• With: KT McFarland

    This is a rush transcript from "Your World," October 14, 2014. This copy may not be in its final form and may be updated.

    STUART VARNEY, GUEST HOST: If threats to national security are on the rise, why is the number of U.S. troops on the decline?

    Top four-star General Ray Odierno says Washington budget cuts are putting our troops at risk.

    And former Reagan defense official KT McFarland agrees with that.

    KT is here.

    The Army down to -- will be down to 440,000 active soldiers, about the same level as before World War II. Too small?

    KT MCFARLAND, FORMER DEPUTY ASSISTANT SECRETARY OF DEFENSE: Right.

    Well, it's not just the Army. It's the Air Force. It's the Marines. It's the Navy. Everything is being downsized considerably, and at the same time that President Obama has committed them to even more missions. That is a shortfall that is guaranteed to be failure. Why? Because the missions keep increasing, the size of the military keeps shrinking, the military probably can't succeed in achieving those missions as they are now, and yet those missions are expanding.

    I was in the Reagan administration and we came into the Pentagon in early 1981 and we saw the effects of the Carter defense cuts. We had ships that couldn't sail because there was no fuel. We had planes that couldn't fly because pilots weren't even certified. They hadn't had enough training hours.

    And we had -- for every tank that worked, there was another one sitting right next to it that was cannibalized. But worst of all, we had Vietnam vets who were homeless and didn't have adequate medical care and our current active duty at the time...

    (CROSSTALK)

    VARNEY: Do you think it's going to be that fast?

    MCFARLAND: Yes, I do think it's going to be that fast.

    VARNEY: In the near future, it is that bad for the U.S. military. You think that?

    MCFARLAND: If we continue to have these missions that the president continues to...

    (CROSSTALK)

    VARNEY: Well, what do you think of what the president just said? He said, we have got -- our allies are united in a long-term effort against ISIS. Ed Henry comes on and says that ISIS has now surrounded two more towns, including one with an important air base.

    What do you make of what the president said?

    MCFARLAND: I don't know who believes him.

    I mean, we're succeeding? The allies, the coalition is succeeding? The only thing the coalition agrees on is nobody's going to put combat forces into the region. We're advancing against ISIS? ISIS is now surrounding -- in the centers of Iraq. Iraq is now in the north of Iraq.

    And there's nothing separating, nothing standing between ISIS and advance on the Kurdish regions. There is no boots on the ground, and the one group in the Middle East that's willing to fight, the Kurds, that's one group we're not arming.

    VARNEY: But the president knows that. He knows what's happening. And he's come out with a statement that we are succeeding. How do you get this juxtaposition here? How do you get the two stories straight? They're not straight.

    MCFARLAND: They're not straight at all, and he's got this senior military leadership that's issuing all these sort of cautionary statements that we're not succeeding, we may need combat forces.

    If the president has this mission where he says we're going to degrade and defeat ISIS, he's not giving the military the equipment and the wherewithal to do that. He needs to change the mission. My guess is he's going to -- after the election, which is all this is about, is getting through the election -- is, after the election, he is going to have three options.

    We either say we bombed everybody, it's a success, we're coming home, or he's going to say we're going to send in tens of thousands of combat forces, or I think the more likely, he's going to partner with Iran and he's going to say, you know, you, the pro-Iranian, Iraqi army, the Shiite militias, we're all going to work together to get rid of ISIS.

    And Iran will have a price tag on that and that will be nuclear weapons.

    VARNEY: You don't approve of any of those, do you?

    MCFARLAND: I think it's all just a complete disaster and it's only going to get worse. And America's word is worth nothing. And our military forces are in jeopardy, and the president, what is he doing? Cutting the benefit, cutting the size of the military, while he sends them over to Ebola epidemics in Africa.

    VARNEY: KT McFarland, thank you very much.

    MCFARLAND: Thank you.

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