"The budget challenges Panetta faced when he came in are largely the same, but it wasn't for a lack of trying," said Todd Harrison, a defense budget analyst at the Center for Strategic and Budgetary Assessments.
The Pentagon also has not effectively dealt with the rising costs of weapons systems or the growing expense of operations and maintenance, two problems that will soon confront Hagel if he is confirmed. Nor has it tackled the even thornier issue of personnel costs, like military health care and retirement benefits, Harrison said.
"Under Panetta, the Pentagon has been treading water during the budget chaos."
Harrison also said Panetta's over-the-top warnings about sequestration may have contributed to the quagmire on Capitol Hill. He made sequestration seem so devastating to the military that lawmakers in neither party believed the other would allow it to take place. But for sequestration to work as a threat that would compel both political parties to act, it had to be seen as credible, Harrison said.