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BIG PENTAGON BUDGET REDUCTIONS

31 Dec 04. The Wall Street Journal reported that under orders from President Bush to tighten its belt amid the escalating cost of the war in Iraq, the Pentagon is poised to make significant cuts to its budget for buying new weapons systems, aiming to trim some $60 billion over the next six years, industry and government officials said.

The Navy and the Air Force are expected to be among the hardest hit, given the number of big-ticket weapons in their budgets. On the list of possible programs that could see funding delayed or scaled back is the Air Force’s F/A-22 fighter jet and the Navy’s newest DDX destroyer, as well as aircraft carriers and auxiliary ships, industry and government officials said.

Defense Secretary Donald Rumsfeld’s office is finishing a budget that is expected to be sent to the White House Office of Management and Budget shortly. Top Pentagon officials are looking to cut about $10 billion from their budget for fiscal 2006, which begins next October, as well as in each of the following five years. The proposed cuts were reported yesterday in the New York Times.

Such cuts aren’t a complete surprise. Pentagon and military officials have warned for years about a “bow wave” of funding requirements in 2008 when the bills for a number of new weapons programs begin to come due. As it happens, that wave is arriving just as the Pentagon budget is under extra pressure from the cost of the Iraq occupation and a federal deficit that now totals about $413 billion.

Within the last week, Mr. Rumsfeld called Sen. John Warner, a VirginiaRepublican and head of the Armed Services Committee, to outline the general thrust of the budget cuts being considered, confirmed John Ullyot, a committee spokesman. “It is clear that the Department of Defense will not be exempt from budget cutting this year,” said Mr. Ullyot.

He said Mr. Warner is reserving judgment about possible cuts to the Navy’s shipbuilding budget, which the senator has strongly supported because of the amount of work done in Virginia shipyards. Industry officials said the Navy could decommission its two non-nuclear aircraft carriers, the USS Kitty Hawk and the USS John F. Kennedy, and scale back plans for its next-generation version, the CVN-21.

Also being considered is scaling back a joint Navy-Marine Corps program of transport ships called LPD, which could be cut to nine vessels from the currently planned 12. Northrop Grumman Corp., based in Los Angeles, is the maker of both the aircraft carriers and the LPD ships. The Navy’s next-generation DDX destroyer is still in development, though rising costs in the program could lead the service to pare the planned funding of eight of these ships in the next five years, a Navy official said. (See BATTLESPACE UPDATE Vol.6 ISSUE 41, 30 October 2004, AUSA 2004 – BACK TO THE FUTURE)

The F/A-22, a $60 billion program, has been a frequent target for attack in recent years. Originally developed to fight the Soviets, the fighter jet has been in development for more than 20 years, and its procurement numbers already have been severely reduced. In 1991, the Air Force expected to produce 750 of the supersonic aircraft made by Lockheed Martin Corp., of Bethesda, Md., and Chicago-based Boeing Co. The service recently planned to buy 276, but under current discussions, production could slip to 160 aircraft, with reductions largely taking effect after 2008, industry officials said. That would cause the price per aircraft to skyrocket, making the plane an even bigger target in a race to cut budgets, industry analysts said.

For now, the biggest Pentagon program, the $250 billion Joint Strike Fighter being developed by Lockheed, appears to have escaped cuts. The Army’s marquee development program — a comprehensive revamping of armor, surveillance, communications and howitzers dubbed Future Combat System — has been bracing for significant cuts since the summer. Led by Boeing and car

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