Confusion Surrounds U.S. Navy’s Nixed Boeing Order
On March 1, automatic spending cuts to federal government spending, known as sequestration, began, reducing the U.S. military’s budget by $37 billion and forcing the Department of Defense to make difficult decisions as to how that money is spent.
As part of the budget deal that ended the government shutdown earlier this month, Congress passed a continuing appropriations resolution that kept funding for federal programs at existing levels, meaning Pentagon spending will remain at an annualized level of $496 billion in the 2014 fiscal year, which began on October 1.
That level is about $31 billion below the amount requested by President Barack Obama, but it is $21 billion above the caps set in place by the Budget Control Act of 2011, the legislation that brought about sequestration. Therefore, the Pentagon will have to implement another across-the-board cut unless Congress inks a new spending deal that changes the law before mid-January.
The terms of the 2011 budget act allow defense spending to begin increasing in 2015, but as a defense budget analyst told Reuters last week, based on historical trends, the Defense Department spending could shrink to $415 billion. Todd Harrison, an analyst at the Center for Strategic and Budgetary Assessments think tank, explained to the news service that a budget decrease of that magnitude would force the department to dramatically cut the size of the military and cancel many weapons programs, which would cause a number of defense companies to go out of business.