Global Policy Forum

An extraordinary action by the chief of staff sends a message: The Pentagon must increase the budget or reduce commitments in Iraq and elsewhere.

By Peter Spiegel

The Army's top officer withheld a required 2008 budget plan from Pentagon leaders last month after protesting to Defense Secretary Donald H. Rumsfeld that the service could not maintain its current level of activity in Iraq plus its other global commitments without billions in additional funding.

The decision by Gen. Peter J. Schoomaker, the Army's chief of staff, is believed to be unprecedented and signals a widespread belief within the Army that in the absence of significant troop withdrawals from Iraq, funding assumptions must be completely reworked, say current and former Pentagon officials. "This is unusual, but hell, we're in unusual times," said a senior Pentagon official involved in the budget discussions.

Schoomaker failed to submit the budget plan by an Aug. 15 deadline. The protest followed a series of cuts in the service's funding requests by both the White House and Congress over the last four months.

According to a senior Army official involved in budget talks, Schoomaker is now seeking $138.8 billion in 2008, nearly $25 billion above budget limits originally set by Rumsfeld. The Army's budget this year is $98.2 billion, making Schoomaker's request a 41% increase over current levels. "It's incredibly huge," said the Army official, who, like others, spoke on condition of anonymity when commenting on internal deliberations. "These are just incredible numbers."

Most funding for the fighting in Iraq has come from annual emergency spending bills, with the regular defense budget going to normal personnel, procurement and operational expenses, such as salaries and new weapons systems. About $400 billion has been appropriated for the Iraq and Afghanistan wars through emergency funding measures since Sept. 11, 2001, with the money divided among military branches and government agencies.

But in recent budget negotiations, Army officials argued that the service's expanding global role in the U.S.-declared war on terrorism — outlined in strategic plans issued this year — as well as fast-growing personnel and equipment costs tied to the Iraq war, have put intense pressure on its normal budget.

"It's kind of like the old rancher saying: 'I'm going to size the herd to the amount of hay that I have,' " said Lt. Gen. Jerry L. Sinn, the Army's top budget official. "[Schoomaker] can't size the herd to the size of the amount of hay that he has because he's got to maintain the herd to meet the current operating environment."

The Army, with an active-duty force of 504,000, has been stretched by the Iraq and Afghanistan wars. About 400,000 have done at least one tour of combat duty, and more than a third of those have been deployed twice. Commanders have increasingly complained of the strain, saying last week that sustaining current levels will require more help from the National Guard and Reserve or an increase in the active-duty force.

Schoomaker first raised alarms with Marine Gen. Peter Pace, chairman of the Joint Chiefs of Staff, in June after he received new Army budget outlines from Rumsfeld's office. Those outlines called for an Army budget of about $114 billion, a $2-billion cut from previous guidelines. The cuts would grow to $7 billion a year after six years, the senior Army official said.

After Schoomaker confronted Rumsfeld with the Army's own estimates for maintaining the current size and commitments — and the steps that would have to be taken to meet the lower figure, which included cutting four combat brigades and an entire division headquarters unit — Rumsfeld agreed to set up a task force to investigate Army funding.

Although no formal notification is required, Army Secretary Francis J. Harvey, who has backed Schoomaker in his push for additional funding, wrote to Rumsfeld early last month to inform him that the Army would miss the Aug. 15 deadline for its budget plan. Harvey said the delay in submitting the plan, formally called a Program Objective Memorandum, was the result of the extended review by the task force.

The study group — which included three-star officers from the Army and Rumsfeld's office — has since agreed with the Army's initial assessment. Officials say negotiations have moved to higher levels of the Bush administration, involving top aides to Rumsfeld and White House Budget Director Rob Portman. "Now the discussion is: Where are we going to go? Do we lower our strategy or do we raise our resources?" said the senior Pentagon official. "That's where we're at."

Pressure on the Army budget has been growing since late May, when the House and Senate appropriations committees proposed defense spending for 2007 of $4 billion to $9 billion below the White House's original request. Funding was further complicated this summer, when rising sectarian violence in Baghdad forced the Pentagon to shelve plans to gradually reduce troops in Iraq. Because of those pressures, the Army in July announced it was freezing civilian hiring and new weapons contract awards and was scaling back on personnel travel restrictions, among other cost cuts.

Schoomaker has been vocal in recent months about a need to expand war funding legislation to pay for repair of hundreds of tanks and armored fighting vehicles after heavy use in Iraq. He has told congressional appropriators that he will need $17.1 billion next year for repairs, nearly double this year's appropriation — and more than quadruple the cost two years ago. According to an Army budget document obtained by The Times, Army officials are planning repair requests of $13 billion in 2008 and $13.5 billion in 2009.

In recent weeks, however, Schoomaker has become more publicly emphatic about budget shortfalls, saying funding is not enough to pay for Army commitments to the Iraq war and the global strategy outlined by the Pentagon. "There's no sense in us submitting a budget that we can't execute, a broken budget," Schoomaker said in a recent Washington address.

Military budget expert Steven M. Kosiak of the Center for Strategic and Budgetary Assessments, an independent Washington think tank, said that despite widespread recognition that the Army should be getting more resources because of war-related costs, its share of the Defense Department budget has been largely unchanged since the 2003 invasion.

However, a good portion of the new money the Army seeks is not directly tied to the war, Kosiak cautioned, but rather to new weapons it wants — particularly the $200-billion Future Combat System, a family of armored vehicles that is eventually to replace nearly every tank and transporter the Army has. "This isn't a problem one can totally pass off on current military operations," Kosiak said. "The FCS program is very ambitious — some would say overly ambitious."

Even with Rumsfeld's backing, any request for an increase could force a conflict with the White House Office of Management and Budget, which has repeatedly pushed the Pentagon to restrain its annual budget submission.

"Year after year there were attempts to raise the ceiling, but year after year OMB has refused," said a former Pentagon official familiar with the debate. "The difference this year is the Army has said that if a raise in the ceiling isn't going to be considered, they won't even play the game." Added the senior Army official: "If you're Rob Portman advising the president of the United States and duking it out with the [secretary of Defense], it's a pretty sporting little event."

Army officials said that Schoomaker's failure to file his 2008 Program Objective Memorandum was not intended as a rebuke to Rumsfeld, and that the Defense secretary had backed Schoomaker since the chief of staff raised the issue with him directly.

Still, some Army officials said Schoomaker expressed concern about recent White House budget moves, such as the decision in May to use $1.9 billion out of the most recent emergency spending bill for border security, including deployment of 6,000 National Guard troops at the Mexican border. Army officials said $1.2 billion of that money came out of funds originally intended for Army war expenses.

"The president has got to take care of his border mission; he needs to find a source of funds so he can play a zero-sum game — he takes it out of defense," the senior Army official said. "But when he takes it out of defense, the lion's share is coming out of the outfit that's really in extremis in the current operating environment in the war."

Rumsfeld has not set a new deadline for the Army to submit its budget plan. The Army official said staffers thought they could submit a revised plan by November, in time for President Bush to unveil his 2008 budget early next year.