Infrastructure becomes more obsolete by the day. That means the cost of doing business in america rises. Other countries those at the gap and we become less competitive. Right now, it can take 15 years to study a single project. Nothing gets going. The cost of these studies keep going up and up. To top it off, this bill was bloated with earmarks, freeforall spirit it is the worst of all rose. Republicans turned the page. We are sitting hard deadlines and cost limits for cutting out the outdated projects. There are no earmarks. These things mean breaking down barriers to the worthy products worthy projects. This is progress. When you entrust republicans with majority in the house, we pledge to do some simple things. Important things. Focus on jobs. Change the culture to make government more accountable to you. This is a great example of how we are delivering on both accounts. With so much more to do, its an example of what we can accomplish when president obama and Senate Democrats work with us to address your priorities. Whatever it takes, were determined to bring home jobs for mac my coworkers. Thank you for listening. In honor of memorial day, let me take this moment to say god bless United States of america and all who have fallen in our name. For over 35 years, suzanne brings cspan brings Public Affairs events to you. Putting him in the room at congressional hearings, white house event, briefings and conferences and offering complete gavel to gavel coverage of the u. S. House, all as a Public Service of private industry. We are cspan. Created by the cable tv industry 35 years ago. Brought to you as a Public Service by your local cable or satellite provider. Watch as in hd, like us on facebook and follow us on twitter. The house passed a bill to fund defense programs in 2015. The estimated cost is nearly 600 billion. Next come a closer look at some of the measures in the bill. This is from todays washington federal. Host Todd Harrison is a senior fellow. Youre here to talk about the Defense Authorization bill. Remind us of difference between an authorization and an appropriation in legislative language. That is confusing about this. The house and senate have their own Armed Services committees. They produce a Defense Authorization act. That is a policy bill. It sets broad policy like changing dont ask the hotel. They can prohibit the military from retiring weapon systems or moving units or bases. It can close bases. It sets broad policy. This has an implication on defense spending. The authorization bill does not give the money to spend. That is the appropriations bill. That is a separate process that goes to the house and senate and different committees. That wont happen until the fall. Host this is an area that is a place of agreement on capitol hill. Guest if you sit in on the hearings, it is surprising. There is a lot more by predators and bipartisan agreement. The issues dont write down easily along partisan lines. You see a lot of cooperation. The Senate Authorization bill that passed this week, the vote was 25 to one in the committee. Host talk about how the bill is affecting these measures as it moved through congress. Guest the budget control act in 2011, that set at it caps on defense and nondefense spending. Those caps are still in effect until 2015 and beyond, up to 2021. That is going to limit defense spending this year. Previously they had wanted to spend 550 billion. The budget cap is going to limit the dod share to 406 billion. That is a much tighter constraint than they were expecting a few years ago. Both the house and senate dont like this constraint. They want to spend more. They recognize that they are stuck with this. They will not be able to alter the budget cap this year. Host what are the areas of spending under the budget cap . Guest the base Defense Budget, not including the wars, you have compensation, pay and benefits. Youve got operations and maintenance accounts. That funds the Peacetime Operations of our forces. Everything from buying fuel to paying for the maintenance of equipment in peacetime. Training operations. This is the back office for defense. Funding all of the administrative functions. The other big part of the budget is acquisition. That pays for research and development. Those are the big components. It does the big pots of money they are working with. The house and senate take the president s request. They like to tinker with that in make changes. Host we will go through what the pentagon has requested. We want our viewers to call in. We have a special line for members of the military in this segment. Lets start with what the pentagon is proposing. Guest first of all, what is notable is this the first time they proposed a budget that fit within the budget caps that are required by law. For 2015, they spent 496 billion. In order to make this fit, they retired a number of weapon systems that they dont think they need any more. The big highlight is the a10 aircraft. They will be retiring the entire fleet of them. Theyre proposing retiring them and meeting stiff resistance on the hill. They propose doing things at the navy ships. There are a number of changes like that. The army has made some changes in their core structure. Theyre taking some helicopters into the active component and taking helicopters and moving them into the guard and the reserve. There has been a lot of resistance on that. Dod has some other cost savings. They have another round of days closures. As the military gets smaller, it will be more like that. They will have another round of base closures to get rid of some of that excess inventory. Host this is the process we have heard before . Guest that would save money in the long run, getting rid of waste in the budget. They would have changes in military compensation. They would reduce the amount of pay raises. They would only get a one percent pay raise this year. Not a big change, but it adds up to quite a bit. They want to reduce the housing allowance. In addition to regular pay, you get a housing allowance. It is taxfree. It pays 100 of rental cost and what ever market they live in. They are scaling it back and instead of covering 100 , it would cover 95 . They want to change the military Health Care System. It would raise the premiums. It would raise copays into a single plan. Some dependents would be affect it. It is a broad package of changes in order to fit within the budget. Many of those as congress ok with . Guest very few. Both house and the senate have said no to these closures. Jobs in peoples districts. A do not want to go along with this in an Election Year. But the house in the senate have said no to retiring major Weapons Systems like these. They have said no. They do not want to let the air force retired them. These things cost money. They have also said no to the changes in the military Health Care System and increases in copays. They said no to that. Seem tothing that they be ok with is the pay raise. Both the house and senate are willing to let dod do the one percent pay raise instead of the 1. 8 . That happened last year as well. The dod got a lowerthanexpected payraise. Host we want to get into collars. Stacy is from maryland on the line for democrats. Good morning. Caller good morning. I want to make a quick comment. Is ridiculous to put a cap on pay and make them pay more for their health care. There are weapon systems that need to be shut down. There should be a cap on corporate profits. The corporate profits should be managed. Topsecret of these programs know we has visibility to . Guest what she is talking about is the defense acquisition regulations. That governs how they buy weapon systems. There has been quite a bit of emphasis in this administration on looking at the actual costs of contractors. That actually does get to the point she is talking about looking at corporate profits. Price you are paying for it and you can determine the profit. I think that is misguided. Dod should be focused on the price. That is what matters. Is the product worth the price . Is it a fair price in terms of what other people are paying . It is a Comparable Service or product. Compared to what you paid in the go out to you are i buy something, we buy a car what youre focused on is the price. You have no visibility what it cost that country to provide it. Its not really relevant to you, you just need to know am i willing to pay that . Is that a good price compared to the price other people are offering . Is it a good price compared to what ive paid in the past . So i think d. O. D. Is actually going down the rabbit hole here and trying to figure out the internal cost of companies. For people who want to know that, how much transparency is there . To looking into company profits, the d. O. D. Can actually force companies, if they want to contract with them, to reveal this kind of information. The problem with that is for companies that do mix business between government and commercial clients, its very difficult for them segregate out their cost. If you read the Financial Reports of any major companies, they go to great extremes to twist themselves and contort themselves to define what their costs are, how you portion those costs across different parts of the business, over the long run, especially up front capital costs that are, youre buying equipment or a facility that might last 10, 20, 30 years. Its very complicated for companies to calculate this. Its even more complicated when the government gets involved and man tate how they calculate these things. Host a veteran and democrat calling in. Good morning. Come good morning, how are you . Thank you for taking my call. Host go ahead, quest. Caller i know the d. O. D. Has priorities, and on this memorial day i would like to know why the president of the United States was able to have tim geitner bailout wall street and the banks and these corporations, yet he cant depth them to bailout the veterans and their families, which would be a lot less money than it took to bailout the banks and the corporations, you know. And the housing people, speculators. So why cant the department of defense bailout the veterans for the back log and take care of the veterans and their families . Because without the veterans and their families, you dont have a military. Guest the difference as youre explaining this between the d. O. D. Budget and the Veterans Affair budget as well. A lot of people miss this fact. The d. O. D. Budget does not include the cost of veterans spending, veterans benefit services. Thats in the department of Veterans Affairs budget. If you actually look at what the administration has done, in 2009, the v. A. Budget was about 96 billion a year. Now, today, in 2014, its over 150 billion a year. So theres been a huge increase in spending on Veterans Benefits and services. Thats not part of the Defense Budget or these Defense Budget caps or anything. A huge increase in veteran spending, a lot of people assume its because of veterans coming back from iraq and afghanistan with all the injuries theyve incurred there. Actually the growth in veteran spending is due more to the vietnam era of veterans. Many of those veterans now are reaching, you know, theyre part of the baby boomer generation. Theyre reaching retirement age, and you know, when you get older, your Health Care Costs go up. Thats a lot of what were seeing. The other thing thats happened benefits and services who qualifies and whats provided have expanded under the Obama Administration so more and more people are qualifying now. That has contributed to the back log, and seen patients and in processing claims for Veterans Benefits. You know, could they have done better in tackling just the mountain of work theyve got before them . Probably. But im not an expert on how they process all of these claims. But its not for lack of spending money. Host you talk about the Veterans Affair budget. Heres the department of Defense Budget, thats the dark blue here from the year 1948 through 2014. You can see defense spending. The orange part of this chart here is the supplemental war funding, and explain what that is and how that fits into the militarys budget. Sure, the wars in iraq and afghanistan have been funded a bit differently than previous wars. You see a spike for the korean wars in the early 1950s there. You see another bomb for the vietnam war, and then the next bump you see, was not for a war, but for the reagans arms buildup in the 1980s, then the drawdown at the end of the cold war. Wars in iraq and afghanistan were funded a bit differently because theyve been funded consistently through supplement supplement funding. Its not part of the regular Defense Budget, its submitted separately. It gets expedited procedures, considered emergency funding, its not subject to the budget caps that are in place right now. So as a budget analyst, thats convenient because it allows us to segregate that money and analyze it separately. Now, you see it drops off suddenly after 2014, thats because theres no future projection of what that war funding will be after 2014. Weve not even seen the request from the administration yet for what the 2015 war budget will be. I imagine it will probably be so. D 50 billion or now the light blue section you see on the chart, thats actually the budget caps that are in effect for the next several years. Thats what were talking about, if congress doesnt change the budget caps, it will be limited to the level you see there. Now, it doesnt look like a cut. If you look at it in that graph. But it is a cut relative to what d. O. D. Had been planning to spend. They had been planning to significantly increase funding over the coming years to pay for things like military compensation, which has been growing much faster than inflation, been growing about 4 a year, faster than inflation for the past decade. And pay for all these excess bases and facility that Congress Wont let him retire. To pay for all these legacy Weapons SystemsCongress Wont let them retire. Legacy Weapons Systems, you know, planes and ships and tanks, theyre kind of like an old car. As they get older they cost more and more to operate and maintain. Theres a lot of internal cost growth within d. O. D. That basically means if we want to maintain the same size military we have today, it will cost more and more year after year unless we do somethings to fundamentally reform it. Host a big picture question for you from twitter. Is military buildup in rich nations individually and as a group like nato, seen by poor nations as a threat directed against them . Guest thats a good question. Were not at a point right now where we are building up. Not only is the u. S. Reducing its defense spending and reducing the size of its military, our nato allies are doing that as well. And many of them are moved faster than we have. In the united kingdom, they moved rather quickly to down size their military. So, we are seeing that its not just a matter of the u. S. Having more constrained resources for defense. Many of our partners and allies around the world have similar constraints. Host lets go to jim waiting in massachusetts on our line for democrats. Jim, good morning. Caller hi, how are you . Do you hear me . Host yes. Caller you know, this is my point. I understand and i appreciate everything youre saying. Ive learned somethings from you, but it seems to me that youre speaking in an extremely mariah carey ro sense. And a lot speaking in an extremely macro sense. Where its about the waste in defense spending. A couple of months ago i saw a congresswoman on the floor, you know, presenting this stuff like paying ten times what a plastic elbow is worth, and meals overseas for soldiers that were paying for that they throw in the dumpster because they make them whether the soldiers going to eat them or not, because they get paid for it. So i wonder if you could address are of those things that really down low on the radar, and i think its really connected directly with pork fat spending and whatever, and government officials getting contracts for friends and so on and so forth. Anyway, sorry to be so long. Host well let Todd Harrison give you a response. Guest jim, i think you give a good example. Waste in the Defense Budget is not like fat around the slice of the meat that you can cut off neatly, it is marbled into the meat. Its not unique to d. O. D. , its any large bureaucracy, any Large Corporation really. There will be waste and inefficiency, but it is marbled down in the meat, its down at the very low level, a lot of it, so its very hard to get to. I think the only real solution is weve got to find a way to enable and empower middle and lower level managers to actually root out this waste. Thats a hard thing to do, i hope we can crack that nut one day. But in the meantime, weve got to keep every time you find an example of waste like that, you got to bring it to peoples attentions and try to get it fixed one by one, little by little. We can start to make some improvements. Todd harrison, youve been on the program before, but for those who arent familiar with your group, talk about it. Guest sure, were a nonpartisan, nonprofit defense think tank. Our goal is to help educate and inform issues about issues of Defense Strategy in the Defense Budget. So i lead the budget side, so i focus on how we resource for defense. Online. Org. Ba and well talk to paul in South Carolina on our line for independents. Paul, good morning. Caller good morning. Im a military retiree, 10 years in the marine corps, and 10 in the air f