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U.S. Secretary of Defense Jim Mattis. Photo: Brendan Smialowski / AFP / Getty Images

The Defense Department has had its spending disrupted by temporary spending bills for several years, and the continuing resolution lawmakers passed in late December leaves it stuck with the same problem. Now, about three months behind when Congress needed to pass a federal budget, it needs to determine how much funding the Pentagon will receive when the most recent CR expires this Friday.

Why it matters: Stopgap funding squeezes offices’ operations in the Pentagon across the board — it slows new acquisitions programs, it prevents new starts to programs, damages readiness, disrupts planned growth for programs, and disrupts implementing orders from the top of the DoD to change focus. But at this point Congress may be barreling towards another CR.

The impact:

  • A CR often prevents agencies from implementing or continuing a program that didn't have funding in the previous year. The DoD claims that 75 weapons programs have been delayed by the most recent CR's restrictions, according to the U.S. Naval Institute.
  • Even if updates to programs or contracts are already awarded, a CR forces the Pentagon to halt all progress on those fronts. The Pentagon's comptroller, David Norquist, said the effect of that waste is that the DoD is "delayed in meeting the requirements of the combatant commanders." Pentagon spokesman Christopher Sherwood told Axios: "The longer the CR, the more damaging it is."
  • The timing and pace of work is changed. CRs may put caps on expenditures for programs that tend to spend heavily in the first few months of the year, per the USNI. John Conger, a former Pentagon official in the Obama administration, says CRs force the Pentagon to compress the bulk of its work into three quarters of the year, leaving one quarter of each year in a lull.
  • CRs make bulk buys and multiyear contracts more difficult to execute. CRs also lead to repetitive contracting when new funding is issued, time and money that could be spent elsewhere more efficiently.
  • Contingency plans have to be updated more frequently under CRs, since the Pentagon has to constantly assess how it will operate in the event of a shutdown.
  • In recent years, the Pentagon has been planning ahead for stopgap funding, Conger said, which has made CRs a little less disruptive — but that doesn't mean there's no damage at all.

How CRs work: They freeze funding at the previous fiscal year’s spending level, which is linked to a broader spending deal lawmakers forged in 2011 that set budget caps and included defense spending cuts.

  • Just two times since then has Congress reached two-year budget deals that raised those spending caps.

Where things stand on Capitol Hill:

  • "There's no way that we won't need another CR coming into the week," Rep. Tom Cole, a defense hawk who serves on the House Appropriations defense subcommittee, told Axios. "Even if they reach an agreement then, it's still going to take time to actually write the final bills themselves and negotiate a final outcome."
  • Senate Majority Leader Mitch McConnell told reporters last week much of the same. He said that an agreement on spending might take a little more time beyond the Jan. 19 deadline to fund the government, indicating Congress may need to craft another CR this week.
  • Some defense hawks are threatening to vote no on a CR if they don’t get a longer-term deal over spending caps, per Politico — a threat that raises the risk of a government shutdown. Cole said he doesn't see what good would come from that, however. "You might as well just help the Democrats obtain the majority," he said.
  • But the goal of a two-year deal to prevent spending cuts for the Pentagon that some Republicans are pushing for in spending deals ahead is "imminently achievable" once Congress agrees on the spending levels for one year, Cole said.
  • Democrats don’t want to increase military spending without increasing spending on domestic programs by the same amount, complicating those negotiations.

Don't forget: The amount of wiggle room Republicans have for pushing military spending is slim. The tax code overhaul that passed last month is set to raise the deficit by $1.5 trillion over a decade, which has made some lawmakers concerned about government spending adding to that figure.

Go deeper

Austria approves COVID vaccine mandate for adults

A vaccination center installed at the Barbara Chapel of St Stephen's Cathedral in Vienna, Austria. Photo: Alex Halada/AFP via Getty Images

Austria's lower house of parliament voted on Thursday in favor of making COVID-19 vaccinations compulsory for most adults from next month.

Why it matters: The bill is expected to soon pass the upper house and be signed by President Alexander Van der Bellen in order for the law to take effect Feb. 1, per Reuters. It'd make Austria the first EU nation to impose such a sweeping mandate.

Hope King, author of Closer
Updated 3 hours ago - Economy & Business

Peloton pumps its brakes

Data: FactSet; Chart: Axios Visuals

Peloton’s popularity is falling as swiftly as it shot up.

Why it matters: Not all pandemic habits stick around. Peloton's trajectory over the past two years exemplifies how challenging it's been for companies to gauge shifts in consumer demand — particularly in sectors heavily altered by the pandemic.

Mitch McConnell's remarks on Black voters raise ire

Senate Minority Leader Mitch McConnell during a Capitol Hill news conference earlier this year. Photo: Anna Moneymaker/Getty Images

Senate Minority Leader Mitch McConnell (R-Ky.) has been widely criticized for comments he made this week about Black American voters.

Driving the news: When asked by a reporter Wednesday about concerns among voters of color, McConnell said "the concern is misplaced, because if you look at the statistics, Black American voters are voting in just as high a percentage as Americans."