WASHINGTON — In his second press conference at the White House, President Barack Obama said Tuesday night that he wants to reform a defense procurement system that “doesn’t work” to find savings at the Pentagon, singling out multi-billion-dollar weapons systems that have run over budget and short of their promises. He also said returning wounded veterans did not get the service they needed during the Bush administration, and that his budget proposes the largest increases for veterans services in 30 years.

In the primetime event, which was designed to address the economic crisis and the administration’s response, the president repeated that, despite trillion-dollar deficits, he was intent on spending increases he called a necessary investment in the future, listing health care, education, and energy as his priorities for spending.

But with mounting commitments in defense and veterans issues going up — including the rising costs of caring for returning wounded warriors, increased operations in Afghanistan, and even the very size of the military — the president said he is turning toward the spending process itself to help balance the books.

“There is uniform acknowledgement that the procurement system right now doesn't work. That's not just my opinion. That's [Arizona Republican Sen.] John McCain's opinion. That's Carl Levin's opinion,” he said, referring to the Democratic chairman of the Senate Armed Services Committee.

“Now, I think everybody in this town knows that the politics of changing procurement is tough, because, you know, lobbyists are very active in this area. You know, contractors are very good at dispersing the jobs and plants in the Defense Department widely,” he said. “And so what we have to do is to go through this process very carefully, be more disciplined than we've been in the last several years.”

Obama said the details of the defense budget will be coming soon, but that he already has identified $40 billion in procurement savings. The president sounded a warning to major weapons projects that have not delivered on time and on budget.

“There are a whole host of people who are students of the procurement process that will say, if you've got a whole range of billion-dollar, multi-billion-dollar systems that are — where we're seeing cost overruns of 30 percent or 40 percent or 50 percent, and then still don't perform the way they're supposed to or aren't providing our troops with the kinds of tools that they need to succeed on their missions, then we've got a problem,” Obama said.

“And we are going to continue to find savings in a way that allows us to put the resources where they're needed, but to make sure that we're not simply fattening defense contractors.”

Defense-spending observers have pointed to big-ticket items like the F-22 Raptor, which has never flown a mission over Iraq, and the high-tech Future Combat System as examples of projects known to be costly and controversial.

The president also said that all defense spending, including that which previously has been pushed off-the-books into supplemental appropriations bills, needs to be on the table in plain sight.

“In order for us to get a handle on these costs, it's also important that we are honest in what these costs are. And that's why it was so important for us to acknowledge the true costs of the Iraq war and the Afghan war, because if — if those costs are somehow off the books and we're not thinking about them, then it's hard for us to make some of the tough choices that need to be made.”

Obama also said his proposal is the largest increase for the VA in 30 years, saying it was the right thing to do, but did not say how, or if, he would look for budget savings in how veterans services and benefits are doled out.

American Legion spokesman Craig Roberts confirmed Wednesday that such an increase would be the largest in 30 years.

Already the White House swung and missed on veterans issues when, last week, the administration proposed a plan to bill veterans’ private insurance companies when they are treated for their combat injuries at VA hospitals. Veterans’ organizations protested, and despite estimates that placed the savings at roughly $530 million per year, the White House removed the idea from the table.

“I don't think anybody doubts the extraordinary sacrifices that men and women in uniform have already made. And when they come home, then they have earned the benefits that they receive. And, unfortunately, over the last several years, all too often the VA has been under-resourced when it comes to dealing with things like post-traumatic stress disorder or traumatic brain injury, dealing with some of the backlogs in admission to VA hospitals,” Obama said.

In response to a question about reports of rising U.S. homelessness in the bad economy, Obama brought up veterans.

“A number of the increases that we're looking for, in our budget on veterans funding, directly addresses the issue of homeless veterans. That, I think, can provide some real help,” the president said.

Obama addressed a series of other issues, starting with the economy. He said the nation must move from a culture of borrow-and -spend to one of save-and-invest, a change that he said will take time.

“It took many years and many failures to lead us here. And it will take many months and many different solutions to lead us out. There are no quick fixes, and there are no silver bullets,” Obama said.

Instead, the president offered three-step approach: job creation, stabilizing housing markets, and getting banks to loan money again to small businesses, families, students and others.

He also said the country must end “reckless speculation” that caused a “cycle of bubble and bust.”

“It creates the illusion of prosperity, and it's endangered us all,” said Obama.

In response to a question asking why, in this time of crisis, he has not asked the nation to sacrifice in some specific way for the good of the country, Obama replied, “I think folks are sacrificing left and right.”

When asked if his budget will “pass the problem” to future generations, in the form of more deficits, Obama said he wanted to make investments “that put us on a pathway to growth as opposed to a situation in which we're not making those investments and we still have trillion-dollar deficits.”

Additionally, Obama said that the status quo in the Israeli-Palestinian divide was “unsustainable,” noting the St. Patrick’s Day visit to the White House by the peacemakers of Northern Ireland who also once were sworn enemies, but persisted to find peace.

Persistence, he said, in tackling the nation’s issues with long-term solutions would be a theme of his administration “as long as I’m in this office.”

“We haven't immediately eliminated the influence of lobbyists in Washington. We have not immediately eliminated wasteful pork projects. And we're not immediately going to get Middle East peace. We've been in office now a little over 60 days. What I am confident about is that we're moving in the right direction,” he said.

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