War funds will be exempt from sequester, analysts say

Pentagon officials, including Defense Secretary Leon Panetta, all but guaranteed war spending would remain untouched from the $500 billion in defense cuts set to take place in January. 

However, the Pentagon confirmed to The Hill in May that White House budget analysts concluded the war funds would be included in those automatic budget reductions. 

“Upon further review of the law and after consulting with OMB, the Department now understands OCO funding is not exempt" from budget cuts via sequestration, according to Pentagon spokeswoman Lt. Col. Elizabeth Robbins, at the time. 

That means the $88 billion DOD requested for operations in Afghanistan would be slashed by 10 to 15 percent in fiscal 2013, along with the rest of the department's other spending accounts. 

While reductions to war funds is perfectly acceptable under the letter of the law, the move will be a political disaster on Capitol Hill, according to members of a new defense sequestration task force sponsored by the Bipartisan Policy Center. 

"It will not be there, I guarantee you," task force member and former Marine Corps Maj. Gen. Arnold Punaro said on Tuesday. 

Led by former Sen. Pete Domenici (R-N.M.), former National Security Adviser Gen. James Jones and former Secretary of Agriculture Dan Glickman, the task force is drafting its own alternative sequestration plan. 

Domenici and former White House Budget Director Alice Rivlin headed up a similar debt reduction panel, also sponsored by the center, in 2010. That plan was built upon a massive restructuring of Medicare, benefit cuts to Social Security and a new national sales tax. 

Domenici's new task force did not go into details on their upcoming plan to fix sequestration on Tuesday.

But members were adamant that moves were already under way to protect the Pentagon's war funding and the rest of the department's budget coffers. 

A bipartisan group of roughly 30 senators was already meeting behind closed doors, attempting to formulate a compromise plan to avoid sequestration, according to Glickman. 

Task force members have been consulting with these lawmakers during those deliberations, pushing Senators to start considering ways to stave off reductions to funding for Afghanistan, Punaro told The Hill. 

Legislative language to protect war funds would likely be introduced as an amendment to a possible continuing budget resolution if Congress can't get a FY 2013 defense spending bill to the White House by September, he said. 

Lawmakers could also introduce stand-alone legislation on the Senate floor, designed to shield DOD dollars for Afghanistan, he said.

Another alternative would be a tailored proposal specifically protecting war funds for actual combat operations and to repair damaged vehicles and equipment used in Afghanistan, Punaro added. 

But even under those scenarios, war funding only constitutes 2 percent of the overall Pentagon budget that is subject to automatic reductions. 

Protecting those dollars would be a drop in the bucket compared to the billions the Pentagon stands to lose if sequestration goes into effect, according to Punaro. 

"I do not know if there is enough time" to come up with an alternative plan, he admitted on Tuesday. "This is [just] a game of chicken."