The U.S. Defense Department will slash up to $2 billion from the budgets of its top officials as the defense budget retreats from the record highs its grown to in recent years.
The cuts, which go into effect in October and will last six years, will take place regardless of Congress' sequestration-related defense cuts, according to a statement from Pentagon spokesman George Little on Tuesday evening.
"Early estimates indicate that the total savings could be in the range of $1.5 billion to $2 billion," he said, according to CNN.
The majority of the savings will come from layoffs of staff working under the Pentagon’s top officials, including those working under Secretary of Defense Chuck Hagel, who is orchestrating the measures to reduce spending at the administrative level -- an attempt to share the pain of defense cuts that will affect procurements from military contractors.
On Monday, General Dynamics Corporation (NYSE:GD), the world’s fourth-largest defense company, announced it was folding one of its weapons-systems units into another and closing an office in Charlotte, N.C. Contractors across the board have faced a loss of revenue from government contracts due to sequestration.
The winding down of the military engagements in Iraq and Afghanistan, which sent the country’s defense budgets to record highs since the start of the Iraq war in 2003, have also played a role in reduced spending.
On Monday, during a town hall-style meeting with soldiers at Fort Bragg, N.C., Hagel addressed the issue of budget cuts by saying the Defense Department is juggling its responsibilities around the world with the need for it to chip in to reduce government spending.
“This is forcing us to take deeper, steeper and more abrupt reductions than we've ever had to do,” Hagel said in his address.
Angelo Young is a general assignment business reporter who joined IBTimes in April 2012. Much of his career has been behind the scenes as a copy editor, assignment editor and...