CIA ‘black budget’ complicates Pentagon audit

Late last year, the Pentagon announced the launch of its first-ever audit. Since then, it has emerged that the Defense Department didn’t properly account for more than $800 million in construction projects, and that the full audit, which Politico reports “may never even be possible” is projected to cost $367 million in itself.

“I anticipate the audit process will uncover many places where our controls or processes are broken,” Pentagon chief financial officer David Norquist said earlier this year. “There will be unpleasant surprises. Some of these problems may also prove frustratingly difficult to fix.”

Indeed, as Steven Aftergood of the Federation of American Scientists’ Secrecy News has recently pointed out, one problem that could easily frustrate auditors’ efforts stems from the military’s longstanding institutional penchant for secrecy in all things — up to and including however much taxpayer money it spends, and for what purpose.

“The so-called ‘black’ budget — which refers to classified government spending on military procurement, operations, and intelligence — is not merely secret. It is actually deceptive and misleading, since it produces a distortion in the amount and the presentation of the published budget,” Aftergood writes. He continues:

The amount of money that is purportedly appropriated for the US Air Force, for example, does not all go to the Air Force, the Senate Armed Services Committee recently observed.

“Each year, a significant portion of the Air Force budget contains funds that are passed on to, and managed by, other organizations within the Department of Defense. This portion of the budget, called ‘pass-through,’ cannot be altered or managed by the Air Force. It resides within the Air Force budget for the purposes of the President’s budget request and apportionment, but is then transferred out of the Service’s control,” according to a Senate report on the 2019 defense bill (S.Rept. 115-262).

Although the report does not say so, the Air Force budget may also include pass-through funding for the Central Intelligence Agency, which of course is not even part of the Department of Defense, as well as for other non-Air Force intelligence functions.

“In fiscal year 2018, the Air Force pass-through budget amounted to approximately $22.0 billion, or just less than half of the total Air Force procurement budget. The committee believes that the current Air Force pass-through budgeting process provides a misleading picture of the Air Force’s actual investment budget.”

The Senate therefore recommended that such “pass-through” funds be removed from the Air Force budget and included in Defense-wide appropriations.

But in the House-Senate conference on the FY2019 defense bill, this move was blocked and so the deceptive status quo will continue to prevail.

In fiscal year 2013, according to documents leaked by former intelligence contractor Edward Snowden, the CIA was in fact the single biggest recipient of “black budget” funding, at nearly $15 billion. Next on the list at over $10 billion each were the National Security Agency (NSA) and National Reconnaissance Office (NRO) — like the CIA both intelligence agencies, but unlike the Agency, as some CIA agents seem to see their employer, the NSA and NRO are at least both technically part of the US military.

The $52.6 billion reported “black budget” for 2013 worked out to almost exactly 10 percent of the Defense Department’s approved “base budget” of $525.4 billion for that year, although another $88 billion was allotted for “Overseas Contingency Operations.”

“Our budgets are classified as they could provide insight for foreign intelligence services to discern our top national priorities, capabilities and sources and methods that allow us to obtain information to counter threats,” then-Director of National Intelligence James Clapper reportedly said at the time.

“The [classified] summary provides a detailed look at how the U.S. intelligence community has been reconfigured by the massive infusion of resources that followed the [September 11] 2001 attacks. The United States has spent more than $500 billion on intelligence during that period, an outlay that U.S. officials say has succeeded in its main objective: preventing another catastrophic terrorist attack in the United States,” the Washington Post noted in its report on the 2013 black budget, a 178-page summary of which it had in its possession but did not publish in full.

“The result is an espionage empire with resources and a reach beyond those of any adversary, sustained even now by spending that rivals or exceeds the levels at the height of the Cold War.”