PAUL LEWIS & GRAHAM WARWICK / WASHINGTON DC
Despite major funding boosts, operational cutbacks have led to more than 480 aircraft retirements
The USA's planned total national defence expenditure will rise to almost $400 billion next year and is projected to grow by a further 25% by the end of the decade, as the military pushes ahead with its transformation in capabilities and organisation. The cost of the ongoing war on terrorism in Afghanistan, and the looming prospect of conflict with Iraq, will result in even more money being required by the Department of Defense (DoD) before the next budget rolls around.
Excluding defence-related spending by other government agencies, the Bush administration is requesting a "peacetime" budget of $379.9 billion in fiscal year 2004 - an increase of $15.3 billion on FY2003. The DoD is still $13 billion short of the $20 billion in supplemental funding it asked Congress for last year to cover war-related costs, which instead have been funded by the operations budget. "Sometime this spring our services will not have the money to conduct certain training activities," warns DoD comptroller Dov Zakheim.
The DoD spends between $1.25 and $1.5 billion a month fighting terrorism, not including an allowance for the increasing likelihood of war with Iraq. The 1991 Gulf War cost $61 billion, of which the USA footed $11 billion. The DoD has no estimate of the cost of a second war with Iraq. "It depends how long it will go on, its intensity and what we might do afterwards," says Zakheim.
Despite a $2.7 billion hike in procurement funding to $72.7 billion, the three services have still had to make hard decisions. The US Army has axed 24 systems, including the Northrop Grumman BAT anti-armour weapon, and restructured 24 more, while the US Air Force is retiring early 114 fighters and 115 transports and tankers, and the US Navy another 259 aircraft. This will save a projected $82 billion by 2009, freeing up money for transformation, which in FY2004 will account for around one-third of the DoD's $75 billion discretionary spending.
"The basic point of this year's budget is that we have accepted near-term risk to transform for the longer-term," says Zakheim. Major areas funded in FY2004 include $9.1 billion for missile defence programmes, $1.4 billion on unmanned air vehicles, $1.5 billion on satellite systems, including new laser communications to overcome bandwidth constraints, and $4.5 billion for special operations forces - an increase of nearly 50% on 2003 and with money for Boeing MH-47G and Sikorsky MH-60M helicopter upgrades.
Other major airborne systems funded in the budget include $300 million for development of the MC2A successor to the Northrop Grumman E-8C J-STARS airborne ground surveillance platform and Boeing E-3 airborne warning and control system; $1.5 billion to continue limited production of the Bell Boeing V-22 with nine tiltrotors for the US Marine Corps and two for the USAF; and $1.7 billion for precision guided weapons such as Boeing's GPS satellite navigation-guided JDAM, output of which is increasing to 2,400 kits a month.
Extra money will be spent on USN warship construction, including the start of work on the first CVN-21-class carrier in 2007.
Source: Flight International
