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Debt Reckoning: Military Looks To Phase In Spending Cuts

In last year’s budget talks, Congress set up the prospect of $500 billion in automatic cuts in military spending to help pressure political leaders to reach a broader deficit-reduction deal.

The cuts, which would start with $50 billion next year, would be disruptive. But military analysts say they could be phased in more gradually than originally thought, eliminating the need for furloughs or layoffs on Jan. 2.

As a result, White House officials and House Republicans believe that they can limit the fallout at the Pentagon if they miss that deadline and reach a larger budget deal sometime next year.

“It’s not like a government shutdown, where things close and the lights go out,” said Todd Harrison, an analyst at the Center for Strategic and Budgetary Assessments, a research group in Washington. “It looks more like a glide slope than going down a cliff/.../”

Mr. Harrison, the budget center analyst, said that if the automatic cuts were to start on Jan. 2, they would unfold in several stages. The fiscal year started on Oct. 1, so the Pentagon would have three quarters in which to shave about $50 billion from its base budget of more than $525 billion.

“There would be no immediate layoffs,” he said. And weapons programs that had already been financed would keep going.

By next spring, the Pentagon would probably have to furlough or lay off civilian employees, and “things could get messy,” he said. It would also have to slow awards of new contracts, and it would have fewer employees to oversee contractors, causing more delays.

Mr. Harrison said that unless the department could shift money from other uses, it would eventually have to reduce its civilian payroll by nearly 14 percent. Though the Pentagon has said it would try to avoid layoffs, Mr. Harrison said it could only achieve that level of savings through furloughs if nearly every one of its 791,000 civilian employees took a month off without pay.

Because most weapons programs are financed in advance of the work, he said, the purchases from contractors might decline by only 3.5 percent next year.