The across-the-board cuts set to go into effect on March 1 “would create an immediate crisis in military readiness,” according to Deputy Secretary of Defense Ashton Carter.  In the longer-term, Carter warned sequestration will force a change in US defense strategy.

Carter testified last week before the Senate Armed Services Committee (SASC) along with Joint Chiefs of Staff Chairman Gen. Martin Dempsey, and Service military leaders on the effects sequestration will have on defense capabilities.

Carter reminded the SASC that he told Congress in August that implementing sequestration would lower readiness, disrupt DoD’s investment programs, and could lead to a partial hiring freeze or unpaid furloughs.

Now, with sequestration imminent and the prospect of operating under a continuing resolution (CR) for the entire FY2013 a distinct possibility, Carter identified the effects of these events in more detail.  The FY2013 DoD budget would have to be cut by $46 billion in the last seven months of the year, he said.  Because the president exempted military personnel from sequestration, the remaining accounts would be reduced by eight percent under sequestration (nine percent if DoD were required to operate under a CR for the entire year).  The current CR runs out on March 27, 2013.

The across-the-board cuts would have to taken proportionately at the appropriation account level, he said.  In the investment accounts (procurement, research and development, and military construction), proportional cuts would have to be taken from 2,500 separate line items.

Carter warned that the Operations and Maintenance (O&M) accounts would be especially hard hit (-$13 billion in FY2013) by sequestration.  To protect O&M funding that supports combat forces, DoD would have to disproportionately cut other O&M accounts, producing a $5 billion shortfall.  If the CR is extended, lower overall funding for O&M would add another $11 billion to the shortfall.  Higher than expected wartime operating costs could require even more base-budget cuts, adding $5 to $6 billion to the O&M shortfall.  In total, the FY2013 O&M shortfall could reach $35 billion or about 23 percent of the O&M request, Carter said.  

He cited actions DoD and the Military Services are already taking to slow spending to avoid serious problems if sequestration is implemented.  A civilian hiring freeze has been implemented for most non mission-critical activities and a large portion of the 46,000 temporary and term employees are being laid off, he said.  Military Services and Defense Agencies will also cut facilities maintenance activities, affecting $10 billion in funding.

Carter said DoD still hopes that Congress will agree to an alternative to sequestration.  Therefore, it appears that DoD will not reflect sequestration in the FY2014 budget.  When asked by Sen. Inhofe (R-OK) if the FY2014 budget the administration will send to Congress at the end of March will include sequestration cuts, Carter simply replied “no.”

Gen. Dempsey and the Service Chiefs underscored Carter’s testimony.  Implementing sequestration over the long-term would cause another $500 billion in reductions over 10 years, Dempsey warned.  This will, he said, “severely limit our ability to implement our defense strategy, put the nation at greater risk of coercion, and break faith with the men and women who serve this nation in uniform.”

Gen. Raymond Odierno, Army Chief of Staff, said the Army would terminate 3,100 temporary employees and furlough 251,000 civilians.  Cancelling third and fourth quarter depot maintenance could mean terminating 5,000 employees, he said.  If sequestration is implemented for the long-term, Odierno said the Army might have to cut 189,000 personnel and delay one in 10 major Army modernization programs.

ADM Mark Ferguson, Vice Chief of Naval Operations, said that combined effect of sequestration and a year-long CR would “reduce the Navy’s overseas presence and adversely impact the material readiness and proficiency of our force.”  The Navy would have to cut O&M by $4.6 billion, delay starting construction of the John F. Kennedy (CVN-79) and completing the America (LHA-6), and cancel buying the Arleigh Burke class destroyer.  The Navy will also have to cut flying hours and underway days, cancel deployments, and suspend most non-deployed operations, he warned

Marine Corps Commandant Gen. James Amos said as a result of sequestration “50 percent of my combat units will be below minimal acceptable levels of readiness” by year’s end.  

Gen Mark Welsh, Air Force Chief of Staff told the committee the Air Force expects a $12.4 billion cut in FY2013 under sequestration.  As a result, he said Air Force would furlough 180,000 civilians and lose 200,000 flying hours.  Walsh warned that two-thirds of the active duty combat Air Force units would be “non-mission capable by July.”  

National Guard Bureau Chief Gen. Frank Grass said sequestration will increase depot maintenance backlogs and cut funding for equipment reset.  Sequestration, he said, will very quickly erode “our readiness as an operational force for our Nation’s defense and as an immediate homeland response capability.”