Budget cuts hit domestic programs harder than defense

at 02:39 PM ET, 01/04/2012

There’s been plenty of chatter about the cuts to military spending that the Pentagon will have to make in the years ahead, thanks to last August’s debt-ceiling deal. On Thursday, Defense Secretary Leon Panetta is scheduled to lay out his strategy for hacking some $450 billion from the defense budget over the next decade (though he’ll have to make additional cuts still if Congress lets the sequester kick in).

But is the military bearing a disproportionate burden for deficit reduction in the coming decade? Not according to a new analysis by Richard Kogan of the Center on Budget and Policy Priorities. Between now and 2021, Kogan estimates, defense spending will shrink some 15.1 percent relative to the March 2011 baseline (note that these numbers don’t include spending on wars). But discretionary domestic programs — which includes things like veterans’ health to medical research to low-income housing assistance — will get cut an even deeper 17.1 percent in the same time period.

The graph on the right breaks things down. “2011 CR” refers to the cuts made in the regular budget process. “BCA caps” refers to the first round of cuts agreed to as part of August’s deficit deal to raise the debt ceiling. And “BCA sequester” refers to the automatic second round of cuts scheduled to kick in after the supercommittee failed to come up with its own deficit plan.

According to Kogan, both defense and non-defense spending will be higher in 2021 than they were in 2001. By 2021, defense spending will be $72 billion per year higher than it was in 2001 — an 18 percent increase. (Again, this doesn’t include spending on wars, which are often budgeted via supplemental spending bills.) Domestic discretionary programs, meanwhile, will be 5 percent higher in real terms by 2021, although note that these programs will also have to cover a population that will be about 18 percent larger than it was two decades prior.

Here’s another graph from CBPP, laying the rise and fall of these programs out as a percentage of GDP:

In 2001, domestic discretionary programs were somewhat larger, as a percentage of GDP, than defense. By 2021, under the current deals, domestic spending will be slightly smaller than defense. (You can check the full piece for some of the assumptions that Kogan made — for instance, Congress is almost certain to add in some “emergency” defense spending over time.)

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