A Battle for Military Bucks

For the first time since 9/11, the U.S. military is feeling a different sort of pressure at home: a money crunch. Despite ongoing wars in Iraq and Afghanistan, Congress has been slow to approve defense funds, even for the Army and Marines, which have borne the brunt of the fighting. That has left the Pentagon with a huge deficit--even though a 40% hike in its budget since 9/11 has swelled its yearly funding to nearly half a trillion dollars.

The crunch's cost is evident at installations like the Red River Army Depot in Texas, where hundreds of humvees sit in disrepair, and Fort Sam Houston, which is three months behind in its electric bills. The Army says it needs $17 billion to fix equipment worn down after five years of fighting.

Critics say the Army could save money by ditching expensive projects like the high-tech $160 billion Future Combat Systems, a battlefield command-and-control program. The Army and Marines are making cuts but are also set to fight for more funds. Defense officials say the two services are considering openly defying the Pentagon's civilian leadership, which has pushed for slower spending, by submitting budgets that break preapproved ceilings.

Army Chief of Staff Peter Schoomaker, who came out of retirement in 2003 to run the service, told a congressional committee last month that defense spending during World War II neared 40% of GDP; it is now 3.8% and shrinking. He is frustrated, says a retired general who is a friend of Schoomaker's. Frustrated enough to quit if funding isn't boosted? Says his friend: "Absolutely."