Fayetteville Observer January 08, 2012
Fort Bragg likely to feel pinch from expected defense budget cuts
By John Ramsey
With two lengthy wars wrapping up and military strategy moving toward a leaner force, the mountain of federal money that has insulated the Fort Bragg region from the worst of the recession will likely be shrinking.
The Pentagon must cut at least $450 billion from its budget over the next 10 years. It could mean a shrinking Army and Marine Corps and delays in major weapons acquisitions. Soldiers and retirees may see the cost of benefits rise, military pay raises capped and civilian salaries frozen.
And that does not include another $500 billion in automatic cuts starting next January unless Congress reaches an alternative debt-reduction deal.
Defense experts say Fort Bragg - anchored by the U.S. Army Special Operations Command, Forces Command, Army Reserve Command and the 82nd Airborne Division - will probably see fewer cuts than most military installations as strategy shifts to deal with the budget cuts.
The size of the Army already is shrinking, from 570,000 soldiers to 520,000, or possibly fewer. But President Obama says he wants to increase the size of Special Operations Forces, which could mean growth for that command at Fort Bragg.
The Pentagon's strategic review, released Thursday, mentions that counterterrorism efforts, Special Forces and rapid deployment capabilities - all Fort Bragg strengths - will remain important.
"Special Forces and special operations are platinum. That's totally off-limits (to cuts)," said John Pike, director of Globalsecurity.org. "The whole operation, regardless of how deep the cuts get - y'all's neck of the woods is going to feel it less than just about anybody."
But Fort Bragg and surrounding communities likely will feel the pinch in other ways. Most immediately, more contract employees could lose work. On Fort Bragg, 431 civilian jobs were eliminated last fall.
Those cuts could be a big deal in Cumberland County, which accounted for about $1 billion in defense contract spending in 2010, according to the latest figures available.
Any cuts at Fort Bragg would likely be felt throughout the Fayetteville economy.
The U.S. Bureau of Economic Analysis estimates that 40 percent of all personal income in Cumberland and Hoke counties comes from the military.
David Gray, who teaches national and international security at Campbell University and the University of North Carolina at Chapel Hill, said that even though cuts may be smaller at Fort Bragg, they will be felt.
"Fayetteville is in better shape than a lot of military towns," said Gray, a retired Air Force officer and former foreign service CIA officer. "But there's still a trickle-down that less money going into pockets of soldiers translates into less money going into business downtown."
Scott Dorney, executive director of the N.C. Military Business Center, said it's hard to guess how much the defense cuts could hurt contractors in the region until the White House releases its budget next month.
Service contracts probably will be slashed further.
But Fayetteville and the rest of the state may be well positioned to avoid the brunt of the cuts.
"We really think that although there'll be pain in some areas, it offers some real opportunities," Dorney said. "It's not necessarily a bad-news story locally."
If there are delays in buying weapons systems or vehicles, he said, some North Carolina contractors might benefit. The state doesn't have assembly plants for fighter jets or ground vehicles, Dorney said, but it does have maintenance facilities.
Another area likely to face cuts is military pay and benefits. Personnel costs have been rising at an exorbitant rate for the military.
Todd Harrison, an analyst with the Center for Strategic and Budgetary Assessments, calculated that the entire defense budget would be consumed by personnel costs if those expenditures continue rising at the same rate and overall Pentagon spending stays flat.
The strategy review notes that the military must reduce its personnel costs, but it also promises to "keep the faith with those who serve."
Several options are on the table. There could be a $200 annual fee for Tricare-for-Life - a free supplement to Medicare for military retirees older than 65 - higher co-pays for drugs under the military insurance program Tricare, changes to the retirement system for new recruits, and caps on military pay raises.
"You can make changes without breaking faith to people you've already made promises to," Harrison said. "Some modest changes to health care benefits for retirees could save a tremendous amount of money for the Department of Defense and help avoid cuts to things for current service members, like cutting weapons systems, cutting active-duty pay, cutting the number of people in the service."
Richard H. Kohn , a retired professor who taught military history at the UNC-Chapel Hill, said adding fees to Tricare has always been a tough political sell, but it may look easier weighed against other cuts to the defense budget.
Kohn said he looks at the scale-backs as a partial demobilization. Two wars are coming to an end, and there was never a demobilization after the Cold War, he said.
The Defense Department's total budget, including war spending, more than doubled from $316 billion in fiscal 2001 to $691 billion in fiscal 2010.
Fort Bragg's recent addition of the $300 million Forces Command and Reserve Command will shield it from some of the cuts, Kohn said.
"If the Army is going to be cut in the next 10 years, and I believe it will, I would think it would not happen at those bases that have constructed the infrastructure for the expansions of the last 20 years when we've been closing other bases." Kohn said.
Looming over everything is the potential for the amount of the cuts to double. When the congressional "supercommittee" failed to agree on debt reduction last year, it triggered an automatic $500 billion cut in the defense budget starting next January.
Most analysts say Congress won't allow that cut to go through, instead finding a compromise before it happens.
But Kohn said a compromise by this Congress in an election year might be difficult.
If the cuts reach that level, Defense Secretary Leon Panetta has warned that the result could be a "hollow force," a severely weakened military.
Michael O'Hanlon, a national security and defense policy analyst with the Brookings Institution in Washington, doesn't think there are any good choices if the cuts come in full force.
"If (Obama) were really to let Panetta have his way, and I hope he does, then I think Fort Bragg is safe," O'Hanlon said. "On the other hand, if we go to this $900 billion in cuts, I'm not sure the 82nd Airborne is sure to survive. Everybody loves it, but not everybody is convinced it's the most important thing we've got in this day and age."
If the 82nd Airborne does survive, it could be slashed to one brigade from its current four, O'Hanlon said.
He doesn't expect Congress to let the deeper cuts occur. But Obama has threatened to veto any attempt to simply undo the military cuts without a larger deal in place.
Pike and other experts disagree. Pike said he doesn't expect cuts to the 82nd Airborne.
"Who else would we have to go around and kick people's butts? There's plenty of stuff to be cut before you get to the ready brigade, it seems to me," Pike said. "I would say the Army could go from 10 active divisions to five active divisions and the republic would be OK. Is one of those going to be the 82nd? No."
Congressman Mike McIntyre, a North Carolina Democrat, said the second round of defense cuts could be devastating. In a written statement, McIntyre said that's why he voted against the original bill that mandated cuts if the supercommittee failed.
"We have now reached that tipping point - it is here, it is real, and it will harm our national security," McIntyre said after the committee failed to reach an agreement in November. "With North Carolina being such a military friendly state, the last thing we want is to cut funds for vital programs that help our men and women here at home and abroad. And we cannot jeopardize our national security by weakening our overall national defense."
© Copyright 2012, The Fayetteville Observer
