WASHINGTON — Leon Panetta, director of the Central Intelligence Agency, is President Barack Obama’s reported choice to lead the Defense Department in an era of lingering wars and contracting military budgets.

The president will announce the nomination Thursday, a senior White House official said.

Panetta, 72, a former Democratic congressman, chief of staff to President Bill Clinton and an Army intelligence officer, will succeed another former CIA director, current Defense Secretary Robert Gates.

Gates plans to retire on June 30, according to the White House official.

Army Gen, David Petraeus, who commands U.S. forces in Afghanistan, will take over for Panetta at the CIA. Lt. Gen. John Allen, deputy commander of Central Command, will receive a fourth star and assume command from Petraeus in Kabul. Additionally, former U.S. ambassador to Iraq Ryan Crocker will be the new ambassador to Afghanistan.

Petraeus and Allen are expected to assume their new positions in early September, the official said, but it's not clear when Crocker will begin his new job.

All four men must be confirmed by the Senate before assuming their new positions. Petraeus will retire from the military before taking over the CIA post, the official said, and an interim director will be appointed to fill in between Panetta's departure and Petraeus' arrival.

Gates recommended Panetta to the president six months ago, according to a senior defense official.

Like Gates, Panetta is a respected Washington presence with broad support on both sides of the aisle. A prominent Republican was quick to praise the selection.

“Director Panetta has had important success in stabilizing the CIA workforce and played a critical role in identifying and disrupting terrorist plots against the United States,” Rep. Peter King of New York, chairman of the House Committee on Homeland Security, said in a prepared statement.

When Panetta moves from Langley to the Pentagon, he’ll face a new set of challenges, chief among them closing out the Iraq War and managing the White House’s plans to draw down troops in Afghanistan.

He’ll also continue military reform efforts, taking over Gates’ five-year cost-savings plan to find $78 billion of internal “efficiencies” to stave off defense budget cuts that would impose radical changes on the Pentagon, as well as dealing with Obama’s recent proposal to cut $400 billion over 10 years.

Panetta has large shoes to fill, said Rick “Ozzie” Nelson, senior fellow at the Center for Strategic and International Studies.

“Gates has been arguably one of the most successful secretaries of defense we’ve had in recent history -– effective at making changes inside the Pentagon and very successful at managing the Washington bureaucracy,” he said. “It’s going to be a challenge for anyone to come in after Gates and match his success, but Panetta is a good choice.”

Panetta should bring a measure of stability, said Michael Swetnam, chairman of the Potomac Institute for Policy Studies, a defense-oriented think tank in Arlington, Va.

“It’s another person with a big background coming from the CIA to run DOD, so I would expect a lot of the same approaches to national security issues,” he said. “If there’s any change I would expect, it’s that the remnants of the Bush administration will disappear from the DOD.” Gates, a holdover from the Bush administration, has said he will step down later this year.

The administration official acknowledged that Panetta was initially reluctant to take on the defense secretary role because of his enthusiasm for the CIA job. But the president appealed to his sense of public service, and on Monday he agreed to the switch.

Obama’s selection of the cabinet insider reinforces the trend of alignment between intelligence operations and the military. As the Afghanistan War ramped up, Panetta oversaw the CIA’s controversial drone operations, which have targeted America’s enemies in Pakistan and elsewhere but caused civilians deaths as well.

Panetta became CIA director in February 2009, shortly after Obama took office and has steered the agency away from the media spotlight. He has overseen a period of relative stability following intense public criticism during the Bush era.

In his confirmation hearings, Panetta surprised some Obama voters by supporting the practice of “renditions” of captured terrorist suspects to foreign countries where they could be held, though he disavowed torture. He has said that Osama bin Laden, if captured, would likely be placed in the prison at Guantanamo Bay in Cuba -- which Obama has vowed to close -- but admitted last year that the U.S. has not had a fix on the al-Qaida leader’s location for more than a decade.

Panetta’s performance at the agency bodes well for his coming years at the Pentagon, said former Deputy Secretary of Defense Rudy DeLeon, senior vice president at the Center for American Progress, a Washington, D.C., progressive think tank.

“(His) tenure at the Central Intelligence Agency shows he understands the heart of the national security mission, that he knows how to create policy and strategy, and that he stands up for his people when they need a leader to stand up for them,” DeLeon said.

Born in Monterrey, Calif., Panetta is the son of Italian immigrants and lives in their former farm home in nearby Carmel. He served two years in the Army, leaving as a first lieutenant in 1966 with an Army Commendation Medal. He holds a B.A. in political science and a law degree from Santa Clara University and has three grown sons and five grandchildren with his wife, Sylvia.

Panetta came to Washington early in his career as a legislative assistant to California Republican Sen. Thomas Kuchel, and later as special assistant to the secretary of Health, Education and Welfare, and director of the U.S. Office for Civil Rights. He also was executive assistant to New York Mayor John Lindsay, according to his official biography.

Panetta was a congressman from 1977 to 1993, rising to chair the House Budget Committee. Under President Bill Clinton, he was tapped to be the White House’s powerful Office of Management and Budget director, but within the year he was appointed Clinton’s chief of staff, serving from July 1994 to January 1997.

For nearly 10 years before returning to government at CIA, Panetta was far from the spotlight, operating the Leon & Sylvia Panetta Institute for Public Policy at California State University, Monterey Bay. He was drawn back to Washington in March 2006 when he was picked to be a member of the bipartisan Iraq Study Group alongside Gates, then president of Texas A&M University.

Panetta’s rich background gives him a good chance to pick up where Gates leaves off, said Nelson of the Center for Strategic and International Studies.

“He’s a strong leader, a strong manager, very politically effective and he knows how to operate in Washington,” Nelson said.

Stars and Stripes reporter Leo Shane III contributed to this report.

baronk@stripes.osd.milTwitter: @StripesBaron

carrollc@stripes.osd.milTwitter: @ChrisCarroll_

Sign Up for Daily Headlines

Sign up to receive a daily email of today's top military news stories from Stars and Stripes and top news outlets from around the world.

Sign Up Now