# Overseas Contingency Operations **OCO** — the war-funding account used from the late 2000s through 2021, nominally for the costs of operations in Iraq and Afghanistan, but in practice the Pentagon's favorite **cap-evasion device**. Because OCO was designated emergency/contingency funding, it sat **outside the [[Budget Control Act of 2011]]** — so both parties used it as a slush fund to push base-budget defense spending above the limits without formally breaking them. ## How the gimmick worked - Regular [[National Defense]] spending was capped; OCO was not. - Tens of billions of genuinely *base* (non-war) Pentagon costs were relabeled "OCO" to fit under the caps — a bipartisan accounting fiction that the GAO and budget hawks repeatedly flagged. - OCO was formally **ended around FY2021** once the caps lapsed and the wars wound down, folding its functions back into the base budget. ## The RWKB angle OCO is the cleanest case study in [[Budget Gimmicks]]: a category invented to make the defense budget appear to comply with caps it was actually busting. It shows that the caps "disciplining" spending were theater — the money flowed anyway through a side door, with bipartisan consent. The same dynamic recurs whenever a [[Discretionary vs Mandatory Spending]] limit collides with a politically protected priority like [[National Defense]] — see the $350B mandatory defense supplemental in the [[Federal Budget FY2027 Request]]. ## Related - [[Budget Gimmicks]] · [[National Defense]] · [[Supplemental Appropriations]] - [[Sequestration]] · [[Budget Hub]]