Chairman LEVIN. Good morning, everybody. Today the committee gives a warm welcome to Secretary of Defense Chuck Hagel; General Martin Dempsey, the Chairman of the Joint Chiefs of Staff; accompanied by the Department's Comptroller, Under Secretary Bob Hale, for our hearing on the Department of Defense's fiscal year 2014 budget request and the posture of the U.S. Armed Forces.
We welcome Secretary Hagel on his first appearance as Secretary of Defense before this committee. We thank all of our witnesses for their service to our Nation and to the soldiers, sailors, airmen, and marines at home and in harm's way. We can never say that enough.
Your testimony today is a key component of the committee's review of the fiscal year 2104 budget request for the Department of Defense. This year's request includes $526.6 billion for the base budget and $88.5 billion for overseas contingency operations, or OCO, although as your testimony notes, the OCO number is simply a placeholder figure pending final force level and deployment decisions.
The future of the defense budget is in flux due to the Congress? failure to enact legislation reducing the deficit by $1.2 trillion as required by the Budget Control Act. As a result of that, the DOD funding for fiscal year 2013 was reduced by sequestration in the amount of $41 billion, and unless Congress acts, the fiscal year 2014 DOD budget will be cut by an additional $52 billion below the funding level which is in the President's budget for fiscal year 2014 and also in the budgets passed by the Senate and the House of Representatives.
Congress can fix the budget problems by enacting legislation that reduces the deficit by $1.2 trillion over 10 years. That would take a grand bargain, including both spending cuts and additional revenues, that would turn off the automatic spending cuts of sequestration for those 10 years. I remain hopeful we can develop such a bipartisan plan. But absent a so-called ""grand bargain,'' surely we can devise a balanced deficit reduction package for 1 year that avoids sequestration in fiscal year 2014. We simply cannot continue to ignore the effects of sequestration.
Sequestration will have a major impact on military personnel. Though the pay of military personnel has been exempted, the sequester will reduce military readiness and needed services for our troops, including schools for military children, family support programs, and transition assistance programs and mental health and other counseling programs.
The President's budget request continues the measured drawdown of active duty and Reserve end strength. We have, in recent years, given the Department numerous force shaping authorities to allow it to reduce its end strength in a responsible way, ensuring that the services maintain the proper force mix and avoiding grade and occupational disparities, all of which have long-term effects. If sequestration continues, the result would be more precipitous reductions, leaving us with a force structure that is out of sync with the requirements of our defense strategy.
Sequestration has already affected military readiness. We have heard testimony that as a result of cuts to flying hours, steaming hours, and other training activities and testimony that readiness will fall below acceptable levels for all three military services by the end of this summer. The Army, for example, has informed us that by the end of September, only one-third of its active duty units will have acceptable readiness ratings far below the two-thirds level that the Army needs to achieve to meet national security requirements. These cuts are having an operational impact as well. For example, four of six fighter squadrons in Europe have been grounded and the deployment of the Truman carrier group to the Persian Gulf has been postponed indefinitely. It will cost us billions of dollars and months of effort to make up for these shortfalls in training and maintenance, and it will be nearly impossible for us to do so if we have a second round of sequestration in fiscal year 2014. Our men and women in the military and their families should not have to face both the pressure of military service and the uncertainty about future financial support from their Government.
The Department faces these budget shortfalls at a time when 68,000 U.S. troops remain in harm's way in Afghanistan. We must, above all, ensure that our troops in Afghanistan have what they need to carry out their mission. The campaign in Afghanistan is now on track to reach a major milestone later this spring, when the lead for security throughout Afghanistan will transition fully to Afghan security forces. As our commander in Afghanistan told us yesterday, there are clear signs that the Afghan security forces are capable of taking the fight to the Taliban and are doing so effectively. Operations by Afghan security forces are increasingly conducted by Afghan units on their own; that is, without international forces present. There are fewer Afghan civilian casualties in recent months and fewer U.S. and coalition casualties, including a 4-week stretch earlier this year with no U.S. or coalition fatalities.
The Department's budget challenges, which are the subject of today's hearing, are occurring in a world full of threats to U.S. security, including North Korea's reckless rhetoric and provocative behavior, and perhaps the greatest world threat, Iran's nuclear program and its support for international terrorism.
In the interest of time, I am going to submit the remainder of my statement relative to those and other matters for the record.
As each of us were notified, we will have a separate hearing on the growing bloodshed in Syria after the conclusion of this morning's session. We will take a half-hour break and then we will return to hear from our witnesses about the situation in Syria.
Secretary Hagel, General Dempsey, Under Secretary Hale, we look forward to your testimony, and I now call on Senator Inhofe.