(Bloomberg) -- The Defense Department has “dedicated an ever-smaller share” of dollars for research and development contracts over almost two decades, according to the Congressional Research Service.
R&D contracts issued by the Pentagon and the military services dropped to 8 percent of defense contract obligations last year from 15 percent in fiscal 2000 -- a period that tracks a shift to spending on weapons and other goods and contractor services that began with the war on terrorism and the 2003 invasion of Iraq, according to data cited by the nonpartisan agency in a report issued last week.
The statistics buttress the arguments of Pentagon leaders such as Michael Griffin, the new undersecretary for research and engineering, that the U.S. is rapidly losing its technological edge to competitors such as China. The Pentagon’s fiscal 2019 budget requested $91.1 billion for research and development, including the military services -- a 3.2 percent increase from the $88.3 billion Congress appropriated for this year.
The Senate Appropriations Committee reflected those concerns in its version of the defense spending bill, adding $4 billion by shifting funds to bring R&D funding to $95.1 billion.
Among the added items in the bill, which awaits Senate passage: $929 million for hypersonic weapons and defensive measures, including research and prototyping; $317 million for directed-energy laser offensive and defensive research; and $308 million to accelerate artificial intelligence systems that can be rapidly adapted to warfighting needs.
The House Appropriations Committee’s version (H.R. 6157), which passed the House on June 28, would increase the research request more modestly, to $91.2 billion.
Of the $320 billion the Pentagon obligated last year, 51 percent went for goods -- including weapons systems -- 41 percent for contractor services and only 8 percent for research and development, according to Federal Procurement Data System numbers analyzed by the CRS.
Underscoring the military’s role in the economy, Defense Department contract obligations last year accounted for 63 percent of the $507 billion in federal contracting dollars. That’s in contrast to 5 percent each for the Department of Health and Human Services and the Department of Veterans Affairs and 2 percent for the General Services Administration, according to the CRS.
Pentagon contracting “was marked by a steep” 138 percent increase in contract obligations of all types from fiscal 2000 through fiscal 2008 -- after the 9/11 attacks, invasions of Afghanistan and Iraq and 2007 troop surge in Iraq --followed by a 29 percent drop from 2008 to last year, according to the report.
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