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Politics : American Presidential Politics and foreign affairs -- Ignore unavailable to you. Want to Upgrade?

To: sandintoes who wrote (32752)	2/16/2009 9:06:30 AM
From: Peter Dierks	Respond to of 71588

"a trillion dollars and change"

To: sandintoes who wrote (32752)	2/23/2009 9:22:33 AM
From: Peter Dierks	Read Replies (1) \| Respond to of 71588

Pentagon Faces Tough Budget Choices FEBRUARY 21, 2009 By AUGUST COLE The Obama administration is expected to unveil a Defense Department budget next week that ensures wrenching decisions at the Pentagon about which weapons programs should face cuts. The financial crisis and the $787 billion economic-stimulus package have shaken up many long-term assumptions about government spending. The preliminary budget for fiscal 2010, which starts Oct. 1, will be the White House's first chance to reveal what its spending priorities will be across the federal government. A more detailed version is expected in April that will reveal the winners and losers. With fiscal pressure mounting, many in the defense industry are braced for what could be the beginning of a protracted campaign to pare spending on big programs. Most defense companies reported record profits in 2008, and some contractors have grappled with cost overruns and delays on their biggest weapons programs, making them easy targets for cutbacks. In the defense contractors' corner: national-security-minded lawmakers, as well as those trying to protect local jobs. Defense Secretary Robert Gates has been trying to use the Pentagon budget as a tool for achieving his broader policy goal of balancing the military's traditional orientation toward big wars with today's focus on unconventional missions against insurgents and terrorists. Mr. Gates said last week he has already been hunting for items he can pare back, in order to ensure "the budget reflects the need to balance current and future capabilities and the president's priorities." Even before the financial crisis, he pressed hard for such changes. A Defense Department spokesman declined to comment on the budget. The Obama administration's base budget for the Pentagon will likely be higher than last year's, according to people following the process. But that's because the base budget is expected to roll in many additional costs that previously had been accounted for separately. In recent years, billions in Defense Department spending for military operations in Iraq and Afghanistan, as well as other items, were appropriated outside the Pentagon's base budget. Mr. Gates said last week that he is trying to fold such war costs and other supplemental spending into the general Pentagon budget, but that he is not able to move as quickly as he would like, citing "today's economic realities." For fiscal 2009, Congress so far has allocated about $66 billion in such supplemental funding, on top of the Defense Department's base budget of $513 billion. Mr. Gates has estimated that approximately another $70 billion in fiscal 2009, which ends Sept. 30, will be needed, and a request to Congress is expected soon. In fiscal 2008, the Pentagon had a base budget of $480 billion and $187 billion in supplemental spending. "Overall spending, when you count the base [budget] and the supplemental, will go down" from fiscal 2009, said Robert Work, vice president of strategic studies at the Center for Strategic and Budgetary Assessments in Washington. Mr. Work, who was also on the Obama transition team, said that the White House's Office of Management and Budget and the Defense Department appear to have settled on a base budget figure ranging from $535 billion to $540 billion for fiscal 2010. Lawmakers also expect a similar figure, according to people familiar with the situation. Mr. Gates's vision for a leaner budget is bumping up against the military's own assessment of its weapons needs. Air Force Chief of Staff Gen. Norton Schwartz said Tuesday the service will ask for more Lockheed F-22 Raptor fighters, though Mr. Gates has said the planned 183 jets are sufficient. But Gen. Schwartz also cut back the Air Force's previous goal of buying 381 of the $143 million jets. For Boeing Co., a more than $200 billion Army modernization effort, shared with SAIC Inc., is expected to come under pressure, despite success in speeding up deployment of some systems. Write to August Cole at august.cole@dowjones.com online.wsj.com