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WASHINGTON - Bigger defense cuts triggered by failed deficit-reduction negotiations would have "devastating" effects on the nation's security, Defense Secretary Leon Panetta said on Tuesday.

In a joint appearance at the National Defense University, Panetta and Secretary of State Hillary Rodham Clinton made their case for limiting their budgets' exposure to the political battles in Congress over identifying ways to reduce government spending.

Panetta said the Pentagon is prepared to make $350 billion in cuts in projected spending over the next 10 years, as agreed by Congress. But he warned of dangers to the national defense if bigger reductions are required.

The deficit compromise reached between the White House and Congress set up a bipartisan committee to draft legislation to find more government cuts. If the committee cannot agree on a deficit-reduction plan by year's end or if Congress rejects its proposal, it would trigger $500 billion in additional reductions in projected national security spending.

"This kind of massive cut across the board -- which would literally double the number of cuts that we're confronting -- that would have devastating effects on our national defense; it would have devastating effects on certainly the State Department," Panetta said.

Clinton said Americans should understand that in addition to preserving the nation's military strength, it is in the nation's security interests to maintain the State Department's role in diplomacy and development. She suggested that the political stalemate over spending cuts has put that in jeopardy.

"It does cast a pall over our ability to project the kind of security interests that are in America's interests," she said. "This is not about the Defense Department or the State Department ... This is about the United States of America. And we need to have a responsible conversation about how we are going to prepare ourselves for the future."

Panetta was asked about news reports that the Pentagon is considering reducing military retirement benefits, which, along with military health costs, have ballooned in recent years.

Though those payments have been considered sacrosanct -- part of the bargain the nation makes with those who protect it -- the economic and debt crises have put those issues into play.

A private-sector advisory panel last month drafted a plan to eliminate the current system under which those who retire with 20 years of service get immediate, lifetime payments of about 50 percent of their salaries. The board recommended that the system be replaced with a 401K-type plan.

"It's the kind of thing you have to consider," Panetta said. He quickly added that it must have a grandfather clause so the government does not "break faith" with the military.