Obama Threatens to Veto ‘Biggest Reform’ to Pentagon in Decades

National defense bill also provides resources to U.S. service members, allies to defeat adversaries abroad

October 6, 2015

President Obama’s threat to veto the national defense bill could leave vital benefits for troops in limbo and hamper some of the most substantial changes to the Department of Defense in decades, according to analysts.

The Senate is set to vote on the National Defense Authorization Act on Tuesday after it passed the House last week. The annual legislation, which authorizes several compensation and equipment programs for troops but is separate from the actual defense appropriations bill, has been signed into law every year for more than a half century and is rarely vetoed by presidents.

However, Obama has threatened to veto several versions of the act during his presidency, and appears to be linking the 2016 bill to the broader debate in Congress about funding the government. While the legislation authorizes $611.8 billion in defense funding—about the same as Obama’s own budget request—the president has criticized lawmakers for leaving spending caps in place on both defense and domestic appropriations. The national defense bill works around the caps known as sequestration by allocating $89.2 billion to the fund for combat operations overseas.

Justin Johnson, an expert on defense budgets at the Heritage Foundation, said it would be a serious misstep for the president to veto the national defense bill. Not only would benefits for troops be delayed, but a veto would also deprive the U.S. military of resources amid multiplying threats abroad, he said.

"It’s dangerous both in a national security sense and a political sense," he said. "The world is not in a good place right now to be vetoing a defense bill."

Josh Earnest, the White House press secretary, said last week that the national defense bill represents "an irresponsible way to fund our national defense priorities." He reiterated Obama’s veto threat on Monday.

This year’s national defense act includes several measures that directly affect compensation and benefits for troops.

A new retirement system, scheduled to start in 2018, would expand the number of troops who receive retirement benefits while reducing the amount of direct government contributions to military pensions. It allows service members to divert a portion of their pay into 401(k)-style accounts, which the government will provide with matching contributions, up to 5 percent, for a 26-year period. Currently, 83 percent of troops do not earn retirement benefits because they did not serve at least 20 years.

The national defense act also aims to expand access for troops and veterans to prescription drugs, childcare, military flights for families of service members, and treatment at urgent care facilities.

Additionally, the defense bill presses the Pentagon to reduce its bureaucracy by shrinking headquarters’ budgets and personnel by 20 percent and achieving $10 billion in cost savings by 2019.

Defense analysts have noted in recent years that while the Pentagon continues to add civilian workers, services such as the Army are cutting troops. Civilian employees and contractors for the Pentagon now outnumber the 1.36 million active duty personnel in the military.

"This [bill] is the biggest reform bill the Pentagon has seen in decades," Johnson said. "It moves the ball significantly on personnel and retirement reforms, acquisition reforms. So it’s really pretty significant change in a lot of ways that will be lost, or at least delayed at best, if the president vetoed this bill."

In terms of threats abroad, the national defense bill authorizes the Obama administration to provide $50 million in lethal aid to Ukrainian forces battling Russian-backed separatists, though the secretary of defense could waive that requirement. Lawmakers from both parties have assailed the president for not doing more to help Ukraine’s military in a war with Russia that has claimed more than 8,000 lives.

If Obama vetoes the national defense act, the bill could be sidelined for weeks while he negotiates a long-term budget deal with Congress that is also expected to address the spending caps. The act’s provisions would "all be in limbo," Johnson said.

Rep. Mac Thornberry (R., Texas), the chairman of the House Armed Services Committee, said in a statement last week that it would "unbelievable" for the president to veto the national defense bill.

"It is unbelievable to me that an American president would threaten to veto a defense bill that supports our troops and gives him additional tools to use against aggressors, especially at a time when the world situation is spiraling out of control from Eastern Europe to the Middle East and South Asia," he said. "This is a time to stand together for our nation’s security, rather than play cheap political games."