JIM LEHRER: Now to the second of our budget stories tonight.
The Obama administration defends its military budget before Congress today.
U.S. troops are still embroiled in Iraq and Afghanistan, but the top leaders at the Pentagon engaged today in combat of a different kind at a House hearing on the defense budget.
U.S. DEFENSE SECRETARY ROBERT GATES: We still live in a very dangerous and very unstable world. Our military must remain strong and agile enough to face a diverse range of threats.
JIM LEHRER: Defense Secretary Robert Gates and the Joint Chiefs chairman, Adm. Mike Mullen, went before the Armed Services Committee. They agreed on the need for belt-tightening but not at the risk of U.S. strategic interests.
ROBERT GATES: We shrink from our global security responsibilities at our peril. Retrenchment brought about by short-sighted cuts could well lead to costlier and more tragic consequences later, indeed, as they always have in the past.
ADM. MICHAEL MULLEN, Joints Chiefs chairman: Cuts can reasonably only go so far without hollowing the force. In my view, then, this proposed budget builds on the balance we started to achieve last year and represents the best of both fiscal responsibility and sound national security.
JIM LEHRER: President Obama's military budget for the coming fiscal year includes more than $550 billion. It seeks another $118 billion to cover the costs of war operations. In a major cost-saving move, it calls for reducing the size of the army and Marine Corps starting in 2015.
That last item didn't sit well with Committee Chairman Buck McKeon, a Republican from California.
REP. HOWARD "BUCK" MCKEON (R-Calif.): Much of the savings appears to be generated with reductions to Army and Marine Corps end strength in the 2015 to 2016 time frame. The decision to reduce end strength seems premature given the uncertainty in predicting the full range of force and manpower requirements in Afghanistan after 2014.
ROBERT GATES: Just three years ago, we had 190,000 troops combined in Iraq and Afghanistan. By the end of this calendar year, we expect there to be less than 100,000 troops deployed in both of the major post-9/11 combat theaters, virtually all of those forces in Afghanistan.
That is why we believe that, beginning in F.Y. 2015, the U.S. can with minimal risk begin reducing Army active-duty end strength by 27,000 and the Marine Corps by somewhere between 15,000 and 20,000.
JIM LEHRER: The Pentagon budget also cancels a second engine for the F-35 Joint Strike Fighter now under development. Gates and Mullen said it would save hundreds of millions of dollars.
ADM. MICHAEL MULLEN: I mean, I've been doing money a long time. I cannot make sense out of this second engine. It is two to three years behind. It's not going to compete, quite frankly. We cannot afford to buy the second engine.
REP. HOWARD "BUCK" MCKEON: Do we have a fixed cost on this? Or will they, being the sole source engine, be able to raise their prices 10 years out?
ADM. MICHAEL MULLEN: I actually think -- I think, with the kind of production line we're talking about, they'll come down.
REP. HOWARD "BUCK" MCKEON: We hope.
JIM LEHRER: Later this afternoon, the House agreed with that stance and voted to cancel the backup engine. The vote was 233-198. A wave of Republican freshmen joined in killing the project.
Still, the Pentagon leaders at today's hearing urged lawmakers to keep military spending in perspective.
ROBERT GATES: You have 18.9 percent of federal outlays, which I might add is the lowest percentage of federal outlays for defense, other than the late '90s, early 2000s, since before World War II, and yet because we have a half a trillion dollars, then we must be part of the problem in terms of the -- of the nation's debt and the deficit.
JIM LEHRER: For Gates, this was his fifth and final budget presentation to Congress. He said he's stepping down later this year.
For more on the politics of military spending, here is NewsHour political editor David Chalian.
David, first, just this vote today to kill that second engine on that -- that fighter -- fighter jet, is that saying something has changed politically in the House of Representatives, if nowhere else?
DAVID CHALIAN: I think, very much, it does say that, Jim.
Remember, let's start broad picture here. At the beginning of this Congress, when the Republicans took over, the new House majority leader, Eric Cantor, said, when talking about needing to cut spending, everything's on the table, including defense spending. That was new in general as a Republican-controlled Congress or House.
You didn't hear that from previous Republican-controlled Houses. So, that was a new line of thought. What I -- what was new today was having -- there are 87 new freshmen Republicans in this House. Many of them were Tea Party-backed candidates last year who went to Congress with a single mission: cut spending.
These are not Republicans that find the Pentagon sacrosanct from this or -- and apart for this. So, they joined with the Democrats, with President Obama's stated mission of wanting to get rid of this second engine and put this over the top.
It was only a year ago that the Democrat-controlled Congress actually continued -- voted to continue to let this program live. This represents a new with these Republican freshmen, many of which -- many of whom came from the Tea Party process.
JIM LEHRER: Well, the other issue that was raised by Chairman McKeon, should we really reduce the forces, the size of forces in the United States Army, the United States Marine Corps?
We heard what Secretary Gates -- that's also -- nobody -- usually, everybody is -- wants for more troops. And for a secretary of defense and for a Joint Chiefs chairman to say, OK, it's OK to cut the size, that's unusual, is it not?
DAVID CHALIAN: It is unusual, but there's a political point here being made, too, that the White House is eager to get out there. And Secretary Gates leaned into that a bit, which is, a lot of what they point to is the fact that the Iraq war has now unwound, and they have been able to -- they are able to bring so many troops home, and that they're not going to have these two huge active theaters.
Of course, that was one of President Obama's major campaign promises was to unwind the Iraq war. And -- and that's why they're able to point to this as, we may not need what we once needed.
But you're right. It is not something you usually hear from a secretary of defense, nor is trying to control the spending at the Pentagon. And you hear that from Secretary Gates as well.
JIM LEHRER: Because he not only -- not only this engine, the second engine. There's also a large amphibious piece of equipment that the Marines want that -- that it also is going to be canceled. And there's opposition to that within members in whose districts these things are built, which has always been part of the equation, has it not?
DAVID CHALIAN: Well, now you've hit the nail on the head, because, when you're talking about defense spending, you're talking about debates that are far more parochial than partisan.
JIM LEHRER: Yes.
DAVID CHALIAN: This is not Republican versus Democrat. And this is age-old, right, base closings that we have seen over the years as well.
This is when, if you're from Ohio and it's jobs and federal money in Ohio that you want to protect, all of a sudden, your party label doesn't matter as much. And so you do see that. You know government contractors, to build a single plane, try to spread out all the parts across all the states and all the congressional districts for exactly this reason, because they know that the members will vote their parochial interests.
JIM LEHRER: So, somebody says: Hey, I'm all for cutting federal spending and yes, defense spending is on the table. You bet it is. Oh, but I didn't mean that because that Navy base is in Virginia, and I'm the -- a United States senator from Virginia, just to use an example.
DAVID CHALIAN: Right. It's a flip on that phrase of not in my backyard.
JIM LEHRER: Yes.
DAVID CHALIAN: You can't cut from there.
But, as we said at the top here, Jim, the new element here...
JIM LEHRER: Yes.
DAVID CHALIAN: ... are these Tea Party Republicans that are part of this huge freshman class who don't necessarily feel that way. They are a different strand of member of Congress, who don't seem right now all that fearful, at least a handful of them, and a significant handful, to go back home and say: I voted against that, even though it would have been good for our district, because the overall spending for the country has to come down.
JIM LEHRER: And do you expect this to really take off? I mean, do you expect this to become a new -- in other words, is the impetus, the political impetus on doing something about the deficit, doing something about spending going to change the way we do defense spending?
DAVID CHALIAN: Well, a little bit, I would say, change it a little bit, because, remember, that $78 billion cut plan that was put out by...
JIM LEHRER: Yes.
DAVID CHALIAN: ... that you spoke to Secretary Gates about, those, as you know, are not real cuts. They're cuts in growth. So, it means that the Pentagon won't be spending as much as quickly. But they're not actual real-world cuts to defense spending.
So, do I think it will have a little impact? Yes. But do I think we're about to change the way we do business? I'm not so convinced just yet.
JIM LEHRER: All right, David, thank you.
DAVID CHALIAN: Sure.