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3 Feb 03. President George W. Bush today released details of his
fiscal year (FY) 2004 Department of Defense (DoD) budget. The
budget requests $379.9bn in discretionary budget authority
— $15.3bn above FY 2003.

The FY 2004 DoD budget is the first to reflect fully the Bush Administration’s new defense strategy, which calls for a focus on the capabilities needed to counter 21st century threats such as terrorism – rather than on specific regional dangers or requirements.

The central theme of the new budget is “Meeting today’s threats while preparing for tomorrow’s challenges.” The budget establishes a balance between near-term and longer-term demands – in FY 2004 as well as over the 6 years covered by the FY 2004-2009 Future Years Defense Program (FYDP). The budget funds strong support for:

– Winning the global war on terrorism

– Sustaining high quality people and forces

– Transforming the U.S. military and defense establishment

The DoD prepared its FY 2004 budget using a new combined program/budget review process – with greater transparency and substantial interaction between the military services and the Office of the Secretary of Defense. The Department increased support for programs to transform the capabilities available to
U.S. forces – while sustaining robust funding for near-term force readiness and the capabilities needed now in the war on terrorism.

The budget reflects Secretary Rumsfeld’s insistence on realistic funding for all DoD programs. By making tough, strategy-driven decisions, the Department has established a program that can be executed with the funding projected in the
President’s budget.

Global War on Terrorism

In his FY 2003 budget, President Bush requested $10.1bn for the Department’s baseline funding including $8.2bn for acquisition and other requirements resulting from the Department’s experience in the global war on terrorism, $1.2bn for increased air patrols in the continental United States, and $0.7bnfor implementation of the Nuclear Posture Review. Congress appropriated only $7bnof the $10.1bn requested. Congress did not appropriate the additional $10bn the President requested as a contingency for FY 2003 incremental operations costs related to the global war on terrorism.

In the FY 2004 budget, the Department continues to acquire capabilities critical to the war on terrorism. FY 2004 initiatives for force protection and combating terrorism include intrusion detection systems, blast mitigation measures, chemical and biological detection equipment, personal protection gear, waterside security enhancements, harbour patrol boats, regional command systems, mass notification systems, and initiatives to restrict access to DoD installations.

Force Readiness

The new budget sustains the robust Operation and Maintenance (O&M) funding of last year – so that U.S. forces are fully prepared for intensely waging the war on terrorism and meeting other commitments. FY 2004 O&M discretionary budget authority is $117bn, in real terms about 1 percent above
FY 2003.


Transformation is the process whereby DoD is overhauling the U.S. military and defense establishment to enable it to counter 21st century threats most effectively. Transformation is about new ways of thinking, fighting, and organizing the Department and its operations – as well as about acquiring new system capabilities. To increase military effectiveness, the Department is strengthening joint warfighting by advancing new operational concepts, command and organizational changes, and expanded joint experimentation and training.

The FY 2004 budget reflects ongoing major changes to the
Department’s Combatant Commands – aimed at strengthening
warfighting preparation and execution. Improvements include:

– Establishing of Northern Command to consolidate homeland defense missions

– Creating a strategic plan for transforming DoD training to
meet combatant commander requirement

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