President Obama should stick to his word and veto the fiscal 2016 defense authorization bill if congressional Republicans attach an extra $38 billion to the so-called Overseas Contingency Operations (OCO) account, which pays for fighting and counterterrorism operations in Afghanistan, Iraq, Syria and elsewhere.
As passed Friday by the House — and by the Senate Armed Services Committee the day before — the bill would appropriate that amount for the OCO but direct it to pay core or base costs for the Defense Department, not war fighting.
Why put it in the OCO account? Because putting it there does not count against the spending ceilings set by the 2011 Budget Control Act (BCA).
Why $38 billion? That’s roughly the amount that Obama requested for core defense spending that exceeded the BCA limit for next year.
By putting that amount in the OCO account, GOP budget hawks can vote for the bill, which provides more than the $50.9 billion Obama sought for that account, and tell their conservative constituents, mostly tea party folk, that they remain fiscally responsible.
It is also a way to get around sequestration — the across-the-board cuts that are automatically required if the budget exceeds the BCA ceilings.
As Defense Secretary Ashton B. Carter put it during a May 6 congressional hearing, 32 percent of the base budget goes toward military pay and benefits ($169 billion); 15 percent toward civilian pay and benefits ($70 billion); 20 percent toward other operating costs ($105 billion); and 34 percent toward procurement, research and development, and new facilities ($181 billion).
The administration’s OCO request consists of $42.5 billion for Afghanistan; $5.3 billion for operations to counter the Islamic State in Iraq, Syria and elsewhere; and $2.9 billion for counterterrorism partnerships and NATO initiatives.
For several years the administration and the Pentagon have objected to using the OCO account for core or base costs because such costs often require a guarantee of multi-year funding — and there is no certainty the same amount will be available in subsequent years.
“The one-year OCO approach does nothing to reduce the deficit,” which was the purpose of the BCA, Carter said. It “doesn’t provide a stable multi-year approach” because, as he put it, “quality ships are not one-year projects.”
The White House, through the Office of Management and Budget, sent a letter to the House on May 12, before the defense bill was approved, listing “use of OCO funding to circumvent budget caps” as one of several issues that could draw an Obama veto.
The letter also expressed concern with a House provision that would prohibit the administration’s request for another round of Base Realignment and Closure, a process intended to close excess facilities that officials say total almost 20 percent of all facilities and cost billions of dollars to keep open.
However, in making the threat, the White House used limp language: “If this bill were presented to the President, the President’s senior advisors would recommend to the President that he veto it.”
Carter, in his May 6 appearance, tried to underscore the threat, saying legislation that uses OCO to avoid sequestration “will therefore be subject to veto.”
Apparently, those threats had little effect.
The day the OMB letter arrived, House Armed Services Committee Chairman Mac Thornberry, R-Texas, told reporters that Obama has “threatened to veto our bill pretty much every year at some stage in the process.”
Thornberry also pointed out the cleverness of the GOP approach, noting that where Obama wanted to use the $38 billion within the core defense budget — forcing Congress to in effect do away with the BCA ceilings and sequestration — the Republicans put it in the OCO account. That allowed Thornberry to say, “What we authorized and what he requested are exactly the same.”
The Republicans took one other step. They wrote into the bill a section that specifically directs the OMB to apportion the $38 billion to the Pentagon “in support of base (core Defense Department) requirements” and not restrict them under criteria set for real OCO funds by an OMB document titled “Criteria for War/Overseas Contingency Operations Funding Requests.”
On Thursday, in releasing the Senate Armed Services Committee version of the bill, with the $38 billion added to the OCO account, Chairman John McCain, R-Ariz., acknowledged that he was aware of the White House veto threat and called it “very serious.”
“I hope that we can satisfy some of those (White House) concerns,” McCain said, waving off Obama’s threat.
His approach was to put in his bill a provision that would permit the Defense Department to transfer the $38 billion from OCO to the base Pentagon budget in the event that Congress revises equally upward the BCA limits for fiscal 2016 defense and non-defense spending.
While that would meet White House desires, it won’t happen unless Obama vetoes the defense authorization bill and holds firm to his demands.
He has vetoed only four bills during the past six years and has never been overridden.
An OCO-heavy defense bill should be the fifth. Then let the tough budget negotiating begin.