The cardinal rule of bargaining is that the first number you propose should never be the number you actually think you can get, and nobody knows this better than the Defense Department. In September the Army Times reported that the Pentagon was preparing to box the new president in to a major increase in military spending by drawing up a budget before the election had been decided. The number it eventually leaked was $584 billion, a whopping increase of $68.6 billion over last year. It was kind of like telling the new boss that your old boss had already agreed to give you a $100,000 raise. In any other context, the sheer hubris would get you fired or laughed out of the room.

But the Pentagon budget is ruled by the appropriations equivalent of quantum physics, in which the normal rules of constraint do not apply. We still don’t know how much the Obama administration is planning to give the Pentagon–the announcement of the number has been postponed–but reports indicate the number will likely be $527 billion, around an 8 percent increase instead of the 12 percent the Pentagon requested.

Despite that fact, propagandists like neoconservative Robert Kagan are already crying foul, arguing that the increase is insufficient and–more insidious–will cost jobs at a time when we’re losing half a million a month. Military spending “is exactly the kind of expenditure that can have an immediate impact on the economy,” Kagan recently wrote in the Washington Post, and any cuts would be a sign to the world that “the American retreat has begun.”

“It seems like kind of the game they play every year,” Miriam Pemberton, a research fellow at the Institute for Policy Studies, told me when I asked her about the rumored budget numbers. “The Pentagon puts out this hugely inflated number, and then it turns out that the ‘cut’ is from that hugely inflated number, so the Pentagon still wins. The number is $40 billion more than we spent last year.”

You may think Barack Obama has the toughest job in Washington, but for my money it’s Pemberton. Since 1989, when she left academia with a PhD in English, she’s worked as an advocate for reining in the military-industrial complex in favor of a broader, less militarized approach to international security. Each year she and former Reagan Pentagon official and Center for American Progress senior fellow Lawrence Korb write an alternate Unified Security Budget. Their 2009 version identified $61 billion in cuts to military programs that could be made “with no sacrifice to our security.”

Cutting the military budget has been a staple of the progressive agenda for decades, of course, but it’s worth putting the budget numbers in context to highlight how out of control things have gotten across the Potomac in Arlington. Everybody knows that the wars in Afghanistan and Iraq have been mind-bogglingly expensive–about a trillion-dollar bonfire. Less noticed has been the skyrocketing of non-war-specific Pentagon funding. Since 2001 the regular Pentagon budget has increased by 77 percent, while cost overruns in weapons systems have ballooned to $300 billion. “We’ve never been perfect there,” says Korb. “But it has really gotten out of hand in the last eight years.”

And those numbers don’t fully capture the explosion in security spending because they don’t capture security spending outside the Defense Department budget, in the departments of Justice, Energy, Homeland Security or the NSA and the CIA.

“Congress is not set up to consider the overall balance of what we’re spending our money on,” says Pemberton, who notes that the ratio of military to nonmilitary foreign engagement spending is eighteen to one. “Even the secretary of defense says this imbalance is not good for our security.”

Indeed, over the past year Defense Secretary Robert Gates has made a series of speeches about shifting resources toward nonmilitary international engagement, as well as reducing spending on outdated weapons systems. “The spigot of defense spending that opened on 9/11 is closing,” he told senators on the Armed Services Committee in January. “The economic crisis and resulting budget pressures,” he said, would provide “one of those rare chances…to critically and ruthlessly separate appetites from real requirements, those things that are desirable in a perfect world from those things that are truly needed in light of the threats America faces and the missions we are likely to undertake in the years ahead.”

Obama expressed similar sentiments on the campaign trail: “I will cut tens of billions of dollars in wasteful spending,” he said in a campaign video. “I will cut investments in unproven missile defense systems. I will not weaponize space. I will slow our development of future combat systems.”

Most recently, Rahm Emanuel hinted on Meet the Press that the administration might have the Pentagon in its sights as part of its promise to trim fat from the budget. “We have about $300 billion in cost overruns,” he said. “That must be addressed, and we will be addressing it.”

Sensing that the Obama administration has laid the rhetorical groundwork for a significant reduction of the inflated military budget, the military lobby has already launched a pre-emptive strike, pooling resources to fund a $2 million PR campaign arguing against cuts.

When in October Congressman Barney Frank called for a 25 percent reduction in the Pentagon’s budget [see Frank’s Comment on this page], GOP lawmakers went apoplectic, issuing a string of hysterical press releases attacking Frank as “reckless” and the proposed cuts as a “grossly irresponsible,” “draconian” attempt to “gut national security.”

The first concrete test of the strength of the military lobby and its allies in Congress is the battle over the fate of the F-22 Raptor fighter jet. Military experts agree that the F-22 is outdated and unnecessary. As Gates has noted, not a single F-22 mission had been flown in either of the current wars.

Production of the last Raptor is scheduled for 2011, but Congress has pressured the Pentagon (amazingly, against its will) to order more in this year’s budget. Lockheed Martin, which stands to lose billions should the F-22 be discontinued, has launched an all-out PR war, leveraging the recession to argue that cutting the jet would mean the loss of 95,000 jobs. (It has even set up an online petition at preserveraptorjobs.com.) Most economists agree, however, that military spending is one of the least efficient ways of creating jobs per dollar of government spending.

That doesn’t seem to bother members of Congress who represent districts where the F-22 is produced (a surprisingly high number, since the makers intentionally spread out production to maximize Congressional influence). When Obama took questions from Democratic House members at their annual retreat, the second question came from Georgia Representative David Scott, who pleaded to keep the F-22 going. Obama was evasive: “We also have to deal with the debt, and it is unsustainable. We have to make tough decisions.”

Despite the encouraging rhetoric from the administration, Lockheed Martin won the first round in December, when Gates included funding for four additional F-22s in a draft of the upcoming war supplemental. Defense lobbyists scored another victory in the appointment of Bill Lynn as deputy defense secretary. A longtime lobbyist for Raytheon, Lynn was the first recipient of a waiver from the stringent new White House rules against hiring lobbyists. Says Pemberton of Lynn, “He never met a weapons system he didn’t like.”

The path of least resistance for the Obama administration, legendarily parsimonious with its political capital, will be to continue on the path and avoid what will unquestionably be a vicious and hard-fought battle to impose some kind of rational boundary on the security budget. The fight for a sane rebalancing of our security budget will be led by members of the House.

Earlier in the year, Pemberton met with one of the Obama transition teams to discuss the Pentagon budget. She wouldn’t tell me what they discussed, but when I asked her whether she thought they were committed to reining in the Pentagon, the weary look her in eyes made me think it’s going to be, in the words of a former defense secretary, a long, hard slog.