Leon Panetta cites Afghanistan gains, continued terrorism threat in confirmation hearing

Leon Panetta, nominated to be the next secretary of Defense, told a Senate committee Thursday that the United States and its allies have made progress in Afghanistan, but warned that terrorists remain a threat despite the death of Al Qaeda leader Osama bin Laden.

In a morning of wide-ranging discussion of U.S. defense policy, Panetta, the current CIA chief, told the Senate Armed Services Committee that he expected Libyan leader Moammar Kadafi will eventually step down if the international community keeps up the pressure of sanctions and airstrikes against his regime.

Panetta also said he would be a watchdog on Pentagon spending, sure to be an issue in this tough economy when some are looking to cut military spending while others are concerned that defense cuts not to be too severe.

President Obama has proposed $400 billion in national security cuts, but some lawmakers, including Sen. John McCain (R-Ariz.) warned that the trims should not come at the expense of military power, already stretched with wars in Iraq, Afghanistan and with NATO strikes in Libya. The ranking Republican said he was concerned about hollowing out U.S. military might and argued that it wasn’t defense spending that has worsened the U.S. budget crisis.

Panetta said he agrees with the man he is seeking to replace, Defense Secretary Robert Gates. “I share his concerns about the possibility of hollowing out our force,” Panetta said. “I share his concern about automatic, across-the-board cuts.”

But Panetta noted that the days of large growth and unlimited defense budgets are over. “Our challenge will be to design budgets that eliminate wasteful and duplicative spending while protecting those core elements that we absolutely need for our nation’s defense,” he said.

On Libya, where NATO is continuing to bomb under a U.N. resolution designed to protect civilians from Kadafi’s forces, Panetta said he expected the leader to eventually step down in the face of international pressure.

“Frankly, I think there are gains that have been made,” Panetta said. “We have seen the regime weakened significantly. We have seen the opposition make gains both in the east and the west. I think there are some signs that if we continue the pressure, stick with it, ultimately Kadafi will step down.”

Panetta is expected to easily win confirmation in the Senate. He will replace Gates, who is retiring at the end of the month after more than four years in the Obama and Bush administrations.

Perhaps the most immediate security decision is how many troops to withdraw from Afghanistan.

Obama has said the withdrawal will be significant, but the exact size is still being discussed. Liberals are seeking a major cut, well in excess of 10,000 troops, while many hard-liners see the drop as no more than 5,000. Panetta shied away from giving a number.

Panetta said conditions on the ground will determine the size of the cut and warned that whatever progress has been made was fragile. The ultimate goal of Afghanistan policy, he said, was to ensure that the country could no longer be used as a haven for terrorists as it had been when groups such as Al Qaeda had sanctuary.

In answer to questions from Sen. Ben Nelson (D-Neb.), Panetta said there was “no question” that Al Qaeda had been hurt when U.S. commandos killed Bin Laden, who had been hiding in Pakistan.

But terror threats remain, Panetta warned.

“I do think we have to pay attention to these nodes that Al Qaeda is developing,” he said of areas like Yemen and Somalia. “They remain dangerous and we have to go after them.”