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Rapid Growth in U.S. Military Personnel Costs Driven by Pay and Benefit Increases

Mounting fiscal challenges have forced policymakers to confront difficult budgetary choices. One of the most important concerns is spending on our national security: whether to cut the defense budget and, if so, by how much. In fiscal years (FYs) 2013 and 2014, sequestration and other budget cuts have reduced defense spending by $166 billion relative to what was projected in 2011; in FY 2015, the U.S. defense base budget will be $521 billion, compared to $530 billion in 2012.1 Some argue that we can afford to cut more still, while others contend that we have already gone too far. But this is not the right debate.

A single number—the “top line,” or total defense budget—tells us nothing about what should be the fundamental question when it comes to national security: Is our military adequately staffed, trained, and equipped to protect us from the threats that our nation does and might face? An informed debate about the appropriate level of defense spending, therefore, requires both an understanding of strategy (what are the threats and how can they be addressed?) as well as budgeting (what are our defense dollars spent on?).

This paper, which is intended to provide factual analysis on part of the latter question, is based on joint analytical work by the Bipartisan Policy Center and the American Enterprise Institute. It examines how spending on military personnel—a particular, but particularly important, part of the defense budget—has changed over time.

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