Center for Arms Control and Non-Proliferation

The FY 2005 Request

Highlights of the FY'05 Budget Request

February 2, 2004

The administration of President George W. Bush is requesting $420.7 billion for the military in fiscal year 2005 ($401.7 billion for the Defense Department and $19.0 billion for the nuclear weapons functions of the Department of Energy). This is an increase of 7.9 percent above current levels.

In all, the administration plans to spend $2.2 TRILLION on the military over the next five years - and this as the Congressional Budget Office project a federal deficit of $477 billion this year.

HIGHLIGHTS

"Top Line" Funding -- Unlike past years, this year's DoD request does not list the funding request for the nuclear weapons functions of the Department of Energy (Function 053), nor does it include the total for National Defense (Function 050). The FY'04 total for National Defense is $401.3 billion, which includes roughly $17.3 billion for DoE. The estimated total National Defense "Top Line" request (Function 050) for FY'05 is $420.7 billion in Budget Authority, including $19.0 billion for DoE -- a 7.9 percent increase over FY'04.

Funding for Contingency Operations (Supplemental Appropriations) -- The request contains no funding for ongoing military operations in Iraq and Afghanistan, or for the Defense Department's participation on the global war on terrorism. Pentagon officials state that the Defense Department "cannot yet determine the scope of these operations nor their incremental costs" and therefore has not budgeted for them. They also indicate that they will not request a supplemental funding appropriation in calendar year 2004. Clearly, however, such a request will be necessary to fund these operations in FY'05. The FY'04 supplemental appropriation for combat operations is $64.7 billion.

Missile Defense -- The ballistic missile defense program receives more funding than any other weapon system in the annual Pentagon budget. The FY'05 request contains roughly $9.1 billion for the Missile Defense Agency (MDA), up from the current $7.6 billion. This does not include totals for programs funded outside the MDA, such as the Army's Patriot PAC-3. Nor does it include funding for the SBIRS-High satellite program. In all, the Pentagon is requesting a total of $10.7 billion for ballistic missile defenses.

Shipbuilding -- The budget provides $11.1 billion to support procurement of nine ships in FY'05, up from seven in FY'04. These include one "Virginia" class nuclear attack submarine ($2.6 billion), three "Arleigh Burke" class destroyers ($3.6 billion), and one DD(X) new surface combatant ($1.5 billion).

Aircraft -- The request includes funding for 24 F/A-22 fighters for the Air Force ($4.7 billion), 42 of the Navy's F/A-18E/F fighter ($3.1 billion), and $4.6 billion for continued development of the Joint Strike Fighter. It also includes $1.8 billion for continued development and procurement of 11 of the Marine Corps/Navy V-22 "Osprey" tilt-rotor.

Personnel -- The request contains a 3.5 percent military base pay raise. It also completes the elimination of average out-of-pocked housing expenses for military personnel living in private housing.

Federal Budget Deficit -- The Pentagon request is arriving on Capitol Hill at a time when the Congressional Budget Office (CBO) estimates that the federal budget deficit will reach $477 billion this year. CBO projects a $362 billion deficit for FY'05.

The FY'05 Pentagon "Top Line" Request

FY'05 Budget Request by Function Increase/Decrease From FY'04
(Budget Authority in $Billions)

	FY'04	FY'05 Requested	$ Change	Percentage Change
Military Personnel	97.9	104.8	+6.9	+7.0%
Operations & Maintenance	127.6*	140.6	+13.0	+10.2%
Procurement	75.3	74.9	-0.4	-0.5%
RDT&E	64.3	68.9	+4.6	+7.2%
Military Construction	5.5	5.3	-0.2	-3.6%
Family Housing	3.8	4.2	+0.4	+10.5%
Misc. Other	0.8**	3.0	+2.2	+275%
TOTAL (051)	375.3	401.7	+26.4	+7.0%
Notes: *Includes $3.5 billion recission to the fiscal 2003 Iraq Freedom Fund. **Includes $1.8 billion recission to DoD appropriations in the fiscal 2004 Omnibus Appropriations Act. Totals may not add up due to rounding

 

Percentage of Total Defense Spending (051 Account)
(Budget Authority in $Billions)

	FY'05 Requested	Percentage of Total
Military Personnel	104.8	26.1%
Operations & Maintenance	140.6	35.0%
Procurement	74.9	18.6%
RDT&E	68.9	17.2%
Military Construction	5.3	1.3%
Family Housing	4.2	1.0%
Misc. Other	3.0	0.7%
TOTAL (051)	401.7
Totals may not add up due to rounding

FY 2005 Budget Request by Service Increase/Decrease From FY'04
(Budget Authority in $Billions)

	FY'04	FY'05 Requested	$ Change	Percentage Change
Army	95.4	97.2	+1.8	+1.9%
Navy/Marine Corps	115.1	119.3	+4.2	+3.6%
Air Force	110.9	120.5	+9.6	+8.7%
Defense Wide	53.9*	64.7	+10.8	+20.0%
TOTAL (051)	375.3	401.7	+26.4	+7.0%
Notes: *Includes $3.5 billion recission to the fiscal 2003 Iraq Freedom Fund and a $1.8 billion recission to DoD appropriations in the fiscal 2004 Omnibus Appropriations Act. Totals may not add up due to rounding.

Percentage of Total Defense Spending (051 Account)
(Budget Authority in $Billions)

	FY'05 Requested	Percentage of Total
Army	97.2	24.2%
Navy/Marine Corps	119.3	29.7%
Air Force	120.5	30.0%
Defense Wide	64.7	16.1%
TOTAL (051)	401.7
Totals may not add up due to rounding

Source: DoD, Fiscal Year 2005 Budget Request, February 2004.

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The FY'05 Request for Selected Weapons Systems

The FY'05 Request for Ballistic Missile Defense

The ballistic missile defense program receives more funding than any other weapons system in the annual Pentagon budget.

Background: As part of its Fiscal Year 2002 budget request, the Defense Department announced a major restructuring of the Ballistic Missile Defense Office (BMDO). Funding for a range of programs within BMDO were absorbed and redistributed in to five major areas of research. These are the Terminal, Midcourse and Boost Segments, the Ballistic Missile Defense Segment, and Ballistic Missile Defense Sensors.

As part of the FY'02 reorganization, some specific missile defense programs were absorbed in to the general research areas and have, from a funding prospective, effectively disappeared.

Such changes continue in the FY'05 request. The BMD System Segment and the Terminal Segment have disappeared. Meanwhile, a half-dozen subsections under "BMD" have appeared.

"Navy Area-Wide" was terminated in January, 2001, when it violated the Nunn-McCurdy amendment, which calls for the cancellation of a program that experiences significant cost growth.

The Space Based Infra-Red System-High (SBIRS-High) continues to be funded outside the MDA budget.

The FY'05 Request for Ballistic Missile Defense
($ in Millions)

	FY'04 Total	FY'05 Request
Boost Segment	617.3	492.6
Midcourse Segment	3,724.1	4,384.8
BMD Sensors	396.1	592.0
BMD Technologies	225.3	204.3
Advanced Concepts	150.0	256.2
BMD System Interceptors	117.7	511.3
BMD Test & Targets	633.8	713.7
BMD Products	305.3	418.6
BMD System Core	445.4	479.8
Other Programs	67.0	100.1
Joint Theater Air Missile Defense Org. (JTAMDO)	85.1	86.4
International Co-op Programs	227.2	159.6
Military Construction	22.0	22.3
MEADS	249.4	264.5
THAAD	716.3	833.7
Patriot PAC-3 & Patriot MODs	1,020.9	643.1
Total Ballistic Missile Defense*	9,002.9	10,193.0
Space Based Infra-Red System-High (SBIRS-High)	610.2	508.4
GRAND TOTAL Ballistic Missile Defense	9,613.1	10,701.4

Source: DoD's Program Acquisition Costs by Weapons System, February 2004.

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The FY'05 Request for Unmanned Aerial Vehicles (UAVs)

Unmanned Aerial Vehicles (UAVs) continue to prove their worth on the modern battlefield. The newest weapon in the U.S. arsenal is the armed UAV. The administration is requesting nearly $2 billion to develop both combat and surveillance UAVs.

Source: DoD's Program Acquisiton Costs By Weapon System, February 2004.

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The FY'05 Discretionary Spending Request

The Fiscal Year 2005 budget request includes $818 billion for discretionary spending (the money the President and Congress must decide and act to spend each year), $421 billion of which will go to the Pentagon. The "National Defense" category of the federal budget for FY'05 accounts for over half (51.4 percent) of all discretionary spending.

The other category of federal spending is mandatory spending, money that is spent in compliance with existing laws that govern the particular program or function. Mandatory spending includes entitlements, money or benefits provided directly to individuals such as Social Security, Medicare, Medicaid, Food Stamps, and Federal Retirement. It also includes interest payments on the national debt.

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Note: The "Social Security & Medicare" funding in this graph refers to administrative costs associated with these programs, and does not reflect actual benefits paid out.

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Note: The "Social Security & Medicare" funding in this graph refers to administrative costs associated with these programs, and does not reflect actual benefits paid out.

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U.S. Military Spending vs. The World