If the sequestration cuts of up to $600 billion occur, they will be spread out evenly over the next decade. That means that the Pentagon would have to reduce its 2013 budget to roughly $472 billion from the $525 billion that’s currently planned with the initial round of cuts in the August debt-limit deal.
“A lot of things you could do to save money in the defense budget take time to implement,” Harrison said. “Instead of making these structural changes, in the short term, the DOD will be forced to make quick cuts, and the quickest way to cut money is in acquisitions.”
That doesn’t mean that the Pentagon can easily ignore benefits, Harrison said, as healthcare costs are rising rapidly. In the 2012 budget, the defense health program totals $32.2 billion. That doesn’t include TriCare for Life, a program for retired veterans on Medicare, which is budgeted at $10.7 billion in 2012.
Military healthcare costs have also increased in part because TriCare premiums have not risen since 1995, and retired veterans are increasingly opting to remain in the system over private health insurance, Harrison said.
Even if the automatic sequestration cuts of $500 billion do not occur, the Pentagon will still look to weapons systems as it cuts $450 billion over the next decade from the debt-limit deal.
One of the top targets could be the F-35 fighter program, the Pentagon’s most expensive weapons program in history.
“Size matters here,” Harrison said. “If you are going down the list looking to free up billions of dollars, you’re going to start with by looking at the big programs.”