For Immediate Release


Carl Conetta, Project on Defense Alternatives

Project on Defense Alternatives

Reports Hit 'Unprecedented' Spike in Defense Spending

Cite inflated goals, failed reforms, and weak priorities as cause

CAMBRIDGE, Mass. - Since 1998 the Pentagon has spent more than $6.5 trillion. More than $2
trillion of this sum was above the levels set in 1998. But only half of the $2
trillion in added funds was for recent wars and military operations. Among other
things, the surge in spending has allowed the Defense Department to re-inflate
its workforce to Cold War levels. And almost all the expansion is contractor

These are among the findings of two 18 January reports on the dynamics of
recent defense spending from the Project on Defense Alternatives, a small think
tank with offices in the Washington area and Cambridge, Massachusetts.

According to the reports, the boost in spending after 1998 is unmatched over
a nearly 60-year period, edging out both the Reagan and the Kennedy-Johnson
spending hikes. And the Obama administration, in a move likely to confound
critics and supporters alike, plans to spend more on the Pentagon than any
administration since 1948.

"The recent wars are only half the story," says author Carl Conetta, "And
their high price tag raises as many questions as it answers." The report finds
the recent wars to have cost $792,000 per deployed person per year, while the
Vietnam war cost only $256,000 per person per year in today's dollars.

Part of the reason for the relatively higher cost of current wars is that the
United States today relies on an expensive professional military, rather than a
conscript one. The cost-structure of today's military is not well-suited to
protracted, labor-intensive wars, concludes the report. Related to this, the
proportion of private contractors used in today's wars is five times higher than
during the Vietnam war. Also adding to costs, DoD equipment purchases in the
decade before the wars focused too heavily on the legacy systems favored by the
services and on long-range strike weapons. So a new round of buying was needed
to support counter-insurgency operations.

The reports find that DoD has been generally lax in setting priorities among
contending acquisition programs. But the most serious problem cited in the
studies was the adoption of ambitious new roles, missions, and strategies for a
reduced military after the Cold War ended. A variety of reform and
transformation efforts were supposed to make it possible for a smaller military
to do more. But these efforts fell short of their promise. So costs rose with

Since the mid-1990s, the Pentagon has turned increasingly to private
contractors to help fill the gap between ambitious strategies and the available
number of military personnel. The report finds that the Pentagon's contractor
workforce has probably grown by 40% since 1989, while the numbers of military
personnel and civilian DoD employees have declined by more than 30%.

To avoid today's exceptionally high budgets the reports suggest that national
authorities would have to be more realistic in setting military missions and
goals, more judicious in decisions about going to war, more forceful in pushing
for Pentagon reform, and stricter in setting and enforcing budget priorities.
There is a deeper political problem, warns Conetta: "At present, civilian
leaders are politically disinclined to push the Pentagon hard or enact tighter
budget constraints, and this stance undercuts reform." In reviewing the economic
landscape, however, the reports do conclude that fiscal realities may soon
prompt a change in attitudes.

Download the Reports:

Undisciplined Defense: Understanding the $2 Trillion Surge in US Defense
. 75
pages including Executive
and 21 charts and tables.

The President's Dilemma:
Debt, Deficits, and Defense Spending.
11 tables and


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