No Brass Bands When Troops Return Home From Iraq

U.S. troops returning home from war may be greeted with pay caps and increased health insurance premiums, and could even lose their jobs -- if Congress no longer wants to keep on the payroll all the soldiers and Marines once needed to fight both the Iraq and Afghanistan wars.

Among other benefits at risk, troops and their families could lose their local military exchanges and commissaries, the large Wal-Mart-type stores where military families enjoy convenient and cut-rate shopping right on base.

Previous generations of troops have come home to brass bands and parades. This time, thanks to the rising federal budget deficit of $1.6 trillion and a sagging economy, their welcome may be a little more sobering. The defense spending spree that began nine years ago with the 9/11 terrorist attacks may, according to defense officials and outside analysts, finally be over.

Defense Secretary Robert Gates, saying he is "mindful of the difficult economic and fiscal situation facing our nation,'' has demanded that the military services cut $100 billion of "overhead'' over the next five years, in part to stave off even deeper cuts by Congress.

Normally, Congress is deeply reluctant to reduce troop pay and benefits, triply so in an election year. And yet the demand to cut deficit spending, heard from economists and Main Street alike, has become deafening. And with President Barack Obama declaring the end of the "combat phase'' of the Iraq war, the pressure to restrain defense spending may become irresistible.

"The budgetary and political tornado is well on its way,'' said Gordon Adams, professor of international relations at American University and a former White House national security budget director.

Read Our Other Iraq coverage:

- Republican Reaction to Obama's Iraq Speech: Mostly Negative
- Biden Gives George W. Bush Some Credit for Iraq Surge Success
- Obama in Oval Office Address: Iraq War Combat Mission Is Over
- Transcript of President Obama's Speech on Iraq
- Iraq Scorecard: The War So Far
- Jill Lawrence: What I Want to Hear From President Obama on Iraq -- Never Again

Gates and other Pentagon officials have said they will try to protect military jobs and benefits, especially the wide array of benefits ranging from college tuition to housing, day care, financial and child counseling and recreation programs offered to families. Last spring, Army Secretary John McHugh has vowed that "family programs will be sacrosanct. They will not be touched'' in any budget-cutting exercise.

But that was then. More recently, Gates has made it clear that all troop benefits, including health care, are on the table.

"In this effort there are no sacred cows,'' he told Pentagon reporters Aug. 9.

Gates already has his eye on military health care premiums, which have stayed at the same rate since 1995 when the Tricare program was set up. Military health care costs consequently have skyrocketed from $19 billion in 2001 to a projected $60 billion in 2011. "Everybody knows we're being eaten alive by health care,'' Gates said recently.

The Pentagon already is fighting Congress over a modest pay increase proposed by the Obama administration; Congress wants to raise military pay even higher, although military pay has risen 42 percent since 2002, 10 percent higher than comparable civilian pay. An increase of one half of one percent, which some in Congress want to add to soldiers' paychecks, costs about $500 million a year, accumulating for years and even decades.

How the Pentagon leadership feels about troops' pay was summed up over the weekend by the Pentagon's top budget official, Comptroller Robert Hale.

"Now, you can't pay enough [to] somebody to get shot at in Afghanistan'' he said Sunday on the TV program, This Week in Defense News.

"But unfortunately with the unemployment rate where it is, we have plenty of people coming in. We don't need that extra half percent. It costs about $500 million a year. And that's money that I could otherwise spend to train and equip this force ...''

The military's own internal strategic study, the Quadrennial Defense Review, has already proposed a "reform'' of pay calculations, by including in proposed pay increases the list of non-cash benefits such as tax-free pay and housing allowances. Such a change would skim billions off military paychecks, even with a pay increase. Taken together with increased health insurance premiums and co-pays could save $120 billion over a decade, the review said.

More billions could be saved by closing or consolidating commissaries and post exchanges, according to analyses by the Congressional Budget Office and Todd Harrison, analyst for the private, non-partisan Center for Strategic and Budgetary Assessments in Washington.

The largest targets of budget-cutters, however, are the ranks of troops themselves. The ground forces, the Army and Marine Corps, grew by more than 95,000 after 9/11. Personnel – the costs of recruiting, paying, training and sustaining military personnel – and their families – is the largest single cost in the defense budget. "For any real savings on defense budgets to occur,'' Adams said, "end strength must shrink.''

Cuts in "force structure'' would mean that some who plan to make the military a career might not have that option. After the Cold War was over, the Pentagon and Congress cut the active-duty armed forces to 1.4 million from 2.2 million, leading to a decline in defense spending of more than one third. But it also meant that many service members were involuntarily separated – i.e., fired.

But troop reductions at some point, with no large land wars on the horizon, may become inevitable – an outcome that Defense Secretary Gates is already fighting against.

"My greatest fear is that in economic tough times that people will see the defense budget as the place to solve the nation's deficit problems, to find money for other parts of the government,'' Gates said Aug. 9.

Given the continuing threats to U.S. security from terrorism and failed states, he added, "I think that would be disastrous in the world environment we see today and what we're likely to see in the years to come.''