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General Odierno Warns of Rising Personnel Costs

Troop reductions and lack of preparation could be fatal

U.S. military exercise in South Korea / AP
• July 29, 2013 3:20 pm

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General Raymond Odierno, chief of staff of the U.S. Army, warned Monday that the Army’s budget could be unsustainable in a decade if officials are not able to partner with Congress and slow the growth of compensation and benefit costs.

Odierno spoke at the American Enterprise Institute about the Army’s efforts to balance cuts to troop levels with rising personnel costs during a period of significant financial stress for the military. The Army is undergoing a drawdown of about 80,000 active duty members due to budget reductions, one of its most sweeping organizational changes since World War II.

Odierno said the United States should avoid repeating the historical mistakes of periods like the shrinkage of forces after World War II. The downsizing of the military left U.S. forces ill equipped to meet the initial challenges of the Korean War, he said.

"It cost thousands of lives," he said. "There’s a lesson there that we should not forget."

Military budget cuts have already begun to delay periodic training sessions and affect troop readiness, Odierno said. Sequestration will reduce about $1 trillion from the Pentagon’s budget in the next decade when combined with already planned cuts.

"If I’m asked to deploy 20,000 soldiers somewhere, I’m not sure I can guarantee that they will have been able to train collectively the way we’d like," he said.

If such a conflict arises, "there will be more casualties," he added.

Meanwhile, the military’s health care and compensation costs continue to escalate. Funding for the military health care system has more than doubled since 2000 and now exceeds $50 billion annually, according to the Congressional Budget Office.

Odierno said 80 percent of the Army’s budget would be allocated to compensation by 2023 under current projections, a dangerously high percentage that could divert resources from other core functions like training. The Army’s current budget devotes 46 percent of its funding to compensation.

"We can’t operate like that," he said.

President Barack Obama has threatened to veto the Department of Defense Appropriations Act because it fails to increase fees and co-payments for TRICARE, the Pentagon’s in-house health care system, and increases basic pay by a larger amount than the administration requested. Working age military retiree families assumed 11 percent of the total cost of their care in 2012, compared to 27 percent when the TRICARE program was first implemented in 1996, according to the CBO.

Yet the White House has also asked lawmakers to increase TRICARE’s costs.

Odierno said military officials would continue to work with Congress to reform the compensation and benefit programs.

As the military continues its rebalancing toward the Asia-Pacific region—where the Army already has 82,000 troops—and examines ways to reduce costs, officials must also not neglect the vital health care needs of those returning from more than a decade of wars in the Middle East, Odierno said.

"We have to continue to monitor to ensure we have the right care for our soldiers who have the unseen wounds," he said.