Inflation is harming Navy readiness and unpredictable funding from extending a delayed defense spending bill will thwart deterrence against near peer competitors like China, according to Chief of Naval Operations Adm. Mike Gilday.
“The price of Fleet readiness is going up,” Gilday said in his written testimony the House Appropriations Committee on Jan. 12. “Manpower, operations, and maintenance costs — which make up almost 60 percent of our budget — continue to grow above the rate of inflation. Making matters worse, inflation rose and remains at 6-8 percent, well above the historical average. This will likely exacerbate all of our readiness costs.”
Gilday’s comments coincide with the U.S. Bureau of Labor Statistics reporting on Jan. 12 that inflation had reached the highest 12-month increase since June 1982.
Additionally, Gilday said the Navy’s funding levels have remained “flat relative to inflation for over a decade,” and noted Congress stalling on passing spending bills also poses challenges to operational readiness, delays military construction projects and upends acquisition schedules, among other things.
Although both chambers of Congress passed the National Defense Authorization Bill and the White House signed it in December, funding can’t kick in until the defense appropriations bill is passed. As a result, the Defense Department is funded under a continuing resolution at least until Feb. 18, 2022, which means the Navy is operating under FY21′s funding levels.
That’s problematic, Gilday said, since the funding levels for FY22 are significantly higher and unpredictable levels of funding wastes manpower and taxpayer money. Under the FY22 NDAA, the Pentagon would receive an additional $25 billion in funding in comparison to the previous year.
Gilday also voiced concern over the possibility of a year-long continuing resolution, or CR, in the event lawmakers can’t reach a long-term agreement in February. Operating past February — up to a full year — under a CR would jeopardize national security, make sailors’ missions more challenging, signal doubt to allies and partners, and would waste taxpayer dollars, he said.
Gilday summed up his request to lawmakers by urging them to avoid a full-year CR and enact FY22 funding.
“As our competitors aggressively modernize their forces, a full-year CR cedes ground we cannot afford to yield,” Gilday wrote. “CRs further erode our deterrence posture against China.”
“The competition is on, and it is heating up,” Gilday wrote. “If the CR continues past February, or worse, remains in effect through the end of the fiscal year, we inject unnecessary risk to our national security and concede advantages to our adversaries; we make our sailors’ mission even more difficult; we signal doubt to allies and partners; and we waste American taxpayer dollars. All of which can be prevented.”
Other Navy leaders have also recently raised concerns about the continuing resolution and the budget. Adm. Daryl Caudle, commander of U.S. Fleet Forces Command, said at the annual Surface Navy Association conference Jan. 12 that the Navy does not have the “luxury to do more with less” and called for more ships, no CR, and a bigger budget.
Meanwhile, lawmakers want the Navy to better outline what it needs to be most effective. For example, Rep. Elaine Luria, D-Va., pointed out at the Surface Navy Association conference on Jan. 12 that the Navy only requested one new guided-missile destroyer in the FY22 budget.
“We all know in this room that the only ship that we’re building on time, on budget and on schedule right now are DDGs,” said Luria, a former Naval officer and graduate from the U.S. Naval Academy. “And why would we only request to build one?”
Ultimately, the NDAA legislation Congress passed and that was approved by the White House for FY22 includes funding for three new Arleigh Burke-class destroyers.
“The number one thing I want to do is to be able to provide more resources to the Navy,” Luria said. “But when the Navy comes before Congress, there really isn’t a push to say, ‘This is the Navy needs, this is what the nation needs.’”