Jan. 30 (Bloomberg) -- U.S. defense budget cuts may target spending on weapons as the Obama administration juggles paying for personnel and wars in Iraq and Afghanistan, the chairman of the Joint Chiefs of Staff said.

“The most expensive part of our budget is our people,” Admiral Michael Mullen said in an interview yesterday. “There’s not a lot of flexibility with respect to people, unless you start” reducing forces.

That is unlikely, meaning the weapons procurement budget, which averaged about 20 percent of fiscal 2008 and 2009 defense spending, will come under increased scrutiny, Mullen said.

“We’ve got to fund the wars we are in,” and that “puts an awful lot of pressure” on decreasing spending on weapon modernization and the repair of war-worn equipment, he said.

The largest part of the weapons accounts is tactical aircraft, shipbuilding and ground equipment produced by Lockheed Martin Corp., Boeing Co., Northrop Grumman Corp., General Dynamics Corp., Raytheon Co. and BAE Systems Plc.

Earlier this week, Defense Secretary Robert Gates warned two congressional defense committees that “one thing we have known for many months is that the spigot of defense spending that opened on 9/11 is closing.”

‘Hard Choices’

“With two major campaigns ongoing, the economic crisis and resulting budget pressures will force hard choices on this department,” Gates said.

Mullen said he expects the entire federal government will come under pressure for budget cuts and “the Department of Defense is going to have to do its share.”

“It’s important for all of us in defense to look realistically at what our requirements are,” said Mullen, who once served as the Navy’s director of resources.

The Pentagon faces a March 1 deadline to decide whether to approve more Lockheed Martin F-22 fighters than the 183 already ordered. Mullen said he didn’t know what direction the Pentagon would take, adding that “it’s an incredibly capable platform. I’ve walked through it with those who fly it. At the same time, it is an enormously expensive platform.”

The F-22 is the most expensive fighter in U.S. history, costing $354 million apiece when calculated in inflation- adjusted dollars that amortize 20 years of research and development.

Mullen said the debate over defense spending shouldn’t focus solely on “expensive platforms or expensive programs.”

“We’ve got to get a handle on our costs,” he said. “We need to be looking at our overhead, we need to be looking at where our expenses are, so we can reduce those in addition to making hard decisions about programs.”

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net.

Last Updated: January 30, 2009 00:04 EST