As recently as a year ago, the Pentagon had hoped it could escape relatively untouched. In May 2010, Gates ordered the armed services to scrape together $100 billion in savings over five years in what he called an “efficiencies” drive. But rather than give the money back to the Treasury, Gates said the services could spend the money on new programs instead.
In January, Gates tried again to deflect fiscal pressures by ordering the Pentagon to cut $78 billion in projected spending over five years. But that figure was soon dwarfed by Obama’s directive in April to identify $400 billion more in possible cuts over 12 years.
While those may sound like big numbers, some analysts said they represent a reduction in projected spending only and that the Pentagon’s budget would actually continue to grow slightly, about at the rate of inflation.
Even cuts of $1 trillion over 10 years could be absorbed relatively easily, said Gordon Adams, who oversaw national-security budgets for the Clinton White House and is now a professor at American University.
“It’s not like it would be whacking American’s defense budget to the bone,” he said.
While a reduction of $1 trillion would be significant, he said, it would represent a much smaller-percentage decline in defense spending than what the Pentagon encountered at the end of the Cold War, when its budget declined by 36 percent between 1985 and 1998.
Meanwhile, signs that the Pentagon is entering a period of thrift are becoming apparent.
On Thursday, the Defense Business Board, a private-sector panel that advises the secretary of defense on financial matters, will convene its quarterly meeting to discuss a report on “corporate downsizing applications” that might prove relevant for the military.
“This new era will require a different mindset,” Ashton B. Carter, the Defense Department’s chief weapons buyer, said to an audience at the Brookings Institution.
While expensive weapons programs may grab the most public attention, analysts said the biggest — and toughest — target for spending reductions will be personnel costs, which are rising at unsustainable rates. Also soaring are expenses for overhead, back-office functions, military schools, commissaries and other functions that are distant from the battlefield, said Arnold L. Punaro, a member of the Defense Business Board and a retired general in the Marine Corps.
“The reason we have a Department of Defense is to break things and kill people,” Punaro said. “The problem we have now is that so much of the money is not going to the people who are breaking things and killing people.”