The Obama administration sent its final annual budget proposal to Congress Tuesday, beginning a process that is entirely overshadowed by the ongoing escalation of US military operations around the world.
The bulk of the $4.1 trillion budget is consumed by ongoing mandatory expenditures like Social Security, Medicare and interest on the federal debt, but fully half of the $1.2 trillion in discretionary spending goes to the Pentagon and related military and intelligence operations.
Overall spending would rise 4.9 percent, largely because of automatic increases in the mandatory programs. Discretionary spending, under terms of a bipartisan agreement reached last fall between the White House and Congress, is to rise barely one percent.
While media coverage focused on the election-year wrangling between the Democrat in the White House and the Republican-controlled Congress, comparatively little attention was paid to the real significance of the budget, which lies in its unstinting funding of ongoing US military operations in the Middle East, Afghanistan, Eastern Europe, the Pacific and in cyberspace.
There are several eye-popping increases for high-profile military programs:
- Quadrupling of funding for US military preparedness in Eastern Europe, labeled “countering Russian aggression and supporting European allies,” up from just over $1 billion to $4.3 billion;
- A 50 percent rise in funding for US military operations in Iraq and Syria, to fight the Islamic State group as well as undermine the Syrian government of Bashar al-Assad. A total of $7.5 billion is earmarked for that purpose, including $1.8 billion to pay for 45,000 GPS-guided smart bombs;
- An increase of 35 percent for cybersecurity, from $14 billion to a whopping $19 billion, much of which goes to the National Security Agency and Pentagon cyberwarfare programs, as well as to revamping the entire federal computer network to make it more impervious to hackers.
Overall military spending will continue to escalate, with the total proposed Pentagon budget set at $582.7 billion. Each of the three main military departments will have larger budgets than any other country on Earth will spend on war preparations: $166.9 billion for the Air Force, $148 billion for the Army and $164.9 billion for the Navy (including the Marine Corps).
In the course of the past week, the Obama administration has announced a series of concessions to demands from the Pentagon or congressional Republicans on specific weapons systems. The Air Force abandoned plans to retire the A-10 Warthog attack plane, extending it for another two years. The Pentagon will also continue buying F-18 Super Hornet jet fighters and Tomahawk cruise missiles.
The State Department budget was set at $50 billion and funding for the Department of Homeland Security at just over $40 billion, while the overall spending for the intelligence apparatus is believed to be higher than either of those figures, although the number is officially classified. The State Department and DHS budgets include billions in funding for programs to block immigrants leaving Central America or arrest and deport them once they arrive in the US.
When the spending is added up for all the programs involved in military operations, intelligence, homeland security and other repressive purposes, either foreign or domestic—including funding for the FBI, Bureau of Prisons and other Justice Department programs, and grants to state and local police agencies—the total comes to at least two-thirds of all federal discretionary spending.
There is a stark contrast between the lavish spending on war and repression, and the stinginess in the face of acute human need. Humanitarian aid, largely for the refugees fleeing US wars (or US-instigated civil wars), is pegged at $6.2 billion, about one percent of the total being spent on the military. A proposed increase of $158 million for the Environmental Protection Agency, to deal with the crisis in drinking water in Flint, Michigan and other cities, will cost about as much as a single new F-35 jet fighter.
The new domestic social spending proposed by the White House is entirely cosmetic, for electoral purposes, and not taken seriously by anyone either in the Obama administration or in Congress. The Republican leadership was so openly contemptuous that they announced, for the first time since the present budget process was established in the 1970s, that the House and Senate budget committees would not even bother to take testimony from the head of the Office of Management and Budget, Shaun Donovan.
The White House proposed nearly $1 trillion in tax increases on the wealthy to fund about an equivalent amount of new social spending on education, the environment, health care and programs for the poor, knowing full well that the Republican majorities in the House and Senate will dismiss both the new taxes and the new spending out of hand.
The sole purpose of this part of the budget is to provide some raw material for the presidential and congressional campaigns of Democratic candidates in the November elections. It is a brazen attempt to bolster illusions in the Democratic Party as a defender of the poor, the sick and the elderly against the Republicans, when the two parties actually work in tandem to serve the needs of corporate America and the super-rich.
The overall budget numbers do give a glimpse of the precarious state of American capitalism as a whole. Even assuming a 2.6 percent annual growth rate—far beyond what is likely given the ongoing financial shocks and the sharp slowdown in China and Europe—the Obama administration projects large and rising federal deficits.
The deficit for the current fiscal year, ending September 30, 2016, is projected to rise sharply from $438 billion last year to $616 billion, mainly because of tax cuts for business that were enacted as part of last December’s bipartisan deal. The federal deficit as a percentage of GDP will jump from 2.8 percent to 3.5 percent, above the 3 percent level regarded as the desired ceiling by the International Monetary Fund and debt-rating agencies.