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The Pentagon’s Wartime Slush Fund

Pentagon

It’s called the Overseas Contingency Operations account, or OCO, and it’s the Pentagon’s warfighting fund. Or at least it’s supposed to be. Instead, it has become a slush fund for Pentagon programs that have no connection to our war efforts. Whether you think the Pentagon budget is too large or not large enough, using the OCO as a piggy bank for bureaucratic pet projects and earmarks is no way to make up the difference.

From 2001 to 2014, the Pentagon spent $71 billion from the OCO on non-war programs. For example, last year’s budget included $9.2 billion for repairing surplus gear from Iraq and $3.3 billion for classified Air Force equipment purchases; $810 million went to U.S. defense initiative to “reassure” allies in the wake or Russia’s invasion of Ukraine, and another $351 million to Israel for its Iron Dome missile defense system. Perhaps most troubling, the majority of the funding for U.S. Central Command (CENTCOM), which is responsible for the Middle East, comes from the OCO. CENTCOM promised to provide the Government Accountability Office with plans for shifting to the base budget by the middle of last year, but has yet to do so. 

In addition to the funds that don’t belong in the OCO, there are items which do belong in the OCO but which aren’t needed. In these cases, the Pentagon attempts to “reprogram” the money, i.e. use extra cash to fund programs that Congress would not. As Julia Harte writes for the Center for Public Integrity, “’reprogrammings’ are typically approved without a public hearing, based merely on written assent from the four chairmen of Congress’s defense-related committees.” More egregious requests may become public and may be denied, such as when the Marines, Air Force and Army tried to turn $2 billion for supplies and linguists into 8 F35’s and 21 Apache attack helicopters.

Without proper oversight, almost anything can be seen as a war expenditure. In 2009, the Office of Management and Budget attempted to place limits on the OCO, including length of time and location, but they were never put into law. Instead, there was an informal understanding between the Pentagon, Congress and the White House, which has steadily eroded. With last year’s budget hearings, a new precedent emerged, as House Armed Service Committee Buck McKeon (R-Calif.) articulated a definition of war losses that covered “readiness shortfalls” developed over “a decade of war.” As the FY2016 budget debate shows, that definition appears to be the new standard for congressional leaders.

The OCO encourages the Pentagon to spend on weapons simply because the money is there and not because those purchases fit a broader strategic rationale. This may make perfect sense for generals who have left over money, but from the viewpoint who are buying weapons they never meant to, it’s a boondoggle. As Jeremy Herb and Bryan Bender write in Politico, “Politically, lawmakers have also been less willing to vote against the budget that funds troops in foreign wars — making the measures easier to pass without serious scrubbing.” These legislative circumstances, combined with a dearth of formal regulations, mean that the more money that goes into the OCO, the more reprogramming discretion will be left to the services. If history is any guide, that means more waste, fraud, and abuse.

By: Jacob Marx
Researcher, POGO

Photograph of Jacob Marx At the time of publication Jacob Marx was a researcher for POGO.

Topics: National Security

Related Content: Budget, DOD Oversight, Defense

Authors: Jacob Marx

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