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Obama proposes defense cut after decade of growth

Aerial view of the United States military headquarters, the Pentagon
Aerial view of the United States military headquarters, the Pentagon

By David Alexander and Jim Wolf

WASHINGTON (Reuters) - President Barack Obama unveiled a 2013 defense budget on Monday that proposes cuts in Pentagon spending for the first time since 1998, slashing military personnel costs and weapons purchases as it trims $487 billion in projected outlays over the next decade.

The president's spending plan calls for a Pentagon base budget of $525.4 billion, about $5.1 billion less than approved in 2012. The cost of U.S. wars abroad would fall 23 percent, to $88.5 billion from $115 billion, primarily due to the U.S. withdrawal from Iraq and a drawdown in Afghanistan.

The budget begins to add flesh to the bones of the Pentagon's new defense strategy, which puts greater focus on the Asia-Pacific and the Middle East. The Pentagon plans to spend at least $2.8 billion on arms needed as part of that shift, including $300 million toward a new long-range bomber.

"This budget plan represents a historic shift to the future, recognizing that we are at a strategic point after a decade of war," Defense Secretary Leon Panetta said in a statement. "The plan is aligned to strategic priorities we have identified to keep America safe and maintain the strongest military in the world."

The requested cut in defense spending follows a decade of growing Pentagon budgets, driven by U.S. wars abroad and rising personnel costs. With the country facing ongoing budget deficits and a ballooning $15 trillion national debt, Congress and the president agreed in August to cut projected defense spending by $487 billion over the next decade.

The defense budget slashes personnel costs by $6.7 billion as the military begins to cut its overall force size by about 100,000 troops over five years. The Army is to take the bulk of the reductions - about 72,000 soldiers.

CUTTING FORCES, AND BUREAUCRACY

The Army is expected to shrink by eight combat brigade teams; the Marines are to eliminate six battalions and four tactical air squadrons; the Air Force is to cut six tactical air squadrons and the Navy to retire seven of its older cruisers.

The Pentagon said force structure cuts would save about $50 billion over five years.

Cutting the Pentagon bureaucracy would save about $60 billion over the same period.

The budget for the 2013 fiscal year, which begins on October 1, slashes spending to develop and buy new weapons systems to $178.8 billion, a drop of 7.5 percent.

It requests $9.17 billion for the Pentagon's biggest weapons program, Lockheed Martin's F-35 Joint Strike Fighter, down slightly from $9.25 billion requested in fiscal 2012. But it restructures the program to slow procurement, reducing spending by $15.1 billion over five years.

The budget also would delay development of the Army's ground combat vehicle, saving $1.3 billion over five years, and reduce the Navy's shipbuilding program, for savings of $13.1 billion.

The spending plan terminates one version of the Global Hawk unmanned surveillance drone, a defense weather satellite system and the C-27A transport plane for total savings of $9.6 billion over five years.

The budget would maintain basic pay raises for military personnel through 2014 but begin to slow them thereafter. It also proposes new or increased fees on healthcare for military retirees. Proposed spending on military pay and benefits would drop by $29 billion over five years, Pentagon documents show.

The budget also asks Congress to begin two new rounds of base closures, one in 2013 and one in 2015, a proposal that has already drawn sharp criticism from lawmakers whose districts would be hurt.

(Additional reporting by Andrea Shalal-Esa; Editing by Mohammad Zargham)

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