Inflation to be 2023 Budget Request Headline, Experts Say

The Biden Administration’s inflation estimates will be the big story related to the fiscal 2023 defense budget submission, experts said in a Center for Strategic and International Studies “budget preview” streamed Feb. 7.

Todd Harrison, CSIS budget analyst, said if the Consumer Price Index quotes “a realistic number”—officially acknowledging that “we’re going to have higher than historical inflation … continuing for years to come”—that will be a “downer” for the stock market. If the administration quotes an escalation of just two percent, it could be criticized for lowballing the number and being unrealistic, he said. Either way, the choice will be the headline of the budget stories.

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The panelists said there likely won’t be too much of a break from the 2018 NDS. Stacie Pettyjohn of the Center for a New American Security said the big difference will likely be on nuclear posture, with a possible no-first-use declaration. She also speculated that to assuage the concerns of defense doves, the administration may cancel the low-yield sea-launched nuclear missile or the Long Range Stand Off missile.

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