In August 2011, the Budget Control Act was signed into law and sequestration quickly became a buzzword in Washington. Facing the prospect of $500 billion in defense cuts over the next decade, the Department of Defense (DoD) has spent the past two years moving through the classic five stages of grief.

■Denial. Senior defense officials refused to believe that budget cuts mandated by law would ever materialize, and thus chose not to prepare for them.

■Anger. Once the bipartisan “super committee” failed to agree on deficit reductions, DoD officials voiced their frustration with political leaders who were unable or unwilling to compromise.

■Bargaining. Rather than implementing sequestration budget cuts evenly over the 10-year period and across all accounts as required by the Budget Control Act, DoD pleaded for greater flexibility to limit the damage.

■Depression. With sequestration taking effect March 1, officials recalled the hollow forces of the 1970s and ’90s to warn of the possible consequences.

■ Acceptance. The Strategic Choices and Management Review ordered by Defense Secretary Chuck Hagel considered potential changes to US military capabilities under several budget scenarios, including the mandated $500 billion reduction.

This review could be a step in the right direction. While the consequences of sequestration may be severe, there is little to be gained by avoiding difficult strategic choices. Hope, as the saying goes, is not a strategy. The question, then, is how will the Pentagon choose to adapt? Will it rely on savings from “efficiencies” that may not materialize and cut personnel uniformly across the services, an option that would lead to a US military that is simply a smaller version of the current force? Or will the Pentagon set clear priorities and use sequestration as an opportunity to rebalance its capabilities for future challenges?

There is an emerging consensus that DoD must implement major changes, regardless of the size of future budget cuts, and that Congress and the White House should set politics aside and push for change if the Pentagon will not.

Defense analysts from multiple Washington think tanks have called for pursuing another round of base closures, reducing the size of DoD’s civilian workforce and undertaking serious compensation reform for military personnel to rein in the fastest-growing part of the defense budget.

Yet these measures alone won’t achieve the savings required by law or help the Pentagon avoid the worst-case outcome: that the confluence of politics, interservice competition and a lack of foresight lead to a military that is not just smaller, but also ill-suited for likely security challenges.

Despite all the attention paid to sequestration, the strategic environment is in flux as well. For example, China is developing advanced capabilities such as ballistic and cruise missiles, submarines, and anti-satellite and cyberwarfare systems that could upend the balance of power in East Asia. Nuclear proliferation represents a growing danger, with an unpredictable North Korea threatening its neighbors and an unfriendly Iran expanding its nuclear infrastructure.

Thanks to the support of sponsors such as Iran, non-state actors are acquiring increasingly sophisticated weapons that could further destabilize strategically important regions like the Middle East.