[Budget of the United States Government]
[VI. Investing in the Common Good: Program Performance in Federal Functions]
[12. National Defense]
[From the U.S. Government Publishing Office, www.gpo.gov]


 
                          12.  NATIONAL DEFENSE

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                          Table 12-1.  FEDERAL RESOURCES IN SUPPORT OF NATIONAL DEFENSE                         
                                            (In millions of dollars)                                            
----------------------------------------------------------------------------------------------------------------
                                                                               Estimate                         
               Function 050                   1997   -----------------------------------------------------------
                                             Actual     1998      1999      2000      2001      2002      2003  
----------------------------------------------------------------------------------------------------------------
Spending:                                                                                                       
  Discretionary Budget Authority..........   266,180   268,598   271,616   276,957   284,786   288,090   298,048
  Mandatory Outlays:                                                                                            
    Existing law..........................    -1,169      -997    -1,035    -1,033    -1,020    -1,009      -978
Credit Activity:                                                                                                
  Direct loan disbursements...............  ........         7  ........       175       345       319       334
  Guaranteed loans........................  ........        20       176       216     1,236     1,164     1,205
Tax Expenditures:                                                                                               
  Existing law............................     2,080     2,095     2,120     2,140     2,160     2,180     2,200
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  The Federal Government will allocate over $271 billion in 1999 to 
defend the United States, its citizens, its allies, and to protect and 
advance American interests around the world. National defense programs 
and activities ensure that the United States maintains strong, ready, 
and modern military forces to promote U.S. objectives in peacetime, 
deter conflict, and if necessary, successfully defend our Nation and its 
interests in wartime.
   Over the past half-century, our defense program has deterred both 
conventional and nuclear attack on U.S. soil, and brought a successful 
end to the Cold War. Today, the United States is the sole remaining 
superpower in the world, with military capabilities unsurpassed by any 
nation. As the world's best trained and best equipped fighting force, 
the U.S. military continues to provide the strength and leadership that 
serve as the foundation upon which to promote peace, freedom, and 
prosperity around the globe.

Department of Defense (DOD)

   The DOD budget provides for the pay, training, operation, basing, and 
support of U.S. military forces, and for the development and acquisition 
of modern equipment to:
   Shape the international environment by sustaining U.S. 
          defense forces at levels sufficient to undertake our strategy 
          of engagement, and conducting programs to reduce weapons of 
          mass destruction, prevent their proliferation, and combat 
          terrorism;
   Respond to the full spectrum of crises by deploying forces 
          overseas and maintaining capabilities to mobilize forces 
          stationed on U.S. soil;
   Prepare for an uncertain future by giving U.S. forces the 
          military hardware that employs the best available 
          technologies; and
   Ensure that the U.S. military remains the world's most 
          prepared and capable force by sustaining force readiness 
          levels and reengineering business practices to improve 
          operations.
   To achieve these objectives, DOD sustains the following capabilities.

   Conventional Forces: Conventional forces include ground forces such 
as infantry and tank units; air forces such as tactical aircraft; naval 
forces such as aircraft carriers, destroyers, and attack submarines; and 
Marine Corps expeditionary forces. The Nation needs conventional forces 
to deter aggression and, when

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that fails, to defeat it. Funds to support these forces cover pay and 
benefits for military personnel; the purchase, operation, and 
maintenance of conventional systems such as tanks, aircraft, and ships; 
the purchase of ammunition and spare parts; and training.
   Mobility Forces: Mobility forces provide the airlift and sealift that 
transport military personnel and materiel throughout the world. They 
play a critical role in U.S. defense strategy and are a vital part of 
America's response to contingencies that range from humanitarian relief 
efforts to major theater wars. Airlift aircraft provide a flexible, 
rapid way to deploy forces and supplies quickly to distant regions, 
while sealift ships allow the deployment of large numbers of heavy 
forces together with their fuel and supplies. The mobility program also 
includes prepositioning equipment and supplies at sea or on land near 
the location of a potential crisis, allowing U.S. forces that must 
respond rapidly to crises overseas to quickly draw upon these 
prepositioned items.
   Strategic Nuclear Forces: Strategic nuclear forces are also important 
to our military capability. They include land-based intercontinental 
ballistic missiles, submarine launched ballistic missiles, and long-
range strategic bombers. Within treaty-imposed limits, the primary 
mission of strategic forces is to deter nuclear attack against the 
United States and its allies, and to convince potential adversaries that 
they will never gain a nuclear advantage against our Nation.
   Supporting Activities: Supporting activities include research and 
development, communications, intelligence, training and medical 
services, central supply and maintenance, and other logistics 
activities. In particular, the Defense Health Program provides health 
care through DOD facilities as well as through the CHAMPUS medical 
insurance program and TRICARE--its companion program.

DOD Performance

   DOD has identified broad objectives and key performance indicators 
and quantitative measures that will determine whether it is achieving 
its major goals.

   Shaping the International Environment: DOD's first goal is to shape 
the international environment by participating in international security 
organizations, such as NATO, and improving our ability to work 
cooperatively with our friends and allies. Such efforts are designed to 
promote regional stability and security, and reduce the threat of war. 
Their failure could lead to a major conflict affecting U.S. interests.
   Evaluating DOD's performance in this area includes an assessment of:
   The ability of U.S. forces to enhance and sustain security 
          relationships with friends and allies, enhance coalition 
          warfighting, promote regional stability and support U.S. 
          regional security objectives, deter aggression, and prevent or 
          reduce the threat of conflict. For example, in 1999, the 
          United States and Russia will conduct one Joint Theater 
          Ballistic Missile Defense command post exercise.
   DOD's success in implementing threat reduction programs and 
          arms control agreements, including inspection, verification, 
          and monitoring programs.
   DOD's achievement of the force structure objectives of the 
          Quadrennial Defense Review (QDR).

   Responding to the Full Spectrum of Crises: DOD must be able to 
respond to the full spectrum of crises, from small-scale contingencies 
to two nearly simultaneous major theater wars.
  In 1999, DOD and the relevant services will meet the following 
performance goals:
   The Air Force will maintain 20 Air Force Fighter wing 
          equivalents, four air defense squadrons, 89 strategic bombers, 
          and 550 intercontinental ballistic missiles.
   The Navy will maintain 11 aircraft wings and 314 battle force 
          ships, including 12 aircraft carriers and 18 ballistic-missile 
          submarines.
   The Army will maintain four active corps headquarters, 18 
          active and National Guard divisions, two active armored 
          cavalry regiments, and 15 National Guard enhanced readiness 
          brigades.
   The Marine Corps will maintain three active and one reserve 
          divisions, three active

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          and one reserve wings, and three active and one reserve force 
          service support groups.
  Overseas presence, mobility, and the sustaining of a capable force 
structure are all key to DOD's ability to respond effectively to crises. 
DOD's effectiveness will be determined, in part, by the ability of U.S. 
forces ``forward deployed'' (that is, on site around the world) and 
those deploying from U.S. bases to rapidly converge at the scene of a 
potential conflict to deter hostilities and protect U.S. citizens and 
interests in times of crisis.
  In the Pacific, DOD will deploy one Army division, one Marine 
          expeditionary force, two Air Force fighter wing equivalents, 
          one Navy carrier battle group, and one amphibious ready group 
          with an embarked Marine expeditionary unit.
  In Europe, DOD will maintain one Army armor division and one 
          Army mechanized infantry division, two Air Force fighter wing 
          equivalents, one carrier battle group, and one amphibious 
          ready group with an embarked Marine expeditionary unit.
  In Southwest Asia, DOD will deploy at least one Air Force 
          fighter wing equivalent, one carrier battle group, and one 
          amphibious ready group with an embarked Marine expeditionary 
          unit, in addition to materiel prepositioned in the region.
  The amount of sealift and airlift capacity must be sufficient to meet 
deployment timelines for deterring and defeating large-scale, cross-
border aggression in two distant theaters in overlapping time frames, 
and to sustain U.S. forces engaged in two major theater wars.
  In 1999, DOD will attain an organic strategic airlift 
          capability of 26.5 million ton miles a day and will attain a 
          surge sealift capacity of 7.8 million square feet.

   Preparing Now for an Uncertain Future: U.S. forces must maintain a 
qualitative superiority over potential adversaries by pursuing a focused 
procurement and research and development program. Achieving this goal 
depends on ensuring that:
   DOD will acquire modern and capable weapon systems and will 
          deliver them to U.S. forces in 25 percent less time, while 
          ensuring that costs do not grow more than one percent a year 
          by the year 2000 and meeting required performance 
          specifications.

   Remaining the World's Most Ready and Capable Force: Attaining this 
goal depends on four elements: ensuring the readiness of military units; 
retaining and recruiting high-quality personnel; strengthening and 
enhancing quality of life programs for military members and their 
families; and providing equal opportunity throughout the armed services.
   DOD has identified specific milestones to measure progress in each 
area, such as the amount of training that individual units accomplish, 
the availability and operability of equipment, and the achievement of 
recruiting and retention goals.
   Several factors determine overall unit readiness, such as 
          training, quality and availability of equipment, and number of 
          personnel and, in 1999, DOD will ensure that all of its units 
          meet their specified readiness goals.
   On average, the Army will attain 800 tank miles a year; the 
          Air Force will achieve 20 flying hours per crew a month; the 
          Marine Corps will fully execute its mission training syllabus; 
          and the Navy will execute 50.5 deployed and 28 non-deployed 
          ship steaming days per quarter.
   In 1999, DOD also will:
   Recruit 191,300 new members of the armed services, obtain 60 
          percent of recruits from the top half of those tested for 
          service, and achieve a 50 percent enlisted retention rate 
          after the first term.
   Achieve all of its projected targets for its civilian work 
          force reductions.

   Exploiting the Revolution in Military Affairs: DOD will follow the 
strategy of Joint Vision 2010, developed by the Chairman of the Joint 
Chiefs of Staff, to transform U.S. forces for the future, and it will 
exploit emerging information technologies to reshape the way it fights 
and prepares for war.

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   Reengineering DOD's Infrastructure: DOD must develop new, innovative 
approaches to manage and reduce infrastructure costs. Following the end 
of the Cold War, the United States began a major reduction of its 
military forces. DOD's cuts in infrastructure costs, however, have not 
kept pace. To make further cuts, DOD plans to adopt innovative 
management techniques and technological practices. In addition, DOD will 
submit legislation to Congress proposing two more rounds of base 
closures and realignments in 2001 and 2005.
   DOD has identified specific goals around which to focus the reform of 
business affairs.
   By 1999, DOD will:
   Produce a Facility Strategic Plan to guide the acquisition, 
          operation, maintenance, repair, renovation, and replacement of 
          its physical plant.
   By 2000, DOD will:
   Ensure that U.S. forces can achieve visibility of 90 percent 
          of DOD materiel assets, while resupplying military 
          peacekeepers and warfighters and reducing the 1997 average 
          order-to-receipt time by half.
   Dispose of $2.2 billion in excess National Defense Stockpile 
          inventories and $3 billion in unneeded Government personal 
          property, while reducing supply inventory by $12 billion.
   Simplify purchasing and payment by using purchase card 
          transactions for 90 percent of all DOD micropurchases, while 
          reengineering the requisitioning, funding, and ordering 
          processes.
   Create a world-class learning organization by offering 40 or 
          more hours a year of continuing education and training to 
          DOD's acquisition-related work force.
   Complete the disposal of half of the surplus real property, 
          while privatizing 30,000 housing units.
   Cut paper acquisition transactions by half from 1997 levels 
          through electronic commerce and electronic data interchange.
   Eliminate layers of management by streamlining processes, 
          while cutting DOD's acquisition-related work force by 15 
          percent.

Department of Energy (DOE) Performance

   DOE contributes to our national security mainly by reducing the 
global danger from nuclear weapons and other weapons of mass 
destruction. DOE is committed to maintaining confidence in the nuclear 
weapons stockpile without testing, as required under the Comprehensive 
Test Ban Treaty; to strengthen the nuclear nonproliferation regime; to 
work with states of the former Soviet Union to improve control of 
nuclear materials; to develop improved technologies to detect, identify, 
and respond to the proliferation of weapons of mass destruction and 
illicit materials trafficking; and to aggressively clean up the 
environmental legacy of nuclear weapons programs.
   The budget proposes $12.1 billion to meet DOE's national security 
objectives, of which $6.1 billion is for ongoing national security 
missions to support DOD and other agencies.
   DOE will achieve the following performance goals:
   Maintain and refurbish specific warheads in 1999, and certify 
          that standards for safety, reliability, and performance of the 
          nuclear weapons stockpile are met.
   Develop advanced simulation, modeling, and experimentation 
          technologies to replace underground testing by 2004, including 
          installing a computer system capable of three trillion 
          operations per second in 1999.
   Dismantle about 500 nuclear weapons.
   Jointly, with Russia, test and demonstrate technologies to 
          dispose of surplus weapons plutonium and begin to develop a 
          pilot scale plutonium conversion system in Russia, design a 
          full-scale pit disassembly and conversion facility, and 
          procure mixed-oxide irradiation services in the United States.
   Complete 85 percent of the development of the next generation 
          nuclear reactor plant for the Navy's new attack submarine.

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   The remaining $6 billion of DOE's national security funding addresses 
the environmental legacy of nuclear weapons activities.
   DOE will meet the following performance goals:
   Reduce the number of geographical sites requiring high-risk 
          environmental cleanup from 87 to 42 by the end of 1999.
   Close one high-level waste storage tank at the Savannah River 
          site; and
   Stabilize and safely store or dispose of radioactive and 
          hazardous wastes, including 37 tons of spent fuel, 134,000 
          cubic meters of low-level waste, about 150 canisters of high-
          level waste, 0.3 tons of plutonium at the Hanford site, and 
          initial shipments of transuranic wastes at the Waste Isolation 
          Pilot Plant, which will be opened for disposal in May 1998.

Other Defense-Related Activities

   Other activities that support national defense and that are 
implementing performance measurement include programs involving the:
   Coast Guard, which supports the defense mission through 
          overseas deployments for engagements with friends and allies, 
          port security teams, boarding and inspection teams for 
          enforcing U.N. sanctions, training, aids to navigation, 
          international icebraking, equipment maintenance, and support 
          of the Coast Guard Reserve;
   Federal Bureau of Investigation, which conducts 
          counterintelligence and surveillance activities;
   Maritime Administration, which helps maintain a fleet of 
          active, military useful, privately owned U.S. vessels that 
          would be available in times of national emergency;
   Arlington National Cemetery, which is developing an expansion 
          plan for using contiguous land sites that will be vacated by 
          the Army, Navy, and Marine Corps; and
   Selective Service System, which is modernizing its 
          registration process to promote military recruiting among 
          registrants. This spirit of volunteerism will be achieved in 
          partnership with the America's Promise group, private 
          corporations, and the armed services.

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                             Accurately Recognizing and Reporting Veterans Benefits                             
                                                                                                                
   The Nation has long viewed veterans programs as a key way to attract the high-quality people needed for our  
volunteer armed forces. Americans recognize veterans benefits as an appropriate part of the compensation        
provided for service in the military. Veterans programs are inextricably linked with national defense; without  
defense, veterans programs would not exist.                                                                     
                                                                                                                
   Because the Veterans Affairs Department funds and administers these benefits, however, the Federal Government
has accounted for them differently than other defense-related budget costs. They appear in the budget's Veterans
Benefits and Services function, not the National Defense function. \1\ Also, the budget does not report the full
size of these obligations. Rather than recognize the benefits and future Federal obligations that military      
members earn through their service, the budget reports only the amounts paid in a single year to veterans. Thus,
neither the Defense Department (DOD) nor Congress gets a full picture of defense personnel costs when making    
decisions about the size and scope of our military, making it far harder to consider which package of benefits  
might best attract and retain quality military personnel. Finally, the 1993 Government Performance and Results  
Act encourages policy makers to align missions and related Government programs in the budget.                   
                                                                                                                
   The Administration, which plans to work with Congress this year to address this problem, believes that any of
the following four options would improve the current budgetary treatment of veterans programs, enabling the     
Government to more accurately measure the true cost of our national defense: (1) move the veterans-related      
discretionary accounts into the Defense function; (2) fund veterans entitlements on an accrual basis in DOD's   
budget and fund discretionary veterans programs in the Defense function; (3) fund veterans entitlements on an   
accrual basis in DOD's budget and display veterans spending in related functions (e.g., Education); or (4) fund 
veterans entitlements on an accrual basis in DOD's budget and continue to reflect veterans spending in its      
current function.                                                                                               
                                                                                                                
  Table 12-2 below shows the estimated annual charges to DOD's military personnel account from pre-funding      
veterans benefits.                                                                                              
                                                                                                                


    Table 12-2.  ACCRUING VA BENEFITS FOR CURRENT MILITARY PERSONNEL    
 (Notional Costs of Accruing and Actuarially Funding VA Benefits in DOD 
                                 Budget)                                
------------------------------------------------------------------------
                                             Percentage      1999 DOD   
                                               of DOD     Notional Cost 
                  Program                    Basic Pay   (in millions of
                                                \2\          dollars)   
------------------------------------------------------------------------
VA Compensation...........................        11.6%            3,960
Active Duty Education.....................         1.6%              546
 VA Loans.................................         0.2%               68
 Vocational Rehabilitation and Counseling.         0.9%              307
VA Pensions...............................         2.5%              853
VA Burial.................................         0.1%               34
                                           -----------------------------
  Total VA Benefits.......................        16.9%            5,768
                                                                        
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\1\ For a more detailed discussion of veterans programs, see Chapter 26,
  ``Veterans Benefits and Services.''                                   
\2\ Basic pay for military personnel does not include benefits, special 
  and incentive pay or bonuses, or housing and subsistence allowances.  

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