Panetta, Clinton warn that State, Defense budget cuts undermine national security

Steep cuts to military or diplomatic budgets could undermine national security, Secretary of Defense Leon Panetta and Secretary of State Hillary Clinton warned Tuesday in a joint appearance. 

The two Cabinet members said cuts that could be triggered under the debt-ceiling deal signed by President Obama earlier this month could hurt U.S. troops while limiting the State Department's ability to engage in diplomacy. 

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"[The proposed cuts] would break faith with troops and their families," Panetta said. "It would literally undercut our ability to provide for the national defense."


Clinton echoed the new Pentagon leader's concerns, warning that budget were casting "a pall" over the U.S. ability to project its security interests. 

"I'm not saying we should be exempt, but we have to do a reasonable analysis of what our needs are," Clinton said.

Panetta and Clinton chose a town-hall event at National Defense University Tuesday morning to raise their concerns. The event was aimed at underscoring the increasing cooperation between their departments. Clinton had a close working relationship with ex-Pentagon chief Robert Gates, and Tuesday's event underscored efforts Clinton and Panetta are making to remain on the same page. 

Clinton cautioned that while cuts to foreign aid might be politically palatable, she believed that the United States was missing an opportunity for a modern-day Marshall plan in response to the wave of popular uprisings in the Arab world.

"We have an opportunity right now in the Middle East and North Africa that I'm not sure we're going to be able to meet," Clinton said.

 Panetta was questioned about a CBS report that the military was considering an overhaul of the military retirement system that would replace the current pension program with a 401(k)-style plan, and confirmed that the department was studying the idea.


 "No decisions have been made, but it's the kind of thing that has to be considered." Panetta said. "You have to look at everything on the table."


Under the debt-ceiling deal struck earlier this month, the Defense Department faces an additional $500 billion in cuts unless Congress adopts the deficit supercommittee's suggestions.

Those cuts will be triggered if the new panel's members are unable to reach a deal on $1.5 trillion in deficit cuts, or if Congress rejects the panel's proposal.

While the secretaries were primarily concerned with pushing back against possible budget cuts, they also took time to promote increased cooperation between their departments. Clinton and Gates took great pains to coordinate their missions prior to Gates' retirement.


"We are a nation that has a special role in the world - a special role because of our military power, a special role because of our diplomatic power," Panetta said.

At the event, Clinton was also asked about the U.S. response to the conflict in Syria and again avoided explicitly calling on Syrian President Bashar Assad to resign.

Panetta refused to comment on reports that the Pakistanis had allowed the Chinese to study wreckage from the stealth helicopter that crashed during the Osama bin Laden raid.

Panetta was also asked about the possibility of political engagement with the Taliban in Afghanistan, a strategy that American officials have shied away from in the past.

"Part of the mission is supporting Afghani reconciliation," Panetta said. "There has to be political resolution ... but we want this to be Afghani-led and Afghani-owned."