Jan. 25, 2022
NDIA warns against a full-year continuing resolution for fiscal 2022 Such action would significantly reduce DoD outlays, damage military and industrial readiness, delay modernization and call into question U.S. efforts to counter China and Russia.
ARLINGTON, VA – Ahead of a potential large-scale troop deployment countering Russian threats to Ukraine, the National Defense Industrial Association has called for immediate action from Congress to pass full-year funding for fiscal year 2022 while warning against extending continuing resolutions through the rest of the fiscal year, which would hold spending to last year’s budget, prevent new starts and misalign funding.
In a new NDIA white paper, “Risks to National Security, a Full-Year Continuing Resolution for 2022,”<https://content.ndia.org/-/media/sites/policy-issues/continuing-resolution/cr_white_paper.ashx> John Whitley, former acting Army secretary, says such action significantly reduces defense purchasing power and risks signaling a lack of seriousness and competence to counter Russian aggression in the Ukraine and Chinese actions in East Asia and the South China Sea.
The paper NDIA.org/CR<http://ndia.org/CR> notes that a full-year CR would cut $36 billion in congressionally intended growth from the Defense Department. When coupled with the effects of increased inflation, it estimates a full-year CR would result in an overall loss in purchasing power of $75 billion or more and a $20 billion reduction in outlays in FY22 alone.
If this becomes a new baseline for defense spending, NDIA says the top-line numbers would reduce by $180 billion and outlays would fall by approximately $155 billion from fiscal years 2022 through 2026. This would harm servicemembers, their families, the defense workforce and national security.
* NDIA.org/CR<http://ndia.org/CR> (download white paper)
* In the absence of FY22 appropriation and given significant budget disagreements to be resolved, DoD faces the real possibility, and the significant risk, of a full-year continuing resolution.
* As Defense Secretary Lloyd Austin said, this “would cause enormous, if not irreparable, damage to a wide range of bipartisan priorities – from defense readiness and modernization to research and development, to public health.”
* A full-year CR will be disastrous and reduce the U.S. capacity to navigate a near-perfect storm of a deteriorating strategic environment, the urgent need for catch-up modernization, increasing inflation that is eroding buying power and a defense industrial base wrestling with COVID-19, supply-chain constraints and workforce disruptions.
* The United States is in a race against time to regain its edge over China and Russia by investing in the force structure and capabilities needed to deter further aggression and prevent a major conflict.
* A full-year CR would delay those key investments, and some of these delays may be unrecoverable. Furthermore, Congress has authorized large increases to the Pacific Deterrence Initiative, the European Deterrence Initiative and the Ukraine Security Assistance Initiative. Stopping this funding in FY22 in the face of Russian build-up along the Ukrainian border, in the Arctic and elsewhere as well as increasingly aggressive Chinese acts toward Taiwan risks signaling a lack of seriousness and competence to counter their actions, further emboldening their increasingly belligerent stances.
* A full-year CR would cut $36 billion in congressionally intended growth from DoD, prevent new programs from starting as well as increased procurement and leave resources misaligned to needs. It would delay key investments, including space capabilities, hypersonic weapons, artificial intelligence and autonomy and nuclear force modernization. In total, more than 300 new starts across DoD would be canceled in FY22 by a full-year CR in research, development, test and evaluation appropriations; procurement and military construction accounts. Funding misalignments include $3 billion allocated for Afghan security forces that no longer exist and a lack of funding for the military and civilian pay raises, causing these unavoidable bills to come at the expense of change-of-station moves, incentive and special pays, flying hours and readiness training and facility maintenance and modernization.
* Additionally, a full-year CR would significantly impact the DIB. The COVID-19 pandemic has disrupted defense production lines, development programs and the industry workforce. Disruptions in supply chain and workforce are now adding further complications. These challenges are set to exacerbate an already challenged sector that has seen thousands of companies depart over the last decade.
* An unprecedented full-year CR would add additional strain to an already heavily burdened sector, costing revenue that suppresses jobs and economic activity across the country. This could be particularly damaging in the technology sector. In many key areas of capability development, such as space and AI, the commercial sector is the primary driver of technological advancement; DoD’s race against time includes improving incentives for this sector to focus on national security challenges.
The National Defense Industrial Association is America’s leading defense industry association promoting national security. NDIA provides a legal and ethical forum for the exchange of information between industry and government on national security issues. NDIA and its members foster the development of the most innovative and superior equipment, training, and support for warfighters and first responders through its divisions, local chapters, affiliated associations and events. For more information, visit www.ndia.org<http://www.ndia.org>
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