Reliable Security Information

Busting Budgetary Restraint: OCO to fund Obama's new security initiatives
In his West Point speech on May 28th President Obama announced one new policy initiative:

"I am calling on Congress to support a new Counterterrorism Partnerships Fund of up to $5 billion, which will allow us to train, build capacity, and facilitate partner countries on the front lines.  And these resources will give us flexibility to fulfill different missions, including training security forces in Yemen who have gone on the offensive against al Qaeda; supporting a multinational force to keep the peace in Somalia; working with European allies to train a functioning security force and border patrol in Libya; and facilitating French operations in Mali."

Then on June 3rd in Poland President Obama announced a $1 billion European Reassurance Initiative:

"We’ll increase the number of American personnel -- Army and Air Force units -- continuously rotating through allied countries in Central and Eastern Europe.  And we will be stepping up our partnerships with friends like Ukraine, Moldova and Georgia as they provide for their own defense.  I’m calling on Congress to approve up to $1 billion to support this effort, which will be a powerful demonstration of America’s unshakeable commitment to our NATO allies."

In both cases President Obama was no more specific about the source of funding these initiatives than saying, "I am calling on Congress to support..."  However, we know from the President's national security advisor for strategic communications and speechwriting Ben Rhodes (background briefing) that the funding for the counter-terrorism initiative will come through the Overseas Contingency Operations (OCO) account.

Rhodes also provided  some insight into White House thinking on budgeting for "dispersed" Pentagon activities:

"...what we’re able to do, even with the type of presence that we’re going to have in Afghanistan next year, is have a substantial drawdown in resources and funding dedicated to Afghanistan.  We want to take some of those resources and apply it to this type of fund for counterterrorism partnerships. That’s part of reallocating our resources across the region to match the threat.  The threat is not overwhelmingly in Afghanistan and Pakistan anymore; in fact, it’s much more dispersed.  This is an effort to reallocate resources to match the threat so that we’re spending less in Afghanistan and we’re able to dedicate more resources to the partnerships that the President talked about in the Middle East and North Africa."      

Regarding the European Reassurance Initiative, a White House Fact Sheet also makes clear that this will be funded through OCO:

 "This initiative will build on existing tools and authorities and will be included in the Department of Defense’s FY 2015 Overseas Contingency Operations (OCO) request to Congress."

In the April 1st Reset Defense Bulletin we pointed out that:

"Even if in-country deployments in Afghanistan head downward toward zero in 2015, it is likely that 15-25,000 U.S. personnel will remain in-theater near Iraq and Afghanistan.  These will be not unlike the forward-deployed U.S. troops that remained in Europe after World War II.  They will become, in essence, another forward peace-time military presence.  It will seem logical for the Pentagon and Congress to seek to pay their bills through the OCO account.

"Not only will it be tempting to continue OCO funding to pay for an ongoing presence in the Persian Gulf and in the Afghanistan-Pakistan region, but, as long as BCA caps remain in place, why not try to get a good portion of the costs of all global presence forces and their activities paid for in the exempted OCO account?  The opportunity for escaping budget restraints is manifest."

The House Armed Services Committee's Readiness Subcommittee signaled enthusiam for using the OCO account to bust BCA caps at a March 27th hearing called "Operation and Maintenance without OCO Funds: What Now?" (video.  The Hill reported that:

"Subcommittee Chairman Rep. Rob Wittman (R-Va.) said wartime funding was needed after combat operations in Afghanistan end, citing 'high-priority' activities such as training other nations’ militaries, humanitarian assistance, conducting training exercises, and performing intelligence functions."

Service officials invited to testify were happy to provide many examples of overseas activities that needed funds.  Now Presdient Obama has responded to this invitation from powerful Republicans by calling on Congress to fund his new initiatives through the OCO account.

Gordon Adams gives further reason to question whether what is going on here is not so much new security initiatives, but rather account shifting.  Regarding the Counterterrorism Partnerships Fund, Adams points out that:

"There are already four existing programs, created over the past decade, for global counterterrorism assistance: Section 1206, Section 1208, Global Lift and Sustain, and the Global Security Contingency Fund (GSCF). And then there's the large security assistance program called Foreign Military Financing, which the State Department has overseen (and the Pentagon has implemented) for decades."

According to a Defense News article Todd Harrison of the Center for Strategic and Budgetary Assessments expects the 2015 OCO to be in the range of $50-60 billion.  He estimates the cost of troops in Afghanistan for the year as being around $20 billion.  With $6 billion in "new initiatives" there remains $24-34 billion in likely OCO funding to be specified.  All together there will be $30-40 billion (7% of the total DoD budget) that deserves very careful scrutiny as to whether it belongs in the contingency account or in the Pentagon's base budget.

Defense News,  01 June 2014

Whatever the final size and shape of the 2015 OCO request, funding new or old initiatives of the sort President Obama has proposed within the OCO will require redefining "overseas contingency operations" to include peacetime forward presence, partner military training and 'facilitation' of foreign military interventions.  Obviously this constitutes a very substantial expansion of the meaning of "contingency operation."  Whether Congress, even with the plethora of lawyers in its ranks, still cares about precise meaning of words when it comes to budgeting legislation is another matter.

What is clear is that to the extent that the OCO account shifts to encompass peacetime overseas presence and cooperative security activites (not to mention humanitarian assistance and intelligence functions) the restraining power of enacted budgetary controls on military spending will be compromised, perhaps as a step on its way to being completely negated.
News and Commentary

Defense News: "US Experts Bank on $50B to $70B Overseas Contingency Ops Budget," Marcus Weisgerber, 01 June 2014.
Foreign Policy: "Obama's Big, New Counterterrorism Plan Is a Hot Mess," Gordon Adams, 30 May 2014.

Foreign Policy: "Clean Up on Aisle One,"  David Rothkopf, 28 May 2014.

Time: "Obama’s Foreign Policy Speech Sounds Familiar," Michael Crowley, 28 May 2014.

Defense One: "The Pentagon and Congress Must Stop Raiding the Afghan War Fund," William Hartung, 27 May 2014.
AP: "As Afghan war draws to a close, Obama looks to reframe foreign policy approach in second term," Julie Pace, 26 May 2014.

Washington Post: "The two things that need to be in Obama’s West Point speech," Daniel W. Drezner, 25 May 2014.

The Hill: "Military officials say they need wartime funding after Afghan War ends," Kristina Wong, 27 March 2014.

Reset Defense Bulletin: "Slip sliding global presence funding into the OCO account,"  01 April 2014.

Key Reports, Official Sources, Journal Articles, and Books

White House: "Remarks by President Obama and President Komorowski of Poland in a Joint Press Conference," 03 June 2014.

White House: "FACT SHEET: European Reassurance Initiative and Other U.S. Efforts in Support of NATO Allies and Partners," 03 June 2014.

White House: "Background Conference Call on the President's Commencement Address at West Point," 28 May 2014.

White House: "Remarks by the President at the United States Military Academy Commencement Ceremony," 28 May 2014.

White House: "Press Gaggle By Deputy National Security Advisor for Strategic Communications Ben Rhodes, 5/25/2014"

HASC: "Operation and Maintenance without OCO Funds: What Now?" 27 March 2014 (video).


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The Reset Defense Bulletin is a service of the Project on Defense Alternatives (PDA) at the Center for International Policy.  PDA seeks to adapt security policy to the challenges and opportunities of the new era. Toward this end, it promotes consideration of a broad range of defense options and advocates resetting America’s defense posture along more effective and strategically sustainable lines. 

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