What’s in Biden’s $850-billion defense budget proposal?

The Pentagon is seen from the air in Washington, U.S., on March 3, 2022.
The Pentagon is seen from the air in Washington, U.S., on March 3, 2022. REUTERS/Joshua Roberts/File Photo.

President Joe Biden submitted his fiscal year (FY) 2025 budget proposal on March 11, including a request for $850 billion in discretionary budget authority for the Department of Defense. The new request represents a 4.1 percent increase from the FY 2023 enacted level—or a $34 billion increase. Once inflation is taken into account, however, that projected two-year growth totaling 4.1 percent turns into negative growth, given that aggregate inflation over the last two years totaled about 7 percent.

The Biden administration did not have much choice in the matter since Biden’s deal with then-House Speaker Kevin McCarthy in spring 2023 capped defense spending for FY 2025 at the requested level. The FY 2025 total grows to $895 billion if the National Nuclear Security Administration’s nuclear weapons activities (and a few other, smaller things) are also included; indeed, formally speaking, the “National Defense Budget” of the United States (called the 050 budget function by the Office of Management and Budget) includes those funds as well.

By any measure—but particularly in this election year and in this era of competing budget priorities—that is an enormous amount of money that will surely raise many eyebrows. The sum prompts questions about how it compares internationally and historically. And most importantly, it begs an exploration of its purpose. What is the money for? Why does the military cost this much? Why is it of its current size? And what is it intended to do?

What is the money for?

One way to understand the U.S. national defense budget is to break it down by broad function, or in the language of budgeteers, by “appropriations title.” In rough numbers, this approach shows that the United States is proposing to allocate, in FY 2025, approximately:

  • $182 billion a year on military personnel (for active, reservist, and retired personnel but not including costs associated with the Department of Veterans Affairs).
  • $338 billion a year on operations and maintenance.
  • $168 billion a year on the procurement of weaponry and other equipment.
  • $143 billion a year in Research, Development, Test, and Evaluation (RDT&E) funding.

Personnel funds pay for an all-volunteer force that the nation has rightly decided should be well compensated, at a time when recruiting woes make any consideration of economization almost unthinkable. Operations and maintenance accounts include salaries and benefits for the 795,000 civilians who work full-time for the Department of Defense, and also pay for equipment upkeep, training, fuel, many spare parts, and more mundane aspects of running perhaps the second-largest organization on Earth. Procurement funds purchase the cutting-edge equipment that, along with our people, gives America’s military its fighting edge. Finally, RDT&E pays not only for basic science and laboratory work, and initial design and development, but also for prototyping and testing advanced equipment. None of these categories of military expenditure is easily reduced; each is critical to what makes the American military successful and strong.

U.S. versus global military spending

Shifting focus to an international perspective, in 2023, the United States spent a towering $905.5 billion on defense, more than twice what the rest of NATO spends ($397.7 billion). Meanwhile, U.S. rivals and adversaries collectively spent an estimated $301.6 billion, with China accounting for approximately $219.5 billion and Russia for $74.8 billion. In fact, U.S. defense spending accounted for over 40 percent of the global total for military expenditures. These figures underscore the immense scale of U.S. defense spending relative to that of other nations and are often cited by those who advocate for a smaller defense budget.

However, one should be wary of comparisons that rely solely on these metrics for three reasons.

  1. Some of these figures, particularly those of our rivals and adversaries, are uncertain and cannot be robustly backed by data.
  2. The seemingly straightforward comparison gets more nuanced when considering defense spending as a percentage of each country’s GDP. In 2023, the United States spent 3.4 percent of its GDP on defense. In comparison, Russia spent approximately 4.01 percent. Notably, NATO’s defense investment guideline sets the expectation that allies must spend at least 2 percent of their GDP on defense. Granted, many NATO allies fall short of this burden-sharing expectation—a reality that has incited former President Donald Trump’s wrath—with only 18 out of 32 allies expected to meet this requirement in 2024. Comparatively speaking, however, 3.36 percent is not dramatically higher than the guideline set by NATO.
  3. Dollars do not win wars; people, weapons, tactics, and strategies do. History is littered with examples of countries with larger military budgets losing wars (including the United States itself in Vietnam and Afghanistan).

When comparing Biden’s defense budget request on historical terms, the verdict on whether or not we are spending enough on defense also depends on how you look at it. On the one hand, this sum—in absolute dollar terms, adjusted for inflation—is still substantially greater than the Cold War average and indeed more than peak spending in that period. On the other hand, it is not as high a percentage of GDP as during the Cold War years; from 1950 to 1990, U.S. defense spending varied between roughly 4.5 percent and 10 percent of GDP.

The military’s size and objectives

Comparisons aside, what is the size of today’s military, and what are its designated objectives? Today’s U.S. military is comprised of 1.3 million active-duty troops and 800,000 reservists, backed up by about 750,000 civilian employees of the Department of Defense, along with an additional 2 million to 3 million contractor personnel engaged in the construction, maintenance, and logistical support of weaponry and infrastructure. According to official doctrine, the military is intended to have the following key capabilities:

  • Fight, together with at least some allies, and defeat China or Russia (but not both at the same time), presumably in conflicts centered on the Western Pacific region and Eastern European region, respectively.
  • Defend the American homeland while also maintaining a nuclear deterrent.
  • Deter North Korea and Iran.
  • Maintain momentum against transnational violent extremist organizations as part of the so-called “war on terror.”

In as crisp an explanation as one can find, former chief of staff of the U.S. Air Force, General David Goldfein, offered the following insights about what the Air Force, and by extension the entire U.S. military, needs to be able to successfully execute the five missions of the Trump administration’s National Defense Strategy (released in early 2018 by Secretary of Defense Jim Mattis—and something the Biden administration under Secretary Lloyd Austin changed only slightly in its own 2022 strategy):

“We’re told that we have to simultaneously, first, be able to defend the homeland. And as we are defending the homeland, we must ensure that we have a safe, secure, effective nuclear deterrent, and on our worst day as a nation, get the president where he needs to be when he needs to be there and stay connected to his leadership team and forces in the field to execute the nuclear deterrent. While we are doing that, we are expected to defeat a peer threat and ensure that while we are in a fight to defeat a peer in a return to great power competition that we’re also able to deter a rogue nation that might choose to take us on because they see that we’re anchored. And so we have to do those four things simultaneously while we do the fifth, which is to maintain momentum against violent extremism as a global campaign.”

This list does not even include other responsibilities either subsumed within the capabilities of any force that could do the above or, in some instances, that place additional burdens on the American armed forces. These may include disaster relief, joint exercises with allies around the world, and modest activities in Africa, Latin America, and South/Southeast Asia. It also does not explicitly include another crucial imperative: to innovate constantly and modernize the joint-service force.

This force-sizing framework amounts to a one-war (or “one enemy”) combat capability. To be sure, this scenario anticipates a major war against a capable enemy, and, as Goldfein alluded to, we are expected to be able to deter other threats while fighting this single war—but we are not prepared to fight simultaneous wars should deterrence fail. This one-war framework might further increase this risk by tempting other adversaries to take advantage of the opportunity and use military force in one region while U.S. forces are engaged elsewhere.

To put this reality into perspective, once the Berlin Wall fell in 1989, U.S. forces had for 25 years been organized around a two-war framework. However, those two overlapping wars were imagined to be against much less capable foes: the likes of Iraq, Iran, North Korea, or perhaps Syria or another relatively small state in a key strategic region like the Middle East. In fact, the United States was engaged in two overlapping wars for many years in Iraq and Afghanistan—though they differed from the typical scenarios envisioned in these force-sizing paradigms, since they were long and modest in scale, rather than short and big (like Operation Desert Storm in 1991). And even then, it turned out that the United States was not able to undertake both missions at the full required tempo simultaneously.

By way of further historical backdrop, during the Cold War, the United States generally aimed to be able to fight a major war alongside NATO allies against the Soviet bloc in Europe and at least one other simultaneous conflict (like the Korean or Vietnam wars) elsewhere. The U.S. military during the Cold War was generally at least 60 percent larger than it is today; in fact, it was more than twice as large during the Vietnam War. Today, being prepared to fight both China and Russia at the same time would likely require a military 25-50 percent larger than today’s (in rough numbers).

Linking force sizing and war planning

So, the Mattis/Austin framework is one way to understand the size, shape, structure, and global posture of America’s armed forces today. However, it’s worth taking a step back and evaluating whether factors like inertia, bureaucratic dynamics within the Pentagon, and America’s challenges in foreseeing strategic shifts influence our military capabilities. Indeed, the structure of U.S. military forces has changed little over the last 5 to 10 years, even as the last two administrations have dramatically changed the focus of American defense planning from regional contingencies to great-power deterrence. In fact, U.S. military force structure has actually not changed much since the 1990s.

Some advocates want the overall U.S. military, or at least its own services, to grow a substantial amount. But such ambitions are improbable. Although discussion continues around the idea of pursuing a 500-ship Navy with dozens of unmanned vessels, and although the Air Force still harbors hopes of a larger force structure itself—dating back to Goldfein’s “386-squadron Air Force” vision—those services, as well as the Army and Marine Corps, have not changed in size by more than about 5-7 percent over the last 10 years. The Navy has grown modestly, as has the still-tiny Space Force; the other services have declined modestly, and force posture remains generally unchanged.

The Navy continues to struggle to reach a 300-ship size given the inertia and long construction timelines involved in any such changes. The Air Force would have to grow almost 25 percent to reach Goldfein’s goal—and no one is really trying to make that happen now. The Army remains below authorized strength largely because of a problem with recruiting.

Overseas basing has changed somewhat. Since 2022, there are now roughly 20,000 more troops in Central and Eastern Europe and more small bases and contingency access in parts of the Western Pacific. There is also a somewhat smaller Middle East presence than 10 years ago (and much smaller than 20 years ago). But the United States continues to have nearly 100,000 uniformed personnel in East Asia, about the same number in Europe, and about half that number in the broader Middle East/Persian Gulf region. Most of these forces stationed abroad do not cost much more to maintain overseas than they would at home; salaries and equipment costs are about the same either way, and host nations often cover some local costs for the American armed forces.

So, in addition to Goldfein’s five tasks, a more diffuse and general goal of maintaining multi-purpose forces with a substantial presence in three key parts of the world guides American defense strategy and force planning as well. A preference for some secrecy also may limit the degree to which the Trump and Biden administrations link the size and characteristics of the U.S. military to specific contingencies and missions.

There is one more big reason why it is hard to see a direct link between force sizing and war planning. For both the Trump and Biden administrations, the force’s quality has been seen as a higher priority than its exact size. Rather than encourage a debate about whether America needs an even larger military, planners have wanted to focus on military lethality, survivability, sustainability, resilience, and adaptability in an era of rapid technological change. In other words, many would reasonably argue that it is not all about quantity or about which country spends more, but about quality and what we get for the money—about what capabilities would allow our forces to sustain military advantages for the most relevant military scenarios of importance to the nation.

So, when it’s all put together, yes, we have a one-war planning framework, and yes, that helps drive force planning and shaping. However, bureaucratic politics, concern about other possible missions, and a certain inertia also contribute to American defense decisions. At times, that makes the system inefficient and expensive. But it also tends to create a certain hedging or insurance against the unexpected and unforeseen. Perhaps that is not all bad. As Congress gets to work evaluating and modifying the president’s request for national defense funding for FY 2025, there is room for debate about many specifics, to be sure. Yet to us at least, the overall magnitude of the American national defense budget does not seem out of kilter when measured against the geopolitical realities it is meant to address.

  • Footnotes
    1. It is hard to compare with FY 2024 because, even though we are about halfway through the current fiscal year, the government continues to operate on a continuing resolution for this year—a continuation of the previous year’s budget—because Congress has not taken action on a proper budget.
    2. As measured in terms of total people, with the Chinese military probably larger.