The American Defense Budget

In “constant” (inflation adjusted) dollars the Pentagon budget is now significantly larger than at any time in recent history. It is now larger than the previous peaks of Department of Defense spending for the Korean and Vietnam wars and the similarly large increase during the early part of the Reagan presidency. We present the data in both graph and table form here. We also briefly discuss how some analysts “cook” the data to present a case biased in favor of their selected agenda. These are two of many pages in CDI’s 2007 Military Almanac that discuss the U.S. defense budget and how it can be understood—and misunderstood.

More than a few military analysts and journalists sometime present confusing data on the size of the U.S. “defense” or “national security” budget. They frequently fail to distinguish between the budget for the Department of Defense and the totality of U.S. “defense” or “national security” spending. We present here the components of all national security related spending. Knowing what you are counting makes a big difference: the “baseline” Pentagon budget for 2008 was requested by President George W. Bush at $481.4 billion, but all of the national security budget requests he has submitted to date amount to $802.9 billion. It all depends on how one might select to describe the “defense” budget.

As budgets have increased, U.S. forces have been shrinking. We present here the data for the growing budgets for the Army, Navy, and Air Force and the shrinking inventories of Army Divisions, Navy Combat Ships, and Air Force Tactical Air Wings. While the trend has been longer, we present these data for 1980 forward. One of the many major contributors to these developments has been the growth in the cost of individual weapons systems. We show here the remarkable prices the United States pays today for weapons; note, for example, the growth in the cost of Navy destroyers from an already huge $1.0 billion price tag for a single DDG-51 destroyer to the unbelievable unit cost for the Navy’s new DDG-1000 destroyer, $3.7 billion.