Secretary Panetta Briefing on Defense Budget Cuts

By The Pentagon, The Pentagon - January 26, 2012

            SECRETARY OF DEFENSE LEON PANETTA:  Good afternoon, everybody. 

            As all of you know, this department has undertaken a very fundamental review of its defense strategy and of our spending priorities. 

            The reasons for the review are clear.  First of all, we are at a strategic turning point after a decade of war and after a very substantial growth in the defense budget.  And second, the Congress of the United States, through the passage of the Budget Control Act, has required that the defense budget be reduced by $487 billion over 10 years. 

            To accomplish this effort, we decided that it was important to make this an opportunity to develop a new defense strategy for the United States and for the U.S. military force that we wanted for the future. 

            That strategy has guided us in making a series of tough budget choices and establishing a new set of defense priorities.   

            The ongoing process reached an important milestone earlier this month with the release of the new strategic guidance and the priorities for a 21st century defense.  And it will be reflected in the decisions that have been made and will be presented in the President's budget.   

            When I announced the new guidance, I highlighted five key elements of the strategy and five key elements of the vision that we have for a military force of the future.  And let me just summarize each of those. 

            First, the military will be smaller and leaner, but it will be agile, flexible, rapidly deployable and technologically advanced.  It will be a cutting-edge force.   

            Second, we will rebalance our global posture and presence to emphasize where we think the potential problems will be in the world. And that means emphasizing Asia-Pacific and the Middle East.  

            Third, we will maintain our presence elsewhere in the world and will do that by building innovative partnerships and strengthening our key alliances and develop new partnerships elsewhere in the world:  in Europe, in Africa and Latin America and elsewhere.   

            Fourth, we will ensure that we can quickly confront and defeat aggression from any adversary anytime, anyplace. 

            And fifth, we will protect and prioritize some very important and key investments in technology and new capabilities as well as our capacity to grow, adapt, to mobilize, to surge as needed. 

            Given the significant fiscal constraints that have been imposed on the department, our approach was to develop this force for the future with some pretty important guidelines.  We wanted to maintain the strongest military in the world.  We committed ourselves not to hollow out the force, as has been done in the past in these kinds of drawdowns, to take a balanced approach to our budget by putting everything on the table and to not break faith with the troops and their families. 

            I want to thank the entire leadership of this department, military and civilian alike, for their participation and support in this effort.  This has truly been a team effort, and I am deeply appreciative for their cooperation. 

            And we are united in the belief that this strategy and the resulting budget decisions followed the right approach to meet the country's most pressing security challenges and to preserve the strongest military in the world and at the same time meet our fiscal responsibilities. 

            Today I'd like to offer a preview of the decisions that we made to help build the department's budget request for fiscal year 2013 and the future years' defense plan. 

            Consistent with the Budget Control Act, this plan reduces spending over the 10 years, obviously, by $487 billion.  But in the five-year budget that will be presented by the President, we reduce the defense budget by 259 billion [dollars] over the next five years. 

            Specifically, the department will request for its base budget $525 billion in its base budget for fiscal year FY13.  And our -- by the way, that compares to 531 billion [dollars] in fiscal year 2012 -- and our hope and plan here is to try to rise to 567 billion [dollars] by fiscal [year] 2017.   I would just point out that the projected growth before we had to do this was to reach about 622 billion [dollars] by that year of 2017. 

            In fiscal 13, we will also ask for an additional $88.4 billion for overseas contingency operations, so-called OCO funds.  That compares to about 115 billion [dollars] that we receive in fiscal year 12, all of that obviously to maintain support for our troops in combat. 

            We believe this is a balanced and complete package that follows the five key elements of the strategy and vision that I've described. You have the specifics in the package you've been provided.  And I know that Ash Carter, the deputy, and Sandy Winnefeld, the vice chair, will fill you in on any additional specifics that you're interested in. 

            But what I wanted to do is to kind of summarize some of the key decisions for you. 

            First of all, with regards to the area of developing a smaller and leaner but agile and flexible and technologically advanced force, we knew that coming out of the wars and dealing with budget reductions of this magnitude, the military would be smaller.  But the key -- as tough as it was to make the decisions with regards to drawing these down -- the key is to fashion an agile and flexible military force that we need in the future. 

            What that means for the services is that we will have an adaptable and battle-tested Army that is our nation's force for decisive action, capable of defeating any adversary on land.  Let me say that again:  capable of defeating any adversary on land.  We will have a significant land force presence in places like Korea and in the Middle East.  But at the same time, we will emphasize special operations forces.  And we will also emphasize a rotational presence so that we can establish the kind of partnerships that I discussed and provide training and advice in other parts of the world. 

            We will have a Navy that maintains a forward presence and is able to penetrate enemy defenses.  The Navy essentially has agility built into its force because it can move and deploy anywhere throughout the world. 

            The Air Force is the same.  It will be an Air Force that dominates air and space and provides rapid mobility, global strike and persistent ISR, and it will provide unmanned capabilities through their operators as well.   

            A Marine Corps that is a middleweight expeditionary force with reinvigorated amphibious capabilities.  And a National Guard and Reserve component that is ready and prepared for operations, all of this networked into a highly capable joint force for the future. 

            To ensure an agile and ready force, we made a conscious choice not to maintain more force structure than we could afford to properly train and equip.  The budget also seeks to retain the most flexible, versatile and technologically advanced platforms that we will need for the future.  That involves unmanned systems, satellites, submarines, helicopters, aircraft carriers and fifth-generation aircraft.  What we're looking at are multi-mission weaponry and technology that can support that kind of agile force. 

            Striking the right balance between force structure and readiness is critical to our efforts to avoid a hollow force, and we'll continue to focus on this area to ensure that we make the right choices. 

            In this budget, we plan to gradually resize the active Army to 490,000.  That's down from present force level of 562,000.  And the active Marine Corps will go to 182,000.  That's down from 202,000. That transition will take place over the five years.  We won't reach those numbers until 2017. 

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