Let me see if I understand this: in order to consider that Clinton's
numbers *cut* the defense budget, one has to accept that the rate of
Defense inflation will be more than 150% (3.2%) of consumer inflation
(2%)? What's the excuse/reason for this?
--
Curtiss
>>>>
As I tried to explain, one could look at spending in terms of what it buys, or what is foregone. "Current Services" costs reported by the Administration uses the what-it-buys frame of reference.
This is not altogether crazy. For instance, if we were talking about a program providing infant formula, it would be reasonable to extrapolate "current policy" according to the expected future cost of infant formula, which could differ from average or consumer inflation.
"Current policy" in terms of defense, as for other things, includes spending that has already been passed but not yet consummated. It also includes expected increases in personnel costs, based on the Employment Cost Index. Combining all these factors, the administration's calculations imply the average of 3.2, as I noted. I am not defending this number, just relaying it.
For political purposes, it would be completely accurate to say the Administration increases the amount of tax dollars devoted to defense spending, after adjusting for inflation. The size of the increase would be $110 billion at most, less if you think inflation will be higher than 2.0 percent.
It would also be accurate, though not particularly useful politically, to say that in terms of what tax dollars buy, the Administration's budget is a cut, relative to current policy, according to the Administration. (The cut in this sense is to me very small -- $42 billion over ten years, by my reckoning.)
mbs