By Larry Shaughnessy, with reporting from Elise Labott at the State Department
The Pentagon spelled out in billions of dollars on Monday precisely how it wants to save nearly half a trillion dollars in defense spending over the next five years, as the Department of Defense and other parts of the American national security apparatus sought to rebalance their books to account for new areas of concern.
Beginning this year, the military wants to spend far less on the war in Afghanistan compared with recent years as the U.S. draws down its forces, with an eye on the exit for most by the end of 2014.
In 2013, the Department of Defense expects to spend $88 billion on overseas contingency operations, almost all of it on the war in Afghanistan. That's compared with the $115 billion it expects to spend this year.
Those savings have to come from somewhere.
To find those savings, the plan is to cut $5.5 billion from the amount it pays for Afghan security forces, whose training is a key part of the plan to draw down U.S. forces.
Todd Harrison, a senior fellow for defense budget studies at the Center for Strategic and Budgetary Assessments, said those numbers surprised even him. "That is interesting. I don't know ... why that is. And it literally is cutting (the Afghan National Security Force) budget) in half."
In addition, $700 million will be cut from the budget for defeating improvised explosive devices, one of the deadliest weapons in the enemy's arsenal. The Iraq war still has some cost; $2.9 billion is budgeted to repair and replace equipment and replenish munitions.
The cuts come in part with the Obama administration's plan to reduce U.S. troop levels in Afghanistan.
"It just shows that things are winding down to an end. A lot of what (the Joint Improvised Explosive Device Defeat Organization) has been working on are things that, you know, 'we develop them now, and we can build them in the next year or two.' If we're not going to be there in a few years, then it stands to reason," Harrison said.
But not everything is going down in the overseas contingency budget. After two straight years in which the Army was given $1.9 billion to cover the costs of extra soldiers in Afghanistan, the 2013 request calls from $4.9 billion, even though the number of soldiers in Afghanistan is scheduled to drop.
"They are essentially getting around the budget plans that were passed in the budget control act by shifting $3 billion of Army personnel funding to the war budget," Harrison said. "So this is stuff that's not really war-related."
With the war in Iraq done and the war in Afghanistan given an end date, the military is planning its budget around future threats. "The force will no longer be sized for large scale, prolonged stability operations," according to the department's budget summary.
Monday's budget release mostly puts numbers on a defense budget strategy unveiled by President Obama and Secretary of Defense Leon Panetta last month at a rare joint news conference at the Pentagon. At that time, Panetta said the budget would reflect a military that "will be more agile, more flexible, ready to deploy quickly," but to look at the numbers, you might think otherwise.
The overall U.S. Army budget is going up, while the Navy and Air Force budgets are dropping. Harrison called it a case of institutional inertia.
"I think what it reflects is that while there is an intent to shift, you know, within the military, I think it's harder to put it into practice in the budget, at least in this first year," he said. "The strategic guidance talked about a greater reliance in sea and air power and less reliance on ground forces. What we see in the budget, the Army actually goes up and the Air Force and Navy budgets go down. So it seems to be somewhat inconsistent with the strategy."
One of the most influential members of Congress is giving the budget a thumbs-up. Rep. Adam Smith, the ranking Democrat on the House Armed Services Committee, said in a statement, "I have consistently said that we can rationally evaluate our national security strategy, our defense expenditures and the current set of missions we ask the military to undertake and come up with a strategy that enhances national security by spending taxpayer dollars more wisely and effectively. I believe this budget meets that goal."
Among other places the agency is saving money is the Joint Strike Fighter, the warplane of the future for the Air Force, Navy and Marines. The department plans to save more than $15 billion by slowing the development and testing of the planes. A similar slowdown for the Army's ground combat vehicles and the Navy's shipbuilding program will save $1.3 billion and $13.1 billion, respectively.
Next year, all soldiers, sailors, airmen and Marines can expect a basic pay raise of 1.7%, but starting in 2015, the Department of Defense plans to reduce raises, with an eye toward saving more than $29 billion over the next five years. In addition, the Department of Veterans Affairs is requesting a 4.5% budget increase to support its various health, job and family programs.
But not everything is being cut. Programs like Special Operations forces, unmanned aerial systems, cyber capabilities, missile defense, space initiatives and the new Air Force tankers are expected to see budget increases.
The military will also spend to eventually save, almost tripling the money invested in energy conservation to $1 billion.
Intelligence funding is being requested at $52.6 billion, which will enhance cybersecurity capabilities, according to the intelligence budget summary. That's a slight decrease from the $55 billion that the director of national intelligence was expected to request in 2012 (official 2012 numbers will not be released until later this year).
Obama requested $51.6 billion in discretionary funding on Monday for the State Department and the U.S. Agency for International Development for fiscal year 2013, an increase of only 1.6% over last year.
The discretionary funding includes $43.4 billion for the core budget, with an additional $8.2 billion in a separate "overseas contingencies operations" account in the front-line states of Afghanistan, Iraq and Pakistan. The overseas contingency funding requested is about $3 billion, or 26%, less than the enacted level for fiscal year 2012.
"Even in tough times, this request represents a smart and strategic investment. The State Department and USAID are among the most effective - and cost effective - tools we have to create economic opportunity and keep Americans safe," Secretary of State Hillary Clinton wrote in her letter accompanying the budget request.
"We know that this is a time of fiscal constraint and economic hardship for the American people. So we are seeking out every opportunity to work smarter and more efficiently. We have proposed painful but responsible cuts without compromising our national security mission."
The State Department suffered major budget cuts last year, accounting for the slight increase over fiscal 2012 levels as enacted by Congress in the latest appropriations bill. Still, the increase is minimal, considering the State Department's growing responsibilities in front-line states.
For Iraq, the State Department requested 10% less than the current fiscal-year level. Obama asked for $4.8 billion for civilian-led missions in Iraq, including about $1.8 billion to fund police training and military-assistance programs inherited from the Department of Defense. Another $2.7 billion in operations funding would primarily support the Embassy, which has grown to about 16,000 diplomats and contractors in Baghdad, and three consulates.
The State Department requested $4.6 billion for projects in Afghanistan, including $2.5 billion slated for counterterrorism-related programs, reconciliation and reintegration efforts, and other assistance. An additional $2.1 billion will support the expansion of the diplomatic and other U.S. personnel in the country, as well as public diplomacy programs.
The budget request includes $770 million for a Middle East and North Africa Incentive Fund to deal with the aftermath of the Arab Spring. Although the funding has not been programmed, officials say the money will go to assist countries in transition as they enact political and economic reforms.