U.S. Defense Secretary Chuck Hagel made big news last week by announcing deep cuts to the military, particularly the Army. But those cuts are actually shallower than automatic cuts already mandated by Congress as a result of the 2011 debt ceiling standoff.
Hagel and the Obama administration want to reduce the size of the Army to 440,000 or 450,000 soldiers. That’s down from a wartime high of 570,000. It also would eliminate several weapons systems, cut the number of ships in the Navy and adjust health care for veterans.
Critics, particularly Republicans, howled Monday that the cuts would leave the smallest standing Army since before World War II. But the reality is that $1.2 trillion in mandatory congressional cuts – half to the military and half to domestic spending, called the “sequester” – will make an even deeper cut, lowering the size of the Army to 420,000, if it isn’t repealed before 2017.
The sequester is the result of the debt ceiling standoff three years ago that was driven by House Republicans. The Hagel announcement marks the beginning of a political end game that could have a profound effect on South Carolina’s economy.
“This game is going to be played out in Washington between Congress and the administration sometime over the next 12 months or so,” said Bill Bethea, chairman of the S.C. Military Base Task Force, which was appointed by Gov. Nikki Haley to protect the state’s military installations and expand missions.
“We all recognize there are going to be cuts,” the Bluffton attorney said. “We’re going to have to face issues.”
Haley met with President Obama on Monday, the same day Hagel announced his package of cuts.
The governor later blasted the president for proposed cuts to the National Guard and Reserve. But at an event Wednesday announcing a new program to hire veterans, she told The State she preferred targeted cuts, if necessary, rather than submit to the sequester.
“We want them to reduce spending, but we don’t want across-the-board cuts,” she said. “No government should ever function like that… We are just asking them to be very thoughtful in their approach. We haven’t seen that up to now.”
FORT JACKSON A CONCERN
The stakes are high.
South Carolina’s eight military installations, defense contractors, a substantial and active National Guard and a large population of retirees pump $15.7 billion into the state’s economy each year, according to a 2012 study by the S.C. Department of Commerce.
Commerce secretary Bobby Hitt considers each of the installations to be as important as a Boeing, Continental Tire or BMW plant.
“They are like factories” when it comes to job creation and economic impact,” he said. “Any movement in the military is something we are going to feel in South Carolina.
Of particular concern is Fort Jackson.
It is the Army’s largest training base, churning out about 45,000 new soldiers each year. Experts estimate that the same level of recruits would continue to flow through the installation each year if the size of the Army dips to 490,000. But a drop to 440,000-450,000 under Hagel’s plan – or especially 420,000 under the congressional sequester – could mean a cutback in the number of new soldiers in training, which could mean fewer active duty and civilian personnel needed to train them.
“That would affect Fort Jackson,” said Maj. Gen George Goldsmith, chairman of the military affairs committee of the Greater Columbia Chamber of Commerce.
Payroll just for the 3,000 or civilians working at Fort Jackson is $155 million a year. The 3,000 or so active duty soldiers who work at the fort and the 120,000 family members who travel to Columbia each year to attend the weekly graduation add to the influx of direct money.
When multiplied by how those dollars are spent, from medical treatment to dining out to buying groceries, the fort has about a $2 billion impact on the Midlands and the state, according to a Commerce study. Shaw Air Force Base in Sumter and McEntire Joint National Guard Base in Eastover contribute another $2 billion, the report showed.
The numbers are even bigger in the Lowcountry.
Joint Base Charleston and the Naval Weapons Station at Goose Creek add about $8 billion to the economy annually. Navy and Marine installations around Beaufort pump in another $5 billion.
Bethea predicted that while some installations, like Fort Jackson and the National Guard, might feel the pinch of sharp Army cuts, other installations could benefit from military restructuring. For instance, the F-35 fighter program seems safe. They are new generation jets that are already flying at Marine Air Station Beaufort and are slated, eventually, to replace Air Force F-16s at Shaw and McEntire.
“Sumter, McEntire and Beaufort can breathe a sign of relief,” Bethea said.
NATIONAL GUARD, RESERVE CUTS
While Fort Jackson boosters are hoping for the shallowest cuts possible in the active-duty Army, that could come at the expense of the National Guard.
The Hagel cuts call for the size of the National Guard to drop in 2016 to 335,000 from 355,000. The Army Reserve would shrink to 195,000 from 205,000. The sequester would cut those numbers to 315,000 and 185,000 respectively.
Maj. Gen. Robert Livingston, the state’s elected adjutant general who was in Washington last week in talks about the cuts with other adjutants general, said that would be a bad idea. National Guard soldiers usually are older and in many cases more experienced than their active duty partners. And they are called up only when needed, he said.
“The Army is going to have to look at itself some,” he said. “Size the (active duty) Army to what you absolutely have to deal with immediately. Then put a large portion into Reserve forces and the National Guard.
“That way you only pay soldiers when you need them.”
HALEY DEFENDS GUARD
Haley, whose husband, Michael, is in the S.C. Guard and served in Afghanistan, used the announced Guard cuts to lambaste Obama. She called them a “slap in the face” to Guard members who have been deployed to Iraq and Afghanistan.
The Guard is very popular in South Carolina and Guard families are plentiful. Haley’s bulldog defense of the Guard could solidify her base in her re-election campaign against Democrat Vincent Sheheen.
“Across-the-board cuts like (the sequester) are wrong,” she said. “But now, (for the administration) to actually make it a priority to cut the National Guard is something no one can understand.”
Hitt, who is Haley’s chief job creator and oversees the Military Base Task Force, said the announcement was the opening volley in what will be a desperate fight for military dollars.
“Were at the beginning of the process and not the end,” he said. “We’ll see how it turns out.”
Politicians railed last week against proposed cuts the U.S. military. However, those proposed cuts are not as deep as what is required by the sequester – $1.2 trillion in mandatory congressional cuts, half to the military and half to domestic spending.
The sequester, if it is not repealed before 2017, will require the Army to reduce its size to 420,000 soldiers, rather than the 440,000-450,000 proposed last week. That could mean fewer soldiers being trained at Fort Jackson and fewer personnel required. That would cut into the $2 billion impact the fort has on the local economy.
Under the sequester, the National Guard would drop to 315,000 troops, rather than the 335,000 proposed last week; and the Army Reserve would shrink to 185,000, rather than 195,000.
Shaw Air Force Base in Sumter, McEntire Joint National Guard Base in Eastover and the Marine Corps Air Station at Beaufort are expected to be OK because funding for the F-35 fighter program is safe under both plans.