Michael Grunwald, Politico
4 June 2015
America's next generation of nuclear submarines are supposed to have stealth capabilities. But at $5 billion a pop, they're hard to hide in a budget.
That doesn't mean Congress can't try.
When the House of Representatives debates its 2016 defense spending bill next week, there will be a floor battle over an arcane gimmick designed to keep these subs of the future -the Navy's most expensive shipbuilding program ever - out of the Navy's shipbuilding budget. It's not a partisan or an ideological fight, just a bit of Washington gamesmanship that in another context might not be particularly noteworthy, except that it involves Pentagon-sized sums of money, and could have a major impact on Pentagon spending down the road.
The dispute has its roots in the Navy's need for a lethal replacement for its Ohio-class submarines, which were built in the 1970s and still carry a big chunk of America's nuclear arsenal under the seas. As the subs approach retirement age, the Navy is gearing up to build their 21st-century successors, which the Congressional Budget Office has estimated will end up costing taxpayers more than $90 billion. That's more than three decades worth of funding for all of America's national parks, or about three times the annual Iranian defense budget.
The problem is how to pay for it. In last year's defense authorization bill, Congress created the National Sea-Based Deterrence Fund, a new Pentagon account for the spiffy new subs. The Navy normally pays for new vessels out of its own shipbuilding account, but as the House Armed Services committee warned in its official rationale for the fund last year, the new sub program "threatens to crowd out all other Navy shipbuilding resources."
The fund's sponsor, Rep. Randy Forbes (R-Va.), who represents a region stocked with naval shipyards and chairs the Seapower and Projection Forces subcommittee on Armed Services, argued that nuclear-armed subs are really national assets, not Navy assets, so they shouldn't drain the Navy budget. "You're talking about the nuclear triad," Forbes told me. "This is 70 percent of our deterrence capability. It's a national thing."
Wait a minute. Why exactly would the subs serve a more "national" function than land-based intercontinental missiles, or the Air Force bombers that carry nukes through the air-or, for that matter, Army infantry units or overseas military bases or anything else the Pentagon controls? One supportive House aide suggested to me that the underwater drama of Hunt for Red October demonstrated the unusual nature of nuclear-armed subs, but there are plenty of dramatic military films that haven't inspired expansive new line items.
Nobody can say precisely where the money for the new fund would end up coming from-whether it would be diverted from other military functions, like special operations and even commissaries that are also funded through Pentagon-wide accounts, or whether it would simply be added to military spending once the budget caps imposed by the 2013 "sequester" are relaxed. But either way, it would be real money, not just a quirk of congressional bookkeeping.
"What a crock!" said Steve Ellis, vice president of Taxpayers for Common Sense. "Let's face it: Every weapons system the Pentagon buys is a national asset. This is just a shell game to try to avoid tough choices about the Navy budget."
In part, the dispute reflects an age-old Capitol Hill rivalry pitting authorizing committees like Armed Services, which establish rules and funding limits for various programs, against the appropriations committees, which dole out the cash. Appropriators tend to resist when authorizers try to limit their power and flexibility. For example, the latest authorizing language would empower the defense secretary to divert unspent money from anywhere in the Pentagon into the submarine fund without having to secure permission from appropriators.
Now the fight has been joined. The House Appropriations Committee gutted the fund in the $578.6 billion Pentagon spending bill it approved on Tuesday. Section 8122 of the bill reads: "None of the funds provided in this or any other Act may be transferred to the National Sea-Based Deterrence Fund." It's a not-very-veiled message to the authorizers: Don't try to tell us how to finance new subs.
But when the bill hits the floor, Forbes plans to offer an amendment that would delete Section 8122 and breathe life into the Sea-Based Deterrence Fund. He says this battle isn't about turf, but about protecting other Navy shipbuilding activities from potential budget cuts.
The various combatants over the fund all agree the subs need to be paid for; in fact, the appropriations bill includes $971 million for their design work, the same amount specified in the authorization bill. But it matters where that money comes from, especially now that appropriators face budget caps, and it will matter much more once construction begins and the newfangled replacement subs start sucking up much more money. Forbes warns that unless they can be financed through the separate fund, they will end up overwhelming the Navy's shipbuilding account, which had $16 billion this year for vessels ranging from aircraft carriers to oilers.
"This is a once-in-a-generation kind of expenditure. It wouldn't be fiscally responsible to wait until the night before to figure out how to pay for it," Forbes said.
I asked him why, if the new subs are so vital and the Navy's other shipbuilding efforts are also vital, Congress couldn't just jack up the shipbuilding budget instead. "Sure, we could do that, but it hasn't been done in your generation or mine," Forbes replied. "This is a very big lift, and it has to get done. I'm not saying this is the only approach we could take. If the appropriators have another suggestion, we're happy to entertain that. But right now, this is the only approach out there."
Ellis says that if Congress is determined to fund the new subs, there is plenty of fat it could cut in the Navy's shipbuilding account. For example, a Government Accounting Office report found that the new Ford-class aircraft carrier was more than $2 billion over budget. The House bill also includes new Littoral Combat Ships, near-shore vessels that former Defense Secretary Chuck Hagel once testified were best-suited for missions in "relatively permissive environments." Critics suggest it might make more sense to focus on military equipment for hostile environments. And if Congress didn't want to cut shipbuilding, Ellis said, it could cut elsewhere in the $168 billion Navy budget, or raid the other military branches in order to boost the Navy budget.
But the Republican Congress is not interested in cutting military spending. It wants to spend more on the Pentagon. The House's defense bill blew through the caps in the sequester, in part by stashing a slew of overseas spending into an uncapped war account. Ellis fears that ultimately, the sea-based deterrence fund will just boost the baseline for future defense spending-and inspire similar maneuvers for other expensive Pentagon toys.
Ellis said the other military branches have yet to raise any alarms about the potential Navy raid on their budgets, perhaps because they can imagine pursuing similar accounts for their own weapons systems in the future.
"They're watching and waiting," Ellis said. "If this gambit works, you can be sure we're going to see it again."