Defense Secretary Leon E. Panetta is set this week to reveal his strategy that will guide the Pentagon in cutting hundreds of billions of dollars from its budget, and with it the Obama administration’s vision of the military that the United States needs to meet 21st-century threats, according to senior officials.
In a shift of doctrine driven by fiscal reality and a deal last summer that kept the United States from defaulting on its debts, Mr. Panetta is expected to outline plans for carefully shrinking the military — and in so doing make it clear that the Pentagon will not maintain the ability to fight two sustained ground wars at once/.../
Military benefits and salaries, although politically difficult to cut, are first in the line of sight of many defense budget analysts. Scaling back the Pentagon’s health care and retirement systems and capping raises would yield hundreds of billions of dollars in projected savings over the next decade.
As it stands now, the Pentagon spends $181 billion each year, nearly a third of its base budget, on military personnel costs: $107 billion for salaries and allowances, $50 billion for health care and $24 billion in retirement pay.
One independent analyst, Todd Harrison of the Center for Strategic and Budgetary Assessments, a nonpartisan policy and research group in Washington, has calculated that if military personnel costs continue rising at the rate they have over the past decade, and overall Pentagon spending does not increase, by 2039 the entire defense budget would be consumed by personnel costs.