The Military Budget in the United States: Its Components, Challenges, and Growth

Why U.S. military spending is more than you think it is

Military spending in the United States is expected to reach $754 billion in the fiscal year 2022. This sum is higher than the Department of Defense's estimate of $715 billion. Military spending is the second-largest component in the federal budget, after Social Security. It spans the months of October 1, 2021, and September 30, 2022. Several departments support the United States' defense. All of these agencies must be included to get an accurate picture of how much America spends on military activities.

Key takeaways

The military is the second-largest spending component in the federal budget of the United States. The most significant portion goes to Social Security. The military budget covers the Department of Defense, overseas contingency operations, the Veterans Administration, Homeland Security, the State Department, and many other national security-related agencies. To save military costs, the Department of Defense must reduce its civilian personnel, soldier pay and perks, and military outposts worldwide. Military spending has contributed to the existing debt and budget imbalances of the United States.

The components of U.S. military spending

If you genuinely want to understand how much the U.S. spends on the military, you must consider various factors. The Department of Defense's $715 billion base budget is the most significant contributor to the defense budget. Still, several other agencies safeguard our country as well, and much of their spending is dedicated to the military endeavor. The Department of Veterans Affairs ($113.1 billion) is one of them. The VA's budget has been boosted by approximately $30 billion over last year's levels. The VA MISSION Act and the V.A.'s healthcare system will be funded using this money. Homeland Security ($54.9 billion), State ($63.6 billion), and the FBI and Cybersecurity in the Department of Justice ($10.3 billion) are the other agencies.

Department of Defense's base budget

The annual National Defense Allocation Act (NDAA), enacted into law on December 27, 2021, established the defense base budget for 2022. It gave the Department of Defense $715 billion to fund many long-standing activities and a few new ones. Nuclear modernization ($27.7 billion), missile defense ($20.4 billion), and long-range fires ($6.6 billion) are the top three priorities. Science and technology ($14.7 billion) and Advanced Capability Enablers ($112 billion) are given particular focus in F.Y. 2022, with $112 billion set aside for RDT&E alone. The Air Force will spend $52.4 billion on the F-35 Joint Strike Fighters, which will cost $12 billion. The Navy will spend $34.6 billion, while the Army will receive $12.3 billion in funding. In addition, the Pentagon plans to spend $20.6 billion on space-based systems and $10.4 billion on cyberspace activities. Each department receives additional cash for readiness improvement. The Army will receive $27.8 billion, the Navy and Marine Corps will receive $48.5 billion, the Air Force will receive $36.5 billion, and Special Operations will receive $9.4 billion. Military personnel will receive a 2.7 percent wage rise and an increase in their housing allowance. For child care, education, and professional development, family members will receive $8.6 billion. Building maintenance and construction will cost the Department of Defense $25 billion.

Overseas Contingency Operations

Surprisingly, the cost of conflicts is not included in the Department of Defense's base budget. Overseas Contingency Operations covers this. The Department of Defense has budgeted $69 billion. The OCO budget has spent $2 trillion on the War on Terror since 2001. The NDAA for 2022 set aside $4 billion to support the European Deterrence Initiative's defense against Russia, including $300 million for troops to assist Ukraine's border and $150 million for border security assistance to other Baltic nations.

Military spending history

The following is a breakdown of military spending in billions of dollars since 2003, as reported in official federal budget documents.
FY DoD Base Budget DoD OCO Support Base Support OCO Total Spending
2003 $364.9 $72.5 $437.4
2004 $376.5 $91.1 $467.6
2005 $400.1 $78.8 $478.9
2006 $410.6 $124.0 $109.7 $644.3
2007 $431.5 $169.4 $120.6 $721.5
2008 $479.0 $186.9 $127.0 $792.9
2009 $513.2 $153.1 $149.4 $815.7
2010 $527.2 $163.1 $160.3 $0.3 $851.6
2011 $528.3 $158.8 $167.4 $0.7 $855.2
2012 $530.4 $115.1 $159.3 $11.5 $816.3
2013 $495.5 $82.1 $157.8 $11.0 $746.4
2014 $496.3 $85.2 $165.4 $6.7 $753.6
2015 $496.1 $64.2 $165.6 $10.5 $736.4
2016 $521.7 $58.9 $171.9 $15.1 $767.6
2017  $523.2 $82.5 $177.1 $35.1 $818.9
2018 $574.5 $88.1 $181.8 $46.4 $890.8
2019  $616.2 $68.8 $206.4 $10.1 $904.3
2020 $633.3 $71.3 $215.0 $8.2 $935.8
2021 $636.4 $69.0 $228.4 $0 $933.8
As of 2022, Overseas Contingency Operations (OCO) money will be integrated into the general base Department of Defense (DOD) fund, so military spending will no longer be separated for budgetary purposes. The federal budget for 2022 allotted $752.9 trillion to the Department of Defense, an increase of 1.6 percent above the total allotted in 2021. (including base and OCO).  

Factors influencing the OCO budget

  • 2003: Iraq War launched on March 19.
  • 2004: U.S. torture at Abu Ghraib prison increased resistance to the war but not enough to lower costs.
  • 2005: Afghanistan War costs rose to protect free elections.
  • 2006: Costs rose in Iraq.
  • 2007: Surge in Iraq to mitigate violence.
  • 2008: Violence rose in the Middle East due to the recession.
  • 2009: Surge in Afghanistan.
  • 2010: Obama funds Iraq drawdown.
  • 2011: Iraq War ended, but costs reached an all-time high.
  • 2012: Troop withdrawal in Afghanistan War. Costs began falling.
  • 2013: Sequestration cut spending.
  • 2014: Wind-down of Afghanistan War.
  • 2015: Sequestration cut spending. Still higher than in 2007.
  • 2016: Resurgence of ISIS.
  • 2017: Increase in V.A. and FBI funding. Trump asked Congress for $30 billion more in military spending.
  • 2018: Trump asked Congress to repeal sequestration for the defense budget. Requested a spending increase to fight ISIS.
  • 2019: Congress repealed sequestration for defense for two years.
  • 2020: Trump increased V.A. and OCO and reduced the State Department.
  • 2021: Reduced OCO and emergency expenses were countered by increases in the base budget for all departments.

The Future of U.S. Defense Spending

Defense is the second-largest discretionary spending component in the U.S. budget, after Social Security. Personnel and maintenance now account for more than half of the Defense Department's budget. Retirement and medical costs are projected to drive this up significantly in the future years. This leaves little money for procurement, R&D, building, or housing. Military spending in the United States exceeds the sum of the following ten highest government spending categories combined. It was more than double the size of China's military budget of $260 billion in 2020 and more than ten times Russia's military budget of $65.1 billion.

Criticisms of U.S. defense spending

What could be done to make the Department of Defense more efficient? Critics of defense spending present three choices:
  1. Instead of hiring freezes and unpaid layoffs, it may downsize its civilian personnel.
  2. It has the potential to lower each soldier's pay and benefits costs. Instead, it intends to increase both.
  3. It could result in the closure of military bases that are no longer required.
According to its own estimations, the Department of Defense has waste and surplus capacity in several sectors, including 40 percent extra capacity in its depot facilities alone.

The role of Congress

Congress will not allow the Department of Defense to close bases. Future military post closures were halted by the Bipartisan Budget Act of 2013. Few politicians are willing to risk losing local jobs as a result of base closures in their states. Instead, the Pentagon will have to reduce the number of personnel to afford base benefits. Over a ten-year period, sequestration reduced defense spending by $487 billion. The cuts, according to many members of Congress, imperil national security. They are concerned about a 100,000 personnel reduction, the closure of domestic military bases, and the cancellation of some weaponry systems. All of these cuts cost their districts jobs and revenue. Congress is also hesitant to enable the Department of Defense to slash other costs, such as military health benefits and pay growth.

Defense spending and the bigger picture

Many critics of U.S. defense expenditures point to the nation's mounting deficit. The militarism of the United States allows other allies to reduce their own defense spending. It also increases the national debt and the fiscal deficit in the United States. The United States' debt has topped $30 trillion as of 2022. The large deficit threatens other national spending in healthcare, education, infrastructure, and long-standing welfare programs such as social security, which will run out in the years 2034-2037 if current trends continue.

Frequently Asked Questions (FAQs)

What percentage of the U.S. budget is spent on the military?

Defense expenditures make about $754 billion of the $7.2 trillion yearly budget for 2022. 2 This equates to approximately 10.5 percent of the U.S. budget.

Why is the U.S. military budget so high?

The military budget is decided in collaboration between the president and Congress. The president and members of Congress could cut the budget if they wanted to.

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