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US Defense Secretary Chuck Hagel on Wednesday said the Pentagon must "put everything on the table" as it struggles to digest major spending cuts forced by last month's sequester.
In a major strategy address delivered at the National Defense University, Hagel vowed to press ahead with plans to trim the US military while insuring it can tackle 21st century challenges like terrorism and cyber attacks.
Hagel praised the administration's strategic reorientation, which includes "rebalancing our defense posture to the Asia-Pacific and prioritizing critical capabilities such as cyber, special operations and unmanned systems."
But the defense secretary said he is overseeing a strategic management review to "ensure that we are realistically confronting both our strategic and fiscal challenges." The results of the study are expected in May.
The Pentagon is struggling to adjust to the so-called sequester cuts, which were allowed to take effect after Congress failed to reach a more palatable budget deal and will require the Pentagon to cut $41 billion by the end of September and $500 billion over the next decade.
The defense budget, which has doubled since 2001, is expected to reach $614 billion in fiscal year 2013. The budget for the coming year will be unveiled April 10.
Hagel said even if Congress manages to craft a deal to replace the sequester, the Pentagon must still tighten its belt.
"We need to be steely-eyed and clear-headed in our analysis, and explore the full range of options for implementing our national security strategy. We need to challenge all past assumptions, and we need to put everything on the table."
Without giving exact figures on tanks, planes and other assets, Hagel said the cuts will "fall heavily on maintenance and training."
He added that "any serious effort to reform and reshape our defense enterprise must confront the principal drivers of growth in the department's base budget -- namely acquisitions, personnel costs and overhead."
Hagel also took aim at costly new programs, saying: "The military's modernization strategy still depends on systems that are vastly more expensive and technologically risky than what was promised or budgeted for."
The cost of the F-35 stealth fighter jet program, for example, has doubled since 2001.
Hagel also pointed out that while the size of US military forces has declined since the Cold War, upper-level command and support structures have not followed suit.
He insisted, however, that "America does not have the luxury of retrenchment."
"We have too many global interests at stake, including our security, prosperity and future. If we refuse to lead, something, someone will fill the vacuum," Hagel said.