Posted: January 23, 2017 4:35 PM

Analyst: Republican Unity on Growing Defense; No Unity on Paying for It

By RICHARD R BURGESS, Managing Editor

WASHINGTON — A defense analyst predicted the new administration of President Donald J. Trump will not be able to produce a supplemental 2017 budget in its first 100 days because of the time competition from other policy priorities and the rift between the so-called “defense hawks” and “budget hawks” in the Republican party.

Speaking Jan. 23 in a seminar on the defense budget forecast sponsored by the Center for Strategic and International Studies (CSIS), a Washington think tank, Mackenzie Eaglen, a resident fellow at the American Enterprise Institute, said she expects the new administration to propose a 2017 supplemental budget in the $30 billion to $40 billion range that will not be passed before the current continuing resolution runs its course at the end of April.

She said she expects the administration to set its fiscal policy by July, but before then it will be using its political capital to address other issues, including the confirmation of the next Supreme Court justice, the Budget Control Act, tax reform, transportation infrastructure and the replacement of the Affordable Care Act.

“There is a great desire [among Republicans] to be bold and to do a lot and to get a lot done,” Eaglen said. “That will hit the unyielding tyranny of the calendar in the U.S. Senate.

“Defense becomes an important [priority] for members of the committees with jurisdiction,” she said. “It’s important, in theory, with Trump and his team, but [then] ideas hit reality, and floor time, and Senate calendar, and political capital, and how much to there is to expend, plus the whole fiscal policy question, which will probably be set by July.”

Key to the process is Rep. Mick Mulvaney, R-S.C., a “budget hawk” selected by Trump to be the chief of the Office of Management and Budget, who will set the budget topline, and who Eaglen said “is deeply opposed to defense increases. Never underestimate that.”

She said Mulvaney wants the funds used for base budget functions in the Overseas Contingency Operations (OCO) budget to be folded into the base budget itself. She warned that this shift could be used as a mirage of increasing the defense budget topline that would not, in fact, increase the budget in real terms.

“Trump is going to explode the [federal] debt, way over the head of Mulvaney,” she said.

“This not a unified Republican party, this is coalition governing,” she said. “There are so many factions in the Republican party that have to be constantly cared, fed and managed, and they do not vote in unison.”

Eaglen praised as a starting point for discussion the recent defense proposals by Senate Armed Services Committee Chairman Sen. John McCain, R-Ariz., united with House Armed Services Committee Chairman Rep. Mac Thornberry, R-Texas., noting that their signal is $640 billion for the 2018 base budget.

“The plan to pay for that is complete fantasy, dead on arrival,” she said. “The way that they’re going to be proposing to pay for that will be dramatic cuts in federal non-defense discretionary spending. There are not nearly enough votes.

“There is unity in the party to grow defense,” Eaglen said. “There is no unity on how to pay for it.”

“There is going to be a determined effort to shut down the OCO mechanism,” said Andrew Hunter, a fellow in the CSIS International Security Program, who also spoke at the seminar. He also thinks OCO funding is not a good way to fund modernization of the military.

Hunter said that Navy shipbuilding — the Columbia-class ballistic-missile submarine, for example — could be accelerated a little, but that “building up the Navy is going to take a long time, but you can lay the ground work to get there.”

He stressed that the new administration has not yet promulgated a new defense strategy, which, when announced, will determine the direction and priorities of the future defense budgets.

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