In the first year alone of 2013, it would add up to a 23 percent cut that Panetta called devastating.
"Such a large cut, applied in this indiscriminate manner, would render most of our ship and construction projects unexecutable -- you cannot buy three quarters of a ship or a building and seriously damage other modernization efforts. We would also be forced to separate many of our civilian personnel involuntarily and, because the reduction would be imposed so quickly, we would almost certainly have to furlough civilians in order to meet the target," Panetta wrote in a letter.
By his calculations, "we would have the smallest ground force since 1940, the smallest number of ships since 1915, and the smallest Air Force in its history" at the end of the decade, Panetta said.
If they did not, the Pentagon chief said the military would have to rethink its strategy.
"We would have to formulate a new security strategy that accepted substantial risk of not meeting our defense needs. A sequestration budget is not one that I could recommend," said Panetta, a former California congressman and head of the House Budget Committee.
At least two of the potential cuts outlined by Panetta would strike at the heart of U.S. defense strategy.
One is the elimination of missile defense in Europe. The Obama administration's commitment to building a network of radars and interceptors to defend all of Europe against a potential missile strike from Iran is central to U.S. efforts to update NATO defense priorities, improve defense cooperation with Russia and deter Iran.
Panetta's comments add pressure to the supercommittee just 10 days before its deadline as panel Republicans and Democrats struggle to fulfill their mandate. The Pentagon letter also stirs the recent talk in Congress about trying to nullify the automatic cuts, a step McCain and Graham have discussed. However, President Barack Obama said last week that he wouldn't accept any legislation that tries to undo the automatic cuts.
In a statement, McCain and Graham said the automatic cuts "would set off a swift decline of the United States as the world's leading military power. ... This is not an outcome that we can live with, and it is certainly not one that we should impose on ourselves. The sequester is a threat to the national security interests of the United States, and it should not be allowed to occur." (Z: OH, no wonder Obama won't accept cuts.)
Associated Press writers Robert Burns and Lolita C. Baldor contributed to this report.