The Pentagon will shrink the US Army to pre-World War II levels, eliminate the popular A-10 aircraft and reduce military benefits in order to meet 2015 spending caps, setting up an election-year fight with the Congress over national defence priorities.
US Defense Secretary Chuck Hagel, discussing the Pentagon's plan for meeting its new spending caps ahead of the formal budget presentation on March 4, advanced a number of ideas that have been attempted in the past but rejected by Congress or are seen as likely to be unpopular in a congressional election year.
As the United States military winds down its war in Afghanistan and looks to cut billions in defence spending, the Pentagon plans to continue shifting its focus to the Asia-Pacific region and will no longer need a land army of the size currently planned, Hagel said.
The department plans to reduce the size of the army to between 440,000 and 450,000 soldiers, he said. The army is currently about 520,000 soldiers and had been planning to draw down to about 490,000 in the coming year.
A reduction to 450,000 would be the army's smallest size since 1940 - before the United States entered World War II - when it had a troop strength of 267,767, according to army figures. The army's previous post-World War II low was 479,426 in 1999.
The planned cut in the army's size comes as the Defense Department is in the process of reducing projected spending by nearly a trillion dollars over a 10-year period.
A two-year budget deal in Congress in December gave the Pentagon some relief from the budget cuts, but still forced it to reduce spending in the 2014 fiscal year by US$30 billion (NZ$36bn).
The Pentagon's budget for the 2015 fiscal year is US$496 billion, roughly the same as in 2014 but still lower than had envisioned last year.
"This will be the first budget to fully reflect the transition DoD (the Department of Defense) is making after 13 years of war, the longest conflict in our nation's history," Hagel said.
"We chose further reductions in troop strength and force structure in every military service - active and reserve - in order to sustain our readiness and technological superiority and to protect critical capabilities," he said.
A senior US defence official said the approach outlined by Hagel was "pragmatic and responsible", but noted that "with a smaller force there is less margin for error".
The official, who spoke on condition of anonymity, warned that a return to deeper budget cuts in 2016 would result in "our forces being too small and out of balance with respect to readiness and modernisation".
Hagel said the Pentagon also planned to eliminate the air force's fleet of A-10 "Warthog" close air support planes, which are much beloved by ground troops, in order to ensure continued funding of the new long-range bomber, the Lockheed Martin F-35 Joint Strike Fighter and a new aerial refuelling tanker.
"This was a tough decision," he said. "But the A-10 is a 40-year-old, single-purpose airplane originally designed to kill enemy tanks on a Cold War battlefield. It cannot survive or operate effectively where there are more advanced aircraft."
In a reversal of an earlier decision, Hagel said the Pentagon decided to retire the 50-year-old U-2 spy plane in favour of the unmanned Global Hawk system. He said the decision to reverse course came about because the Pentagon had in recent years been able to reduce the Global Hawk's operating costs.
The Pentagon chief also announced a series of steps to try to reduce the Defense Department's military and civilian personnel costs, which now make up about half of its spending.
Hagel said the department would slow the growth of tax-free housing allowances, reduce the annual subsidy for military commissaries and reform the TRICARE health insurance programme for military family members and retirees.
The defence secretary added that the Pentagon had decided to build only 32 versions of the new Littoral Combat Ship, rather than the 52 envisioned.