The Defense Department’s Missile Defense Agency is facing a budget shortfall that could jeopardize research into next generation technology, a retired Air Force general said Friday.

The Defense Department agency is responsible for keeping MDA is designed to keep Americans and allied nations safe from missile attacks — both nuclear and conventional — but a constrained fiscal environment is making it difficult to research ways to defend against threats from China and Russia, said Lt. Gen. Trey Obering (ret.) at a conference held by the Center for Strategic and International Studies in Washington, D.C.

"Why is this budget squeeze at [research and development] a problem, frankly? One thing we have to realize is what we're talking about is not today; we're talking about the future," said Obering, who served as director of the MDA from 2004 to 2008 and deputy director from 2003 to 2004.

"Even if we're only talking about North Korea and Iran, we have to invest in this R&D to keep up with that 'limited' threat, because those threats are evolving and they're becoming more mature," Obering continued. "And then, of course, if we're talking about a very aggressive China or a more belligerent Russia, we've got a long way to go to address that as well."

The Pentagon needs to invest in technologies like space-based targeting and tracking systems and directed energy weapons that could quickly shoot down any missile launched by an adversary. The breakthroughs in technology are especially needed since the missiles themselves are becoming better and faster, Obering said.

"We have to be able to overcome things like advance countermeasures, maneuvering warheads, hypersonic vehicles and much more," he said.

Between 2007 and 2015, MDA’s budget has dropped 23 percent, from an estimated $11 billion to $8.5 billion, according to a study published by Thomas Karako, a missile defense expert with CSIS.

"MDA has been hit, especially over the last eight to 10 years, with a significantly reduced topline," Karako said.

Army Maj. Gen. Ole Knudson, the current deputy director of MDA, said the agency is trying to deal with a tight fiscal environment as best it can.

"The topline reductions that MDA has taken are what they are," he said. "They also are pretty much in line with what the department has taken overall. Even though there have clearly been those topline reductions, we've at least done all we think we could to keep on increasing both capability and capacity."

The agency is still working to develop new technology, like directed energy weapons that could disable missiles early in their launch stages, Knudson said.

"We've continued to try and work some of these aspects of future technology, not as much as maybe we would have hoped or as fast, because we sometimes had some reductions in things we asked for," he said. "I'm not going to say it's been … I'll call it 'as perfect' … as maybe we could have been if we didn't have the topline cuts. But the topline cuts are there."

Obering warned that America needs to make missile defense a top priority.

"We are in a fundamentally different world then we've known in the past," he said. "We talked in the past about near-peer. We have peer competitors now. We have a much more dangerous world we're entering into."

The funding side of defense – especially for technologies like missile defense – needs to change to meet the ever-adapting threats, Obering said.

"We can't rely on a 1971 acquisition process built for the Cold War and a funding process that was made years and years — decades — ago," he said. "So we need to be making some fundamental looks at what we're doing, how we're doing business and what should we be placing our bets on for the future, because if we keep going through the way we are now, we're going to have a whole different conversation in another 10 years."

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