CBO Defense Option #2

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Another Congressional Budget Office way to trim defense spending is to slow the rate of growth in troops’ pay. That’s going to be a tough sell, especially during wartime. For a decade, Congress has boosted the Pentagon’s annual recommendation that military pay raises match the employment cost index by adding 0.5% to each year’s ECI. This recommendation would reverse those congressional add-ons over the next four years by giving troops raises equal to the ECI minus 0.5%. The savings would be close to $6 billion, in both outlays and budget authority (because in payroll accounts, which spend out rapidly, there is little difference between the two).