Defense

July 18, 2012

Defense firms warn of job losses from budget cuts

by Donna Cassata
Associated Press

Leader of the nation’s major defense contractors warned July 18 of job layoffs and disruptions in manufacturing if Congress fails to agree on an alternative to automatic budget cuts.

Robert J. Stevens, chairman and chief executive officer of Lockheed Martin, said the across-the-board reductions could result in layoffs of 10,000 employees from his company of 120,000 workers. Executives from Pratt and Whitney, EADS North America and Williams-Pyro also sounded the alarm about the $110 billion in cuts slated to hit defense and domestic programs on Jan. 2.

“From an industry perspective, because of the specter of sequestration, the near-term horizon is completely obscured by a fog of uncertainty,” Stevens said in testimony before the House Armed Services Committee.

Republicans and Democrats are trying to undo the cuts they voted for last summer when they agreed to a deficit-cutting budget, but partisan divisions stand as a major obstacle to any solution. Democrats argue that any alternative must include tax hikes on high wage earners. Republicans are resisting any tax increases as the economy slowly recovers.

Politically, Republicans are trying to use the issue against President Barack Obama, contending that the commander in chief is willing to undermine the nation’s military with deep defense cuts. In fact, Republicans and Democrats backed the legislation that called for $487 billion in defense cuts over 10 years, plus the automatic cuts of about $492 billion in projected spending if a congressional bipartisan committee failed to come up with $1.2 trillion in savings. The panel was unsuccessful.

Some Republicans, including Armed Services Committee Chairman Howard “Buck” McKeon, R-Calif., have said they regret the vote.

The House voted overwhelmingly Wednesday for legislation requiring the Obama administration to spell out how it would implement the cuts in a report to Congress. The vote was 414-2.

In another political wrinkle, the officials from some of the defense firms said they would send out notices warning of possible layoffs 60 days before the cuts – which would fall just days before the November elections.

“Some may consider it flattering to believe that our industry is so robust and so durable that it could absorb the impact of sequestration without breaking stride,” Stevens said. “But that is a fiction. The impact on industry would be devastating, with a significant disruption to ongoing programs and initiatives.”

Despite the gloom, a report this past spring from Price Waterhouse Coopers found that the top 100 aerospace and defense companies reported $677 billion in revenue and $60 billion in operating profits, a record-setting year.

“Revenue was higher by 5 percent compared with 2010, while operating profit was up 2 percent over 2010,” the report said.




All of this week's top headlines to your email every Friday.


 
 

 

Headlines May 29, 2015

News: U.S. Army chief opens door to embedding U.S. troops with Iraqi forces - After the fall of Ramadi, the Iraqi Security Forces need military and political leadership, Gen. Raymond Odierno says.   Business: No acquisition strategy yet for LCS frigates - Details of the new Littoral Combat Ship frigate program’s acquisition strategy are still being reviewed,...
 
 

News Briefs May 29, 2015

Finnish navy: Underwater intruder possible foreign submarine Finnish military officials say that an underwater object the navy chased last month in territorial waters and dropped several depth charges could have been a foreign submarine. A navy investigation released May 28 says that technical analysis did not provide sufficient proof of the presence of a submarine...
 
 
Lockheed Martin photograph by Chad Bellay

F-16 test pilots hit the ‘road’ to help train USAFE pilots

Air Force photograph by Airman 1st Class Kyla Gifford Three F-16s assigned to Spangdahlem Air Base, Germany, on a refueling mission last year. Two F-16 test pilots from the 416th Flight Test Squadron recently returned from a &#...
 

 
Navy photograph

Its reign in the fleet over, naval Sea King helicopter now rests at Pax Museum

Navy photograph At more than 54 feet in length with a 62-foot rotor diameter, the mighty SH-3A Sea King helicopter sits in its final spot at the Patuxent River Naval Air Museum. Designed as an anti-submarine warfare helicopter,...
 
 
boeing-korea

New Boeing Avionics Facility to enhance ROKAF readiness, affordability

Boeing formally opened a new avionics maintenance and repair center in the Yeongcheon Industry District of Daegu-Gyeongbuk Free Economic Zone May 28. The 10,000 square-foot facility will test and repair aircraft electrical syst...
 
 
Navy photograph by John F. Williams

ONR testing high-speed planing hulls

Navy photograph by John F. Williams A ship hull model attached to a high-speed sled moves through waves at the David Taylor Model Basin at Naval Surface Warfare Center, Carderock, during Office of Naval Research -sponsored rese...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>