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Can the Army Go Broke?What happens when a war spending bill gets vetoed.

By Michelle Tsai
Updated Tuesday, May 1, 2007, at 6:49 PM ET

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George Bush. Click image to expand.

On Tuesday, President Bush vetoed a $124.2 billion war spending bill that stipulates a timeline for withdrawing troops from Iraq. Lawmakers may revise the legislation, but in the meantime, could the armed forces run out of money?

Yes, but it's very unlikely. Even if a standoff between Congress and the president kept the war spending bill on ice for a few months, the Department of Defense would be able to cover its expenses in Iraq. That's because most of the DoD's money comes from the annual defense appropriations act, which Congress OK'd in September. The $437 billion bill allocates funding for day-to-day military operations—pretty much everything besides Iraq, Afghanistan, and the war on terror. But it also grants the DoD some flexibility to shift funds between programs.

The government currently pays for war-related costs like extra fuel out of $70 billion in emergency funds, which were part of the September package. If necessary, the DoD can move $7.5 billion of the total operations budget to more urgent needs, like forces in Iraq. This is enough to fund operations and maintenance in the Army through most of July, according to the Congressional Research Service, the research arm of the U.S. Congress. Delaying facility repairs and equipment overhaul and restricting travel are other moves that can trim costs without sacrificing troop readiness. In addition, the military has circumvented its cash-flow problems in the past by tapping money that's budgeted for spending later in the year and then paying back those programs when the funds finally come through. If the military finds itself in dire straits, it may consider calling on the Feed and Forage Act to help pay for clothing, medicine, and other supplies.

The White House, however, believes that cutbacks are already hurting troop readiness. The DoD said in March that it will support the Marine Corps and the Army with money originally intended for replacing vehicles and modernizing tactical communications. General Peter Pace, chairman of the Joint Chiefs of Staff, has also talked about halting some training for Guard, Reserve, and unit soldiers. In 1994, for instance, the United States delayed training at home to help pay for missions in Somalia and Haiti. When last year's supplemental war spending bill didn't pass until mid-June, Army officials compensated by curtailing nonessential travel, limiting meetings and hiring, sending cargo overland instead of in planes, and stopping work on some contracts. Some family members of soldiers couldn't find jobs on military bases.

Chances are high that Congress and the White House will go to great lengths to avoid a stalemate that might leave soldiers without armor or otherwise weaken the war effort. The biggest budget showdown of recent years took place in the mid-1990s, when Bill Clinton had to shut down the federal government twice.

Got a question about today's news? Ask the Explainer.

Explainer thanks Steve Ellis of Taxpayers for Common Sense and Steve Kosiak of the Center for Strategic and Budgetary Assessments.

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Michelle Tsai is a writer living in Jersey City, N.J.
Photograph of President George W. Bush by Mannie Garcia/AFP/Getty Images. Photograph of soldier on the Slate home page by Joe Raedle/Getty Images.
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