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Slight State Department Spending Increase, Military Decrease In Obama Budget

Copies of U.S. President Barack Obama's 2012 budget are unveiled on Capitol Hill in Washington.
U.S. President Barack Obama has sent his 2012 budget proposal to Congress, which he says will halve the U.S. deficit by 2013 and slash $1.1 trillion over a decade through spending cuts and tax increases.

"When I was sworn in as president, I pledged to cut the deficit in half by the end of my first term," Obama said. "The budget I'm proposing today meets that pledge and puts us on a path to pay for what we spend by the middle of the decade."

Obama's $3.7 trillion budget proposal shows the deficit rising to a record $1.6 trillion in fiscal year 2011, then falling sharply to $1.1 trillion in 2012.

The proposed budget would provide $47 billion for the core activities of the State Department and the U.S. Agency for International Development (USAID), representing a 1 percent increase over 2010 funding.

The figure doesn't include an additional $4 billion for diplomacy and development programs, such as the Peace Corp and U.S.-funded broadcasters. The proposed budget for the latter reflects an almost 3 percent increase over last year.

Thomas Nides, deputy secretary of state for management and resources, told reporters that the State Department budget is directly tied to national security.

"The core [State Department] budget is part of the U.S. government's national security budget," he said. "It stabilizes conflict zones, it reduces the threat of nuclear weapons, it restores old alliances, it supports democratic transitions, it counters extremism, it opens global markets, and it protects citizens abroad."

Af-Pak-Iraq Spending

The modest increase in the department's proposed budget, however, does not reflect special spending for Afghanistan, Iraq, and Pakistan. For the first time, funding for the United States' military and diplomatic activities in these countries is given its own category in the proposed budget, entitled "Overseas Contingency Operations."

The term came into use early in the Obama presidency as a replacement for the Bush-era phrase "war on terror."

The special funding would give the State Department a further $8.7 billion, the majority of which is allocated to operations in Iraq.

As the U.S. troop presence dwindles there, funding for the Department of Defense's Iraq activities would drop by more than $40 billion to just $10 billion. At the same time, funding for State Department activities in the country would nearly double from 2010 levels, to $5.2 billion.

The increase would defray the costs of 400 "essential activities" that the State Department will take over from the military, including training of the Iraqi police and security forces.

U.S. Secretary of State Hillary Clinton said the extra funds are necessary to consolidate hard-won gains.

"We're asking for about $4 billion [more] to make sure that we have a civilian presence to continue working with the Iraqi government in order that the enormous sacrifice that our men and women in uniform made, and that this country made, to try to give Iraqis the opportunity to chart their own democratic future is not lost," she said, "because we are not the only country that is going to be in a position to influence what happens to Iraq in the future."

The State Department says the need to support another civilian surge is also behind the requested $2.2 billion increase for its efforts in Afghanistan.

"We've already surged civilians in Afghanistan," said Deputy Secretary Nides. "Now our challenge is to sustain our presence and build on our military gains and show results. We're working to give General [David] Petraeus and Ambassador [Karl] Eikenberry the support they need to execute our strategy. This budget requests funding for 1,500 civilian staffers. Two years ago, we had 230."

An additional $1.2 billion is requested for the State Department's 2012 funding for Pakistan.

Other proposed increases to the State Department's budget are requested for food security and global health initiatives.

State Department Cuts

But the department also plans to make cutbacks in 2012, and the proposed budget would eliminate "entire bilateral programs" for six countries and eliminate military financing for five. The specific countries were not made immediately available. The budget said security assistance funds would instead become more focused on "key priorities" such as Israel, Pakistan, and other allies.

Funding for assistance to Europe, Eurasia, and Central Asia would also be slashed by $115 million compared to Obama's budget request last year.

According to the new proposal, the reduction "reflects the success of sustained U.S. assistance efforts over the last 20 years and the perception that several countries are firmly on track to membership in Euro-Atlantic institutions."

The cuts were not enough to assuage the doubts of many opposition Republicans, however, some of whom have proposed that foreign aid should be eliminated completely as the United States faces record deficits.

In fact, Republicans are currently pushing legislation that calls for reductions in the current fiscal year's State Department budget.

According to Clinton, the proposed reduction of 16 percent from would be "devastating" to U.S. security and would "damage [U.S.] leadership around the world."

Clinton told reporters, "The scope of the proposed House cuts is massive. The truth is that cuts of that level will be detrimental to America's national security."

If they are approved, she warned, "We would be forced to scale back significantly our mission in the front line states of Iraq, Afghanistan, and Pakistan where we work side by side with the American military."

Military Budget

For the first time since the 9/11 terror attacks, the proposed U.S. military budget reflects a reduction in previous levels, reflecting savings from the withdrawal of American troops from Iraq.

The total defense budget of $671 billion is down from last year's request of $708 billion, but the "base" defense budget -- excluding the cost of the wars in Iraq and Afghanistan -- represents a new record at $553 billion, according to figures released by the Pentagon.

The budget includes $113 billion for a range of drone aircraft, a new long-range bomber, helicopters, warships, submarines, and other weapons, while also funding generous pay and benefits for a force stretched by years of combat.

The budget's estimated price tag for the wars comes to $118 billion, down $45 billion from last year's budget request, what Defense Secretary Robert Gates told reporters constituted a "fairly dramatic reduction."

The budget proposal takes into account the planned pullout of troops from Iraq by the end of 2011 and "a modest decline in funding for Afghanistan operations," he said in a statement.

written by Richard Solash, with agency reports.
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