WASHINGTON — North Carolina leaders exhaled Thursday as Defense Secretary Robert Gates announced sweeping cuts to Pentagon programs for the coming years - but left the Tar Heel state largely unscathed.
There will be a two-year delay in eight squadrons of F-35B Joint Strike Fighter jets scheduled for Marine Corps Air Station Cherry Point in the next decade, but no cuts, and little else to affect the state, officials said.
"The delay is code for 'It's still a go,'" said Lance DeSpain, executive director of the N.C. Military Foundation, a privately funded economic development group in Raleigh. "That's a really good thing."
Many observers had feared Gates would cut the program. Amid mounting pressure from Congress to cut military spending and a planned drawdown of forces in both Afghanistan and Iraq, Gates unveiled his proposed budget Thursday, which included troop cuts, program eliminations and rising health cost for retirees.
Defense officials said they anticipated $78 billion of overall cuts over five years. In addition, Gates said, the military plans to reduce the Army and Marine Corps by more than 70,000 starting in 2015, the year after the Obama administration has promised to finish withdrawing forces from Afghanistan. Gates also proposed raising health care enrollment costs for retirees who are of working age.
Yet despite those cuts, next year's proposed budget will increase by 3 percent in real growth to $553 billion, not including war spending, raising questions over how much the proposed budget will allay concerns that the Defense Department is not being fiscally responsible during tough economic times.
Gates proposed budget would increase the defense budget for the 14th year in a row. Indeed, it is nearly double what it was just a decade ago. The military currently spends another $159 billion on the wars in Iraq and Afghanistan.
Gates' plan found another $100 billion in savings, including the cancellation of a $14 billion amphibious Marine vehicle, the Expeditionary Fighting Vehicle, designed by General Dynamics, and made in Lima, Ohio.
Little concern in N.C.
But much of that money will be reinvested in other military programs, and many in the state weren't worried about the effects.
"North Carolina will feel little impact from these steps because the strengths of our state and the military operations here are well-oriented toward the future needs of the armed forces," said Gov. Bev Perdue's spokesman, Mark Johnson.
In December, the Navy announced that Cherry Point would be getting eight squadrons of F-35Bs, or about 128 aircraft, beginning in 2018.
Delaying the placement of the squadrons at Cherry Point would not prevent the base from going ahead with necessary construction and renovation to accommodate the aircraft when they become available, said Marine Corps spokesman Capt. Brian Block, at the Pentagon.
The next-generation, super-sonic stealth aircraft is expected to bring nearly 1,200 new military personnel to the area around Cherry Point.
The Marine Corps version of the F-35, the F-35B, can hover, take off within a short space and land vertically on improvised airstrips and amphibious ships. But it faces significant technical hurdles; and the cost, first estimated at $50 million per jet, is now estimated at more than $100 million apiece.
U.S. Sen. Kay Hagan, a Greensboro Democrat and member of the Armed Services Committee, heard early Thursday from Marine Commandant Gen. James Amos that deployment of the fighter jets for Cherry Point would be delayed.
Perfecting the F-35B
The military wants Lockheed Martin to spend more time developing software so the jets can execute the short-takeoff, vertical landing capability that they're supposed to have. They're meant to replace in part the Harrier jump jets in operation now.
"Secretary Gates' decision to give the Marine Corps a two-year extension to develop the Joint Strike Fighter is intended to allow the plane to be perfected for our Marines," Hagan said.
Gates' announcement Thursday was just the beginning of the budgeting process, and lawmakers said they expect the Defense Department will recommend other cuts that North Carolina officials won't like.
Among those are proposals for an alternative engine for the F-35 that would be developed by GE.
Pentagon officials don't want the alternative engine, saying it isn't needed. N.C. congressional members disagree.
GE has been lobbying hard for the program. The company has a significant presence in North Carolina, including a plant in Durham that manufactures commercial engine parts.
North Carolina's stake
An alternative engine would likely be built in Richmond, and N.C. officials say Tar Heel companies would be well-positioned to pick up work as subcontractors.
"It's true that North Carolina does have a stake in it," said U.S. Rep. David Price, a Chapel Hill Democrat and the state's only member on the Appropriations Committee. But he said there are other reasons to support the GE engine.
"I think the presence of a competitive engine, first of all, provides some cost pressures and competition to both engines. It also provides a fallback," Price said.
Some lawmakers are more wary of that second engine, though.
U.S. Rep. Walter Jones, a Farmville Republican whose district includes Cherry Point and Camp Lejeune, the Marine base near Jacksonville, said he trusts the military to tell Congress what it does and doesn't need - especially in tough fiscal times, when conservatives are trying to rein in the national debt.
"We've got to make the best investment of taxpayer dollars we can for the military," Jones said, "but the days of luxury are over, and it is now the day of necessity."
Armed forces to shrink
Under the proposal, the Army will shrink by 27,000 starting in fiscal year 2015; there are currently 569,000 soldiers. In addition, the Marine Corps will be cut by 15,000 to 20,000 from its current 202,000.
Despite that, the Army and Marine Corps will be bigger than when Gates took the top post four years ago, under his plan.
"These projected reductions are based on an assumption that America's ground combat commitment in Afghanistan would be significantly reduced by the end of 2014 in accordance with the president's strategy," Gates said.
Gates briefed top defense legislators on Capitol Hill on Thursday about his proposed budget including Sen. Carl Levin, D-Mich., the chairman of the Armed Services committee, and ranking member Arizona Republican Sen. John McCain.
Martha Quillin of The News & Observer contributed to this report.