The Pentagon says that war funding would be hit by the $500 billion in automatic defense cuts through sequestration set to take effect January 2013, which was an area that the Defense Department had previously said would be exempt.
The inclusion of Overseas Contingency Operations (OCO) in sequestration will give opponents of the automatic cuts another tool to argue for their reversal, particularly with the war in Afghanistan still ongoing.
Initially, the Pentagon said that OCO funds were not included in sequestration: Defense Secretary Leon Panetta wrote in a letter to Sen. John McCainJohn McCainSunday shows preview: Trump plans next steps Ex-Bush aide Nicolle Wallace to host MSNBC show Meghan McCain: Obama 'a dirty capitalist like the rest of us' MORE (R-Ariz.) that OCO was “fully exempt from the sequester, so added costs for wartime operations would not be affected.”
Panetta wrote that letter in November 2011, just as the congressional supercommittee was failing to avoid the sequester in arguments over the federal debt limit.
Since then, however, the Pentagon has consulted with the Office of Management and Budget to determine whether the war funds are in fact included.
“When we first read the Budget Control Act, the Department believed that since OCO could not trigger a sequester, it would also not be subject to sequester,” Pentagon spokeswoman Lt. Col. Elizabeth Robbins said in an email.
“Upon further review of the law and after consulting with OMB, the Department now understands OCO funding is not exempt from sequester,” she said.
Panetta and other Pentagon officials have said that sequestration would be devastating to the military — a sentiment that is embraced by members of Congress in both parties.
McCain and House Armed Services Committee Chairman Buck McKeon (R-Calif.) have introduced similar bills to delay sequestration for one year, but they haven’t gathered Democratic support.
While both Republicans and Democrats largely oppose sequestration, the two sides have failed to find a solution to reverse the cuts with alternative deficit-reduction plans.