Another round of continuing resolutions — who loses?

The federal government’s fiscal year will end on Sept. 30, 2022. This is not a surprise. It ends on Sept. 30 every year. Despite this known turn of the fiscal calendar, it seems to catch our national and congressional leadership by surprise most years as the clock winds down and time runs out to complete annual appropriations bills, the only real must-pass legislation of the year.

As a stop gap, or bridge, or whatever we want to call it, failure to enact annual appropriations results in continuing resolutions (CRs), which extend current year funding and priorities into the next year. 

The federal government has operated under CRs in all but three of the last 46 years. The Department of Defense (DOD) has operated under CRs for 1,500 days since 2010. That is over four years of budget stagnation and uncertainty, requiring incremental, inefficient funding solutions and delays in starting new programs and innovative solutions to address our most pressing national security challenges.

For the fiscal year that begins on Oct. 1, a CR would mean $207 million per day in lost buying power. If the CR lasts until the end of November, $12.6 billion will be lost. These are big numbers. For context, $207 million buys 55 long-range anti-ship missiles; $12.6 billion buys two DDG-51 Arleigh Burke destroyers plus the department’s entire fiscal year 2023 planned investment in developing and fielding a mix of multi-service, multi-domain offensive long-range weapons.

Deputy Defense Secretary Kathleen Hicks said recently that the department must shrink the “’lab-to-fab’ timeline from decades to years, or even months” if it is to meet the “pacing challenge” posed by China.

What stops speed and innovation? Funding bills that incrementally extend last year’s priorities and money into the next year, increasing the technology “valley of death” where innovative technologies fail to make it through production and into warfighters hands and pushing small innovative companies out of the DOD orbit, and sometimes out of business altogether.

Today, the disruptive, dangerous and wasteful impacts of CRs are better known and understood by more people than at any time in the past, due in part to a House Appropriations Defense Subcommittee hearing held on Jan. 12, 2022.

At that hearing, Defense Department witnesses, led by DOD Comptroller Mike McCord and including the uniform leadership of each military service, made clear that CRs have immediate and long-term, operational and strategic effects. Air Force Chief of Staff Gen C.Q. Brown summed it up well: “All the money in the world cannot buy more time; time is irrecoverable, and when you are working to keep pace against well-resourced and focused competitors, time matters.”

The effects of continuing resolutions will be further magnified this year due to inflation, which is hitting the workforce and industry hard. A group of industrial associations reportedly met with McCord to discuss including anomalies or exceptions in the CR this fall to mitigate some of the negative impacts of inflation.

Though a well-meaning attempt to put a bandage on the problem, Congress almost never approves such exceptions, favoring instead a “clean” extension of funds to keep the pressure on reaching a budget agreement which would enable enactment of appropriations bills. Makes you wonder though, pressure on whom?

Those really hurt by CRs are those held hostage by them, not those who can fix the problem. If it were administration and congressional leadership jobs or finances at stake, CRs would disappear as a funding option. But those who experience negative impacts from CRs in the near term are the defense workforce, the communities where they operate and live and the companies and industry with whom they do business. In the long term, it is our national security and place as a global leader that suffer.

How do we get real action to solve this problem? If our leaders can’t get their fundamental job done, enacting annual appropriations on time, maybe they shouldn’t get paid. Or they should take a pay cut that is somehow mathematically relevant to the taxpayer money and competitiveness lost by the use of CRs.

Once they get their job done, they would again get paid. Such an idea sounded a bit crazy in the past. But nothing else has worked so far to motivate our leadership to come together on budget agreements in time to support our military competitiveness and national defense.

So, now it seems like a viable option to put the pain of CRs where it can do some good. Otherwise, we might as well accept defeat and submit to this avoidable self-inflicted wound and shoot the hostage, again.

Elaine McCusker is a senior fellow at the American Enterprise Institute. She previously served as acting undersecretary of defense (comptroller) at the US Department of Defense.