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Saturday, August 6, 2011

Leon Panetta warns against more cuts in Pentagon budget

WASHINGTON — Defense Secretary Leon E. Panetta effectively told Congress on Thursday to raise taxes and cut Social Security and Medicare before taking another swipe at the Pentagon budget beyond defense cuts already called for in the debt-ceiling deal.

In his first Pentagon news conference, Mr. Panetta, a former budget director in the Clinton White House, lent his voice to the Obama administration’s strategy of putting pressure on Congress to consider raising revenues when a special committee meets this fall to recommend $1.5 trillion in additional deficit-reduction measures. Mr. Obama signed a debt-ceiling deal on Tuesday calling for an initial $1 trillion in cuts.

Mr. Panetta’s argument was that defense had given up enough — about $350 billion of that $1 trillion over 10 years — and that further cuts would have dire consequences. He then segued into a brief discourse on “discretionary” federal spending, like defense, and “mandatory” federal spending, like Social Security and other entitlements.

“Let me for a moment put a budget hat on,” said Mr. Panetta, who is a month into his job as defense secretary. “You cannot deal with the size deficits that this country is confronting by simply cutting the discretionary side of the budget. That represents less than a third of the overall federal budget.

“You’ve got to, as the president’s made clear, if you’re going to look at those size deficits, you’ve got to look at the mandatory side of the budget, which is two-thirds of the federal budget. And you also have to look at revenues as part of that answer.”

Mr. Panetta made his comments on the second straight day of a Pentagon pushback to hundreds of billions of dollars of budget cuts potentially coming its way, the first time since the attacks of Sept. 11, 2001, that it has faced shrinking spending.

Both Mr. Panetta and Adm. Mike Mullen, the chairman of the Joints Chiefs of Staff, who joined Mr. Panetta at the news conference, used words like “disastrous” and “unacceptable” to describe across-the-board cuts that would automatically kick in if the new committee failed to agree on reductions this fall.

Mr. Panetta also took the position that the committee should make no further defense cuts, either. The White House, however, has not ruled out further defense reductions. The committee, to be composed of six Democrats and six Republicans, would also be unlikely to take them off the table.

Defense spending represents about half of the federal government’s discretionary spending, and the military’s budget has increased by more than 70 percent since 2001. Although the conflicts in Iraq and Afghanistan have cost the Pentagon upward of $1 trillion, nearly half of the growth in defense spending in the past decade has been unrelated to the wars.

Panetta said the $600 billion in cuts “would do real damage to our security, our troops and their families, and our military’s ability to protect the nation. It is an outcome that would be completely unacceptable to me as secretary of defense, to the president and, I believe, to our nation’s leaders.”

Earlier this week, a senior defense official said thousands of Defense Department civilians would lose their jobs if larger cuts were triggered by a failure of the bipartisan panel to reach an agreement.

Mullen, who just returned from a trip to Iraq and Afghanistan, said the partisan fight over debt reduction had fueled worries among the troops that they might not be paid on time.

“Our men and women down range have enough to worry about just getting their job done,” Mullen said. “They shouldn’t also be concerned about whether or not they will be paid to do that job or whether or not their families will continue to get the support they need during long absences. We can do better than that, as a military and as a nation.”

Pentagon officials have tried to sound optimistic about the chances of a congressional panel reaching a deal that would spare the Pentagon additional pain. That hasn’t stopped them, however, from citing the dangers should the committee of Democrats and Republicans fail.

Asked whether, given the sharpness of his warning, Panetta thought he would be able to serve as defense secretary if the additional cuts were made, he chuckled.

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