Home inFocus Defense: Rising Challenges and Changing Strategies (Fall 2020) Defense Budgeting: Readiness and Research

Defense Budgeting: Readiness and Research

The Pentagon, headquarters of the U.S. military.

President Donald Trump’s Budget Request for defense was released on Feb. 10, 2020, under the tagline of seeking to achieve “irreversible implementation of the National Defense Strategy.” This is a great sentiment that reflects the Department of Defense’s (DOD) commitment to move toward the great power competition outlined in the National Defense Strategy (NDS) and de-emphasize counterterrorism missions.

There has been substantive support in Washington, D.C. for the shift to great power competition, with its particular emphasis on long-term rivalry with the People’s Republic of China (PRC).

In its budget request, DOD largely emphasized readiness in the present and research for future capabilities, in lieu of increasing contemporary capabilities. DOD leadership will have to make a case in Congress why that is the correct path. However, it will be up to Congress to examine whether the choices made by the department are best suited for the United States in the current world of great power competition and sustained counterterrorism operations.

Each of the services’ budget requests and the defense-wide budget request raise issues that should be considered. This article will hit only a very few. Ultimately, the only way the country can reach an irreversible implementation of a policy is if there is broad bipartisan consensus for that policy in Congress. Absent that consensus, the policy will be washed away in the natural political waves in Washington.

Defense-Wide Issues

The fiscal year (FY) 2021 budget request is marked by trade-offs of contemporary capabilities for research programs and increased investments in readiness. It is a theme that echoes through all the services budget requests. DOD is also trying to do more with resources by generating savings within the defense-wide accounts; however, base realignment and closures (BRACs) – a major savings generator – are nowhere to be found.

Since the Trump administration took office, there has been a concerted effort to prioritize resources for defense within the discretionary budget. Not adjusted for inflation, from FY 2016 to FY 2020, there was a substantial increase of more than 20 percent in the defense budget, from $624 billion to $757 billion.

However, that growth is set to slow in FY 2021. The defense budget is expected to increase by only 0.3 percent from FY 2020 to FY 2021. The increase is determined by the Bipartisan Budget Act of 2019, which set the defense caps at $740.5 billion; of that, $69 billion was under the Overseas Contingency Operations (OCO) account.

The cap for FY 2020 was $738 billion; of that $71.5 billion was under OCO. The current projections of the Office of Management and Budget show that the White House intends to raise the defense budget by an average of 2.2 percent until 2025, and then freeze it from 2025 to 2030.

Those budget limits fall short of the 3 percent to 5 percent real growth recommended by then-Secretary of Defense James Mattis,  and current Secretary Mark Esper, and reinforced by the National Defense Strategy Commission as necessary to implement the strategy. Each has assessed that DOD will need more resources.

It is critical for lawmakers to acknowledge the real budgetary trade-offs required to implement the defense strategy. The “parity” strategy, which marked the decade of the Budget Control Act, of raising defense and non-defense funds is both poor budgeting and dangerous, and it jeopardizes the levels of defense spending that are required over the next several years. 

Furthermore, Congress must address non-defense mandatory programs that contribute to the budget’s long-run unsustainability. 

If ignored, overspending on domestic programs will cause significant challenges for national security in the future.

The increased level of funding is necessary for the military services to better balance their competing priorities – current levels of readiness and modernizing and preparing for deterrence – in the context of great power competition. Every service is going through that challenge, and the increased funding will provide a better margin and context in which to make those decisions.

 R&D Versus Personnel

In broad terms, there will always be a balance in how to prioritize defense readiness (today), procurement (tomorrow), and research and development (the future). The FY 2021 defense budget request generally favors improving current readiness levels, supporting the current force structure, and investing in research and development over increasing the current numbers of equipment and personnel. By and large, the services outlined a reduction in their procurement of contemporary military assets, such as the F-35, or the anti-submarine aircraft P-8, to fund research and development projects.

In the department as a whole, the Research and Development, Testing, and Evaluation (RDTE) account is slated to grow by two percent, from $104.4 billion to $106.5 billion in FY 2021. The increase is largely being dedicated to classified programs, accounting for $1.615 billion of new resources.

Every service’s RDTE account is set to grow at some level; the Army, at 1.8 percent, is slated to expand the least; the Navy is receiving a 6.3 percent increase. Military personnel accounts are slated to experience the largest increase, growing by 5.7 percent across DOD.

The Army’s military personnel account is the one set to grow the least, by 4.6 percent, while the Navy and the Air Force would be increasing by 6.4 percent and 6.3 percent, respectively.

The accounts that are slated to decrease (in order to pay for the above increases) are the procurement accounts. In the whole department, procurement is set to decrease by 4.8 percent.

The Navy will experience the largest decline, having its procurement budget reduced by 7.1 percent, while the Army will reduce its procurement by 1.8 percent and the Air Force by two percent.

These choices reflect the bias that this budget request has toward supporting the current force structure and investing in future technologies at the expense of expanding contemporary capabilities.

Small Strength Increases

The president’s budget request calls for modest end-strength changes across all the services (with the Navy receiving the largest) and the Space Force, which is asking for its first substantive end strength.

The Space Force is asking to increase from 38 personnel to 6,400 in its active-duty component, accompanied by a corresponding decline in the Air Force active component, which is decreasing by 6,600. The Marine Corps’ active component is also slated to decrease by 600. Meanwhile, the Army is asking to increase by 900 and the Navy by 5,300. The focus of the Navy is on increasing the manning levels to augment its capacity to staff the current ships in the fleet. In the aggregate, DOD wants its active component to increase by 5,500 personnel.

It is modest growth that does not meet the needs that multiple service chiefs have testified as necessary over the years, nor the force construct that would be necessary for two simultaneous major regional contingencies.

Congress ought to investigate and assess the implications of DOD’s modest planned growth.

Defense-wide Review Results

The Department of Defense was able to alleviate some of the budgetary pressure through its defense-wide budget review.

In the review, based on Secretary Esper’s similar efforts in the Army, the Department was able to save more than $5 billion and reinvest those resources in higher priority areas. The process is planned to continue in all areas of the department, from the military services to the combatant commands and other organizations under the control of the secretary.

A review of this type is laudable, and it should indeed continue. However, the effort is bound to hit a point of diminishing returns, a point the Army has likely already reached.

BRAC: Lost in the Shuffle 

The Department of Defense was supposed to deliver a report assessing the force structure and infrastructure capabilities, outlining the current excess capacity in the department. The most recent study, from October 2017, outlined 19 percent excess capacity in DOD.

The newer report was supposed to re-assess excess capacity and start the process of identifying the locations that have surplus or deficits.

Additionally, the evaluation could serve DOD by helping make its case for new base closures and realignments (BRAC). A new round of BRAC is needed both to generate savings, estimated at $2 billion annually, and to advance the implementation of the National Defense Strategy.

It is a missed opportunity by the administration that Congress can and should revisit.

The Services

The Army is focusing on maintaining its current readiness gains and preparing to invest in future capabilities. However, doing so means reducing procurement of contemporary capability and decreased projected growth in the size of the Army. [Ed. Note: For a deeper look at Army issues, see Steven Metz in this issue.]

The Navy’s budget request reflects a service in transition. Its force structure assessment that will determine requirements for the future has been delayed, and the budget request reflects the uncertainty of this transitional period.

In 2019, the Navy began a new assessment of its fleet and the various demands placed upon it to either validate its 2016 force structure assessment (FSA) or to modify it as necessary to account for changes in technology, U.S. national security interests, and advances made by likely competitors during the past four years. As with the other services, the Navy is mindful of the National Defense Strategy and its emphasis on major power competition between the United States, China, and Russia.

The FSA was to have been released in January 2020, but had been delayed “until Spring” due to the Marine Corps’ parallel effort to redesign its forces based on new operational concepts for distributed naval power and the Corps’ contributions to projecting naval power in highly contested environments.

The Marine Corps, like the Navy, has been deeply engaged in a comprehensive review of its forces, capabilities, and geographic posture to ensure it can do its part in meeting the demands of great power competition, as directed in the National Defense Strategy.

The Commandant of the Marine Corps, General David Berger, has pointed the service toward the Indo–Pacific region – with China as the pacing challenge – and made force design his top priority. [Ed Note: For another look at Marine Corps issues, see Maj. Gen. Jarvis Lynch, USMC (Ret.) and Maj. Gen. Michael Sullivan, USMC (Ret.) in this issue.]

The Air Force has described a force that needs to increase by more than 20 percent to meet the challenges of great power competition. However, the budget request retires aircraft and reduces the level of procurement of new aircraft. This misalignment must be addressed by Congress.

The Air Force procurement budget, which the Air Force has stated is too small for the missions the nation expects of it fell by $1.4 billion.

In order to sustain current capacity and stop the aging of its fighter force, the service needs to buy 72 fighters per year. In 2018, the Secretary of the Air Force backed up that statement with a study called “The Air Force We Need,” which found the service needs to grow by 25 percent in order to meet the 2018 National Defense Strategy.

And yet, the service has reduced its procurement budget in each of the two years since that study was released.

National Nuclear Security Administration’s budget includes $19.8 billion for the National Nuclear Security Administration (NNSA), which is an 18.3 percent increase from last year’s enacted level. 

This boost is critical for nuclear modernization because it comes in time for the NNSA to move forward with a number of programs that would revamp the nuclear security enterprise. In particular, the NNSA is planning to resume its ability to produce plutonium pits at both the Los Alamos National Laboratory and the repurposed Savannah River Site, continue the B61-12 life-extension program, develop the W87-1 warhead, and refurbish decaying Cold War–era infrastructure that has been neglected for the past two decades.


Congress must play its role in better aligning the budget with the National Defense Strategy. In order to achieve this, Congress should:

Assess the trade-offs that the DOD has carried in the budget request. The budget request emphasizes the present and the long-term in lieu of developing contemporary capabilities. Congress needs to understand why the services made those choices as well as the risks that these choices bring. The department has not done a good job defining risk – and Congress needs to continue pressing on that question. After all, if there is no precise definition of the downsides of each choice, it is not possible to make an informed decision.

Evaluate how great power competition is reflected in the defense budget. The changes required by the National Defense Strategy are not trivial and should have lasting impact on the shape of our forces. It will require Congress to move away from some of its parochial preferences and give way to priorities that focus on the threats posed by Russia and the People’s Republic of China.

Appropriate and authorize the defense budget on time. Continuing resolutions, unfortunately, have been the hallmark of recent budgetary history.

This year, there are already top limits defined for defense that are unlikely to be renegotiated in the current political environment. Congress should use this certainty to accelerate the process and have both authorizations and appropriations acts signed before the start of the new fiscal year.


The fiscal year 2021 defense budget requires decisions and priorities that will determine how the country will implement the National Defense Strategy and adapt to the challenges of great power competition. The president’s budget request outlined the department’s trade-offs for the coming fiscal year. However, it will be up to Congress to decide on these trade-offs and determine if the proposed investment and divestments are the adequate path forward. 

Frederico Bartels is Senior Policy Analyst, Defense Budgeting; Patty-Jane Geller is Policy Analyst, Nuclear Deterrence and Missile Defense; Thomas Spoehr is Director, Center for National Defense; John Venable is Senior Research Fellow for Defense Policy; and Dakota Wood is Senior Research Fellow, Defense Programs at the Heritage Foundation.