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Pay Raises, Benefit Cuts on the Table

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Automatic budget cuts could force the U.S. military to choose between the force it has now, or slashing troops, aircraft and weapons to afford modernization to retain a technological edge over other nations, the Pentagon's top civilian leader says.

The capacity versus capability debate Secretary of Defense Chuck Hagel raised under the Strategic Choices and Management Review was meant as a message to Congress as the military confronts a $52 billion reduction in the fiscal year starting Oct. 1 and nearly half a trillion dollars in the decade ahead because of sequestration.

Among the budget alternatives Hagel mentioned: a White House option to cut $150 billion, versus deeper cuts of $250 billion, or $500 billion the Pentagon would lose under the full impact of sequestration.

Deep cuts could mean lower pay raises to servicemembers and civilian employees, asking military retirees to use private insurance when available, and deep reductions in management overhead, such as cutting 20 percent of headquarters staff at major commands, saving $90 billion under Pentagon projections.

In a briefing to reporters, Hagel said pay and benefits consume roughly half the budget.

"If left unchecked, pay and benefits will continue to eat into readiness and modernization," he said. "That could result in a far less capable force that is well-compensated, but poorly trained and poorly equipped."

Cuts to military pay and benefits have been unpopular with Congress, but that might change under budget realities, said Todd Harrison, a senior fellow with the Center for Strategic and Budgetary Assessment in Washington, D.C.

"If Congress won't let you do that, then you have to cut $90 billion out of something else," he said.

Those kind of cuts, coupled with a $487 billion spending reduction already planned, would mean hard choices throughout the Department of Defense. The biggest cuts might mean eliminating five Air Force tactical squadrons, such as old bombers and C-130 cargo planes, large reductions in the number of Army and Marine Corps troops with one war over and another scaled back, and dropping the Navy's aircraft carrier fleet to "eight or nine" from 11 today, Hagel suggested.

The Air Force and other service branches have struggled to slash expenses since March 1 when sequestration forced a $37 billion reduction this year, causing the furlough of about 10,000 Wright-Patterson Air Force Base civilian employees alone.

Loren B. Thompson, a senior defense analyst with the Lexington Institute in Arlington, Va., said many weapons programs were cut in the past few years, and now it's time to look elsewhere.

"Trying to cut more from the Air Force's modernization budget now would leave us with a decrepit Air Force," he said.

"Hagel's top goal in releasing all these details is trying to convince Congress that sequestration should be repealed," he said. "If he succeeds, that would be very good news for Wright-Patterson, but if sequestration goes forward then the base will be hit in many ways. It will lose civilian workers, it will lose contractors, it will lose programs and in some cases it will lose missions."

A new round of military base closures, which the Pentagon has lobbied for but Congress has balked at, might be good for Wright-Patterson because it could gain new missions as bases close, he said.

"The best thing the Air Force would be to consolidate its many missions to a handful of megabases where there could be economies of scale," Thompson said.

U.S. Rep. Mike Turner, R-Dayton, said the options Hagel has suggested between a military at the current size or a smaller one with more modern weapons are a "false choice" that would result in "devastating impacts on national security, needlessly."

"Hagel paints a picture of a greatly diminished United States military," said Turner, a member of the House Armed Services Committee. "That also means a projected further declining military in the future. Those impacts would be felt at Wright-Patterson Air Force Base as we provide direct support to the warfighter and the military force of the future.

"This is gambling with our national security and it has such a huge effect on our local community," Turner said.

Lawrence J. Korb, a former secretary of defense under President Ronald Reagan, said the military could handle $500 billion in sequester reductions if it's phased in and not imposed haphazardly by a 10 percent across-the-board reduction. In the post-9/11 era, the defense budget has outpaced the highest levels of spending in the Cold War, he said.

"I've been around this business since (Robert) McNamara (was defense secretary during the Kennedy and Johnson administrations) and I've never seen it so badly managed," said Korb, a senior fellow at the Center for American Progress in Washington, D.C.

Pentagon leaders have said all options are on the table, although it's not clear what options Congress will enact, said Michael Gessel, Dayton Development Coalition vice president of federal programs.

"What it all means is we don't know what is in store for Springfield (Air National Guard Base) and Wright-Patterson," the former congressional staffer said.

Harrison said sequestration might mean the Air Force would have to cancel the F-35 Joint Strike Fighter and the next generation bomber if the military keeps its current size.

"To preserve capacity, you're going to have to cut deep into your modernization programs," he said. "Preserving capability would be better for Wright-Patterson."

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Sequestration and the Military Defense Budget Chuck Hagel
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