(This analysis is a preview of the DOD chapter
in the forthcoming AAAS Report XXX: Research and Development FY
2006, a comprehensive look at the President’s budget for R&D in
FY 2006. This analysis contains revised AAAS estimates of DOD R&D,
different from figures presented in the AAAS Preliminary
Analysis of February 10. More tables and continually updated supplemental
materials on R&D in the FY 2006 budget can be found on the AAAS R&D
Web site at http://www.aaas.org/spp/rd.)
Highlights
- The Department of Defense (DOD), the largest federal sponsor of R&D,
would see its R&D budget
grow only slightly by 0.1 percent to $71.0 billion in FY 2006, an
increase of just $80 million compared to multi-billion dollar increases
the past five years (see Table 1).
- On the
research side, there would be steep cuts. DOD
“Science and Technology” (S&T), which includes research, medical
research, and early technology development, would
plummet 21.3 percent down to $10.7 billion (see Table
3); at 2.54 percent of the regular DOD budget, this would fall far
short of the Pentagon-endorsed target of 3 percent and the 3.39 percent
ratio Congress appropriated in 2005.
- Within
S&T, DOD funding for basic and applied research
would both decline steeply. Basic research (“6.1”) would fall 12.9
percent to $1.3 billion, while applied research (“6.2”) would fall 14.7
percent to $4.1 billion in FY 2006, after large increases for both in
this year’s budget (see Table 1).
- DOD weapons development would see a modest increase overall,
but there would be some steep cuts. Missile Defense Agency (MDA)
funding for the development, testing, and evaluation of missile defenses
would fall $1 billion to $7.8 billion (see Table
2). Including procurement funds and R&D in other DOD agencies,
the total missile defense investment would be $8.8 billion, down from
$9.9 billion this year.
- The Defense Advanced Research Projects Agency (DARPA) would be a winner among
research-oriented programs, with a request of $3.1 billion in FY
2006, a 3.6 percent increase.
Defense R&D:
An Overview
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. Defense-related R&D is also
funded by the Department of Energy (DOE), which is responsible for maintaining
the U.S.
nuclear weapons stockpile, and the Department of Homeland Security (DHS),
whose primary mission is homeland defense but also performs R&D
related to military security (see Figure 1).
While
most agencies break out R&D into the three categories of basic research,
applied research, and development, DOD divides its RDT&E (Research,
Development, Test, and Evaluation) account into seven categories, each
with a numerical code: Basic Research (known as “6.1”), Applied Research
(“6.2”), Advanced Technology Development (“6.3”), Advanced Component
Development and Prototyping (“6.4”), Systems Development and Demonstration
(“6.5”), Management Support (“6.6”), and Operational Systems Development
(“6.7”). DOD also funds some R&D and personnel support costs in
non-RDT&E accounts, and funds applied research on medical topics
in the Defense Health Program.
Figure 1. (click
on the image to view or download a color, full-size PDF version of the
chart)
DOD is responsible for only 13
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
(see Figure 2). DOD supports 36 percent of all federal research in the computer
sciences and 37 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. DOD funds research in these disciplines for their
contributions to national defense, but this research is also a key source for
major innovations in the civilian economy. DOD is also a key supporter of
social sciences research.
The “6.1,”
“6.2,” and “6.3” categories are often grouped together as “Science
and Technology” (S&T; see Figure 1 and Figure 3). This category
includes basic research, applied research, and advanced technology development.
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.
AAAS estimates of DOD S&T (see Table 3)
also include applied medical research in the Defense Health Program,
which was formerly funded in the Army “6.2” accounts.
A majority of DOD’s
R&D (and nearly all the work in categories “6.4” and higher) is
performed by industrial firms such as the large defense contractors
Lockheed Martin and Boeing. FFRDCs (federally funded research and development centers),
defense laboratories, and colleges and universities also perform R&D.
If one excludes DOD development, which is nearly exclusively performed
by industry, DOD basic and applied research (“6.1” and “6.2”) is performed
by a diverse group of institutions. 40 percent of DOD research is performed
by DOD laboratories, while 35 percent is performed by industry. A fifth
(19 percent) of DOD basic and applied research is performed by universities
and colleges.
Figure 2. (click
on the image to view or download a color, full-size PDF version of the
chart)
Priorities in DOD R&D
Tables
1 and 2 show DOD’s R&D in detail.
Table 1 shows DOD R&D by “6.x”
category, and Table
2 by agency and department. Table 3 shows
details of the “S&T” portion of the R&D portfolio.
This year, the
Pentagon is presiding over a record-breaking budget of $476 billion,
including a recently proposed FY 2005 supplemental, up from $468 billion
last year. DOD’s budget is at record levels, of course, because of the
continuing deployment of U.S.
forces during the occupation and reconstruction of Iraq.
The FY 2006 budget request appears to be a sharp drop to $419 billion
(see the second half of Table 2), but the
FY 2006 budget leaves out entirely the future costs of the U.S.
presence in Iraq.
Even the Pentagon itself acknowledges that U.S.
troops will be in Iraq
at current strengths at least through the end of 2006, but President
Bush has refused to include Iraq
costs in his last few budgets. These additional funds will have to be
provided in emergency supplemental appropriations bills outside the
regular DOD budget process, as is the case with the $75 billion FY 2005
supplemental for DOD which was released in mid-February, after the release
of the FY 2006 budget.
DOD R&D would barely rise 0.1 percent to $71.0 billion in FY 2006
(see Table 1). In inflation-adjusted
dollars, the FY 2006 R&D total would be the first real cut in DOD’s
R&D since 1996, coming after three years of record-setting R&D
investments that exceed previous Cold War highs (see Figure 1).
But DOD support of basic and applied research would fall steeply in FY 2005. DOD’s “6.1” (basic research) and “6.2”
(applied research) activities combined would fall 14.2 percent to $5.5
billion in FY 2006 (see Table 1). In real
terms, the proposed cut would undo six years of increases and leave
DOD research support at 2000 funding levels.
Basic research funding (the “6.1” category) would fall 12.9 percent to
$1.3 billion, reversing an 11 percent increase last year; Congress
provided an increase after the Pentagon had requested a cut. Table
3 shows that basic research in the Army, Navy, Air Force and Defense
Agencies would all decline. Many of the cuts would be due to the proposed
elimination of congressional earmarks inserted into the FY 2005 budget,
but there would also be cuts in core DOD “6.1” funding. Funding for
the University Research Initiatives program would fall 15.7 percent
down to $248 million. URI competitively awards basic research grants
to university performers and is funded by the three services. The Defense
Research Sciences program, which primarily funds in-house research but
also awards external grants, would receive a combined $849 million in
FY 2006, a cut of 12 percent. One area proposed for increased funding
is the new National Defense Education Program (NDEP), started this year
in the Office of the Secretary of Defense (OSD) with $3 million and
proposed to increase to $10 million next year.
Applied research funding (the “6.2” category) would plummet by 14.7 percent
or $711 million to $4.1 billion in FY 2006, after a 12 percent congressional
increase last year in response to a requested cut. There would be steep
cuts to applied research programs in the three services, including drops
of 40 percent in the Army, 27 percent in the Navy, and 10 percent in
the Air Force. Applied research in the Defense Agencies would increase
2.8 percent because of proposed boosts in DARPA funding (see DARPA,
below).
Figure 3. (click
on the image to view or download a color, full-size PDF version of the
chart)
Beginning
in the early 1990s, Congress has appropriated funds for congressionally designated medical research programs in the DOD budget.
In the last decade, nearly all of these funds were appropriated in the
Army, but in FY 2000 Congress began to appropriate the majority of them
outside the RDT&E accounts in the Defense Health Program (see Table
1). The current-year FY 2005 total of $507 million for medical research
includes $150 million for breast cancer research and $85 million for
prostate cancer research in peer-reviewed, competitively awarded grants.
There is also $50 million for peer-reviewed research on other medical
topics. These programs award grants on a peer-reviewed basis and are
managed by the Army. Additional congressionally designated performer-specific
medical research programs are funded in Army “6.2” and “6.3” accounts.
DOD’s policy is not to request continuing funds for most congressionally
designated projects; the FY 2006 request is only $169 million for information
technology development to support military medical readiness, but Congress
is sure to add on funds for the above programs.
DOD funding of “S&T” (the “6.1” through “6.3” categories plus
medical research) would fall
to $10.7 billion, down 21.3 percent from this year (see Table
3 and Figure 3). For the past several years, Congress has tended
to be more supportive of S&T funding than the Pentagon; in last
year’s budget, DOD also requested a cut in S&T funding, but Congress
ended up appropriating a $1.2 billion increase. 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
four budgets, including this year’s, have met that goal after taking
out Iraq
and Afghanistan
war spending, hitting 3.39 percent in 2005. The FY 2006 request, however,
would cut S&T funding steeply, lowering the S&T/budget ratio
to 2.54 percent and reversing the past four years of gains (see Figure
3) that brought DOD S&T funding to an all-time high in inflation-adjusted
dollars in FY 2005 after six years of steady increases.
On the development
side, there would be mixed news for DOD’s big-ticket weapons development
programs. The largest single development project in DOD, and indeed
the entire federal budget, would once again be the Joint Strike Fighter
(JSF), funded by the Navy and Air Force together at a development cost
of $4.9 billion, up from $4.3 billion this year as the fighter plane
nears production. In a sign of how expensive weapons development can
be, the JSF project alone would be more than the entire R&D portfolio
of the National Science Foundation (NSF). Although the overall Army
R&D budget would fall by 7.5 percent in the request, development
in the Armored Systems Modernization project would climb from $2.3 billion
to $3.1 billion in FY 2006. But there would be steep cuts in development
funding for several projects making up the national missile defense
system in the Missile Defense Agency (MDA; see below). And some programs
would see their development funding fall as projects move into procurement:
the Navy’s DD(X) Destroyer would receive $1.1 billion in FY 2006 for
development, down from $1.2 billion, in preparation for delivering the
first ship in 2007.
After several
years of large increases, R&D in the Defense Agencies would fall
$1.7 billion or 8.2 percent to $18.8 billion, primarily because of a
$1.0 billion or 11.5 percent cut to $7.8 billion for development in
the Missile Defense Agency (MDA; see Table
2). Although missile defense
systems have begun to be deployed in Alaska, the development effort would slow in FY 2006. The MDA (formerly
the Ballistic Missile Defense Organization) no longer funds research;
there would be some funds for technology development ($136 million in
FY 2006), but now nearly all missile defense funds go to advanced development,
testing, manufacturing development, and evaluation of missile defense
systems with an additional $567 million elsewhere in the DOD budget
for procurement of completed systems and some R&D in other DOD accounts,
for a grand total of $8.8 billion next year for missile defense (down
from $9.9 billion).
The Defense Advanced Research Projects Agency (DARPA) would see its R&D
funding increase to $3.1 billion in FY 2006, an increase of $107
million or 3.6 percent (see Table 2), after
similar increases in the last three years. DARPA is research-oriented
(51 percent of its budget is for research, with the remainder devoted
to “6.3” technology development), and its broad research portfolio is
aimed at expanding the frontiers of knowledge and military technology
to provide future solutions to DOD’s technology needs. DARPA’s efforts in areas such as tactical technology, materials,
aerospace systems, network-centric warfare, information and communications
technology, and cognitive computing would all receive increases, while
there would be cuts in DARPA support of electronics technology, biological
warfare defense, sensors, and guidance technology.
Among the other Defense Agencies, the big winner would be the Chemical and
Biological Defense Program (CBDP), with a proposed 26 percent increase
for its R&D to $898 million. CBDP funds chemical and biological
defense R&D at all stages from basic research through testing and
evaluation of new technologies; most categories would receive large
increases in FY 2006, including basic and applied research. But R&D
in the Office of the Secretary of Defense (OSD) would fall by nearly
a third down to $1.6 billion, primarily from steep cuts in the “6.3”and
higher categories. The Defense Threat Reduction Agency (DTRA), after
a large increase in 2005, would see its R&D funding fall 10 percent
down to $409 million. Most of the proposed cuts would come from DTRA’s
applied research programs oriented toward weapons of mass destruction
(see Table 2).
Outlook
for Defense R&D
The FY 2006 DOD
budget is unusual in that total defense spending (excluding Iraq
costs) in FY 2006 would increase only modestly, compared to enormous
gains in each of the past several years. The overall FY 2006 budget
continues the austerity in domestic spending that hit many R&D funding
agencies in 2005, but would extend it to defense spending as well. Partly,
the apparent flattening of defense spending is due to the Pentagon’s
decision to load more and more of what normally would be regular defense
spending into emergency supplemental requests, taking these costs out
of the budget request. But there are real cuts in several development,
procurement, and research programs in the budget that have already attracted
considerable criticism on Capitol Hill. Congress, as usual, is likely
to weigh the balance between short-term operational needs and longer-term
R&D horizons carefully, and will come up with different answers
than the Pentagon. In past years, this has meant adding billions of
dollars to the S&T accounts and saving some weapons programs from
cancellation. But with the willingness to increase the defense budget
year after year apparently waning on both ends of Pennsylvania
Avenue, Congress may be forced to make tough
choices on the defense side of the budget as it has already done on
the domestic side.
- February 23, 2005
(More materials on R&D in the FY 2006 budget, historical data and
charts, and more information on AAAS Report XXX: R&D FY 2006,
can be found on the AAAS R&D web site at http://www.aaas.org/spp/rd.)
AAAS R&D Budget and Policy Program
1200 New York Ave, NW
Washington, DC 20005
(202) 326-6607; -6600
www.aaas.org/spp/rd
