A New Budgeting Approach for the Defense Department

The U.S. military continues to cut troop levels at an alarming rate while allowing bloated levels of Pentagon leadership and their staffs to go virtually untouched. This trend is a stark reminder that the decline in our defense readiness is not only due to decreased funding. Indeed, the defense spending problem has more to do with the budget system, which actually rewards spending, rather than with a lack of financial resources. With one of the largest accounts in government, the Department of Defense (DOD) could be the first place to test a sensible process reform called zero-based budgeting

Zero-based budgeting is an alternative budgeting system proven to decrease expenditures and improve efficiency within private sector companies and public institutions. The process requires organizations to conduct an internal review of all expenditures each year and obligates each department to justify its proposed spending. This budget strategy does not allow costs to simply carryover from one fiscal cycle to the next without examination. Instead, zero-based budgeting helps identify wasteful spending, whether redundant programs or obsolete positions, and helps purge unnecessary expenses.

The traditional government budgeting system is simply not working. Zero-based budgeting could specifically help refocus defense priorities by ensuring money is spent in areas that promote readiness. And successful implementation in the bloated military and civilian sectors would encourage Congress to take similar steps in other areas of government.

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