Defense Budget Cuts Would Limit Raises and Close Bases

Although the pay-raise limits were described as modest, and would not start until 2015, they are certain to ignite a political fight in Congress, which since the attacks of Sept. 11, 2001, has almost always raised military salaries beyond what the Pentagon has recommended.

Increasing health insurance fees for retirees and closing bases are also fraught with political risk, particularly when Republican presidential candidates are charging that President Obama is debilitating the military.

Next year’s Pentagon budget is to be $525 billion, down from $531 billion this fiscal year. Even though the Defense Department has been called on to find $259 billion in cuts in the next five years — and $487 billion over the decade — its base budget (not counting the costs of Afghanistan or other wars) will rise to $567 billion by 2017. But when adjusted for inflation, the increases are small enough that they will amount to a slight cut of 1.6 percent of the Pentagon’s base budget over the next five years.

Nonetheless, Defense Secretary Leon E. Panetta said he was working with about $500 billion less than he had anticipated having on hand through 2017, meaning that the Pentagon had to trim personnel and favorite high-profile weapons programs. “This has been tough work,” Mr. Panetta said at an hourlong news conference.

He said that the Army would be reduced over five years to 490,000 troops, down from a peak of 570,000, and that the Marines would be cut to 182,000, down from 202,000. (Ground forces would still be slightly larger than they were before 9/11.) The Pentagon initially will buy fewer F-35 Joint Strike Fighter stealth jets, which are not expected to be in service until at least 2017 and have the distinction of being one of the costliest weapons programs in history. In the Navy, 14 warships will be either retired early or built more slowly.

Both Mr. Panetta and Gen. Martin E. Dempsey, the chairman of the Joint Chiefs of Staff, who also addressed the news conference, repeatedly said that the United States would still maintain the strongest military in the world, an assessment that seemed aimed at Republicans as well as America’s adversaries. “Capability is more important than size,” General Dempsey said. He added that “this budget does not lead to a military in decline” and that “it is a military that can win any conflict, anywhere.”

Although all American combat troops have been out of Iraq since mid-December and the Obama administration is beginning to withdraw what had been more than 100,000 United States forces in Afghanistan, the Pentagon budget includes a request for $88.4 billion next year, above the $525 billion base budget, to pay for combat operations overseas. Mr. Panetta said that Afghanistan, where there are still 90,000 American troops, accounts for the bulk of that money. This year’s budget for combat operations overseas is $115 billion.

Pentagon officials did not specify what the limits would be on military pay increases in 2015 and beyond, when American troops are due to be home from Afghanistan, although they characterized the change as incremental — an acknowledgment of the political risk of having active and retired members of the armed forces bear the brunt of the budget cuts. “Let me be clear, nobody’s pay will be cut,” Mr. Panetta said.

Still, the defense secretary has also called military personnel costs “unsustainable.” The Pentagon currently spends $181 billion a year, nearly a third of its base budget, on military personnel: $107 billion for salaries and allowances, $50 billion for health care and $24 billion for retirement pay.

Military salaries have risen steadily since the Sept. 11 attacks, and officers have in many cases fared better than enlisted personnel.

A private first class with a family and three years’ experience deployed to a war zone took home $26,700 tax-free in 2001, compared with $36,000 today — an 11 percent raise over inflation. A lieutenant colonel with a family and 20 years’ experience deployed to the same war zone took home $84,000 tax-free in 2001, compared with $120,000 today — a 16 percent increase.