Tag Archives: military spending

Post-Brexit UK announces largest military spending since Cold War

By Andrew MacAskill and William James

LONDON (Reuters) – Britain announced its biggest military spending increase since the Cold War on Thursday, pledging to end the “era of retreat” as it seeks a post-Brexit role in a world Prime Minister Boris Johnson warned was more perilous than for decades.

Johnson said the extra spending reflected the need to upgrade military capabilities even as the COVID-19 pandemic pummels the economy and strains public finances. He outlined plans for a new space command, an artificial intelligence agency and said the navy would be restored as Europe’s most powerful.

Outlining the first conclusions from a big review of foreign policy and defense, he announced an extra 16.5 billion pounds ($22 billion) for the military over the next four years. The defense budget is now just under 42 billion pounds a year.

“The era of cutting our defense budget must end, and it ends now,” Johnson told parliament by video link from his Downing Street office, where he is isolating after contact with someone who tested positive for COVID-19.

“I have done this in the teeth of the pandemic, amid every other demand on our resources, because the defense of the realm and the safety of the British people must come first.”

NEW GLOBAL ROLE

Britain was the main battlefield ally of the United States in Iraq and Afghanistan and, alongside France, the principal military power in the European Union. But its 2016 vote to leave the EU has made its global role uncertain at a time when China is rising and President Donald Trump has cast doubt on U.S. support for traditional allies.

The military spending announcement comes just a week after Johnson promised U.S. President-elect Joe Biden that Britain was determined to remain a valuable military ally.

Christopher Miller, acting U.S. defense secretary in Trump’s outgoing administration, welcomed the extra spending.

“The UK is our most stalwart and capable ally, and this increase in spending is indicative of their commitment to NATO and our shared security,” he said. “With this increase, the UK military will continue to be one of the finest fighting forces in the world.”

The government said the increase will cement Britain’s position as the largest defense spender in Europe and second-largest in NATO.

A national cyber force will be established alongside the new space command, which will be capable of launching its first rocket by 2022. These and other new projects will create up to 10,000 jobs, the government said.

Britain’s main opposition Labor Party said the increase was long overdue after the ruling Conservative government cut the size of the armed forces by a quarter in the last decade.

The extra funding will raise further concerns about how the government manages its defense and security budget after repeated accusations it allowed costs to spiral for overly-ambitious projects.

A report by lawmakers said on Thursday that Britain’s GCHQ spying agency ignored evidence and broke its budget in choosing an expensive central London headquarters for a newly-created cyber-security center.

After media reports that billions of pounds could be cut from Britain’s foreign aid budget, Defense Secretary Ben Wallace told Sky News that higher defense spending would not come at the expense of aid.

“It doesn’t mean to say we are abandoning the battlefield of international aid, we’re still one of the most generous givers of international aid,” Wallace said.

(Additional reporting by Elizabeth Piper in London; Editing by Catherine Evans)

Trump budget plan to seek funds for border wall, infrastructure, opioid treatment

Copies of the President Trump's FY 2019 budget proposal are delivered to the U.S. House Budget Committee offices on Capitol Hill in Washington, U.S. February 12, 2018.

By Ginger Gibson

WASHINGTON (Reuters) – President Donald Trump will unveil his second budget on Monday, seeking to make good on his promise to bolster military spending and requesting funds for infrastructure, construction of a wall along the border with Mexico and opioid treatment programs.

The budget plan, which is viewed largely as suggestions by Congress, which has the constitutional authority to decide spending levels, will likely draw criticism from conservatives who worry that Republicans are embracing deficit spending.

The proposal will include $200 billion for infrastructure spending and more than $23 billion for border security and immigration enforcement, Mick Mulvaney, who heads the administration’s budget office, said in a statement on Sunday night.

It will also provide “for a robust and rebuilt national defense,” he said.

But the statement added that the proposal would recommend cuts that would lower the deficit by $3 trillion over 10 years.

“The budget does bend the trajectory down,” Mulvaney told the “Fox News Sunday” program earlier on Sunday. “It does move us back towards balance. It does get us away from trillion-dollar deficits.”

The budget request will be delivered to Congress only days after Trump signed off on a bipartisan spending agreement hammered out by lawmakers that will increase domestic spending by $300 billion over two years – including $165 billion in defense spending and $131 billion in non-military domestic spending.

The White House plans to amend its request to take into account the higher spending levels in the agreement that passed on Friday, a senior official in the Office of Management and Budget said.

Mulvaney said on Sunday all that money did not need to be spent.

“These are spending caps,” Mulvaney said. “They are not spending floors. You don’t have to spend all that.”

The spending deal will add to the annual budget deficit, which will now exceed $1 trillion in 2019, said the Committee for a Responsible Federal Budget watchdog group.

Trump’s previous budget was criticized for recommending cuts to spending to achieve deficit reduction that ultimately even members of his own Republican Party thought were untenable.

“I hope the budget that we see is workable and recognizes the landscape we’re in,” said Senator Lisa Murkowski, a Republican member of the Appropriations Committee. “A lot of times, what you have is a budget that even the Cabinet secretaries can’t defend.”

DEFICIT DEBATE

“The president’s budget is always a list of pretty good suggestions. It’s not ‘the’ budget,” said Senate Budget Chairman Mike Enzi.

This year’s budget is likely to stoke debates about deficits that began when Congress passed a tax overhaul in December. The tax cuts in the legislation contained no corresponding reductions in spending and instead relied on arguments that the lower rates would stoke economic growth.

Trump’s budget will include a number of economic forecasts and is expected to rely on estimates that the economy will keep growing at a rapid pace for the foreseeable future.

Such forecasts could obscure the level of deficit spending, said Robert Greenstein, president of the progressive Center for Budget Policy and Priorities.

“It’ll essentially be another budget gimmick, alongside rosy economic assumptions, to make the deficit smaller than it will actually be,” Greenstein said.

The budget proposal will include two key elements – $18 billion over two years for Trump’s long-promised border wall and $200 billion in federal funds to spur $1.5 trillion in infrastructure investments over the next 10 years with state, local and private partners, Mulvaney’s statement said.

Trump promised during the 2016 campaign that Mexico would pay for the border wall, which the Mexican government has insisted it will not do.

Democrats oppose the wall, which Trump has said is aimed at keeping out illegal immigrants and drug smugglers.

The budget will also seek some $13 billion in new funding over the next two years to combat the opioid epidemic.

In addition, it will request $85.5 billion for veterans’ health, the administration said.

(Reporting by Ginger Gibson; Additional reporting by David Morgan and Katanga Johnson; Editing by Doina Chiacu and Peter Cooney)

Senate leaders in a rare display of bipartisanship, reach $300 billion federal spending deal

U.S. Sen. Lindsay Graham speaks to reporters outside the Senate chamber on Capitol Hill in Washington, U.S. February 7, 2018.

By Richard Cowan and Amanda Becker

WASHINGTON (Reuters) – U.S. congressional leaders, in a rare display of bipartisanship, on Wednesday reached a two-year budget deal to raise government spending by almost $300 billion, attempting to curb Washington’s fiscal policy squabbling but also widening the federal deficit.

The agreement, announced by the Republican and Democratic leaders of the Senate and House of Representatives, would lift caps on defense funding and some domestic spending. It also would postpone a reckoning with the federal debt limit.

Along with President Donald Trump’s tax cuts that were approved by Congress in December, the new round of spending would further add to the bulging deficit and may face resistance in the House from Democrats as well as Republican fiscal hawks.

“This bill is the product of extensive negotiations among congressional leaders and the White House,” Senate Majority Leader Mitch McConnell, a Republican, said on the Senate floor.

The plan will need to be passed in the House and the Senate, both controlled by Trump’s fellow Republicans, before it can be sent to the White House for the president to sign into law.

House Democrats have warned they will not back the deal unless Republican House Speaker Paul Ryan promises to advance separate legislation on immigration policy.

Chuck Schumer, leader of the Senate Democrats, touted the deal, saying, “It should break the long cycle of spending crises that have snarled this Congress and hampered our middle class.”

The defense spending increase in it should allow Trump to make good on his campaign promise for a military build-up.

The White House said the deal includes an extension, until March 2019, of the government’s debt ceiling. The Treasury Department has been warning that without an extension in borrowing authority from Congress, the government would run out of borrowing options in the first half of next month, risking an unprecedented debt default.

The agreement also funds disaster relief, infrastructure and programs addressing opioid abuse, the Senate leaders said.

DEFICIT INCREASE

White House legislative affairs director Marc Short said the deal would increase spending by “just shy” of $300 billion.

A senior congressional aide said this amount of additional spending would not be offset by any spending cuts or new tax revenue, meaning an increase in the federal deficit.

“This really is the moment where it has become clear that despite record levels of debt and approaching trillion dollar deficits, Congress has stopped caring about what they’re doing to the fiscal health of the country,” said Maya MacGuineas, head of the Committee for a Responsible Federal Budget, a group that advocates for long-term fixes to Washington’s debt problems.

Aside from the budget deal, lawmakers were also trying to reach agreement by Thursday to avoid a government shutdown and fund the government until March 23. If that fails, the U.S. government would suffer its second shutdown this year, after a partisan standoff over immigration policy led to a three-day partial shutdown last month.

In financial markets, yields on benchmark 10-year notes rose on news of the budget deal, on expectations of higher growth and potentially greater Treasury supply.

A large uptick in issuance is expected after Congress raises the debt ceiling, which along with higher inflation expectations has weighed on bonds in the past week.

A congressional source familiar with the agreement said it would increase non-defense spending by $131 billion and include $20 billion for infrastructure spending. It also would extend funding for the Children’s Health Insurance Program (CHIP) for 10 years instead of the current six, the source added.

Passage of the plan would ease the brinkmanship over spending that roils Washington so regularly that financial markets barely flinch at the threat of a government shutdown.

Immigration again emerged as a possible point of contention. House Democratic leader Nancy Pelosi, who helped negotiate the accord, nevertheless said she would oppose it unless Ryan promises to advance legislation to protect hundreds of thousands of young adult immigrants, known as “Dreamers,” brought to the United States illegally as children.

January’s shutdown came after Democrats sought to have a spending bill include protections for the Dreamers that Trump has rescinded effective in March.

Republicans are eager to keep spending and immigration separate. Trump threatened on Tuesday to upend budget talks by saying he would welcome a government shutdown if Congress were not able to agree to changes in immigration law that he said would prevent criminals from entering the country.

(Additional reporting by David Morgan, Susan Heavey and Doina Chiacu in Washington and April Joyner in New York; Writing by Alistair Bell; Editing by Will Dunham)

White House sees good chance of long-term budget deal

Senate Minority Leader Chuck Schumer (D-NY) speaks during a news conference on Capitol Hill in Washington, U.S., February 6, 2018.

By Richard Cowan

WASHINGTON (Reuters) – U.S. lawmakers are expected to unveil “a good, bipartisan deal” on Wednesday that would raise current limits on federal spending for two years, the White House said, as Congress seeks to end fights over spending that have plagued Washington for months.

Higher defense spending expected in the agreement would allow President Donald Trump to make good on his campaign promise for a U.S. military build-up, although the White House is still concerned about non-defense spending levels, White House legislative affairs director Marc Short told MSNBC.

But Nancy Pelosi, the House of Representatives’ Democratic leader, said she would not support such a deal, aimed at lifting some limits on government spending for two years, unless Republican Speaker Paul Ryan promised to advance legislation on immigration. Trump’s fellow Republicans control both chambers of Congress.

Over the past several months, congressional leaders have been negotiating a deal that would raise spending caps for the current fiscal year, which ends on Sept. 30, and the next one for both defense and non-defense programs.

A broad budget deal could ease the brinkmanship over spending that roils Washington so regularly that financial markets barely flinch anymore at the threat of a government shutdown.

“There’s some things that you give and take in a negotiation like this, and so I think this will be a good, bipartisan deal but we’re more excited about the defense spending,” Short said.

Aside from the planned longer-term deal, lawmakers were also trying to reach agreement by Thursday to avoid a shutdown and fund the government until March 23.

“We expect the government is not going to shut down this week,” Short said.

In a further sign of Congress’ inability to get basic work done, the House on Tuesday had to approve another stopgap bill to keep the federal government from shutting down.

Stopgap measures are needed when Congress fails to approve spending on time for a full fiscal year, something it has done only four of the past 40 years, according to congressional researchers.

The Senate was expected to take up the House stopgap legislation as Congress raced to get a finished bill for Trump to sign into law before government funding runs out on Thursday.

If that fails, the U.S. government would experience its second shutdown this year, after a partisan standoff over U.S. immigration policy led to a three-day partial shutdown last month.

Immigration again emerged as a possible point of contention in budget talks when Democrat Pelosi said she would oppose a two-year deal unless the Republican Ryan promised to advance legislation to protect hundreds of thousands of young adult immigrants, known as “Dreamers,” brought to the United States illegally as children.

Republicans are eager to keep spending and immigration separate. But Trump threatened on Tuesday to upend budget talks by saying he would welcome a government shutdown if Congress were not able to agree to changes in immigration law that he said would prevent criminals from entering the country.

January’s shutdown came after Democrats sought to have a spending bill include protections for the Dreamers that Trump has rescinded effective in March.

On Tuesday, top Senate Democrat Chuck Schumer said the emerging Senate two-year deal would increase funding for domestic programs like drug treatment and broadband infrastructure that Democrats want, as well as a military spending increase sought by Republicans.

“We’re making progress,” Senator Dick Durbin, the Democratic minority whip, told MSNBC on Wednesday.

Congress must also raise the federal debt ceiling or face defaulting on the government’s bills, and several Republican lawmakers said the matter would be part of Senate budget talks. The U.S. Treasury is expected to run out of borrowing options by late March.

(Additional reporting by Susan Heavey; Editing by Will Dunham)

U.S. Congress passes $618.7 billion annual defense bill

A U.S. Navy crewman directs an F/A-18E Super Hornet fighter jet on the flight deck of the aircraft carrier USS Harry S. Truman in the Mediterranean Sea in a photo released by the US Navy June 3, 2016. U U.S. Navy/Mass Communication Specialist 3rd Class

By Patricia Zengerle

WASHINGTON (Reuters) – The U.S. Senate overwhelmingly passed a compromise version of an annual defense policy bill on Thursday without controversial provisions such as requiring women to register for the draft or allowing contractors to make religion-based hiring decisions.

Ninety-two senators backed the $618.7 billion National Defense Authorization Act, or NDAA, and seven opposed it. Because it passed the House of Representatives by a similarly large margin last week, the bill now goes to the White House for President Barack Obama to veto or sign into law.

A White House spokesman told a briefing he did not yet have a position on the bill to report.

The 2016 bill, the last of Obama’s presidency, includes some Republican-backed initiatives with which he has disagreed in the past. It includes a $3.2 billion increase in military spending, when there has been no similar increase in non-defense funding.

The bill also bars closures of military bases, although top Pentagon officials say they have too much capacity, and it blocks planned reductions in active-duty troop numbers.

And it continues policies that bar transfers of prisoners to U.S. soil from the detention center at Guantanamo Bay, Cuba, which Obama had hoped to close. While his administration has shipped most inmates from the controversial prison, the Democrat is not expected to accomplish his goal of shuttering it before he leaves office Jan. 20.

Obama’s successor, Republican Donald Trump, wants to keep Guantanamo open, and expand it.

The NDAA passed both chambers in the Republican-led Congress with margins large enough to overcome a veto, and the compromise legislation features many provisions such as a military pay raise and an expansion of a landmark human rights bill, that are extremely popular in Congress. [L1N1E316A]

After months of negotiation, the Senate and House Armed Services committees unveiled a compromise version of the NDAA last month that left out the Russell Amendment, a “religious freedom” measure Democrats said would have let federal contractors discriminate against workers on the basis of gender or sexual orientation, overturning Obama’s executive order.

Some House Republicans said they hoped to revisit that provision after Trump takes office, when they do not have to worry about a veto threat from a Democratic White House.

The bill also excluded a provision that would have required women to register for the military draft, now that Pentagon leaders are moving to allow them into combat.

A provision recommending that the U.S. conducts yearly high-level military exchanges with Taiwan, which Beijing sees as a breakaway province, made it into the final bill.

China’s defense ministry said in a statement on its official microblog on Friday that it was “firmly opposed” to the move, which would “inevitably damage U.S. interests”.

(Reporting by Patricia Zengerle; Additional reporting by Timothy Gardner, and Christian Shepherd and Michael Martina in BEIJING; Editing by Richard Chang and Clarence Fernandez)