Department of Defense

A Plan to Cut Military Spending

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Benjamin H. Friedman and Christopher Preble

November 2010

 

Federal policymakers have supported many extraneous missions for the Department of Defense aside from the basic and constitutional requirement to defend the nation. The result is that America's military budget has become very bloated. The United States would be better off taking a wait-and-see approach to distant threats, while letting friendly nations bear more of the costs of their own defense, as we discuss in a related essay.

There will always be disorder in various places around the globe, but that doesn't mean that all foreign problems are a threat to America. We should retain the ability to participate in multilateral efforts to mitigate humanitarian disasters, but we should not mistake such efforts as something relevant to our defense.

By avoiding the occupation of failing states and limiting our commitments to defend healthy ones, we could plan for fewer wars. By shedding extraneous missions, we can cut our force structure, which means reducing the number of U.S. military personnel and the related costs for weapons, vehicles, and operations. The resulting U.S. military force would be more elite, less strained, and less expensive.

This essay describes 19 proposals that would reduce U.S. military spending by $1.2 trillion over the next 10 years, or about 18 percent of projected military spending in the administration's budget.1 By 2020, the savings would be about $150 billion annually. Although those are substantial reductions, the estimates are conservative. In several cases, we likely erred on the side of undercounting savings. Also, a strategy of restraint could allow greater savings. We have not, for example, included cuts to the National Guard, the reserves, or our air and sea lift capabilities.

Some readers may wonder why we have not gone further, given that even steeper cuts would still leave the United States with a large margin of superiority over all rivals. The cuts we suggest are an initial harvest of restraint, and don't preclude further reductions. It would be prudent to first adopt changes like those we suggest, and then see if the political leadership is capable of adhering to a restrained defense strategy.

The table summarizes our proposed spending cuts. The text and endnotes provide readers with the information needed to understand how we arrived at our estimates.2 Although the proposals fit within an overall strategic rationale, most of them could also stand alone as individual savings proposals.


Department of Defense
Proposed Spending Cuts
Program   10-Year Savings
     
($ billion)
Strategic Capabilities    
  1. Cut the nuclear weapons arsenal   $87
Army and Marine Corps    
  2. Reduce the size of the Army   $220
  3. Reduce the size of the Marine Corps   $67
  4. Reduce Marine Corps expeditionary strike groups   $7
Navy and Air Force    
  5. Build/operate fewer aircraft carriers and naval aircraft   $40
  6. Build/operate fewer tactical submarines   $32
  7. Build/operate fewer destroyers   $34
  8. Terminate the Littoral Combat Ship   $14
  9. Build/operate fewer Air Force fighters   $89
Other Weapon Systems    
  10. Terminate the Expeditionary Fighting Vehicle   $11
  11. Terminate the V-22 Osprey   $15
  12. Realign the missile defense program   $60
Workforce and Compensation    
  13. Cut the Pentagon's civilian workforce   $105
  14. Reform military compensation   $115
Infrastructure and Administration    
  15. Reform maintenance and supply systems   $13
  16. Cut military construction and housing   $30
  17. Reform command, support, and infrastructure   $100
Other Savings    
  18. Reduce intelligence spending   $112
  19. Reduce research, development, testing, and evaluation   $73
Total proposed cuts (FY2011-FY2020)   $1,224
Total department outlays (FY2011-FY2020)   $6,864

 

1. Cut the nuclear weapons arsenal.

The nuclear weapons arsenal should be cut to 500 deployed warheads. This would include a 50 percent cut in the number of delivery platforms, and would include elimination of the bomber leg of the nuclear triad and consolidation of nuclear laboratory and testing facilities.3 Our proposals would cut $66 billion from the Department of Defense (DoD) budget and $21 billion from the Department of Energy (DoE) budget over 10 years.4

This proposal would retain six ballistic nuclear missile-carrying submarines (SSBNs), which would allow for at least four ballistic missile submarines to be deployed at any one time, saving $3 billion over 10 years.5 These platforms, which were designed to carry as many as 192 warheads, will deter any leader foolish enough to contemplate a strike on the United States. To make doubly sure, we would retain 150 Minuteman III Intercontinental Ballistic Missiles in the continental United States. We would also forego the purchase of Trident II missiles for the SSBNs and upgrades to nuclear cruise missiles and shelve plans to deploy nuclear weapons on the F-35 Joint Strike Fighter. Because a smaller arsenal requires less support, we would consolidate nuclear weapons production and testing facilities, which fall under DoE's purview.

2. Reduce the size of the Army.

A reduction in the number of active-duty Army personnel from the current legislated end strength of 547,400 to 360,000 would save $220 billion over 10 years. This figure draws on a Congressional Budget Office (CBO) calculation that estimated the costs of expanding the Army by 65,000 personnel.6 We assume that our savings would be about two and a half times the value of the CBO estimate.

3. Reduce the size of the Marine Corps.

Reducing the size of the Marine Corps from 202,000 to 145,000 would save about $67 billion over 10 years. We would phase in these personnel reductions over 10 years. The estimated savings were obtained by modifying the CBO projections for the Army.

4. Reduce Marine Corps expeditionary strike groups.

A reduction in the number of Marine Corps expeditionary strike groups from 10 to 6 would save $7 billion over 10 years. These reductions are consistent with cuts in Marine Corps' personnel cited above. This proposal would decommission four Amphibious Assault Ships, four Amphibious Transport Dock Ships, and at least two Dock Landing Ships, while eliminating associated air wings. These cuts are justified because the likelihood of the Marines attacking a well-defended coast from the sea without support from carrier air power is remote. And the speed to deployment gained by having Marines sea-based is rarely worth its cost. By reducing the number of expeditionary strike groups to 6, $2.4 billion would be saved in operation and maintenance (O&M) costs over 10 years. Associated naval personnel cuts would save $4.6 billion.

5. Build and operate fewer aircraft carriers and naval aircraft.

Reducing the number of operational aircraft carriers (CVNs) from 12 to 8 would save $40 billion over 10 years. Current Navy plans call for 12 carriers by 2020.7 This proposal would continue production of the new Ford Class CVN 78, which will be deployed in 2015.8 Canceling procurement of CVN 79 and all future Ford Class CVNs would save $16 billion over 10 years (approximately $7 billion for CVN 79 and $9 billion for CVN 80). Decommissioning the Nimitz, Eisenhower, and Vinson would save at least $5 billion over 10 years in reduced O&M costs, including associated air wings. These savings would be partly offset by the decommissioning costs of about $1 billion per vessel.9 Another $12 billion would be saved in foregone procurement of 60 F-35 Joint Strike Fighters.10 Associated reductions in personnel would save $10 billion.

6. Build and operate fewer tactical submarines.

Reducing the number of tactical submarines would save $32 billion over 10 years.  Current plans show the number of fast-attack submarines (SSNs) declining to 40 ships by 2028.11 The Navy can reach 40 in 2020, eight years earlier, by slowing the rate of procurement from two to one new vessel per year. Thus, instead of spending $5.8 billion per year, we could spend $2.9 billion per year, saving $29 billion in procurement and $1 billion in O&M costs over 10 years. Decommissioning the four active guided missile submarines (SSGN) would save at least $500 million in O&M over 10 years, but we estimate that these savings would be offset in the short term by the costs to dispose of the vessels. Savings from reductions in personnel onboard tactical submarines would be $2 billion.

7. Build and operate fewer destroyers.

We would save $34 billion over 10 years by reducing the number of destroyers (DDGs) that the Navy buys and operates. This reduction is accomplished by maintaining the number of DDG-51s at the current level of 62. The Navy has already proposed stopping production of the DDG-1000 at 3, and instead plans to buy 8 Flight IIA version DDG-51s and as many as 8 Flight III version DDG-51s by 2020 at an average cost of about $2 billion.12 We would allow production of the three DDG-1000s to proceed but build no additional DDG-51s, and, where possible, reallocate funds already authorized. Avoiding production of 16 DDG-51s would save at least $30 billion, plus $1 billion in associated O&M costs and $1 billion from reductions in personnel.13

8. Terminate the Littoral Combat Ship (LCS).

The Navy should halt the LCS program and consider developing a less expensive class of frigates or corvettes.14 Current LCS costs are roughly three times initial estimates. The high costs undermine the idea—always questionable—that the LCS could take on particularly risky missions. Cost has also undercut the LCS's modularity, where commanders could select a mission module, a package of software and equipment that can be swapped in and out to tailor each LCS to a mission. There are three such modules: mine warfare, anti-submarine warfare, and surface warfare. Presumably because of cost constraints, the Navy is building only about as many modules as ships, limiting flexibility.

Besides the 4 LCSs already (or nearly) completed, the Navy plans to build about 24 in the next 10 years, at an average cost of $620 million each.15 Forgoing these vessels would thus save $14.9 billion over the next 10 years, plus $3.1 billion in associated O&M costs. While researching alternative platforms, the Navy can refurbish 14 Perry class frigates at a cost of roughly $100 million each.16 These ships, along with destroyers, could perform the LCS's missions. After subtracting the costs of refurbishing and retaining the frigates and the additional personnel costs they require, net savings would be $14 billion over 10 years.17

9. Build and operate fewer Air Force fighters.

The Air Force should eliminate six strike wing equivalents, netting $89 billion in savings over 10 years. The drawdown would be accomplished by accelerating the retirement of aging airframes, especially F-15s and F-16s, and purchasing 301 fewer F-35s than currently programmed.18 The estimated cost per new aircraft is $200 million, which translates into $60 billion in reduced procurement expenses, plus $29 billion in reduced personnel and O&M expenses.

10. Terminate the Expeditionary Fighting Vehicle.

The Expeditionary Fighting Vehicle is 14 years behind schedule and 160 percent over budget.19 It serves an archaic mission—amphibious assault on a hostile shore. The last time such an amphibious assault occurred was the Inchon Landing in September 1950. In the highly unlikely event that the United States again employs Marines in this way, existing platforms, including the Assault Amphibious Vehicle 7A, will suffice. This proposal would save the approximately $11 billion needed to complete the program and purchase 573 vehicles.20

11. Terminate the V-22 Osprey.

The Marine Corps should stop V-22 Osprey production and save the $23 billion estimated cost for the rest of the procurement.21 The V-22's cost is extraordinarily high relative to alternatives.22 It lacks reliability and lift. Its relatively small size means that other aircraft will have to bring supplies such as heavy weapons to the Marines it transports, but no supply aircraft can fly as far and as fast, meaning that either V-22s will drop Marines off in places where they cannot be equipped to fight, or more likely, it will not be used at full range, undermining a primary argument for its procurement.23 Proven rotary-wing aircraft, such as the MH-60 and the CH-53, should handle this mission. After subtracting the cost of procuring and operating alternative platforms for troop and material transport, total savings for the elimination of the V-22 program equal $15 billion over 10 years.

12. Realign the missile defense program.
 
The administration's FY 2011 budget requested $9.9 billion for missile defense, which is similar to spending levels in recent years. Our proposal would save about $60 billion over 10 years by shifting missile defense funding from procurement to research and development and canceling components with excessive cost overruns.24 Assuming that DoD currently plans to spend an average of $9 billion annually, reducing spending to about $3 billion annually would save at least $60 billion over 10 years.25

13. Cut the Pentagon's civilian workforce.

A smaller military requires fewer civilian support personnel. And, as discussed below in the section on overhead, the Pentagon has excessive administrative apparatus even for its current broad missions. Accordingly, we would reduce the Pentagon civilian workforce by nearly a third, with most of the cuts coming through attrition.26 The civilian workforce will total 789,000 in FY2011 and cost $77 billion. Reducing the civilian payroll by 30 percent over 10 years would save about $105 billion. This estimate mirrors reductions in personnel between 1991 and 2001, when civilian manpower was reduced by roughly 34 percent and total civilian compensation declined by just over 24 percent.27

14. Reform military compensation.28

Currently, some components of military compensation, including tax advantages and housing allowances, are not included in the pay raise calculations that are pegged to changes in the civilian sector.29 We propose including these benefits when pay raises are calculated, phasing the reform in as forces are withdrawn from Afghanistan and Iraq. That would save $55 billion over 10 years.

Premiums for DoD's health care system, TRICARE, have not risen in 10 years.30 Lower premiums encourage military retirees earning full-time civilian salaries to choose TRICARE even though health coverage is available through their employer. According to a June 2009 CBO report, reform of TRICARE could save more than $60 billion over 10 years.31 Such changes are more reasonable under a restraint strategy because that strategy would greatly reduce the burden on military personnel.

15. Reform maintenance and supply systems.

According to the CBO, reform of DoD maintenance and supply systems would save $13 billion over 10 years.32 Reforms would include consolidating DoD retailing, changing DoD's depot pricing structure for equipment repairs, and easing restrictions on contracting for depot maintenance.

16. Cut military construction and housing.

The cuts discussed here would allow reductions in the buildings needed to accommodate DoD personnel and thus in the military construction and family housing budget. The budget for these activities has been over $25 billion in recent years, although the administration sees spending falling to $14 billion by 2015. We propose cutting projected spending by 20 percent, or about $30 billion over 10 years.33

17. Reform command, support, and infrastructure.

About 40 percent of DoD's budget goes toward overhead, including rents, depreciation of equipment, facilities maintenance, utilities, headquarters staff, information technology, and other defense-wide support programs.34 The Defense Business Board, a DoD advisory group, recently noted that this overhead ratio is at an historic high, reflecting rapid growth in Pentagon management costs in recent decades.35 As part of an effort to shift $100 billion from swollen overhead costs to force structure over the next decade, the secretary of Defense recently suggested closing Joint Forces Command and several other small DoD organizations, hiring fewer contractors, and reducing staff in the Office of the Secretary of Defense.36

Those are welcome initiatives, but the savings should be used to reduce the deficit, rather than going into other programs. Furthermore, deeper cuts are warranted. The size of DoD under a strategy of restraint would need even less administrative support. We could, for example, eliminate or consolidate the geographic Combatant Commands. Because some of these savings are reflected in the cuts to civilian personnel and intelligence counted elsewhere, we follow DoD and estimate that cuts to overhead could save an average of $10 billion per year or about $100 billion over 10 years.

18. Reduce intelligence spending.

In 2009, then director of National Intelligence Dennis Blair stated that the U.S. intelligence budget was $75 billion. That included $45 billion for the National Intelligence Program and $30 billion for the Military Intelligence Program.37 That amount is greatly expanded from the $27 billion spent on intelligence in 1998.38 In turn, the 1998 intelligence budget exceeded the 1980 intelligence budget by almost 80 percent in real terms.39 This rapid growth is excessive given the historically mild threats we face.

Redundancy in intelligence analysis can be useful by producing competing perspectives and thoroughness, but the explosion in intelligence spending has spawned organizational confusion and excessive overlap.40 The Central Intelligence Agency, for example, is now carrying out paramilitary activities that should be the exclusive province of Special Operational Forces.41 Under our strategy of restraint, there would be even a larger excess in intelligence spending as a result of there being fewer enemies and military missions. Thus, we propose to cut 15 percent from the intelligence budget. Assuming that intelligence spending would otherwise remain at $75 billion annually, a 15 percent cut would save about $112 billion over 10 years. Roughly 20 percent of total intelligence spending falls outside of the "defense" function in the federal budget, about $22 billion of these savings would come from other sections of the budget.42

19. Reduce research, development, testing, and evaluation.

In coming years, DoD plans to spend a about $73 billion annuallyon research, development, testing, and evaluation. Policymakers should reduce total RDT&E spending by 10 percent annually, which would generate about $73 billion in savings over 10 years. The reduced spending levels would still greatly exceed what would be required to maintain the U.S. military's quantitative and qualitative superiority over other nations for the foreseeable future.


1 For the administration's budget projections, see Budget of the U.S. Government, Fiscal Year 2011 (Washington: Government Printing Office, 2010), Table S-11.

2 See also Benjamin H. Friedman and Christopher Preble, "Budgetary Savings from Military Restraint," Cato Institute Policy Analysis no. 667, September 21, 2010.

3 Manned bombers, chiefly B-52s and B-2s, would be maintained for their long-range conventional strike capabilities. The Air Force Association's Mitchell Institute for Airpower Studies published a similar proposal on bombers. Dana J. Johnson, Christopher J. Bowie, and Robert P. Haffa, Triad, Dyad, Monad? Shaping the US Nuclear Force for the Future, Mitchell Paper 5 (Arlington, VA: Mitchell Institute Press, December 2009).

4 Our estimate draws on Stephen I. Schwartz, with Deepti Choubey, Nuclear Security Spending: Assessing Costs, Examining Priorities (Washington: Carnegie Endowment for International Peace, 2009); and Sustainable Defense Task Force, "Debts, Deficits, and Defense: A Way Forward," June 1, 2010, pp. 14–15, www.comw.org/pda/fulltext/1006SDTFreport.pdf.

5 There are no plans for building additional SSBNs over the next 10 years, therefore we capture no savings from procurement. We assume that the reductions would come gradually, thus we do not claim operational cost savings from all eight submarines for each of the 10 years. Over 10 years, cutting eight SSBNs (from the Navy's planned 14 to 6) would save $2.2 billion in operations and maintenance costs, and $1.8 billion in associated personnel costs. We estimate that the costs to decommission the eight vessels will not exceed $1 billion, resulting in net savings of $3 billion.

6 Congressional Budget Office, "Budget Options: Volume 2," August 2009, p. 7. Our estimates of savings from Army and Marine Corps reductions are conservative. Given trends in the cost of compensation, DoD projections for manpower costs in the Army and Marine Corps during 2011–2015 are unrealistic.

7 U.S. Navy projections from Congressional Budget Office, "An Analysis of the Navy's Fiscal Year 2011 Shipbuilding Plan," May 2010.

8 For general background on the Ford Class program, see Ronald O'Rourke, "Navy Ford (CVN-78) Class Aircraft Carrier Program: Background and Issues for Congress," Congressional Research Service Report RS20643, June 10, 2010.

9The Enterprise, CVN-65, is already slated for decommissioning in 2013 and that would proceed as scheduled.

10 This assumes that 50 percent of current F/A-18s would be replaced with new Joint Strike Fighters for each carrier air wing eliminated.

11 See Ronald O'Rourke, "Navy Attack Submarine Procurement: Background and Issues for Congress," Congressional Research Service Report RL32418, December 22, 2009.

12 U.S. Navy plans include procurement of 8 Flight IIA DDG-51s from FY2011 through FY2015. Between FY2016 and FY2031, the Navy plans to procure 24 Flight III DDG-51s. For general background on this program, see Ronald O'Rourke, "Navy DDG-51 and DDG-1000 Destroyer Programs: Background and Issues for Congress," Congressional Research Service Report RL32109, June 14, 2010.

13 Because some destroyers procured during the 10-year period will not be in service during that period, O&M and personnel savings are calculated only for the ships presumed to be in service through 2020, according to U.S. Navy projections.

14 Small, fast ships seem a better fit for many of the missions mentioned in the new maritime strategy. U.S. Navy, "A Cooperative Strategy for 21st Century Seapower," October 2007, www.navy.mil/maritime/Maritimestrategy.pdf.

15 This figure includes an estimated cost of $70 million per ship for modules. On LCS's cost, see Congressional Budget Office, "An Analysis of the Navy's Fiscal Year 2011 Shipbuilding Plan," pp. 14, 19–20. For further information, see Ronald O'Rourke, "Navy Littoral Combat Ship (LCS) Program: Background, Issues, and Options for Congress," Congressional Research Service Report RL33741, June 10, 2010. For the Navy's estimate that modules will cost $50–70 million on average, see J. Michael Gilmore and Eric J. Labs, "The Navy's 2008 Shipbuilding Plan and Key Ship Programs," Statement before the Subcommittee on Seapower and Expeditionary Forces, Committee on Armed Services, July 24, 2007.

16 Current Navy plans call for retiring the 30 remaining Oliver Hazard Perry Class frigates by 2020. On the approximate cost of refurbishment, see "News Release: Pakistan – Refurbishment of Oliver Hazard Perry Class Frigate," Defense Security Cooperation Agency, February 19, 2010.

17 The typical ship's complement for a frigate is approximately 200, whereas the LCS is projected to deploy with fewer than 80 sailors. Net savings from foregoing construction of the LCSs and the refurbishment of the frigates total $15.5 billion, minus $1.3 billion in net additional personnel costs associated with the Perrys.

18 On Air Force fighter plans, see "2010 United States Air Force Posture Statement," Department of the Air Force, February 9, 2010, pp. 5–7.

19 Sustainable Defense Task Force, "Debts, Deficits, and Defense: A Way Forward," June 1, 2010, p. 24, www.comw.org/pda/fulltext/1006SDTFreport.pdf.

20 Government Accountability Office, "Defense Acquisitions: Assessments of Selected Weapon Programs," GAO-10-388SP, March 2010, p. 61.

21 Government Accountability Office, "Defense Acquisitions: Assessments of Selected Weapon Programs," GAO-10-388SP, March 2010, p. 131.

22 Program costs grew from an initial estimate of $24 million ($46 million in 2008 dollars) per aircraft when the contract was first awarded in 1986, to its current per unit cost of more than $110 million.

23 On these points, see, e.g., Michael J. Sullivan, director of acquisition and sourcing management, Government Accountability Office, "V-22 Osprey Aircraft: Assessments Needed to Address Operational and Cost Concerns to Define Future Investments," Testimony Before the House Committee on Oversight and Government Reform, June 23, 2009.

24 Secretary Gates canceled plans to purchase the airborne-laser, a program already eight years behind schedule, and $4 billion over budget, but cuts could be made in other programs as well. On the airborne laser, see Dan Vergano, "‘Star Wars' Meets Reality?  Military Testing Laser Weapons," USA Today, May 14, 2010.

25 The Congressional Budget Office finds that canceling programs including the Far-Term Sea-Based Terminal Defense, Sensor Development, Missile Defense Space Experimentation Center, and Special Programs would save $11.25 billion over the next 5 years, and $40.09 billion over the next 10 years. See CBO, "Budget Options, Volume 2," p. 21. Our plans here include continued funding for the Patriot and AEGIS missile defense systems, which are funded primarily by the Army and Navy, respectively. They should bear the full cost of the programs.

26 The Government Accountability Office estimated in 2009 that more than 50 percent of DoD's civilian workforce is eligible to retire in the next few years. Government Accountability Office, "Human Capital: Opportunities Exist to Build on Recent Progress to Strengthen DOD's Civilian Human Capital Strategic Plan," GAO-09-235, February 2009, p. 1.

27 The civilian workforce in the Department of Defense declined from 1,044,000 in 1991 to 687,000 in 2001. See National Defense Budget Estimates for FY 2011 (2011 Green Book), Table 7-5, "Department of Defense Manpower," p. 217. During that same period, civilian payroll (TOA) in constant 2011 dollars fell from $78.4 billion to $59.4 billion. See 2011 Green Book, Table 6-2, "Department of Defense TOA by Category," pp. 70–71.

28 Sustainable Defense Task Force, "Debts, Deficits, and Defense: A Way Forward," June 1, 2010, p. 26. For other proposals for reforming military pay and benefits, see Cindy Williams, ed., Filling the Ranks: Transforming the U.S. Military Personnel System (Cambridge, MA: MIT Press, 2004).

29 See Report of the Tenth Quadrennial Review of Military Compensation, Volumes I & II (Washington: Department of Defense, Undersecretary of Defense for Personnel and Readiness, February 2008, July 2008).

30 From 1995 to 2010, the TRICARE program also saw no increases in co-pays. The Pentagon regularly asks for such increases, but Congress routinely rejects them. For recent examples, see Tom Philpott, "Gates: Retiree TRICARE Fees Should Rise," Military.com, April 16, 2009; and Admiral Michael Mullen, Chairman of the Joint Chiefs of Staff, Testimony Before the Armed Services Committee, U.S. House of Representatives, February 3, 2010.

31 Congressional Budget Office, "The Effects of Proposals to Increase Cost Sharing in Tri-Care," June 2009. Note that in this case, some of DoD's savings are being shifted to the private sector.

32 Congressional Budget Office, "Budget Options, Volume 2," pp. 28–33.

33 Savings amount to the remainder after subtracting 20 percent from projected OMB spending on these categories for the next 10 years, with the exception of 2011, the final year of significant BRAC spending, when we subtract only 20 percent of non-BRAC spending.

34  Arnold Punaro, Task Group Chair, "Reducing Overhead and Improving DoD's Business Operations," Presentation before the Defense Business Board, July 22, 2010.

35  Arnold Punaro, Task Group Chair, "Reducing Overhead and Improving DoD's Business Operations," Presentation before the Defense Business Board, July 22, 2010.

36 See Stephen Daggett, "Preliminary Assessment of Efficiency Initiatives Announced by Secretary of Defense Gates on August 9, 2010," Congressional Research Service, August 12, 2010.

37 Stephen Aftergood, "DNI Announces $75 Billion Intelligence Budget," Secrecy News, September 16, 2009.

38 The figure for FY 1998 comes from Stephen Daggett, "Preliminary Assessment of Efficiency Initiatives Announced by Secretary of Defense Gates on August 9, 2010," p. 4. Daggett notes that the majority of the increase has gone to contractor costs. That makes it easier to reverse. Aftergood gives the same spending for 1994. Stephen Aftergood, "DNI Announces $75 Billion Intelligence Budget," Secrecy News, September 16, 2009.

39 Commission on the Roles and Capabilities of the United States Intelligence Community, Preparing for the 21st Century: An Appraisal of U.S. Intelligence, March 1, 1996, p. 131.

40 Dana Priest and William M. Arkin, "A Hidden World, Growing Beyond Control," Washington Post, July 19, 2010.

41 On recent failures to change this arrangement, see Richard A. Best Jr. and Andrew Feickert, "Special Operations Forces (SOF) and CIA Paramilitary Operations: Issues for Congress," Congressional Research Service, August 3, 2009.

42 On the share of intelligence spending in budget function 050, see Cindy Williams, "U.S. Budgets for National Security and International Affairs," Working Paper, Defense Economics Workshop, Royal Military College of Canada, November 5, 2008, p. 1.

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