Subject: TIME SENSITIVE: CAP and MILITARY BUDGET
From: Anna Canfield <[email-masked]>
To: "[email-masked]'" <[email-masked]>
Cc: Jennifer Palmieri <[email-masked]>, Winnie Stachelberg <[email-masked]>, "[email-masked]'" <[email-masked]>, Peter Ogden <[email-masked]>
Date: Tue, 2 Dec 2008 18:57:24 -0500

John:  Hi.

Larry is preparing a report for release next Wednesday that has a bit of a surprise.

Rudy has been saying over and over in CAP meetings (including in discussions with you re fiscal policy) that he thinks that after the withdrawal from Iraq is complete in 2-3 years, we should be able to return to the current baseline level of military spending plus inflation (or about $515B+).  It will require some very difficult choices and setting priorities to realign to current needs, given that we need simultaneously to spend money for equipment reset, training, and troop growth.  So it will be hard but should be the goal.

But Larry it appears is in a different place.  Says Rudy misunderstood.  No peace dividend or at least none soon.  Priority is reset and troops.  Yes we need to cut. But at least some of the savings from withdrawal must be redirected to these purposes.... So a long time til any Defense contribution to deficit reduction.  His paper shows a number of things we should not be spending money on, but there are also a lot of things we should instead be spending money on.  I put it more bluntly than his draft.  It is actually not yet very clear on budget impacts of all his analysis but when pushed for clarity the clarity was as described above.  (Exec sum is attached but this is a work in progress.)

Besides being a big gulp for folks like Ben Cohen and Business Leaders, it seems to me to be a uniquely glum story and puts us arguing against Obama's position and much of progressive community.

Given next Wednesday's event deadline, if I am to intervene in this need to act quickly.

You comfortable with letting larry be larry?  Want to discuss?

Sarah Rosen Wartell
Executive Vice President
Center for American Progress
1333 H Street, NW
Washington, DC  20005
(202) 741-6366
[email-masked]