[Budget Supplement]
[Projecting American Leadership]
[4. Supporting the Worldâs Strongest Military Force]
[From the U.S. Government Printing Office, www.gpo.gov]


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  The men and women of our armed forces remain the foundation, the fundamental foundation of our security. You  
put the steel into our diplomacy. You get the job done when all means short of force have been tried and failed.
                                                                                                                
                                      President Clinton                                                         
                                      May 1995                                                                  
                                                                                                                
                                                                                                                

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  America's defense capability is the bulwark that sustains and supports 
its foreign policy.
   Only when U.S. forces were about to land could our 
          negotiators convince an unwelcome dictatorship to leave Haiti; 
          we then reinstalled the rightful democratically-elected leader 
          and, in the process, stemmed the large-scale migration from 
          Haiti to our borders.
   With Iraq once again threatening Kuwait, we moved quickly to 
          send additional forces to the region, averting another crisis.
   We saved hundreds of thousands of lives by employing our 
          military forces in humanitarian efforts in Rwanda.
   Finally, the resolve shown in the NATO air campaign and the 
          promise of U.S. military involvement in securing a peace was 
          pivotal in bringing the warring factions in Bosnia to the 
          negotiating table and achieving the Dayton Peace Accord; U.S. 
          forces are now leading the cooperative NATO effort to enforce 
          that agreement.
   Because the United States must lead, and our forces must prevail when 
called to fight in a world of new post-Cold War threats, the budget 
proposes to continue sustaining and modernizing the world's strongest, 
best-trained, best-equipped, and most ready military force.
   The budget continues the Administration's defense funding plan, 
supporting our military forces with quality of life improvements and the 
best technology we can develop. The budget also supports the President's 
commitment to arms control and to reducing the dangers of nuclear 
weapons at home and abroad.

 Sustaining a Strong Military Capability

   U.S. military forces must deter our adversaries and reassure our 
friends and allies that America is prepared to use force to defend its 
interests.
   When committed to combat, U.S. forces must win decisively. They must 
be highly ready and armed with the best equipment that technology can 
provide. They must be prepared and trained for the new threats of the 
post-Cold War era, many of which know no national borders: the 
proliferation of weapons of mass destruction; ethnic and regional 
conflicts that undermine stability; and terrorism and drug trafficking, 
which directly threaten our free and open society.
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                    Table 4-1.  MILITARY FORCE TRENDS                   
------------------------------------------------------------------------
                                            1989                 Target 
                                          Cold War     1997      Force  
------------------------------------------------------------------------
Active Forces:                                                          
   Army Divisions......................        18         10         10 
   Navy Aircraft Carriers\1\...........        16         11         11 
   Navy Air Wings......................        13         10         10 
   Navy Surface Combatants and Attack                                   
   Submarines..........................       287        192    161-171 
   Marine Divisions and Air Wings......         3          3          3 
   Air Force Tactical Wings............        25         13         13 
                                                                        
Reserve Forces:                                                         
   Army Combat Brigades................        57         42         42 
   Navy Air Wings......................         2          1          1 
   Navy Aircraft Carrier...............         0          1          1 
   Other Navy Ships....................        26         17         15 
   Marine Divisions/Air Wings..........         1          1          1 
   Air Force Tactical Wings............        12          7          7 
                                                                        
Nuclear Deterrent:\2\                                                   
   Intercontinental Ballistic Missiles.     1,000        580        500 
   Ballistic Missile Submarines                                         
   (Missiles)..........................   32 (576)   17 (408)   14 (336)
   Bombers.............................       359        174         86 
                                                                        
Mobility Forces:                                                        
   Strategic Airlift Aircraft..........       431        389        283 
   Sealift Ships\3\....................       162        152        149 
                                                                        
Military Personnel (in thousands):                                      
   Active Forces.......................     2,130      1,457      1,418 
   Guard and Reserve Forces............     1,171        901        893 
                                                                        
------------------------------------------------------------------------
\1\Includes one non-deployable training carrier in 1989.                
                                                                        
\2\Assumes START II ratification and entry into force. Does not include 
  95 B-1 bombers dedicated to conventional missions in 2002 or in the   
  Target Force.                                                         
                                                                        
\3\Includes ships in the Ready Reserve Force maintained by the          
  Department of Transportation but funded by DOD.                       

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   Today, the United States is the only nation with the logistics, 
mobility, intelligence, and communications capabilities required to 
conduct large-scale, effective military operations on a global basis. 
Coupled with our unique position as the preferred security partner in 
many regions, our military capability provides a foundation for regional 
stability through mutually beneficial partnerships. Our willingness and 
ability to play a leading role in defending common interests help ensure 
that we retain a strong leadership position in the world.
   The budget builds upon the Administration's policy of the last three 
years--sustaining and modernizing the world's strongest and
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most ready military force, capable of prevailing
 with our regional allies in two 
nearly simultaneous regional conflicts. The budget maintains our 
commitment to high levels of training and readiness for that force and 
equipping it with technology second to none (see Table 4-1).

Providing Budget Levels that Ensure a Strong Defense

   For programs in the National Defense function (050), the budget 
proposes 1997 discretionary funding of $255.1 billion in budget 
authority and $259.4 billion in outlays. This overall function includes 
the activities of the Department of Defense-Military (051), Atomic 
Energy Defense Activities (053), and other Defense-Related Activities 
(054).
   Table 4-2 shows budget authority and outlay levels for these 
functions through 2002.
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                                 Table 4-2  FUNDING SUMMARY FOR NATIONAL DEFENSE                                
                                 (Discretionary funding, in billions of dollars)                                
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                                                                                     Proposed                   
                                                1995      1996   -----------------------------------------------
                                               Actual   Estimate   1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
Department of Defense-Military (051):                                                                           
   Budget Authority........................      257.4    252.6    243.4   248.9   255.0   262.4   270.3   277.3
   Outlays.................................      261.2    255.3    248.3   244.7   247.3   254.6   257.3   265.6
                                                                                                                
Atomic Energy Defense Activities (053):                                                                         
   Budget Authority........................       10.1     10.6     10.9    10.0     9.1     8.2     9.4    10.6
   Outlays.................................       11.7     10.2     10.5    10.2     9.3     8.4     8.8     9.9
                                                                                                                
Other Defense Related Activities (054):                                                                         
   Budget Authority........................        0.4      0.7      0.8     0.4     0.3     0.3     0.3     0.4
   Outlays.................................        0.7      0.9      0.6     0.6     0.5     0.5     0.5     0.6
                                                                                                                
Total National Defense (050):                                                                                   
   Budget Authority........................      267.9    263.9    255.1   259.3   264.4   270.9   280.0   288.3
   Outlays.................................      273.6    266.4    259.4   255.5   257.1   263.5   266.6   276.1
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  For Department of Defense (DOD) military functions (051), the budget 
proposes $243.4 billion in budget authority and $248.3 billion in 
outlays for 1997. After 1997, the budget reflects the impact of lower 
estimates of inflation, offset by the planned increases needed to 
modernize our military forces. DOD funding would roughly keep pace with 
inflation through 1999, then increase slightly faster than inflation 
through the rest of the five-year planning period.
   The budget continues the Administration's defense funding plan of the 
last three years, which provides for a careful resizing of our
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military forces, ensures full support in the
 near term for military readiness and 
quality of life, and provides properly for modernizing our forces as new 
technology comes on line later in the decade.
   We have carefully recalibrated this defense plan over the past three 
years in response to experience and events. Reflecting the findings of a 
1993 review of previously assumed but unrealized savings, we increased 
the 1994 defense budget. As pay levels rose, we adjusted defense budgets 
accordingly. In December 1994, we added $25 billion to our long-term 
defense plan to provide for readiness and quality of life initiatives 
and for real growth in 2000 and 2001 to purchase new military hardware.
  The President's plan is a rational, careful approach to defense 
funding. By contrast, in 1996 Congress provided $7 billion more than the 
Administration requested, principally for military hardware programs 
that the services have said they do not need or had planned to request 
later.
   These additional funds mean that, overall, 1996 funding for DOD 
military functions is higher than the 1997 proposed level--and observers 
might take that to mean that most programs funded in 1996 would face 
cuts in 1997. This is not the case. Congress added funding for programs 
in 1996 that do not require funding in 1997.
   As Chart 4-1 shows, our 1997 request returns defense funding to a 
plan that makes sense, providing increases for modernization at the end 
of the decade when new technologies become available. By contrast, the 
congressional plan provides funds for older technologies early, then 
falls well below the Administration's budget plan at the turn of the 
century--just as the newer defense technologies for which the military 
forces are planning will begin production.
   Because the President believes that Congress added funds last year 
for many unnecessary projects, the budget proposes to rescind or cancel 
some 1996 defense resources.

[[Page 48]]                                     


Modernizing Our Military Forces

   Relating Procurement to the Total Defense Budget: A key objective of 
the Administration's defense funding plan is to modernize our military 
hardware.
   As Chart 4-2 shows, historical changes in procurement funding 
coincide with changes in total defense funding. In the late 1970s and 
early 1980s, as the defense budget rose, the President and Congress 
invested more and more in equipment. These investments funded a wide 
range of systems (such as fighter aircraft, attack submarines, and 
armored vehicles) and provided the backbone of today's modern force.
   The equipment that the Government bought then is now aging and must 
be modernized to include the latest technological advances. For example, 
the average age of Air Force fighter and attack aircraft is about 10 
years today, but will grow to around 20 years by 2010. When complex 
military equipment ages, it becomes costlier and more difficult to 
maintain and operate. Most important of all, the decisive technological 
advantage that superior equipment provides means few casualties and the 
quick, successful resolution of conflict. For all these reasons, 
modernization is a high priority.

   Providing Modernization Funding: The Administration proposes $314 
billion from 1997 to 2002 for procurement, so that procurement funding 
would grow by 42 percent in real terms over the period. Important 
modernization programs in production would continue, including DDG-51 
guided-missile destroyers, the C-17 strategic airlift aircraft, and 
standoff precision munitions like the Joint Standoff Weapon.

                                     


   In 1997, low-rate production of Marine Corps V-22 tilt rotor aircraft 
and the Navy's multi-role F/A-18E/F fighter would begin. Modernization 
funding would grow in 1998 and
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1999 with initial procurement of the 
Navy's New Attack Submarine and low-rate production of the Air Force's 
F-22 Advanced Tactical Fighter. Full-rate production of the V-22, F/A-
18E/F, and the F-22 would occur at the turn of the century.

   Providing Modernization for the Long-Term: The budget proposes large 
investments in research and development for advanced systems that will 
enter production in the middle of the next decade. The Air Force, Navy, 
and Marine Corps are developing a Joint Strike Fighter as a cost-
effective replacement for today's tactical fighter and attack aircraft. 
Other major weapons in development include the Army Comanche helicopter, 
a new surface ship for the Navy, and an advanced amphibious-assault 
vehicle for the Marine Corps.

Ensuring the Nation's Security

   Achieving Arms Control: The President's policy of stressing arms 
control to reduce threats from weapons of mass destruction was rewarded 
by an overwhelming Senate vote for ratification of the START II treaty. 
Following approval by the Russian Republic, implementation of this 
seminal treaty, together with the START I Treaty that took effect in 
December 1994, will bring warheads deployed on long-range missiles and 
bombers by the former Soviet Union to a third of the Cold War level. By 
reducing weapons levels on both sides, and by banning land-based 
missiles with multiple warheads, START II will make the world a much 
safer place.
   To reinforce our arms control efforts, the budget proposes $3.3 
billion for a wide range of programs to blunt threats posed by the 
global proliferation of nuclear, biological, and chemical weapons.

   Reducing Weapons of Mass Destruction in the Former Soviet Union 
(FSU): The Cooperative Threat Reduction program (also known as the Nunn-
Lugar program) has contributed greatly to U.S. security. Nunn-Lugar 
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assistance increased the safety and speed with which states of the FSU 
have dismantled their nuclear weapons. The budget proposes $328 million 
to continue this important program in 1997.
   Countering Proliferation of Weapons of Mass Destruction: The budget 
proposes nearly $500 million to develop capabilities to locate and 
neutralize weapons of mass destruction before they can be used, and to 
protect U.S. troops against their effects. High-priority efforts include 
developing the means to identify and destroy underground storage sites, 
and the methods to detect and track weapons shipments. To protect troops 
against chemical and biological agents, key efforts include developing 
advanced detection devices, vaccines, and protective clothing.
   Developing and Deploying Defenses Against Tactical Ballistic 
Missiles:  The Administration's Theater Missile Defense (TMD) program is 
designed to defeat existing and future ballistic missile threats around 
the world. With over $2 billion in proposed funding (more than two-
thirds of the total budgeted for ballistic-missile defense), TMD would 
provide defenses against those missiles that directly threaten American 
and allied ground, naval, and air forces deployed abroad. Funding for 
TMD supports development, as soon as possible, of an advanced version of 
the Army's Patriot missile and the Navy's Lower-Tier System, as well as 
the development of more advanced systems to meet future threats.
   Developing Options to Defend Against Strategic Ballistic Missiles:  
The budget proposes $500 million for a vigorous program to develop the 
central elements of a national missile defense system that could be used 
to protect the United States. Although the Administration does not 
believe that such a system is needed now, the development of a 
contingency capability continues to ensure that deployment could proceed 
rapidly--if a missile threat emerges sooner than our intelligence 
community estimates. A decision to force early deployment would not only 
waste billions of dollars, it would force adoption of immature 
technologies that would not likely provide an effective defense.
   Maintaining Stewardship Over Our Nuclear Capability: The unifying 
mission of the Department of Energy's (DOE) defense activities is to 
reduce the global nuclear danger. DOE does this by:
   supporting and maintaining a safe, secure, reliable, and 
          smaller nuclear weapons stockpile without explosive testing of 
          nuclear weapons;
   dismantling excess nuclear weapons;
   providing technical leadership for national and global 
          nonproliferation efforts; and
   reducing the environmental, safety, and health risks from 
          current and former facilities in the nuclear weapons complex.
   The budget proposes $10.9 billion for DOE spending on defense 
activities, a $230 million increase from the 1996 enacted level. Funding 
for stewardship and management of the nuclear weapons stockpile would 
rise by $250 million, to $3.7 billion, reflecting the President's 
commitment to provide sufficient funding for this program next year and 
over the next decade. The increase is designed to help maintain the 
safety and reliability of the nuclear weapons stockpile under a 
comprehensive test ban treaty, which the Administration hopes to 
complete and sign in 1996.

   Undertaking Successful Contingency Operations: U.S. forces are 
engaged in contingency operations around the world that support American 
interests and demonstrate international leadership--from monitoring U.N. 
sanctions on Iraq, to supporting the return to democracy in Haiti, to 
playing a key role in the NATO-led military force implementing the 
Dayton Peace Accord in Bosnia and Herzegovina. The budget includes 
funding for ongoing contingency operations in Southwest Asia, and Bosnia 
and Herzegovina, to help ensure that we protect force readiness. If 
Congress approves these funds, and no unexpected new costs arise, DOD 
can avoid redirecting funds from operations and maintenance programs, 
thereby maintaining its high level of readiness.
   In the 1996 Defense Appropriations Act, Congress funded a portion of 
the costs of contingency operations in Southwest Asia. The remaining 
unfunded contingency operations costs, stemming mostly from operations 
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in Bosnia and Herzegovina, total $2.2 billion. A reprogramming of 
savings from lower-than-expected inflation can fund nearly half of these 
costs. Another $620 million is included in a supplemental appropriations 
request. The Administration submitted these proposals to Congress early 
this year and plans to submit a second reprogramming to fund the balance 
of the Bosnia and other contingency costs.

   Establishing Information Dominance: Information is power. U.S. 
preeminence in information technology helps us to field the world's 
premier military force. The Administration's goal is to continue 
advances in information technology to support military operations and 
our national security strategy.
   Intelligence is critical to information dominance and it continues to 
play a large role in military operations and national security decision-
making. This year's intelligence budget is guided by explicit 
intelligence priorities that the President established for the post-Cold 
War era. We have realigned funds within national and tactical 
intelligence to better cover the President's top priorities, such as 
support to military operations and counter-proliferation. The 
intelligence budget also realigns funds to achieve a better balance 
between collecting and analyzing information.
   A new initiative--the Global Broadcast System--exemplifies the 
Administration's drive for information dominance. DOD is adapting 
commercial, direct-broadcast, digital TV technology to provide real-time 
logistics, weather, and intelligence information to military forces. 
Commanders equipped with terminals as small as 18 inches would receive 
instantaneous, secure, high-data-rate information to out-smart, out-
maneuver, and out-fight any opponent.

Maintaining the Readiness of Our Forces

   Ensuring Adequate Resources for Readiness: The Administration's top 
defense priority continues to be maintaining the readiness and 
sustainability of our military forces. The budget provides full funding 
for operations and support programs critical to sustaining the 
military's current high readiness levels. These programs include unit 
training activities, recruiting and retention programs, joint exercises, 
and equipment maintenance activities. The Administration also proposes 
funding for humanitarian assistance programs.
   DOD has embarked on several initiatives to improve the assessment of 
current and future military readiness. Of particular note are the Senior 
Readiness Oversight Council and the Joint Monthly Readiness Review 
process. These initiatives enhance DOD's ability to ensure that critical 
readiness programs receive sufficient resources and that our forces 
remain prepared to accomplish their missions.

   Enhancing Quality of Life for Our Military Personnel: The 
Administration continues to strongly back programs that directly, or 
indirectly, support military readiness. Our armed forces have been 
extremely successful in attracting and retaining motivated, high-quality 
personnel in part because of the Administration's continuing strong 
commitment to fund quality of life programs. For example, the budget 
provides military personnel a three percent military pay raise, 
effective January 1997, and substantial funding to upgrade and improve 
military barracks and family housing.

Managing our Defense Resources More Efficiently

   Implementing Base Closure and Realignment: Since 1988, four Base 
Closure and Realignment Commissions have recommended the closure of 97 
out of 495 major military installations and over 200 smaller 
installations--about 20 percent of our defense infrastructure. The 
projected annual savings of $5.8 billion by 2001 would help fund, in 
part, the modernization of our military forces. To ensure that the 
Government reaps these savings, the budget proposes increases for 1997-
2000 to fully fund the implementation of final recommendations of the 
1995 Base Closure and Realignment Commission.
   Improving Financial Management: The Administration remains committed 
to reforming DOD's financial management and accounting systems. DOD's 
progress includes developing and implementing standard financial systems 
for civilian payroll, military retirement, transportation, and debt 
management. Significantly, DOD has cut the category known as problem 
disbursements from $51 billion in 1993 to $22 billion in 1995.
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   The Administration is committed to implementing the Chief Financial 
Officers Act in order to ensure that DOD can produce auditable financial 
statements. In addition, DOD will continue to pursue the most cost-
effective solutions to its finance and accounting needs, which may 
include contracting out some functions.

   Streamlining the Civilian Workforce: DOD plans to continue 
streamlining its civilian workforce while maintaining the quality of its 
workers. The budget reflects a cut of over 208,000, or 22 percent, of 
DOD civilian positions from 1993 to 1999. Consistent with the principles 
of the Vice President's National Performance Review, DOD is cutting 
headquarters, procurement, finance, and administrative staffs.
   Implementing the Government Performance and Results Act (GPRA): DOD 
continues to incorporate performance evaluation into its decision-making 
for such broad-based issues as weapons purchases, transportation 
methods, and inventory control. It has designated seven programs 
(including the Defense Logistics Agency and Air Combat Command) as 
demonstration projects to provide a guide to implementing GPRA fully.
   Using the Private Sector for Support Functions: The Commission on 
Roles and Missions of the Armed Forces (CORM) recommended that, to save 
money, DOD use the private sector for a number of support functions. In 
August 1995, the Deputy Secretary of Defense established an Integrated 
Policy Team for Privatization, which includes senior representatives 
from the military departments, defense agencies, and the Secretary's 
staff. They will look for opportunities, identify obstacles, and develop 
solutions and strategies to support the CORM recommendation. The budget 
provides funds to accomplish these goals.