This is the Cato Daily Podcast for Thursday, February 5th, 2009. I'm Caleb Brown.

The Pentagon has already won round one against President Obama, casting level military spending as a spending cut.

For his part, Obama does have options for making a military leaner and more responsive

to the needs of a modern battlefield.

So says Ben Friedman, a research fellow in

defense and homeland security studies at the Cato Institute.

Obama inherits a 2010 defense budget. The work up on that began in the spring or summer under Bush and the Pentagon's

plans, the long-term plans, were to have the FY 09 budget be the peak and then the defense budget was supposed to level off.

According to the budget they created for FY 10, that's not going to be the case.

They have a $60 billion increase over 09, which is already $520 billion.

So we're heading towards $600 billion in the base defense budget,

not including the wars, which is another $200 billion or so.

And so Obama has handed that budget with that big increase and

there's also an increase of 450 billion over five years in their new five year

plan and the question is does he accept that or not?

In other words, does he just say,

I don't have time to send this back to the Pentagon

and put my imprint on it?

So I just accept it or does he say, well, I have

to hold down spending because we're spending so much on the

stimulus and on the bailout and everything else and it looks like he's gonna he's

going to keep the budget that he got at least according to Bill Lynn who is his nominee to be the deputy

...