Defense Spending & News – Challenges for Ukraine, NATO

Fri, Feb 7, 2025: Ukraine gets French mirage fighter jets, more F-16s from NetherlandsCNN

Mon, Feb 3, 2025: Trump says he wants Ukraine’s rare earth elements as condition of support – AP

Thurs, Jan 30, 2025
:
Rubio cites national security in Trump’s desire to acquire GreenlandThe Hill

Wed, Jan 29, 2025: Hegseth takes action against Milley, former Joint Chiefs ChairWashPost

Wed, Jan 22, 2025: US military ordering thousands more troops to southern border, adding to 2,200 active duty forces already supporting customs and border protectionCNN

Tues, Jan 7, 2025: Trump says NATO nations should spend 5% of GDP on defenseBloomberg [Note from GovBudget editor: the U.S. currently spends only 2.9%, according to the nonpartisan Congressional Budget Office]

Mon, Jan 6, 2025:  Analysis of the Navy’s 2025 Shipbuilding PlanCBO

Thurs, Dec 12, 2024Biden admin says it is surging deliveries to Ukraine as Trump criticizes decision to allow US weapons to strike inside RussiaCNN

Wed, Dec 11, 2024: House approves $895 billion defense bill w/ pay raise for FY 2025AP

 

Defense Discretionary Spending – Background:

Defense discretionary spending is $822 billion in projected outlays for FY 2024, or 13% of total outlays. It is funded by the Defense Appropriations bill and other bills that fund military construction and atomic energy.[1]

U.S. defense spending has increased significantly over the last two decades. In FY 2023, alone, defense appropriations increased by 10% while projected outlays are increasing by seven percent.[2] However, evaluating the extent of defense increases depends on which metrics are used:

  • Defense discretionary outlays have increased from $295 billion in FY 2000 to an estimated $884 billion in FY 2024—a 58% increase after adjusting for inflation;
  • However, as a percentage of the economy (measured as Gross Domestic Product or “GDP”) defense outlays averaged 4.2 percent of GDP between 1974 and 2023, but is projected to be far less, 3.0 percent of GDP, in FY 2024;
  • Nevertheless, compared to other countries, U.S. defense spending is equivalent to more than the defense budgets of the next nine countries combined (in order of spending—China, $298b; India, $81b; Saudi Arabia, $73b; Russia, $72b; the UK, $70b; Germany, $58b; France, $57b; Japan, $54b; and S.Korea, $50b.

Defense Spending Category

FY 2024 Outlays
$ in billions (rounded)

Operations and Maintenance (O&M): including equipment operating costs; recruiting and training; base operations; facilities maintenance; utilities; civilian labor; travel; logistics services; and defense health programs. 323
Military Personnel, Active and Reserve Forces: pay and allowances of officers, enlisted personnel, cadets and midshipmen, permanent change of station travel, inactive duty, and active duty training, retirement and health benefits, enlistment, reenlistment and affiliation bonuses, special and incentive pay. 170
Procurement: acquisition of aircraft, ships, combat and support vehicles, satellites and their launch vehicles, weapons, munitions, and all capital equipment. 148
Research, Development, Testing and Evaluation (RDT&E): basic research for all branches of the military, as well as the development of prototype weapons and equipment. 137
Atomic Energy Defense Activities: responsibilities for U.S. nuclear weapons are shared by the Departments of Energy and Defense. 33
Military Construction and Family Housing 16
Defense-related spending at other Departments 12
Note: Most of the roughly $100 billion in national intelligence and military intelligence spending is included within the accounts of the defense budget, most likely concentrated in O&M and Personnel.[3]

[1] The Military Construction-Veterans Affairs appropriations bill and the Energy-Water appropriations bill.

[2] Cong. Budget Off., The Budget and Economic Outlook: 2024 to 2034, By the Numbers (2024); Statement by Senate Appropriations Committee Ranking Member Richard Shelby (R-Ala., (Dec. 12, 2022), https://www.appropriations.senate.gov/news/shelby-senate-passes-fy23-omnibus-package.

[3] FAS Intelligence Budget Data.