Highlights
- The House and the Senate would authorize a record-breaking R&D budget
for the Department of Defense (DOD), the largest federal sponsor
of R&D. Both chambers would authorize more than $69 billion for
DOD R&D, with all of the increase going to the development of new
weapons systems (see Table A).
- The big winner in the House and Senate authorizations, and the Pentagon
request, would be the missile defense program. Funding for the Missile
Defense Agency would jump 18 percent to $9.0 billion in FY 2005 in both
the House and Senate bills in preparation for deployment of missile
defenses beginning this year.
- DOD funding for basic and applied research would decline in the House
and Senate bills. Basic research (“6.1”) would fall 2.6 percent
to $1.4 billion in the House authorization and gain just $6 million
in the Senate, while applied research (“6.2”) would fall 5.6 percent
and 8.7 percent in the House and Senate, respectively (see Table
A). The Pentagon requested even steeper cuts.
- DOD “Science and Technology” (S&T) would fall 11.4 percent in the
House authorization and 11.9 percent in the Senate to $11.1 billion.
S&T, which includes research, medical research, and early technology
development, would be authorized at less than 2.8 percent
of the total DOD budget in the House and Senate authorizations, well
below the 3 percent target endorsed publicly by DOD (see Table
C). The DOD request for S&T is even lower at $10.6 billion.
- The Pentagon’s five-year budget plans call for steep future cuts in DOD’s
S&T investments. DOD
S&T is projected to fall through FY 2006 and rise only modestly
thereafter, ending up at $11.2 billion in FY 2009, 18 percent below
this year’s funding level after adjusting for inflation and only 2.3
percent of the projected FY 2009 DOD budget. DOD
support for basic research (“6.1”) would fall 17 percent over five
years, while applied research (“6.2”) would fall 11 percent.
Authorizations
vs. Appropriations
Discretionary
spending, including defense spending, is provided annually in 13 appropriations
bills. Before the appropriations bills are drafted, the authorization
process is supposed to take place in congressional authorizing committees.
Their role is to enact legislation that serves both as the basis for
operating a program and also provides guidance to the Appropriations
Committees as to what the appropriate level of funding for a program
should be. Especially in the case of defense and homeland security,
one of the few areas in which authorization bills are regularly enacted,
the eventual appropriations could closely correlate to authorizations.
The two Defense
authorization bills this year are HR 4200 on the House side and its
Senate counterpart, S. 2400. HR.4200 was introduced in the House on
April 22 and passed the House on May 20. Its Senate counterpart was
sent to the Senate floor on May 6, and at press time was still being
debated in the Senate.
Defense
R&D: An Introduction
The Department of Defense (DOD) is by far the largest supporter of
R&D in the federal government, accounting for more than half the total
federal R&D portfolio. In the 1980s, DOD supported nearly two-thirds of
total federal R&D. Because of defense cutbacks following the end of the
Cold War, however, DOD’s support for R&D declined by a third after FY 1987,
bottoming out in the mid-1990s, but has increased dramatically in the past few
years to new highs (see Figure 1).
DOD is responsible for only 15 percent of
all federal support of basic and applied research (“6.1” and “6.2”),
but is a key sponsor for several science and engineering (S&E) disciplines.
DOD supports 37 percent of all federal research in the computer sciences
and 44 percent of all engineering research, as well as significant shares
of research in mathematics and oceanography. DOD’s impact is even greater
in several engineering sub-disciplines such as electrical engineering
and mechanical engineering.
The “6.1,”
“6.2,” and “6.3” categories are often grouped together as “Science
and Technology” (S&T; see Table C).
This category includes basic research, applied research, advanced technology
development, and medical research funded in Defense Health Programs.
These programs contribute to a broad knowledge base with potential applications
to a wide variety of military as well as civilian uses. S&T is separate
from the “6.4” and higher categories, which are focused on the development
and testing of specific weapons systems. Nearly all DOD support for
R&D at colleges and universities comes from the S&T accounts.
President Bush
requested $423.1 billion for national defense in his FY 2005 budget.
That figure did not include money for continued operations in Iraq
and Afghanistan,
but he later asked congressional leaders for an additional $25 billion
for military action there in FY 2005. The total includes defense-related
activities in the Department of Energy (DOE).
The Senate Armed
Services Committee opted to meet his request; but rather than authorize
a $25 billion Iraq
reserve fund with no restrictions on its use, the bill specifies how
the $25 billion fund is to be used. The Senate bill authorizes $422.2
billion, roughly equal to the president's request, of which $402 billion
would go to DOD. It also authorizes an additional $25 billion for Iraq,
bringing the bill's grand total to $447.2 billion. The House bill would
authorize a similar amount for defense, including a nearly identical
$402 billion for DOD and $25 billion for Iraq.
Priorities in
DOD R&D
Both the House and Senate would authorize more than $69 billion for DOD
R&D (see Table A). The House
authorization would be a 4.8 percent increase over this year, while
the Senate’s would be a 5.4 percent increase. Both would exceed the
$68.8 billion Pentagon request. In inflation-adjusted dollars, all three
FY 2005 R&D totals would represent an all-time record funding level
following substantial increases in each of the past four years (see
Figure 1).
But in sharp contrast
to the substantial increases for DOD’s development programs, DOD support of basic and applied research would fall in FY 2005. In the request, DOD’s “6.1” (basic research)
and “6.2” (applied research) activities would fall 10.6 percent to $5.2
billion in FY 2005, below the FY 2002 funding level. While the House
and Senate would add funds to the request, their authorizations would
still leave “6.1” and “6.2” funding combined well below this year’s
funding level, 4.9 percent below in the House and 6.5 percent below
in the Senate.
Basic research funding (the “6.1” category) would fall $36 million to
$1.4 billion in the House authorization and would increase $6 million
in the Senate bill, in contrast to a steep requested cut. In FY 2004, funding for the University Research
Initiatives program switches from the Office of the Secretary of Defense
(OSD) to the three services, first proposed by the Pentagon last February
and approved by Congress last fall. URI competitively awards basic research
grants to university performers; in FY 2005, the program would continue
in the three services at a combined level of $275 million, down $8 million
from the FY 2004 funding level. The House would authorize a smaller
cut at $279 million, but the Senate would authorize a large boost to
$310 million, 9.5 percent more than the current year. The broader Defense
Research Sciences programs, which fund research at DOD laboratories,
universities, and other performers, would collectively total $884 million
in the House authorization, even with FY 2004, while the Senate would
authorize an increase to $897 million.
Figure 1. (click
on the image to view or download a color, full-size PDF version of the
chart)
DOD funding of “S&T” (the “6.1” through “6.3” categories plus
medical research) would fall
steeply in both the House and Senate authorizations, but by less than
the DOD request (see Table C). For
the past several years, Congress has tended to be more supportive of
S&T funding than the Pentagon, and if this year’s authorizations
are any indication the pattern holds true for the FY 2005 budget. Both
the House and the Senate would authorize $11.1 billion for these programs,
down significantly from $12.6 billion in FY 2004 but well above the
$10.6 billion DOD request for FY 2005. Advocates of DOD S&T in the
science and engineering community argue that DOD S&T funding is
essential for building the knowledge and technology base for future
DOD needs, and have successfully argued that post-Cold War cutbacks
over the past decade eroded this base. In the past few years, there
has been growing support inside and outside the Pentagon for setting
3 percent of the DOD budget as a goal for the proper level of S&T
investment, and in September 2001 the Quadrennial Defense Review endorsed
the goal of investing 3 percent of the DOD budget in S&T. The last
three budgets, including this year’s, have met that goal after taking
out Iraq
and Afghanistan
war spending. The FY 2005 request, however, would cut S&T funding
steeply, lowering the S&T/budget ratio to 2.64 percent; both the
House and Senate authorizations chide the Pentagon for falling short
of the 3 percent target, but both bills would only move the ratio to
2.8 percent.
R&D
in the Navy, the Air Force, and the Defense Agencies would all increase
(see Table B), with the entire increase
going to weapons development activities. Army R&D would fall substantially
in the House and Senate authorizations as a result of the Army’s revised
FY 2005 request in March which sliced $1.2 billion in development funds
from what the Army had originally requested in February. The authorizers
would follow the Army’s lead in removing these funds from the FY 2005
totals.
R&D
in the Defense Agencies would increase nearly $2 billion in both the
House and Senate authorizations because of a nearly $1.4 billion authorized
increase to $9.0 billion in both bills for development in the Missile
Defense Agency (MDA; see Table B). The missile defense program is a high priority
for the Bush Administration. While both bills would provide less
than the $9.1 billion MDA requested, the authorizations would still
be 18 percent increases over FY 2004 funding. The MDA (formerly the
Ballistic Missile Defense Organization) no longer funds research; there
would be some funds for technology development but now nearly all missile
defense funds go to advanced development, testing, manufacturing development,
and evaluation of missile defense systems. Including procurement funds,
the Senate bill authorizes a total of $10.2 billion for missile
defense, a 13 percent increase over current levels. Separately, the
Senate would authorize funds for research in DOE on new nuclear weapons
that could penetrate the earth to destroy underground facilities. The
House would also authorize $10.2 billion for ballistic missile defense
programs, which are slated for initial deployment in late 2004, a net
reduction of .$177 million from the request, including a $75 million
cut from the program charged with designing a system to destroy mid-
and long-range enemy missiles during their ascent.
The Defense Advanced Research Projects Agency (DARPA) would see its R&D
funding increase in both the House and Senate authorizations, to $2.9
billion in the House (up 3.0 percent) and $3.0 billion in the Senate
(up 5.1 percent). Although both House and Senate authorizers found the
$3.1 billion DARPA request excessive, they nevertheless expressed support
for DARPA programs in contrast to the sharp congressional criticism
DARPA attracted last year. Last year, DARPA’s
Terrorism Information Awareness (TIA) project to engage in R&D on
creating better systems and networks to analyze, process, and find patterns
in intelligence and other data, attracted considerable public and congressional
criticism based on worries that the project could provide the military
with unprecedented capabilities to monitor personal information. The
FY 2004 DOD budget bill terminated the TIA project, eliminated TIA’s
home in DARPA’s Information Awareness Office, and instructed DARPA
to distribute the Office’s other programs among the other 7 DARPA offices.
The FY 2005 defense
authorization bills contain no such terminations or criticisms, but
the House authorization does suggest that DARPA should focus less on
long-range research and more on nearer-term DOD requirements. The cuts
to the request would be concentrated in research rather than development.
Outlook for
Defense R&D
The House and Senate
authorization bills add to the Pentagon’s FY 2005 request somewhat,
but would not fully reverse the Pentagon’s proposed cuts to basic and
applied research, and would do little to alter the long-term outlook
for these programs. The Pentagon’s five-year budget plan calls for the
total DOD budget to increase from $402 billion in FY 2005 up to $488
billion in FY 2009, though these budgets exclude any costs associated
with the occupation of Iraq.
DOD’s RDT&E
core account would be 17 percent of the DOD budget in FY 2005, up significantly
from 14 percent level of FY 2004. The projections call for the RDT&E
/ DOD budget ratio to decline back to 14 percent by FY 2009. The AAAS
analysis of the Pentagon projections show that total DOD R&D would
increase in line with inflation and end up at $71.1 billion by FY 2009.
But the Pentagon’s five-year budget projections call for sharp cuts in
DOD’s support of S&T, including DOD support of basic and applied
research (see Figure 2). Total DOD S&T would fall from $12.6
billion this year down to $10.5 billion in FY 2006 before edging up
slightly to $11.2 billion by FY 2009, for a cut of 17.9 percent after
inflation between FY 2004 and 2009. DOD S&T would fall further and
further away from the 3 percent goal and end up at 2.3 percent of the
total DOD budget by FY 2009 in the DOD projections.
DOD support of basic research would fall 17 percent after inflation
over the next five years, while DOD applied
research would fall by 11 percent (see Figure 2). The steepest cuts
are projected to take place over the next two years, with some recovery
after that. While the cuts would still leave “6.2” and “6.3” funding
somewhat above recent historical levels, they would leave “6.1” funding
on a steady downward trend from the past decade.
Figure 2. (click
on the image to view or download a color, full-size PDF version of the
chart)
After expected Senate passage
next week, the Defense authorization bills move to House-Senate conference, out
of which a final Defense bill may emerge by July. Congress hopes to send the
final bill to President Bush for his signature by the end of the summer.
Meanwhile, congressional appropriators hope to begin work on the Defense
appropriations bill this week, starting with the House Appropriations
Committee. Both the House and Senate Defense appropriations bills are expected
to include an additional $25 billion on top of the regular DOD budget for FY
2005 Iraq costs.
- June 2, 2004
(This analysis is the first of a series of AAAS R&D Funding Updates
on the FY 2005 congressional appropriations process. This analysis
includes information on R&D in House and Senate versions of authorization
bills for the Department of Defense. The complete series of AAAS R&D
Funding Updates, including continually updated analyses of R&D
by agency in FY 2005 appropriations, is available on the AAAS
R&D Web Site (http://www.aaas.org/spp/rd) in the "FY
2005 R&D" or the "What's New"
sections.)
AAAS R&D Budget and Policy Program
1200 New York Ave, NW
Washington, DC 20005
(202) 326-6607; -6600
www.aaas.org/spp/rd
