There are a few points that should be made. While the military has been able to keep meeting "quotas" even in the face of the prolonged conflict, the methods by which it is being done are not necessarily possible over the long term.

First, the Army has already been letting in a lot of "riff-raff.". In the past several years it has quintupled the number of 'Category IV' recruits (the lowest category), bumping into a policy maximum of 4% that many believe will have to be raised. Now approximately 15% of Army recruits do not have a high-school degree. The number of 'waivers' for things like criminal records has increased significantly. These figures are particularly important because the Army is now "skills focused" and has an up or out career path, along with a much large NCO base. The army (and military in general) is *designed* to operate with "high quality" people.

Secondly, the cost of both recruiting and retaining personnel has been skyrocketing. Bonus money paid out today is astronomical, even when adjusted for inflation. The living standards expected by troops (even in places like Iraq) are higher than ever --- and vastly more expensive to provide. This is part of the reason for the vast increase in contracting costs. It is bad enough in the short run --- but projecting these increased costs over the long run makes for dismal budget forecasts. In theory, if the war ends the military could "ratchet down" pay and benefits on a supply/demand basis. But reality shows that once a compensation level is reached it will never be reduced.

Thus, even as the military "transforms" and requires ever higher recruit standards, the army is being forced to accept lower levels. And even as budgets are being squeezed in an attempt to field new technology, costs for this manpower are increasing drastically. In the long run, something is gonna have to give.