Obama's Last Defense Budget Adds Funds for Europe, Counterterrorism

President Barack Obama's last defense budget proposal totals $583 billion and marks a legacy document that seeks to prolong a fundamental shift in the ways the nation prepares for and fights wars -- changes for which he has advocated with mixed results.

The $583 billion proposal for fiscal 2017, an amount some lawmakers in Congress have already charged isn't enough, represented an increase of $2.4 billion or less than 1 percent from the level enacted in fiscal 2016.

The total included $524 billion for the base budget that pays for the daily operations of the Defense Department and weapons programs, and $59 billion for the so-called war budget, known as the Overseas Contingency Operations (OCO) for missions in Iraq, Afghanistan and elsewhere.

Arriving at the final figures involved last-minute bickering between the White House Office of Management and Budget and the Pentagon over which items should go into the OCO account, which is not subject to the restrictions of the Budget Control Act and the sequester process, according to sources.

"This budget marks an inflection point" for the military, Defense Secretary Ashton Carter said in a statement. "Even as we fight today's fights, we must also be prepared for the fights that might come in 10, 20 or 30 years."

In a lengthy fact sheet, the White House said that the $4.1 trillion overall federal budget proposal "provides the resources to address security threats wherever they arise and continues to demonstrate American leadership around the world."

Counting Defense and State department resources, the White House said that the budget was devoting a total of $11 billion to defeating the Islamic State of Iraq and Syria, or ISIS, also known as ISIL, in fiscal 2017.

The formal presentation of the budget at a Pentagon news conference was left to Deputy Defense Secretary Robert Work and Air Force Gen. Paul Selva, the Vice Chairman of the Joint Chiefs of Staff. Carter was in Brussels to press allies for more contributions to the fight against ISIS.

With a major exception, the budget as outlined by Carter essentially put new emphasis on deterring Russia and China in the base budget.

In its background material on the budget, the Pentagon said that Russian aggression in Crimea, Ukraine and the Mideast, and China's spate of island building and provocations in the South China Sea, "all necessitate changes in our strategic outlook and in our operational commitments."

In the first of a string of news conferences at the Pentagon Tuesday afternoon on the budget, Work said the proposal was intended to prepare the military to contain Russia along its periphery while also seeking to deter a "resurgent revanchist China" at sea.

Selva pushed back at charges emerging from the Republican presidential debates that Obama has "gutted" the military by denying resources. Selva said the services were prepared to meet the nation's national security needs "despite the enduring strains of restrained resources." He added, "Make no mistake, today's security environment is more unpredictable than I've seen in my 35 years of service."

Even so, "I would take umbrage with the notion that the military has been gutted," Selva said. "Do we have challenges? Of course, we do." Recovering readiness after 14 years of grinding warfare in Iraq and Afghanistan will be one of those challenges, he said, "but I would say that we're far from gutted."

Mike McCord, the Pentagon's comptroller, touched on concerns within the building on the pace of modernization of the force.

McCord told Defense News, "Leaders have to step back and ask themselves 'are we investing enough?' The Army and Marines would tell you -- and we would tell you -- that we are not investing enough in their modernization right now."

The budget documents state, "The [fiscal year 2017] budget reflects recent strategic threats that have taken place in Asia, the Middle East, and Europe."

In previewing the budget last week, Carter said, "The U.S. military will fight very differently in coming years than we have in Iraq and Afghanistan or in the rest of the world's recent memory. We will be prepared for a high-end enemy," an apparent reference to Russia and China.

The administration asked for a quadrupling of the European Reassurance Initiative, or ERI, from about $800 million to $3.4 billion, which would go into the OCO account to pay for the stationing of three Army brigades in Europe on a rotational basis.

The Pentagon also said that the military costs of the campaign against ISIS would total $7.5 billion -- double the amount requested for FY2016 -- and another $1.8 billion to replenish the stock of precision-guided munitions used exclusively by the U.S. in the air campaign against the terrorist group.

Defense hawks led by House Republicans immediately charged that Obama was shortchanging the military.

In a letter to House Budget Committee Chairman Tom Price, a Republican from Georgia, Rep. William "Mac" Thornberry, a Texas Republican and chairman of the House Armed Services Committee, said Obama's budget proposal should be increased by at least $23 billion.

"An adequate national defense requires significantly more funding," Thornberry said. He recommended adding the $23 billion to the OCO fund, which is exempt from the cost-cutting mandates of the Budget Control Act and the sequester process.

Thornberry was also expected to seek an increase in spending for missile defense following the launch Sunday of what North Korea claimed to be a satellite atop a rocket capable of hitting the U.S.

Last year, the U.S. Missile Defense Agency proposed $8.13 billion in fiscal 2016 to improve and expand U.S. anti-missile programs. The proposal was a 3-percent increase from the previous year.

"Unfortunately, this Administration continues to play budgetary games with our country's security and diminishes what credibility it had left," Thornberry said in a statement.

As an example of the upcoming annual fight over the size of the defense budget and how money is divided among competing priorities, Rep. Price, the Budget Committee chairman, has indicated that he won't even hold a hearing on the defense budget proposals.

The budget was the final one to be proposed by Obama, whose term in office has been marked by fitful attempts to end the wars in Iraq and Afghanistan, a de-emphasis of the counter-insurgency strategy, and a reliance on Special Operations and local forces for regional conflicts that critics have mocked as "leading from behind."

Obama and his defense secretaries -- Robert Gates, Leon Panetta, Chuck Hagel and Ashton Carter -- have also presided over a downsizing of the military. The Army, which swelled to 570,000 soldiers during the peak of the fighting in Iraq and Afghanistan, is projected to go down to 450,000 by the end of 2017.

Against the arguments of Gates and others, Obama effectively ended what some have called the era of the "celebrity general." He fired Gen. Stanley McChrystal and moved Gen. David Petraeus to the CIA, where his government career was ended over an extramarital affair.

Obama has also presided over the most profound and lasting changes in the military personnel system since the desegregation of the armed forces after World War II by scrapping the "Don't Ask, Don't Tell" policy against gays serving openly and recently eliminating the combat exclusion rule against women.

According to the documents, the proposals for fiscal 2017 on personnel would focus on enhancing the readiness of the force while insuring family stability.

The proposals included a 1.6-percent pay increase and modernization of TRICARE through improving access to care and encouraging the use of military treatment facilities through lower fees and copays.

"My most immediate priority is to sound the alarm" for higher pay for the troops, said Rep. Joe Heck, a Republican from Nevada and chairman of the House Armed Services' Military Personnel Subcommittee, said in response to the pay proposal.

The troops by law must receive a pay raise within 0.5 percent of the Employment Cost Index, Heck said in a statement. By that standard, the military pay raise should be 2.1 percent rather than 1.6 percent, he said, citing Congressional Budget Office estimates.

In a cost-cutting move, the Defense Department was also going to try again to eliminate excess infrastructure through another round in 2019 of the Base Closure and Realignment Commission -- a move that has repeatedly been rejected by Congress. The proposals also included another attempt to reduce management headquarters by 25 percent.

Budget documents show the Pentagon is asking to devote $112 billion to develop and procure new weapons systems and technology, and another $74 billion for research and development.

Under the proposals, the Army would again bear the brunt of the military downsizing, with 460,000 active duty troops in fiscal 2017, reducing further to 450,000 in the following year. It would have 335,000 in the Army National Guard and 195,000 soldiers in the Army Reserve. The troops would support a total of 56 Army Brigade Combat Teams.

The Marine Corps would be sized at 182,000 troops in fiscal 2017 and 38,500 Marine reservists. The Navy, which would be projected to grow to 308 ships from 280 over the next five years, would have a total of 380,900 active duty and reserve sailors.

The Air Force would have 491,700 active duty, Reserve and National Guard airmen and would include 55 tactical fighter squadrons

The overall funding proposals for the services, according to the documents, would be $148 billion for the Army, an increase of about $1 billion; $165 billion for the Navy, a decrease of nearly $4 billion, and $167 billion for the Air Force, an increase of $5 billion.

Other highlights from the budget proposal included $6.7 billion for cybersecurity for a range of offensive and defensive capabilities to protect the Pentagon's vast cyber systems; a $1.3 billion decrease in planned buys for Army aviation; $1.4 billion for engineering and development on the new Long Range Strike Bomber to be known as the B-3; and delays in the purchase for the Marine Corps of the Joint Light Tactical Vehicle, the planned replacement for the Humvee.

-- Richard Sisk can be reached at Richard.Sisk@Military.com.

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