- The Washington Times - Wednesday, January 2, 2013

The looming $600 billion defense spending crisis required under last year’s Budget Control Act was delayed for two months under the compromise tax deal passed by Congress this week.

Under the new tax legislation, the sequestration will kick in March 1. Instead of slashing defense spending during the delay, Congress provided $24 billion in the legislation with half to be raised from taxes and half from cutting defense and nondefense spending.

“This will give Congress time to work on a balanced plan to end the sequester permanently through a combination of additional revenue and spending cuts in a balanced manner,” the White House said in a fact sheet.

House Armed Services Committee Chairman Howard P. “Buck” McKeon told reporters that the delay was “better than nothing.”

In a statement, Mr. McKeon, California Republican, said he supported the deal with reservations.

“Our troops have shouldered an unfairly large share of budget cuts to date, in addition to the strains of combat,” he said.

“Rather than shield a wartime military from further reductions, this deal leaves the force vulnerable to sequestration’s devastating and arbitrary cuts, and it leaves Congress and the president with much work to do to end the crisis.”

Mr. McKeon said President Obama missed the chance to honor the promise made to U.S. troops and veterans when he said during the presidential campaign that sequestration would never take place.

“Every day of uncertainty over further reductions limits our ability to fight the war in Afghanistan, keep Americans free from harm at home and prevent potential conflict abroad,” Mr. McKeon said.

The immediate impact of the compromise tax law is that the Pentagon likely will have to produce two budgets for the White House Office of Management and Budget, one for sequestration and one for no sequestration.

A defense official said the Pentagon has been planning for the across-the-board funding cuts since early December when the Office of Management and Budget issued guidance on the matter.

“To date we’ve produced one budget [for fiscal 2014],” the official told Inside the Ring. “At this point, the fiscal 2014 budget does not reflect sequestration.”

The official said the Pentagon is working with the budget office on guidance regarding the cuts.

No figures have been issued by the office on how much to cut for the 2014 budget. The estimate for the last budget, which was never passed, was a cut of 9.4 percent, or $52.3 billion.

So far, the only comment from Defense Secretary Leon E. Panetta on the crisis has been a memorandum sent to all Pentagon employees, warning that civilian furloughs could take place under sequestration.

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