Trends in Government Contracting

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Forecasted Future Conflicts

President Trump's Final Budget Proposal Fiscal 2021: Defense Contractors will Benefit

by Carol Ingley
president, ingleyPRICE-TO-WIN
Week of February 24, 2020 through Week of March 30, 2020

Digital Trends: U.S. government trends


Proposed Budget Fiscal 2021. No one knows who will win the U.S. presidency in 2020. Despite that uncertainty, the machinery of the U.S. government moves forward with President Trump’s Final Budget Proposal for Fiscal 2021 released on February 10, 2020.


According to the article “Trump to Propose $4.8 Trillion Budget With More Border Wall Funding" in the New York Times, “President Trump has proposed a record $4.8 trillion budget for the 2021 fiscal year, and while Congress decides what to fund, the document provides a window into the White House’s spending priorities.”


This fiscal 2021 proposed budget, therefore, represents the mission, values and programs of the current presidency as well as the realistic limitations of available funding for the budget.


Quick Proposed Budget Summary.  In a nutshell, the proposed fiscal 2021 budget of $4.8 trillion increases resources for the military in certain areas as well as increased funding for the policing of the U.S./Mexico border while cutting deeply into certain domestic programs.


The budget uses a 2.8 percent growth rate for the U.S. economy for this year. Growth for the economy will increase to more than 3.0 percent over the next few years if the programs and policies of the proposed budget are implemented.


Resources for the Military. The Pentagon portion of the proposed budget totals $705.4 billion. This is a decrease of 1% (from $713 billion) from a year before. This is a budget that is heavy on its request for investment in updating the nation's nuclear arsenal and providing a substantial boost to research and development, while retiring a number of older Air Force planes. R&D for the military is key, with proposed spending of $107 billion on research and development in hypersonics and other future weapons. These resource allocations are tied to a shift in the type of conflicts the U.S. will likely face in the future.


Conflicts of the Future. The types of future wars the U.S. will face are forecasted to be very different from the counter-terrorism focus of conflicts the U.S. has been involved in since the collapse of the Soviet Union.


These potential future conflicts are also seen not just to be on land, sea and in the air but also in space.  (The budget proposes $111 million to fund essential personnel growth for the Pentagon’s Space Force).


Cutting Domestic Programs.  According to the New York Times, “the president’s plan includes about $2 trillion in cuts to safety net programs and student loan initiatives.”


On the chopping block: eliminating subsidized federal student loans and ending the public service loan forgiveness program. It should be noted that these proposals were also in last year’s budget and were not adopted by Congress.


Other deep cuts include funding for the Environmental Protection Agency, facing a 26 percent reduction in funding and the elimination of 50 programs. There are also proposed cuts for the U.S.’s  primary food assistance programs.


Changes Ahead. This proposed budget clearly shows the mission, values and commitments of the current administration. It is not, however, a finalized document and many changes may be made in the ensuing months.


Trends in Government Contracting by iPTW
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