By Stan Collender, NationalJournal.com
© National Journal Group Inc.
Tuesday, April 17, 2007

Many "Budget Battles" columns come into focus when I hear someone say or ask something seemingly unrelated to the federal budget. That's what happened this week: I heard a report on a local radio news station that the Pentagon had decided to extend the stay for troops in Iraq from 12 months to 15 months.

	It's impossible to read the federal budget tea leaves these days without honestly admitting that federal spending is going to rise in every category.
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That made me wonder how, without a draft, the Pentagon will get enough people to join the military in the years ahead. And that's when this column immediately came into focus. The answer is that the Pentagon will have to pay more to get the troops it already has to re-up and increase pay above current levels and improve conditions to attract new recruits.

The Pentagon is the last piece to fall into place. Last week's announcement means it is now clear that spending in every part of the federal budget will be increasing in the years ahead. The current level of revenues simply won't be enough to pay for what will need to be done or fulfill the promises that an ever-increasing number of voters will consider inviolable.

In other words, unless there is far more tolerance for higher deficits than has yet been the case, a significant tax increase is in the offing.

This is not a political statement and should not be taken as an indictment of either party. Republicans and Democrats will both want to boost spending in some areas and be powerless to stop increases in other areas.

But it's impossible to read the federal budget tea leaves these days without honestly admitting that federal spending is going to rise in every category to meet the country's needs and our expectations of how well the government should perform.

Start with the military. Last week's announcement of extended tours in Iraq is just the latest in a series of events that is likely to make it very difficult for the Pentagon to maintain the troop strength it says will be needed in the future. There are an extraordinary number of deterrents for new recruits: troops rapidly rotated back to Iraq and Afghanistan, revelations about improper equipment for the troops on the ground, National Guardsmen and reserves called up frequently, poor treatment of injured veterans and difficult living conditions for many military families. A new "Be All You Can Be" or "An Army of One" ad campaign won't be enough this time. Higher (perhaps much higher) pay, better benefits and modern equipment will all have to be part of the package.

Add to this the growing drumbeat within the Pentagon about the urgent need to replace equipment used in the past four years and it's easy to conclude that there will be no peace dividend when the current activities in Iraq and Afghanistan are over. Overall Pentagon spending may have to stay at current levels or rise higher than anyone is currently assuming.

The situation is similar on the domestic side of the budget. Almost any appropriator will tell you that revelations similar to those at Walter Reed Army Medical Center will be repeated in many other nonmilitary facilities and programs as the chickens from years of underfunding come home to roost.

Walter Reed wasn't even the earliest such disaster: Washington's preparation for and response to Hurricanes Katrina and Rita was the first time many people took notice of how inadequate federal funding could affect their lives. Other infrastructure disasters and failures are now widely expected and many domestic programs are not expected to keep up with growing needs at current funding levels. Overall pressure for increased spending in this area will be intense.

Interest on the national debt has been among the fastest growing parts of the federal budget for some time. Even if the deficit falls or is erased over the next few years, annual interest payments will increase as interest rates rise and much of the short-term debt has to be refinanced.

Finally, there simply is no dispute that Social Security, Medicare and Medicaid will grow substantially under current law. This growth alone could require a tax increase.

Technology could change this. For example, a different type of military that relies more on systems and less on troops on the ground might eventually make a difference in the Pentagon budget. A "damn the deficit, full speed ahead" attitude would also mean that there would be little concern in Washington and on Wall Street about federal spending and borrowing.

But now that all parts of the budget have reported in, it's hard to see how federal spending will do anything but rise consistently.

-- Stan Collender is a NationalJournal.com contributing editor and managing director at Qorvis Communications in Washington, D.C. A frequent speaker on the budget and the economy to audiences across the country, he is also author of "The Guide to the Federal Budget." His e-mail address is secollender@nationaljournal.com.

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