Defense cuts: three things Americans should know

The US House approved a bill in July that’s likely to spark a showdown on military spending.

3. Automatic defense cuts won’t devastate the US economy – and may even help it

The companies that make America’s fighter jets, drones, and big-ticket weapons items warned in a press conference this week that a series of forced budget cuts known as “sequestration” would cost America more than 2 million jobs if it goes into effect.

Among other things, sequestration involves some $55 billion worth of automatic cuts in the defense budget. It’s set to go into effect in January unless Congress and the Obama administration can agree on a plan to curb the nation’s deficit.

Defense Secretary Leon Panetta has warned that such cuts would have dire effects on US national security.

Moreover, the cuts would reduce America’s gross domestic product by $215 billion, says Stephen Fuller, an economist at George Mason University who works with the Aerospace Industries Association. “The results are bleak but clear-cut,” he said. “The unemployment rate will climb above 9 percent, pushing the economy toward recession and reducing projected growth in 2013 by two-thirds.”

It’s not an uncommon view. Travis Sharp, a fellow at the Center for a New American Security, which has close ties to the Obama administration, warns that sequestration will “most definitely have negative impacts on employment and on workers in the defense industrial base.”

He worries, too, about the impact on defense research-and-development dollars, something he fears will be disproportionately affected by sequestration cuts. “A lot of the things that people use every day started out as research projects at the DOD,” he says, citing, for example, the Internet.

Others, however, say it's a good idea to keep the budget cuts in perspective. The DOD base budget under sequestration would be $469 billion – about what the Pentagon spent in 2006, when it was in the middle of fighting wars in both Iraq and Afghanistan. It was “not exactly a lean year for the Pentagon,” Dr. Preble notes.

Indeed, many of the predictions are overly dire, says Preble, who has studied regions that have experienced reductions in military spending in the past. Cuts initiated after the fall of the Berlin Wall in 1989 “were far deeper and faster than what we’re contemplating under sequestration,” he says.

Still, after an initial economic impact, those communities closely tied to the defense sector nonetheless “recovered quite quickly and prospered with a more diversified economy,” Preble says. “So the question really comes down to, How long is that economic adjustment process?” Research indicates that the effects are most dramatic the year they happen, then decline dramatically over time.

As for claims that defense cuts would mean millions of lost jobs? “That seems implausible considering that the cuts would amount to less than 3/10s of 1 percent of GDP,” Preble says. “More to the point, the defense budget should never be seen as a jobs program.”

3 of 3

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

You've read  of  free articles. Subscribe to continue.