20 Billion Stash

Excerps from 27-Jun-1997 13:10 EDT article
by John Diamond, Associated Press Writer

WASHINGTON (AP) -- The Pentagon denied a lawmaker's charge Friday that it had stashed away a $20 billion secret fund for future weapons purchases.

Rep. Norm Dicks, D-Wash., a senior member of the House Appropriations defense subcommittee, produced a summary sheet showing a Pentagon "modernization reserve" fund totaling $20 billion and set aside for use from 2000 to 2003.

"This account is highly unusual, unlike any other contained in prior budget submissions to Congress," said Dicks, who has served for 20 years on the defense spending panel. He said it "proves that the Pentagon was deceiving Congress about the availability of out-year funding in its budget."

Senior Pentagon officials, however, had briefed lawmakers and reporters about the modernization fund earlier this year when President Clinton sent his defense budget proposal to Capitol Hill. The fund was described in a separate chart detailing how anticipated savings from military base closings would be put toward new weapons.

"We didn't have any secret fund," said Susan Hansen, a Pentagon spokeswoman. "It's public knowledge. The money has now been passed to the services to include in their budget submissions."

Dicks said he was particularly incensed because senior defense officials had testified that they had no spare money in their long-term budgets to buy more B-2 bombers. Boeing Co., the largest private employer in Dicks' home state, is a major subcontractor on the B-2.

The House last week narrowly approved adding $331 million to the defense budget to keep the B-2 program alive. President Clinton wants to stop the program at 21 bombers that are already in service or in the final stages of construction. The additional money would keep open the option of buying up to nine more.

Pentagon officials argued strenuously against the proposal, saying that the $9 billion to $12 billion the bombers will cost - $27 billion if upkeep, repairs and operations are counted - would force deep cuts in other weapons programs.