America’s defense spending dragged into budget chaos 

The Pentagon is sailing into somewhat unprecedented waters as it prepares to unveil its 2025 fiscal year budget next Monday. 

The Defense Department (DOD) still doesn’t have a full budget for 2024, faces a looming 1 percent across-the-board cut unless Congress can break its logjam and is still reeling from years of high inflation. 

What’s more, the Pentagon likely won’t be able to use all the money intended for it should lawmakers finally agree on a spending plan, given the rule that if a department is unable to spend its full funding by the end of this fiscal year those dollars must be turned back over to the Treasury Department. 

Now, more than five months into the current fiscal year, due to lawmakers’ ongoing impasse, experts are predicting that a delay will cause ripple effects for warfighters for the next two to three years. 

“When you have one year money but you’re really only spending it in a six-month window, your odds of not spending it will go up,” Mackenzie Eaglen, a defense expert at the American Enterprise Institute, told The Hill. “Congress is not doing its job, then turning around and yanking funds because they’re use it or lose it.” 

The consequences of this fall twice on the armed forces, according to Eaglen, a former congressional adviser on defense issues. 

“It’s a double whammy,” she added. “They get the money late, then they have to turn over whatever they can’t spend quickly enough because Congress didn’t give it to them on time.”

DOD is among several federal agencies on a short-term budget extension since the end of September due to political infighting over spending levels. 

While Senators on Friday passed a bill to fund a slew of government agencies for the rest of FY-24 — sending the measure to President Biden’s desk hours before a shutdown deadline — that only approved full-year funding for the departments of Veterans Affairs, Agriculture, Interior, Transportation, Housing and Urban Development, Justice, Commerce and Energy, among other offices. 

Biden signed that bill into law Saturday, averting a partial shutdown. 

Defense is counted among the remaining six government funding bills that bankroll more contentious areas, including the departments of Homeland Security and Health and Human Services. Budgets for the remaining agencies are due March 22 and are expected to be more difficult to pass, according to top appropriators. 

In the background is last year’s debt ceiling deal — an agreement Biden struck with then-House Speaker Kevin McCarthy (R-Calif.) last summer — which imposes a 1 percent cut on the Pentagon and all other agencies if Congress fails to pass a full fiscal 2024 (FY-24) budget by April 30. 

The situation is not ideal for the U.S military, which has already been stretched thin as it responds to the two major wars in Ukraine and Gaza, the latter of which has also sparked heightened tensions between the United States and Iran — as well as its proxies in the Middle East. 

The Biden administration hoped Congress would pass a sweeping supplemental request to supply weapons to Ukraine and Israel as well as fund the military mission along the southern border, but that hasn’t happened. 

The service leaders have sounded the alarm over the situation, in late February warning that the U.S. military may run out of personnel funds before the end of the year. 

Without the needed dollars “we have to make tough choices. . . . between the ability to fight tonight and be ready for all the threats, versus preparing for the future and modernizing our forces,” Navy Under Secretary Erik Raven told reporters in a Feb. 27 briefing along with the Army and Air Force undersecretaries. 

And Army Under Secretary Gabe Camarillo said his service has been forced to take $500 million out of its base budget for European theater operations costs, $100 million for U.S. Central Command and $500 million for the operations along the U.S.-Mexico border. 

“At one point in time, there was a thought that all of this could be funded through a supplemental, and it is now currently, today, in FY-24, being funded 100 percent out of the Army’s base budget,” Camarillo said. “We are just burning hotter than we normally would across all of our appropriations accounts.” 

Mark Cancian, a budget expert with the Center for Strategic and International Studies think tank (CSIS), said while the funding situation is unusual this year — given the act of not passing a full year bill before the blueprint for next year’s is out — the supplemental throws a whole new level of complication into the mix. 

“There’s a chunk of money in the Ukraine supplemental that goes to DOD to cover ongoing operations — about $5 billion for the Army to cover the costs of their forces in eastern Europe,” he said. “We don’t get a supplemental, then the Army just has to eat that money.” 

As Congress struggles to get the FY-24 defense spending bill across the finish line, the Biden administration on March 11 is expected to unveil its planned FY-25 DOD budget. 

Not knowing what’s going to be funded in the fiscal year prior’s bill while crafting the next one has added a new level of uncertainty to the mix. 

“Not only are budgets dropping Monday without FY-24 closed, it’s that the House Armed Services Committee amendments to the [National Defense Authorization Act] were due last week,” Eaglen said. “I hear from staffers that the portal will reopen when they have the budget documents in case people want to amend their ideas with actual detail, but that just shows you the state of affairs.”