Panetta Warns Against Deeper Pentagon Cuts

Aug 16, 2011 3:33pm

ABC News' Luis Martinez (@lmartinezabc) reports:

Defense Secretary Leon Panetta warned again today that deeper cuts in the defense budget could affect national security and prove devastating to the military leaving a hollow force unprepared to deal with global threats.  

Speaking at the National Defense University alongside Secretary of State Hillary Clinton, a discussion on the recent debt ceiling agreement prompted Panetta to reiterate once again that a choice does not have to be made between national security and fiscal responsibility.  “I want the country to know that we can get this done, but we have to do it in a way that protects our national defense and protects our national security," said Panetta.

Panetta said both he and Clinton recognize how important it is that  “as we go through these budget tests that we're going to go through, that the country recognize how important it is that we maintain our national security and that we be strong."

The debt ceiling agreement reached earlier this month calls for the Defense Department to make $350 billion in spending cuts over the next decade, which is in the ballpark for spending cuts the Pentagon had anticipated earlier this year.  What concerns Panetta the most is the potential of an automatic $500 billion cut specifically targeting Pentagon spending  that would go into place if Congress cannot agree on further mandated reductions.  

“This kind of massive cut across the board which would literally double the number of cuts that we're confronting," he said. "That would have devastating effects on our national defense. It would have devastating effects on, certainly, the State Department."

A one-time Director of the Office of Management and Budget, Panetta said he spoke from experience when he said that a serious review of the nation’s budget spending must include a look at  mandatory entitlement spending and taxes.  “If you're serious about dealing with budget deficits, you can't just keep going back to the discretionary part of the budget," he said.    

He warned that an across-the-board cut would break faith with troops and their families and “literally undercut our ability to put together the kind of strong national defense we have today."

Panetta was asked about news reports that the Pentagon is considering a change in the military’s current retirement package where servicemembers who have served 20 years in uniform receive an annual pension worth half their pay.

The  Defense Business Board, a DOD advisory panel, has recommended doing away with the current system in favor of a 401k retirement plan that would be collected at the typical retirement age.

Panetta stressed that no decisions had been made with regard to retirement payouts, but said “it's the kind of thing you have to consider, in terms of retirement reforms in the broad form."

He said such reforms had to be done “in a way that doesn't break faith … with our troops and with their families” that would include grandfathering the benefits of those already serving in uniform. 

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