The National Defense budget, business and finance homework help

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1) Identify and describe the three sub-categories of the national defense budget and how they relate to the acquisition process.

2) Discuss the difference between un-obligated and un-expended funds and describe their role in the defense budget process.

STUDENT 1: Michael

Hello Class,

The National Defense budget consists of three categories along with sub categories for each of the three. The three sub categories are the manpower, readiness and modernization. Manpower consists of the actual personnel that are in the uniformed services or are civilians in the Department of Defense. This budget goes towards basic pays allowances, special pay, health care, retirement pays, travel, and other pays that affect the defense force. This budget also pays for basic housing allowance for soldiers and for permanent change of station moves for DOD as well. Other than the basic pay for soldiers, the military’s health care program costs the second most compared to all other parts of manpower. The military also has a program that is called Tricare for life that grants retired soldier’s health care at a low premium for life. Retirement payment take a huge part of the defense budget as the military has changed it retirement plan that will be implemented in 2018 that will save the DOD about 1.8 billion a year.

The next sub category is readiness in the force. This is the costs that are associated with readiness is keeping the force trained and up to date with specific tasks. This also takes a part in general maintenance, facilities maintenance, and equipment maintenance. The final sub category is modernization. These costs are for development of equipment, weapons, communications, and technology that stays at the cutting edge of progress.

Un-obligated funds are funds that have been approved by congress for specific programs but has not yet been paid. Unexpended funds can be un-obligated funds or obligated funds but has not yet been paid out. Both unexpended funds and unobligated funds can help congress manage funds for programs that might have problems with appropriated funds and spending. This can help lower the needed budget in certain areas of programs if the spending is lacking.

Tyszkiewicz, M. & Daggett, S. (1998) A Defense Budget Primer, CRS Report for Congress

STUDENT 2: Terri

The National Defense Budget, commonly referred to as the defense budget is readily identified as the budget that falls under the Department of Defense (Tyszkiewicz & Daggett, 1998). The National Defense Budget it’s a category all its own. It is further divided into three subcategories: Department of Defense, Atomic Energy Defense Activities, and Defense-Related Activities.

Under the National Defense Budget, the Department of Defense (DoD) only manages military programs. Civilian programs are funded elsewhere. The DoD budget functions to fund the acquisitions and procumbent of products that support the National Security Strategy and the U.S. Armed Forces. This includes, but not limited to, weapon systems and contracted services. TheAtomic Energy Defense Activities falls under the Department of Energy (DOE) national security program. These DOE funded programs include development of nuclear warheads and naval nuclear reactors; and environmental cleanup of weapons production facilities. The Defense-Related Activities funded include programs like the civil defense, operation of Selective Service System, and defense-related activities of the FBI.

Unobligated funds are when Congress assigns funds for specific programs, but has not yet been given (Tyszkiewicz & Daggett, 1998). Unexpended funds, includes both unobligated and obligated funds, are funds that have yet been paid for and can only be used for specific programs that have been approved by Congress. In the budget process, these two concepts play a role in the defense budget by determining if there will provisions for the budget authority or result in outlays. Pretty much receive money to spend money.


Tyszkiewicz, M. T., & Daggett, S. (1998). A Defense Budget Primer. Congressional Research Service The Library of Congress.

STUDENT 3: Robert

Hello Class,

The three sub-categories of the national defense budget are Department of Defense, Atomic energy defense activities, and Defense-related activities. Each of these sub-categories contain different components of the defense budget. Department of Defense includes military and DoD programs. DoD is one of the biggest sections of this budget because it contains many elements. Military personnel, procurement, operation and maintenance, research development training and evaluation are a few elements of where most of the budget is spent. Atomic energy defense activities are part of the Department of Energy and includes development of nuclear warheads and naval nuclear reactors. Finally, defense-related activities funds defense related sections of other federal agencies such as the Coast Guard, the Maritime Administration, and the Federal Bureau of Investigation. The national defense budget is used to for the acquisition of systems or assets within these three sub-categories.

Unobligated funds are funds that are meant to be used for a specific program but are not in use. They are basically collected but may or may not yet be used. When a contract is approved or finances are committed to be used for a program then the funds are obligated. Whether unobligated or obligated, the funds may still be unexpended. Meaning they have not yet been paid out. It is like writing a check; once the check is written the money is spent or expended. Unobligated and Unexpended funds are a normal part of the obligation and expenditure process.


Tyszkiewicz, M. & Daggett, S. (1998) A Defense Budget Primer, CRS Report for Congress

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