A wide-ranging debate is taking place over future levels of federal spending, including defense spending, in the context of the deficit-reduction process established by the Budget Control Act of 2011 (S. 365/P.L. 112-25 of 2 August 2011). However it is resolved, it is clear that defense spending will be reduced from levels projected in the Fiscal Year 2012 budget submission.
Even though DOD spending rose considerably in real terms over the past decade, there was not a commensurate increase in procurement rates for ships and other equipment for the Navy. Consequently, in terms of force modernization in a period of declining resources, the Navy will not be able to “live off the fat of the land,” as it and the other services did during the 1990s downturn.