WASHINGTON (Feb. 20, 2013) -- Looming spending cuts and the lack of a budget for the fiscal year present a readiness crisis for the Defense Department, Deputy Defense Secretary Ashton B. Carter told the Senate Appropriations Committee here, Feb. 14, 2013.
Major across-the-board spending cuts will take effect March 1, triggered by a "sequestration" mechanism in budget law, unless Congress acts to stop them. Meanwhile, the government is operating on funding from a continuing resolution that expires March 27.
Carter said he and Defense Secretary Leon E. Panetta have repeatedly warned of devastating effects of sequestration on the nation's defense and everything the Defense Department does, Carter said. "We've been talking about this for 16 months now, and now the wolf's at the door," he added.
But sequestration's potential effects are only part of the fiscal difficulty the department faces, the deputy secretary said.
"The continuing resolution poses a different problem for us," he said. "We have enough money in the continuing resolution. The problem is that it's in the wrong accounts, and, in particular, the operations and maintenance part is very much short."
That, he said, causes problems for what's left of the fiscal year.
In the near term, Carter told the senators, the continuing resolution and the potential effects of sequestration have created what Defense Department leadership calls "a crisis in readiness."
Over the next 10 years, he added, "if the budgetary caps, triggered at the same time sequester is triggered, are sustained, we're not going to be able to carry out the new defense strategy crafted under President (Barack) Obama's leadership just one year ago."
Carter said the Pentagon understands the department needs to make a contribution to the country's fiscal situation and its resolution.
"But both a strategic approach to defense spending and efficient use of the taxpayer dollar are undermined by sequestration," he said. "And what's particularly tragic is that sequestration's not the result of an economic recession or an emergency."
Rather, he said, the problem is the collateral damage of political gridlock.
"For our troops, for the force, the consequences are very real and very personal," he added.
Carter said while the president has indicated he intends to spare military compensation from sequestration, troops will feel its impacts "very directly in other ways."
"Between now and the end of the year, we will need to sharply curtail training in all of the services," he explained. "For example, a brigade combat team that has returned from Afghanistan that is used to being at tip-top readiness can't train."
The Army reports that two-thirds of its brigade combat teams will be at reduced readiness by year's end and similarly affecting the other services as well, Carter told the committee.
He also said misconceptions exist about "much maligned" DOD civilians, who face unpaid furloughs that would reduce their pay by 20 percent over the rest of the fiscal year.
"A lot of people think that DOD civilians are people who wake up in the Washington suburbs, get in a car, and drive up [Interstate] 395 and come to an office building here," Carter said. "They're not. Most of them work in depots. They fix airplanes. They maintain ships and overhaul ships."
Carter said 86 percent of DOD civilian employees don't even live in the Washington area, and 44 percent of them are veterans.
"On or around April 1, we will need to begin to furlough many of them," he said, "and to do that for up to 22 days, which is the statutory limitation."
Carter said that if that happens, he will return a fifth of his own salary to the U.S. treasury, noting that he cannot be furloughed because he is a Senate-confirmed presidential employee.
"There's a real human impact here," Carter said. "And in addition to the military and civilian personnel, the effects will be devastating on the defense industry, upon which we depend."
The quality of the U.S. defense industry, Carter said, is second only to the quality of its people in uniform, and that combination makes the U.S. military the greatest in the world. "And a technologically vibrant and financially successful defense industry is in the national interest," he added.
Carter said even subcontractors -- often small businesses -- will feel the effects of sequestration, of the longer-term budget cuts, and even of the "prolongation of uncertainty."
"And above all, sequester will cause a spike in program inefficiency by stretching out programs and driving up unit costs," Carter said. "So for the force -- military, civilian, our industry -- the consequences are very direct and devastating."
The deputy defense secretary closed his testimony by appealing for a de-triggering of sequestration and a passing of appropriations bills for the Defense Department and all federal agencies.
"The cloud of uncertainty hanging over our nation's defense affairs is already having lasting and irreversible effects," Carter said. "Ultimately, the cloud of sequestration needs to be dispelled and not just moved to the horizon. The magnificent men and women of the Department of Defense and their families deserve no less."
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