Center for Arms Control and Non-Proliferation

Growth in U.S. Defense Spending Over the Last Decade

by Travis Sharp [contact information]

February 26, 2009

Over the last decade, U.S. defense spending has risen dramatically. With the inclusion of funding for Iraq, Afghanistan, and nuclear weapons activities, national defense budgets have grown, in inflation-adjusted dollars, from $387 billion in FY 2000 to $687 billion in FY 2009, a real increase of 78 percent. DOD’s base budget, which excludes both war and nuclear weapons funding, also has grown steadily over the last decade, increasing from $370 billion in FY 2000 to $513 billion in FY 2009, a real increase of 39 percent or an average of $16 billion per year.

Table 2. Budget Authority for National Defense, FY 2000-2009
(in billions of constant FY09 dollars)

	FY00	FY01	FY02	FY03	FY04	FY05	FY06	FY07	FY08 est.	FY09 est.
DOD Base (051)	370	381	408	451	467	427	446	455	493	513
Nukes and Non-DOD Defense	17	20	20	21	22	24	25	24	23	23
SUBTOTAL National Defense (050)	387	401	428	472	489	451	471	479	516	536
War Supplemental	n/a	25	20	75	81	114	134	181	194	144
TOTAL	387	426	448	547	570	565	605	660	709	687

Table/Chart Notes: FY09 figures include stimulus and 2nd war supplemental. Data from Congressional Research Service and Office of Management and Budget.

It is clear that war costs have led to higher defense budgets. However, funding requests for Iraq and Afghanistan may have reached their peak in FY 2008. The expected total FY 2009 war supplemental of $144 billion is $50 billion less than the FY 2008 total of $194 billion. (Table 2) While future supplemental budget requests are difficult to predict, the mix of Iraq and Afghanistan policies the Obama administration seems likely to pursue – removing troops from Iraq and adding troops to Afghanistan – should not restore future annual supplemental budgets to the FY 2008 peak. Moreover, the new administration has pledged to integrate supplemental requests into DOD’s base budget, which will further reduce supplemental budgets but (by definition) increase base budgets.

Whether included in base budgets or war supplementals, procurement funding for aircraft, ships, and vehicles has increased markedly. In inflation-adjusted dollars, DOD procurement budgets grew by 163% during the Bush administration - from $66 billion in FY 2000 to an estimated $174 billion in FY 2008. Procurement budgets increased at an average real growth rate of 20% per year during the same time. (Table 3)

Certain procurement accounts have grown faster than others. For example, funding for Army aircraft increased in inflation-adjusted dollars from $1.8 billion in FY 2000 to $4.9 billion in FY 2009, an average annual growth rate of 19%. Since the Army has been the service branch in highest demand in Iraq and Afghanistan, it makes sense that Army procurement funds have increased. However, procurement funding for Navy ships and aircraft and Air Force aircraft increased steadily over the last decade too. These services, while still vital, are not being called upon as regularly to serve in current U.S. military operations.

Table 3. Budget Authority for Procurement Accounts, FY 2000-2009
(in billions of constant FY09 dollars; FY00-FY08 includes procurement funds in war supplementals)

Selected Account	FY00	FY01	FY02	FY03	FY04	FY05	FY06	FY07	FY08 est.	FY09 est.	Average Annual Growth
Army Aircraft	1.8	1.8	2.2	2.5	2.4	3.4	3.6	5.9	4.3	4.9	19%
Army Weapons & Tracked Vehicles	2.1	2.9	2.5	2.6	2.2	5.4	4.3	8.7	3.1	3.2	6%
Navy Ships	8.4	13.9	10.5	10.2	12.6	11.3	12	10.6	13.9	13.1	6%
Navy Aircraft	10.5	9.5	9.1	9.7	10.1	9.7	10.9	12.3	12.7	14.1	4%
Air Force Aircraft	10.6	11.8	11.9	14.6	13.4	15.1	14.1	16.2	12.3	13.1	3%
Total DOD Procurement	66.2	74.4	73.5	90.1	93	105.3	112	139.1	174	n/a	20%

Table Notes: Data from Department of Defense, Office of Management and Budget, Congress