JEFFREY BROWN: The nation's military will have to make do with fewer soldiers and Marines and wait longer for some next-generation weapons. That was the upshot today as Defense Department leaders laid out their plans for major savings.
As Army drill sergeants work to get their soldiers in shape, Pentagon leaders are working to get the military's budget in shape, cutting nearly $490 billion over the next 10 years, a figure mandated by Congress.
SECRETARY OF DEFENSE LEON PANETTA: We had to achieve savings that would meet the requirement that Congress gave us. And that is tough, it's real, and it's something that obviously will cause some pain. But, at same time, we recognize that Defense has to play role in dealing with the national deficit.
JEFFREY BROWN: Defense Secretary Leon Panetta said the plan will shrink the number of Army ground forces to 490,000 by 2017, down from a peak of 570,000 in 2010.
Also in the line of fire: two Army brigades stationed in Europe. And the number of U.S. Marines will be cut by 30,000, to 182,000 overall. In addition, the Pentagon plans to delay production of at least 100 of the new F-35 Lightning II stealth attack planes. The Air Force, Navy and Marine Corps had planned on replacing a portion of their aging aircraft fleets with those planes.
At the same time, the plan aims to achieve President Obama's goal of restructuring the military to make it smaller, but stronger, more tech-savvy and more mobile. To that end, some parts of the military's budget will be beefed up, with a focus on commando forces, like the ones that killed Osama bin Laden, and on cyber-security.
Overall, Panetta and Army General Martin Dempsey, chairman of the Joint Chiefs of Staff, said they believe they've come up with a well-rounded package.
GEN. MARTIN DEMPSEY, Joint Chiefs of Staff chairman: The special operating forces can only be -- quote, unquote -- "special" if there is a conventional force that allows them to conduct their operations and shape the environment. So, we got to do this all in balance. And I am confident we've done that.
JEFFREY BROWN: But for Republican presidential contenders, the prospect of such cuts is a bridge too far, as they said again in recent days.
MITT ROMNEY (R): As president, I will reverse the Obama-era defense cuts. I believe a strong America must and will lead the future. I'll insist on a military so powerful that no one would ever think of challenging it.
NEWT GINGRICH (R): Defense budgets shouldn't be a matter of politics. They shouldn't be a matter of playing games. They should be directly related to the amount of threat we have.
JEFFREY BROWN: The hit to the Pentagon could be even bigger down the road. Up to $500 billion in additional defense cuts will automatically take effect next January, unless Congress can agree on other ways to reduce the deficit.
Joining us now is Deputy Secretary of Defense Ashton Carter, who's been leading the budget review at the Pentagon.
Welcome to you.
ASHTON CARTER, deputy secretary of defense: Good to be here.
JEFFREY BROWN: I went through the broad vision a few weeks ago with Secretary Panetta, so I want to go right to some of the details, starting with the cuts to the size of the Army and Marines.
If the argument is that the dangers are still there, why do you feel you can make these cuts?
ASHTON CARTER: Well, first of all, there are not just cuts in the Army and the Marine Corps. There are cuts in the Navy and the Air Force as well. And there are things that are not getting cut, and even increased. That's the whole point of proceeding strategically with this effort.
JEFFREY BROWN: But starting with the ground forces.
ASHTON CARTER: So, the ground forces are a particular case of the moment in history in which we find ourselves.
The war in Iraq is over. Afghanistan is undergoing a transition. And that means that the very large stabilization force that we built up for Iraq and Afghanistan is not something we're going to be needing in the next few years, particularly - we'll need it through Afghanistan, but -- and a short while. And it's not something we need to retain.
We need to retain the know-how of how to do counterinsurgency, but we don't need to retain a large rotation force. If, in the future, we need once again to be in a counterinsurgency campaign, we can mobilize ground forces and regenerate ground forces.
So we don't need to keep those forces. Indeed, why spend money on that? That's money we can be spending elsewhere on things that we do need every day that are more relevant into the future. That's the kind of decision we've had to make throughout.
JEFFREY BROWN: The criticism, though, of course, is that we are weakening our ability to fight the two wars, as we have in the past, or to fight a major land war.
But your feeling is, even with the cuts, you can, what, adjust or ramp up as necessary?
ASHTON CARTER: With respect to the ground forces and counterinsurgency, not everything.
In a long counterinsurgency campaign, by definition, it's long. You can build up again the ground forces. What's hard to build up quickly are ships, aircraft, special skill sets in the ground forces.
And, by the way, we're going to continue to have a very large Army and a very large and powerful Marine Corps. These are cuts that are in the neighborhood of 10, 15 percent. We need a strong Army, because there are still many theaters in the world where ground combat is going to be necessary, and the U.S. Army needs to be able to dominate any other army.
JEFFREY BROWN: Secretary Panetta talked today, as he did when he talked with us recently, about potential risks as you downsize and reshape the force.
You also talked today about hard choices. So, it's a huge budget that you've got in all kinds of ways. But give me an example of a detail here of a hard choice that you made and the risk that now is there.
ASHTON CARTER: I'll give you an example that is highlighted in the document that we released today.
It's an unmanned aerial vehicle. It's one that we hope to have, we hope to retain. It's one of these weapons systems that have not been performing well, that's been overrunning in cost. And we decided to eliminate that. That's the kind of discipline we have to apply right along the line.
Now, the gap created by that capability will be filled by another aircraft that's almost as good. So it's not quite as good. Those are the kinds of decisions we have to make throughout.
JEFFREY BROWN: In the case of a major -- or a most expensive weapons system, I understand the Joint Strike Fighter, you're delaying it, right? You're delaying, but you're not cutting, you're not ending the process.
ASHTON CARTER: It's really not the budget that is driving our managerial behavior with respect to the Joint Strike Fighter.
The Joint Strike Fighter is not ready to go into full-rate production. It will take a couple more years to do that, and so we are slowing the climb to full-rate production for the Joint Strike Fighter. That's for the simple reason that we need to do some more testing and some more development work on the Joint Strike Fighter.
We want the Joint Strike Fighter and all three of its variants, and I think we will get it eventually. But, for right now, it's not ready to go into full-rate production.
JEFFREY BROWN: You also announced today a new round of -- well, a process for starting a new ground of base closings, the so called BRAC process.
Now, this has gone on for through several -- for a long time, several iterations. It's always contentious. It's always very politically contentious. And you're still in some ways grappling with the last round. Now, why call for a new round?
ASHTON CARTER: Well, how can we do otherwise?
This is -- if we have unneeded base structure, basing structure -- that is, tail, that is not tooth -- unneeded basing structure in our armed forces in a time when we're trying to deal with the deficit reduction, national security imperative that we face, how can we not put on the table unneeded basing structure?
JEFFREY BROWN: Have you identified . . . bases already?
ASHTON CARTER: The only way we can do it -- the whole point of the BRAC process is to identify cooperatively with the Congress and the communities involved basing structure that is excess to our need.
So to the public out there who wants a strong national defense, realizes it's still a dangerous world out there, but also realizes we don't have as much money as we thought we were going to have to spend on defense, they want us to be making cuts where we're essentially wasting money first, before we begin cutting real capability.
Excess basing structure is an example of that. And we simply have to do it. I realize it's always difficult. It's always politically difficult. Much of what we're doing is politically difficult. But we have no choice, because national defense is an important imperative, and we just don't have all the money that we thought. . .
JEFFREY BROWN: You're also calling for a BRAC-like process to review military pensions. And it's a reminder that, for all the focus on weapons systems and ground forces, a lot of personnel issues are really just like any private company, right, pensions, salaries, health care costs.
So you're limiting some salary increases and you're raising some health care fees. Does that possibly make the military a less attractive destination for people?
ASHTON CARTER: No, I'd say people are more important to us even than to private enterprise.
Our people are, much more than our weapons systems, the thing that makes our military the best in the world. And we want to make sure that we continue to recruit and retain all the excellent people of the kind we have now.
Therefore, we have not spared compensation entirely. But compensation makes up a third of the defense budget. It's only receiving a ninth of the budget reductions, so, not zero, but only a ninth. The areas that we're looking at specifically are military pay, but not soon, so that we give our military people and their families time to adjust.
There will be -- in no year will pay be cut. This is a matter of reducing the rate at which we were planning to raise military pay -- no pay cuts. You mentioned health care. The changes that we're proposing in health care are mostly for retirees and mostly for younger retirees who may be employed in any event.
And you mentioned the retirement commission. You know, retirement is a very serious, very complicated matter. We did not feel that we knew enough about it to make a proposal at this time. The president has suggested a commission to work on it. When that commission makes proposals, all the proposals will be grandfathered. They won't affect anybody who is now in service.
JEFFREY BROWN: All of this of course now goes into the budget process here. . .
ASHTON CARTER: It does.
JEFFREY BROWN: . . . and with details to come. You said it's going to be contentious.
You've already got the Republican candidates out there taking shots. We're starting to quickly get from the Hill reaction. You expect a big fight over all of this?
ASHTON CARTER: Well, we're trying to manage to the realities of the Budget Control Act.
It was passed by the Congress, both parties, both houses. National defense isn't a partisan matter. It's something that touches us all. We're just trying to be as honest and straightforward and analytical as we can, so that we make this huge adjustment, which is forced on us by the Budget Control Act, in the most sensible way, so that it has the least impact on our national defense.
It's still a dangerous world. We need a strong national defense. We're just trying to do it all in a smart way.
JEFFREY BROWN: All right.
Ashton Carter, deputy defense secretary, thanks so much.
ASHTON CARTER: Thanks, Jeff.