SecDef Gates announces surprising cuts in defense budget
“Defense Secretary Robert Gates Thursday told Congress the administration is seeking $78 billion in cuts to the Defense budget over the next five years on top of $100 billion in efficiencies.
House Armed Services Committee Chairman Buck McKeon (R-Calif.) said after the morning briefing that he was deeply concerned about the surprising depth of the spending cuts. McKeon said he had gone into the meeting expecting to oppose the plan to trim $100 billion in waste when Gates announced the additional $78 billion in reductions.
“We are fighting two wars, you have China, you have Iran: Is this the time to be making these types of cuts?” McKeon said.
The depth of the cuts exceeded that predicted by defense analysts and appear to show the seriousness with which the White House is pursuing deficit reduction. Analysts had expected the approximately $80 billion in savings returned to the Treasury to come out of the $100 billion in savings Gates was seeking.”
Just to make sure it’s clear, $100 billion of the savings sought by Gates would be kept within the Defense Department and used for other defense purposes. The additional $78 billion over five years would be actual reductions in projected spending. (And again, just for clarity’s sake, the cuts are in projected spending — actual Defense spending would rise slightly and then level out over the next five years.)
I think the only way to understand this move is as the opening gambit of a series of budget-cutting, deficit-reducing proposals by the Obama administration. I don’t see it being reported that way yet, but it makes sense. The president is not going to make cutting defense his only or even his major deficit-reducing effort. Between now and his State of the Union address, I suspect we’ll see a string of similar announcements, so that he can tell the American people that he is doing his part to close the deficit and challenging the Republicans to do the same.
For example, the Gates proposal calls for “modest increases” in the amount that working-age veterans pay for health care through the government’s TriCare program, noting that such fees haven’t been raised since 1995. That makes sense, but it suggests that similar or greater increases will be proposed for civilian contributions to federal health-care programs, including perhaps for federal employees.
Again, this is all just conjecture on my part. But it’s the only thing that makes sense.
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238 comments Add your comment
Common Sense isn't very Common
January 6th, 2011
4:49 pm
Well at least they are talking about defense cuts. It’s a start
jm
January 6th, 2011
4:53 pm
http://www.nypost.com/p/news/opinion/opedcolumnists/ponzi_socialism_N5xwI2ZD0bi10DOp9wsARM
jm
January 6th, 2011
4:56 pm
Let’s see if he’s willing to cut entitlements. Cut everything, and neither party individually can be blamed.
jm
January 6th, 2011
4:58 pm
Run Mitch Run
http://reason.com/blog/2011/01/05/ny-times-flips-its-whig-over-g
Southern Comfort
January 6th, 2011
5:01 pm
That makes sense, but it suggests that similar or greater increases will be proposed for civilian contributions to federal health-care programs, including perhaps for federal employees.
That’s been going on for years. In the five years I’ve been with the fed, my insurance premiums alone have more than doubled. I think I’m around a 130% increase over the past 5 yrs. It’s not like I have much to choose from either. It’s either pay the increase, or go without coverage.
jm
January 6th, 2011
5:03 pm
On topic – Politico has a good article too
Facing a ballooning federal deficit, Gates was moving quickly to manage inevitable defense cuts to preserve as many investment dollars as possible. In May, he gave a speech at the Eisenhower Library in Kansas, urging the military services to find $100 billion in efficiencies over five years and that they could invest in higher priorities. Later, he asked the Defense Department for an additional $50 billion.
As with his first big setpiece budget showdown with Congress in April 2009, Gates faces immediate resistance to his planned cuts, especially the elimination of the EFV. The Marine Corps’ ability to invade hostile beaches is central to the service’s identity, so its leaders and congressional supporters are bitterly opposed to the loss of the vehicle that permits it to do just that.
Read more: http://www.politico.com/news/stories/0111/47158.html#ixzz1AIHqqLt5
jm
January 6th, 2011
5:06 pm
http://www.thedailybeast.com/blogs-and-stories/2011-01-05/paul-volckers-resignation-volcker-rule-is-a-sad-end-to-a-brilliant-career/full/
Obama goes corporate….
Real Scooter
January 6th, 2011
5:08 pm
Both the Dems and Reps know we the people are tired of their crap and neither have the guts to make the necessary cuts in spending.
TaxPayer
January 6th, 2011
5:08 pm
Well, given this news, I would certainly expect the Republicans to counter with a sizeable tax cut in order to reduce the deficit even more than a meager 78 billion over five years.
heartlandboy
January 6th, 2011
5:10 pm
Hallelujah! About time time starting cutting the pork from the most oversized, bloated, inefficient, wasteful branch of gov’t.
starting with the salary of Captain Jerkoff of the Enterprise, who used our tax-payer’s money to produce sleazy smut videos.
jm
January 6th, 2011
5:10 pm
Entitlements:
the Rivlin-Ryan plan
http://www.american.com/archive/2011/january/two-cheers-for-rivlin-ryan
The plan has two principal features. First, people who turn 65 in 2021 or later would not enroll in existing Medicare. Instead, they would receive vouchers to purchase healthcare in the private market (the voucher amount would equal the average amount of Medicare expenditure per enrollee, growing at the same rate of growth as gross domestic product (GDP) plus 1 percentage point). These vouchers would introduce a meaningful element into the healthcare system, one currently missing from our single-payer Medicare program: price competition. By introducing competition for consumers into the insurance market, the voucher system will pressure insurers to compete on cost while maintaining a high standard of care.
Second, the Rivlin-Ryan plan would establish Medicaid block grants for states. These grants would continue providing states with federal Medicaid, but determine funding evenly by the state’s proportion of low-income residents, growing in future years at gross domestic product plus 1 percent (including adjustments for population growth). In exchange for slower growth in federal support for Medicaid, states would have a greater level of flexibility than under the current system. Overall, the plan would contain the growth of Medicare and Medicaid to the growth of GDP plus 1 percent.
Real Scooter
January 6th, 2011
5:13 pm
Dang Taxpayer,you are starting to sound like a broken record.Give it a rest already! Thanks.
josef nix
January 6th, 2011
5:15 pm
Let me see if I’ve got this straight, the Secretary of Defense proposes budget cuts for his own bailiwick and that’s found “objectionable?” That just don’t make no sense to me…
TaxPayer
January 6th, 2011
5:21 pm
SoCo,
You ready for the privatization of TSA.
TaxPayer
January 6th, 2011
5:22 pm
Dang Real Scooter. You are a broken record. Go to bed.
Jay
January 6th, 2011
5:23 pm
jm, I respect Alice Rivlin a great deal, and I’d be willing to consider a lot of approaches to cutting health-care costs. But I do have an important question. The segment you post states that “by introducing competition for consumers into the insurance market, the voucher system will pressure insurers to compete on cost while maintaining a high standard of care.”
If competition had such an effect in the medical field, why are we not already seeing that effect in the private, non-Medicare insurance market, where companies conceivably do compete on cost?
Real Scooter
January 6th, 2011
5:24 pm
Hey josef,if I’m thinking clearly(probably not),The budget cuts will be used elsewhere and not really be a cut.
Pogo
January 6th, 2011
5:25 pm
Obama wants to reduce the hated corporations tax rates. He is truly a slick snakeoil salesman especially considering the anti-business mantra he has pounded out for the first two years of his administration. And his sheep, including Jay, will continue to think that the only thing we have to do is raise taxes and they will continue to support him. Obama is way smarter than the progressive sycophants that comprise his base and he is willing to do or say anything in the name of his own political expediency. The sad truth is, because of our debt, nothing, including raising taxes or for that matter not raising taxes, will do any good. This country is in deep trouble and the only thing people like Jay can do is to continue to play some kind of blame game in the name of their political ideology but that will not change the end result. America is about to suffer and it is going to suffer badly. However, one can’t blame Jay for being totally naieve because afterall, he receives a check every two weeks for continuously stirring up partisan political turmoil for a bunch of people who sadly have nothing else to do with their lives but to jump to his every post. No, there are only a handfull of them but for them, what Jay serves is their life. There is truly nothing sadder than a grown person posting “First” as some kind of victory. What have these peoples lives been reduced to?
Real Scooter
January 6th, 2011
5:26 pm
I’m in bed Taxpayer!
JohnnyReb
January 6th, 2011
5:26 pm
The $100 billion scenario sounds like new math used at one of those loan shark outfits near the military bases.
The $78 billion that would actually be removed from the DOD budget is Obama calling out the Republicans. Repubs will want to cut entitlements before deep cuts to DOD. Obama knows that and wants to use Repub pushback to the proposed cuts as political fodder.
josef nix
January 6th, 2011
5:26 pm
Scooter
Three card monte, eh?
TaxPayer
January 6th, 2011
5:28 pm
Come on Jay. I know you know how insurance companies would compete on cost under the Republican plan. You divide up the groups to be insured by age and whether they have pre-existing conditions, etc., and offer competitive costs to those that you can make money off of.
TaxPayer
January 6th, 2011
5:30 pm
I’m in bed Taxpayer!
Then go to sleep. Pleasant dreams.
Doggone/GA
January 6th, 2011
5:30 pm
“The $100 billion scenario sounds like new math used at one of those loan shark outfits near the military bases.”
It is. It shouldn’t even be mentioned as it is not cutting anything out of the budget.
jm
January 6th, 2011
5:30 pm
Jay 5:23 – I think competition in the insurance market would improve. However, I think as you allude, to, that doesn’t really fix the underlying cost issue.
The underlying issue is choice and cost at the time of purchase of the health care service. This is fraught with complexity and generally lacking in “price transparency.” My biggest hope is that the combination of government investment in IT and a few technology apps can fix this.
The issue is, when you need a non-emergency CT, you have no idea what the price is. Consumers need to be empowered with technology that says – the CT where you are now costs $2,000, and the CT down the street costs $1,500, and here’s the price at the closest 3 hospitals.
Emergency care is a different issue. When you need emergency care, you’re going to the closest qualified hospital. However, after that, it is all about some of the metrics Obamacare wants to dig into – cost for service. Again, consumers can be empowered. If they know hospital A provides heart surgery with a lower death rate, and a lower cost – competition happens.
What I’m saying in simple terms, is consumers need better information at their fingertips. IT can be the cure…. and for people who don’t have Iphones, the hospital should have to disclose the price the closest 3 hospitals charge for the same slate of procedures.
We need a national procedure cost database….
Real Scooter
January 6th, 2011
5:31 pm
What have these peoples lives been reduced to
The blogosphere ? Maybe.
jm
January 6th, 2011
5:32 pm
“We need a national procedure cost database….” with outcomes data available alongside price….
josef nix
January 6th, 2011
5:35 pm
Free universal health care…anything else is just one more song and dance routine…I know, I know, this is socialism. Well, so what? The medical profession and the insurance companies in conjunction created this mess, so, pay up…
jm
January 6th, 2011
5:37 pm
josef nix – as one of the articles above states, Medicare IS single payer. And look how that has worked out.
If Congress was a well managed operation, that would be one thing. But it isn’t. Hence everyone’s terror of single payer and national healthcare….
josef nix
January 6th, 2011
5:38 pm
DUSTY
When you check in here as per my @ 5:35…see, I am brave and fearless, I’ll risk sleeping on the porch on a night like tonight!
Real Scooter
January 6th, 2011
5:38 pm
Then go to sleep
I’d rather stay awake and hound you about your repeditive tax cut posts. I’ve read enough of your posts to know that you have a lot to contribute to Jay’s threads.
josef nix
January 6th, 2011
5:39 pm
jm
Medicare has worked out pretty well in my opinion…and to hell with single payer…I said free, universal!
Doggone/GA
January 6th, 2011
5:41 pm
““We need a national procedure cost database….” with outcomes data available alongside price….”
Wasn’t something like that proposed in the healthcare overhaul bill and shot down as being part of the so-called “death panels”?
jm
January 6th, 2011
5:41 pm
“free, universal” well that would work out swimmingly….. as you well know…
“Push this red button to self destruct”
“Do not push this red button”
Ooops.
jm
January 6th, 2011
5:42 pm
Doggone – something similar is contemplated I think, although I don’t know if they plan to find a good way to stick the data in the consumer’s hands.
The death panel thing was separate….
josef nix
January 6th, 2011
5:43 pm
jm
works all right in other developed nations…
Redneck Convert (R--and proud of it)
January 6th, 2011
5:44 pm
Well, if they cut the defense budget I don’t know how we’ll ever be able to start another war to take the place of the one that’s winding down in Iraq. I mean, just look at all the jobs that will be lost.
I say we leave the defense budget fat and start cutting the money for the old geezers and the jobless bums and people like that. That’s the Republican way of doing things. This Robert Gates might say he’s a Republican but he’s just a librul Democrat in disguise. Ignore him and start whacking the money somewhere else. He’s just plain Unpatriotic.
Have a good night everybody.
Doggone/GA
January 6th, 2011
5:44 pm
“The death panel thing was separate….”
I think, though, that it all got lumped together as “the government deciding who lives and who dies”
jm
January 6th, 2011
5:45 pm
Off to go schmooze with some socialist tree huggers. I keep trying to convince them the most rational cost effective environmental thing for the ATL is white roofs. They want to become fiat developers and have an oversight panel of bureaucratic consultants (”genius” full employment laws) if you want to put in a new toilet or paint your walls. They don’t listen well. Cheerio folks, may check in later…
JohnnyReb
January 6th, 2011
5:45 pm
Josef, I hope you like dancing! Free universal health care sounds good. The problem of course is, nothing is free. And, there is a growing movement where the producers don’t want to pay for moochers. I know, I know, we are greedy conservatives. Personally, I don’t mind paying for some of the moochers to have health care IF we could reduce the number of moochers down from the current 47% not paying any federal income taxes.
Dusty
January 6th, 2011
5:46 pm
Gates is one of the smartest people in Washington (and the most quiet). He ran the CIA, a university, and did the same job for Bush he is doing for Obama. He cares about the COUNTRY. I was not surprised when I heard his plan some time back. The funds will be held for new items needed in the military. So it is like putting money in the bank for later expenses.
Smart man! Conservative thinking! If only HE would run for the presidency but he won’t. I think he has already said so.
The USMC’s Expeditionary Fighting Vehicle
January 6th, 2011
5:47 pm
[...] | USMC statement || Defense Update | WIRED Danger Room | || Cato Institute | Lexington Institute || Atlanta Journal Constitution | The Atlantic | Bloomberg | Detroit Free Press | The Hill | NY Times | Politico | Stars and [...]
josef nix
January 6th, 2011
5:50 pm
JohnnyReb
No moochers in this as far as I’m concerned…free and universal…health care should be a right (Brazil) and not a luxury…like education and national security…sure, it costs, but it’s money well spent, IMHO.
i’m not getting into that 47% thingie…
Scout
January 6th, 2011
5:50 pm
……………… and at the same time he is sending 1,400 more Marines to Afghanistan.
“AIR RAID PEARL HARBOR, THIS IS NO DRILL”
jm
January 6th, 2011
5:53 pm
good read – exit left
http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=avSsYd96AjHo
Dusty
January 6th, 2011
5:55 pm
JOSEF,
So you got thrown out in the cold to sleep on the porch? Uh huh…But the weatherman did say SNOW and the weatherman is never wrong.
I’ll have you know that I am a health professional and I did NOT make THAT “care” mess. It was those shiftless schoolteachers. That’s who..They are always up to something!
TaxPayer
January 6th, 2011
5:59 pm
I’ve read enough of your posts to know that you have a lot to contribute to Jay’s threads.
Of course I do and this issue with the Republicans exempting tax cuts from any scrutiny regarding their impact on the deficit deserves repeating along with their stoopid claims that tax cuts increase tax revenues.
BADA BING
January 6th, 2011
6:00 pm
Hey Scout……I was feeling depressed today and call ed the Suicide Hotline. I talked to an operator and told him I had suicidal thoughts. I noticed when we talked that he had an accent and I asked where the call center was located, and he told me Pakistan. He wasn’t much help, but he wanted to know if I knew how to drive a truck.
JohnnyReb
January 6th, 2011
6:01 pm
Josef – so you don’t want to get into the 47% thingie. I respect that, but have to state the 47% thingie is a big part of the problem. Everyone, no matter their lot in life, has to contribute something if this semi-socialist situation we have has any chance of improving. If I was in charge, everyone would work at something. Forced work; would that make me a communist?
Real Scooter
January 6th, 2011
6:03 pm
Is there really such a thing as free health care? I think those of us in the middle class will always be paying for ourselves and the poor folks.