SAN DIEGO - The Deputy Chief for Naval Operations told a gathering of military and defense industry movers and shakers on Wednesday, "The bottom line is there is no money, and that's the bottom line."
Vice Adm. John Blake, who is often referred to as the finance guy for the Navy, came to San Diego as the keynote speaker at Wednesday's breakfast meeting for the San Diego Military Advisory Committee. He did not come bearing good news.
"We are in tough fiscal times and we are going to have to make tough decisions," Blake said.
After 10 years of increases in defense budgets, the Pentagon is looking at a budget downturn as events in Afghanistan begin to wind down.
The "fiscal cliff" as it is referred to, is formally known as sequestration. If Congress fails to act, then automatic cuts will be triggered.
"If a ship costs $1 billion dollars, we would have roughly 10 percent or $100 million removed from the project, which means we'd have to go back in and reprogram dollars in order to make that ship whole," said Blake.
"Sequestration is a huge bogey for us out there and we don't know how that's going to affect us, especially where fleet maintenance is concerned," said retired Navy Capt. Joseph Andrilla, who is now with the San Diego Military Advisory Council.
Sequestration by law may trigger automatic cuts in programs but not personnel.
Blake said the other bright spot in San Diego is the concentration of defense contractors and military that is here is beneficial to the Pentagon, and that the strategy moving forward will focus on the Asia-Pacific region.
"Sixty percent of the fleet will be concentrated in that area by 2020," said Blake.