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Hagel: Budget cuts will shrink pay, benefits and force

Hagel details true effects of sequester

Jul. 31, 2013 - 06:00AM   |  
Chuck Hagel
Defense Secretary Chuck Hagel outlined the stark choices facing the Pentagon under sequestration at a news briefing on July 31. (Evan Vucci/The Associated Press)
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Defense Secretary Chuck Hagel for the first time on Wednesday offered details of how today’s budget cuts will impact the military over the next decade, suggesting the Army and Marine Corps force levels could drop to historic lows, the Navy’s carrier fleet will face reductions and the some fighter jet squadrons will be permanently eliminated.

Military pay and benefits also could take a big hit in the form of smaller pay raises, reduced housing allowances, cuts to overseas cost-of-living adjustments, and limits on access to military health care for younger retirees.

Hagel outlined the conclusions of the strategic review he launched in March after taking over the Pentagon’s top job just as the long-term budget cuts known as sequestration were taking effect across the force.

He said the proposals obviously remain open to further debate on Capitol Hill and internal analysis at the Pentagon, yet suggested they offer a window on the future if Washington fails to reach a new, broad-based federal budget agreement and lift the mandatory, automatic spending cuts required under current law.

“Many will object to these ideas — and I want to be clear that we are not announcing any compensation changes today,” Hagel told reporters at the Pentagon. “But a sequester-level scenario would compel us to consider these changes because there would be no realistic alternative that did not pose unacceptable risk to national security,” the secretary said.

The Pentagon has been examining several budget scenarios, and some changes may take effect even if the sequester-level spending caps are lifted. Hagel said his review concluded that “we could still execute the priority missions determined by our defense strategy” while dropping the Army’s active-duty end strength from a current target of 490,000 down to “between 420,000 and 450,000.”

And “the Air Force could reduce tactical aircraft squadrons — potentially as many as five — and cut the size of the C-130 fleet with minimal risk.” Hagel said.

Hagel also outlined the more severe cuts that might be required under the assumption that Congress reaches no new agreement and the budget cuts on the books today, which amount to a roughly 10 percent cut across the board, remain in effect.

That could mean dropping the total number of active-duty soldiers down to “between 380,000 and 450,000 troops,” he said. For the Marine Corps, end strength could fall from today’s target of 182,000 down to “between 150,000 and 175,000,” Hagel said.

For the Navy, the number of carrier strike groups could be dropped from today’s 11 to “eight or nine.” And the Air Force would be forced to retire some of its older bomber aircraft, Hagel said.

“The basic trade-off is between capacity — measured in the number of Army brigades, Navy ships, Air Force squadrons and Marine battalions — and capability, our ability to modernize weapons systems to maintain our military’s technological edge,” Hagel said.

Hagel said options that maintain a larger force structure would require canceling many modernization programs, slowing the growth of cyber programs and cutting special operations forces. He appeared to signal a preference for reductions to manpower rather than modernization, saying “cuts on this scale would, in effect, be a decade-long modernization holiday.”

Adm. James “Sandy” Winnefeld, the vice chairman of the Joint Staff, also said the Pentagon is leaning toward a spending strategy that “edges slightly, probably, toward capability” rather than manpower and capacity.

Other personnel cuts under consideration include ending subsidies for defense commissaries, restricting the availability of unemployment benefits for out-of-work veterans and eliminating civilian pensions for retired military personnel serving in civilian government service, Hagel said.

Cuts to the Pentagon buracracy are also in the works, regardless of whether the bundget crunch is lifted. Hagel said he wants to slash his own staff, the Joint Staff and the services’ headquarters staffs by about 20 percent during the next five years.

Questions remain about whether the Pentagon will have enough money to execute the strategic “pivot” to Asia that was oulined as a key component of the new national defense strategy in 2011.

“Under the worst case ... it would be very challenging to implement that as it was originally conceived,” said one senior defense official.

So far, Congress has limited the Pentagon’s flexibility in finding cost savings. For example, the Defense Department wants to launch a new round of base closures to reduce overhead costs and also to limit troops pay raises next year. Congress has refused to support those measures.

Hagel suggested lawmakers are making the budget crisis worse. “Opposition to these proposals must be engaged and overcome, or we will be forced to take even more draconian steps in the future,” the secretary said, adding that the proposals he outlined are “not crying wolf.”

Hagel’s comments came the day before two top Pentagon officials, Deputy Secretary of Defense Ashton Carter and Winnefeld, are scheduled to testify on Capitol Hill about the strategic review on Thursday.

Winnefeld emphasized that final decisions about Pentagon spending policy will be developed during the annual budget process later this year.

“We’re teeing up choices. We haven’t made those choices,” he told reporters Wednesday.

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