transmitted in April 2008, reflects changes to the department's programs and priorities since February 2007. The 2009 FYDP and CBO's projections of its long-term implications exclude potential future supplemental or emergency appropriations; CBO's projections include additional appropriations that have already been enacted. CBO's projections exclude program changes announced by the Bush Administration after it released the 2009 FYDP and any changes proposed by the Obama Administration so tar. Overall, the budgetary implications of DoD's current plans are similar to those described in CBO's previous projections: Carrying out plans proposed in the FYDP would require sustaining annual defense handing over the long term at higher real (inflation-adjusted) levels than those that occurred at the peak of the buildup in the mid-1980s. Four factors in particular account for the projected high level of defense spending under the FYDP: Plans to purchase more new military equipment over the next several years and then to sustain that rate of procurement over the longer term; Plans, as part of military transformation, to develop and eventually produce weapon systems that provide new capabilities systems whose estimated costs are also increasing; Plans to increase the size of military forces and the growing costs of pay and benefits for DoD's military and civilian personnel; and Plans to meet the rising costs of operation and maintenance (O&M) for aging equipment as well as for newer, more complex equipment.