U.S. military says it may have to cut Europe budget by fifth LONDON (Reuters) - The United States may be compelled to cut its military spending in Europe next year by as much as a fifth in the latest round of reductions under "sequestration," America's top general in the region said on Thursday. U.S. Air Force General Philip Breedlove, who serves as both head of the U.S. European Command (EUCOM) and as NATO's Supreme Allied Commander Europe (SACEUR), said the reductions will require NATO forces to work more closely together and train "smarter." We want to cut the tail to protect the teeth... We have to work together perhaps more than ever before," he told a press briefing in London. The Pentagon is facing nearly $1 trillion in cuts to projected spending over the next decade, which leaders say would dramatically reduce Washington's military capability. The next round of across-the-board "sequestration" cuts will begin on January 15 if U.S. Congress cannot agree deficit reduction measures. The U.S. army is already closing and consolidating several garrisons in Germany and says under current plans the number of troops in Europe by 2017 will be some 30,000, a drastic reduction from the days of the Cold War. The U.S. Air Force also maintains several bases, as does the U.S. Navy. EUCOM had been asked to plan for a budget reduction of between zero and 20 percent next year, Breedlove said. Cuts would likely take place at the headquarters level, he said. Other U.S. commands are taking similar steps. Last week, U.S. Africa Command said it expected to lose more than a tenth of its funding, forcing it to slim down planned exercises and cut spending on its headquarters in Stuttgart, Germany. Almost all European NATO members are also cutting defense spending, and with little or no new money available for exercises, training to build NATO's ability to fight sophisticated adversaries would be a challenge, Breedlove said. One solution would be to building a NATO component to already planned and funded exercises by individual or groups of member states, he said. "We need to exercise smarter," he said, pointing to last month's Mediterranean exercise "Brilliant Mariner," run alongside a pre-planned Italian exercise. This is how I think we do this without extra money... Our training, our exercises will have to be the glue that holds us together. Last month NATO staged an exercise in the Baltic states, "Steadfast Jazz," which Breedlove said showed that the alliance was moving beyond its recent focus on counterinsurgency to more sophisticated fighting. NATO denies such exercises are aimed at Russia, but officials also acknowledge privately that an increasingly assertive Moscow has alarmed eastern and northern European states in particular, most of whom are NATO members. Breedlove emphasized on Thursday that a high priority needed to be put on maintaining and increasing military-to-military relations with Moscow to build trust and avert misunderstandings. Breedlove also noted increased competition for Pentagon resources, particularly from Asia, to which President Barack Obama has said the United States will "pivot" its resources as part of a strategic rebalance. But he said it was important NATO remained strong in Europe. "I think in history that every time we have thought the risk of great power conflict has gone, we've had great power conflict," he said. My responsibility is to make sure we are ready for whatever is needed. This story has been refiled to fix byline.