The Rising Cost of Operations

  1. Navy Fleet

  2. Air Force Fighter / Attack Force

  3. Army Active Maneuver Battalions

  4. O&M spending per active duty person

1.  Since the end of World War II, the number of ships has fluctuated, but generally gone down (left scale).  Conversely, the operations & maintenance (O&M) budget has trended upwards (right scale), reflecting the increasing complexity of ship designs.  Note that although both inventory and O&M budgets have decreased since the height of the Reagan build-up in the late 1980s, the number of ships has declined faster than the operations and maintenance budget.  The net effect of these changes has been a marked increase in per unit O&M costs.


2.  The situation in the Air Force mirrors that of the Navy, with numbers (left scale) decreasing faster than O&M budgets (right scale).  Again, the root cause is the increase in complexity marking each new generation of fighter aircraft (with minor exceptions such as the A-10 failing to offset the main fighter progression: F-100 to F-4 to F-15).

3.  Finally, the Army presents the same pattern, with forces generally declining, while O&M budgets have actually trended upward over the time period shown.

4.  When aggregated DoD-wide, the trends noted above lead to an interesting conclusion:  since its bottom in the early 1960s, O&M spending compared to force size (as measured by number of active duty personnel) has more than tripled.  This is a direct result of a forty-year policy of structuring smaller and smaller forces consisting of ever more complex weapon systems.