Joint Chiefs of Staff

RAMSTEIN AIR BASE, Germany, Feb. 9, 2013 – The Defense Department’s financial problems will affect deployed troops, but not directly, the chairman of the Joint Chiefs of Staff said here today.

“If they are in harm’s way, they are going to continue to be the best-led, best-trained, best-equipped, best-supported force on the planet,” Army Gen. Martin E. Dempsey told reporters. “But it could affect the base operating funding where their families are living, and that will affect them.”

Dempsey is traveling to Afghanistan to attend the International Security Assistance Force change of command ceremony.

Senior DOD officials have been warning about the severe impact that billions of dollars in budget cuts set to take effect March 1st will have on department operations. The department also is operating under a continuing resolution rather than an appropriation. This allows no new starts for projects and makes it difficult to move money from one account to another.

“As we apply these reductions, we’re trying to avoid applying them blindly so we can be alert to what we’re creating for those young men and women,” the chairman said.

DOD is moving to address the fiscal situation. The chairman along with Defense Secretary Leon E. Panetta announced Wednesday that the department would slow the growth of military pay increases. In fiscal 2014, service members will receive a 1 percent pay raise. “That action is being taken to help us absorb the $487 billion in the Budget Control Act – it has nothing to do with sequestration,” Dempsey said.

A second decision – to postpone deployment of the aircraft carrier USS Harry S. Truman and cruiser USS Gettysburg – was made “because the continuing resolution under which we are operating has more money in the investment account and less money in operations and maintenance and we don’t have transfer authority to move them,” he said.

The department is anticipating absorbing sequestration cuts, those set to take effect in March, but these will be mammoth. This will mean a further $470 billion out of DOD over the next 10 years. This fiscal year, which ends September 30, would see $45 billion cut from DOD accounts. “In this fiscal year … we’re going to have to sweep up every bit of money that is not otherwise locked down,” he said.

Overall, “I see about a third of that (cut) absorbed by force structure reductions,” the general said. “The other two thirds will come out of modernization, compensation and readiness.”