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New Budget Deal Still Leaves Big DoD Funding Gap

Capitol Hill's budget deal is good news for the Pentagon.

But it is unlikely to eliminate the need to set in motion long-term money-saving measures such as reducing troop levels, delaying weapons programs and making controversial cuts to military pay and benefits.

The bulk of the $22 billion windfall that the Defense Department would get under the latest budget deal would go to training and readiness, allowing planes to fly, ships to steam and troops to conduct large-scale training exercises.

"What this means is that the Pentagon will probably not have to cut readiness substantially," said Todd Harrison, a defense budget expert with the Center for Strategic and Budgetary Assessments, a think tank in Washington.

Yet that money is not eliminating the long-term threat of the spending caps known as sequestration, which may include big cuts to the size of the active-duty Army, a reduction in the size of the Navy's carrier fleet and slashing the number of Air Force squadrons. Other proposals include closing military bases, reducing the military retirement package and canceling future weapons procurement/.../

In short, the latest budget math looks like this: The Pentagon initially requested about $527 billion for this current fiscal year. But the spending caps known as sequestration were going to slash that by about $52 billion, or down to about $475 billion.

Now, the current budget deal could restore about $22 billion for the current year. But that additional money will not be enough to cover the "$30 billion to $35 billion" shortfall that Hagel described.

So any sense of relief inside the Pentagon may be short lived as it appears that some more limited readiness reductions may still be needed. And all of those controversial proposals that could fundamentally shrink the military's size will remain on the table.

"This should help quite a bit in terms of readiness, but the bottom line is it doesn't solve the underlying budget challenges facing the department," Harrison said.