[Update] Hagel Resigns as U.S. Defense Secretary

Praising Defense Secretary Chuck Hagel’s “class and integrity,” President Barack Obama announced today at the White House that Hagel will leave his post.

The president said Hagel has agreed to remain in his position until a successor is nominated and confirmed. For that, Obama said, he is “extraordinarily lucky and grateful.”

“When I asked Chuck to serve as secretary of defense, we were entering a significant period of transition,” Obama said. That transition included the drawdown in Afghanistan, the need to prepare our forces for future missions, and tough fiscal choices to keep our military strong and ready.

Last month, Obama said, Hagel came to him to discuss the final quarter of his presidency. It was then that Hagel initially determined that, having guided the department through this transition, it was an appropriate time for him to complete his service, the president added.

A Steady Hand

“Over nearly two years, Chuck has been an exemplary defense secretary,” Obama said, crediting Hagel for providing a steady hand during the modernization of the administration’s strategy and budget to meet long-term threats, while still responding to immediate challenges such as ISIL and the Ebola outbreak in West Africa.

Hagel said he is “immensely proud” of what the department has accomplished during his tenure.

“I believe we have set not only this department, the Department of Defense, but the nation on a stronger course toward security, stability and prosperity,” the secretary said.

Privileged to Serve

Hagel called his opportunity to serve as defense secretary the “greatest privilege of my life.”

In the meantime, Hagel said, “I will stay on this job and work just as hard as I have over the last couple of years, every day, every moment, until my successor is confirmed by the United States Senate.”

The United States of America can proudly claim the strongest military the world has ever known, Obama said.

“That’s the result of the investments made over many decades, the blood and treasure and sacrifices of many generations,” he said. “It’s the result of the character and wisdom of those who lead them as well, including a young Army sergeant in Vietnam who rose to serve as our nation’s 24th secretary of defense.”

Technology Mission won't Derail

Defense Secretary Chuck Hagel's resignation will not derail a major Pentagon technology initiative unveiled this month and should not delay a decision on how to improve a new class of smaller warships, U.S. defense officials said.

The officials said the Pentagon remains committed to the Defense Innovation Initiative, an effort to identify and develop new weapons to ensure continued U.S. military dominance that was announced by Hagel at a defense forum in California on Nov. 15.

Hagel resigned on Monday, the first major shift in President Barack Obama's cabinet since his Democrats were routed in midterm elections. He will stay on the job until a replacement is confirmed by the U.S. Senate.

Officials said the Defense Department's push for new technologies to keep ahead of Russia, China and other potential foes will continue. It is being spearheaded by Deputy Defense Secretary Robert Work, a retired Marine Corps officer, who has also been mentioned as a possible successor to Hagel.

Lockheed Martin Corp, Boeing Co and other big weapons makers have welcomed the initiative as a possible source of new funds as overall defense spending shrinks, but they say they need more details to finetune their own investment plans.

The U.S. Defense Department also still planned to announce within "weeks" its plans for future small warships after a lengthy review by the Navy, one of the officials said.

"We expect a decision in the near term," said the official, who was not authorized to speak publicly.

Chief of Naval Operations Admiral Jonathan Greenert this month said he expected Hagel to decide soon how to make a new class of smaller warships more lethal and survivable.

Hagel ordered a pause in the Navy's existing Littoral Combat Ship (LCS) program earlier this year, and asked for a review of options before the Navy ordered the last 20 ships in the 52-ship program.

Lockheed and Australia's Austal build two separate designs of the new warships. Hagel asked the Navy to look at several possibilities, including a wholly new design for a new "Small Surface Combatant," or modifying the existing ships.

Navy officials have said they expect the decision to inform their fiscal 2016 budget request and an associated five-year spending plan, which will be submitted to Congress in February.