Boeing braces for federal reduction in aerospace, defense spending - Ahwatukee Foothills News: Money

default avatar
Welcome to the site! Login or Signup below.
|
||
Logout|My Dashboard

Boeing braces for federal reduction in aerospace, defense spending

Print
Font Size:
Default font size
Larger font size

Related Stories

Posted: Wednesday, October 3, 2012 5:00 pm

It’s a typical day along Boeing Co.’s production line turning out Apache AH-64D helicopters, new and remanufactured.

Kelley Miles hammers rivets above the cockpit of a stripped-down helicopter getting a refit. Ronald Young builds the pylons that hold missiles and rockets. Pat Chi puts together a streamlined exhaust vent.

Outside, finished helicopters roar above the desert.

Miles, Young, Chi and close to 5,000 co-workers are among an estimated 40,000 Arizonans working in aerospace and defense, a sector that contributed roughly $300 million to state and local tax revenues in 2009, according to the Arizona Commerce Authority.

Those depending on Arizona’s defense contractors and subcontractors, as well as its military installations, are looking warily toward year’s end, when automatic spending cuts will occur unless the White House and Congress agree on an alternative plan for reducing the federal deficit.

U.S. Sen. John McCain calls it a “fiscal cliff.”

“If you’re going to enact savings, and we need to enact savings, you do it with a scalpel,” McCain said at an August appearance with West Valley leaders. “You don’t want to do it with a meat ax.”

McCain cited a George Mason University study predicting that Arizona would lose more than 35,000 jobs and suffer a $3 billion loss in gross domestic product.

President Barack Obama and GOP leaders in Congress are at odds over the $1.2 trillion in automatic reductions over 10 years called for by the Budget Control Act of 2011. Under the current plan, about half of the cuts would come from defense.

In a letter last Friday, Obama, who wants a revised plan that increases taxes on those with higher incomes, called sequestration a “blunt and indiscriminate instrument” that was never intended to happen.

Phoenix Mayor Greg Stanton, who heads a U.S. Conference of Mayors defense transition task force, said sequestration would harm Arizona’s many subcontractors in addition to major military contractors.

“It would be greatly damaging to our small-business economy, not just the big ones,” Stanton said in a telephone interview. “Massive cuts will affect mainstream America.”

Boeing’s operations could be harmed by losing second- and third-tier suppliers, such as those providing one specific part, spokesman Dan Beck said in a telephone interview.

“If you lose that you lose the capability to produce these products in the future,” he said.

The primary business of Prescott Aerospace, one of Boeing’s 578 suppliers and vendors in Arizona, is precision parts for the Apache program, said Michael Daley, president of Prescott Aerospace.

“We’re not expanding or doing much of anything,” he said.

The sequestration cuts would cost Maricopa County firms more than $1.37 billion in annual revenue from 2013 to 2021, according to the Center for Security Policy, a conservative think tank based in Washington. Pima County firms would lose an estimated $740.4 million over this same period, the group said.

Tucson Mayor Jonathan Rothschild said one of the concerns for his city is that its economy relies heavily on Davis-Monthan Air Force Base and Raytheon Missile Systems.

“We don’t want to see what’s a slow recovery take another hit,” Rothschild said.

But Arizona is in a much better position than most of the nation when it comes to defense spending and commitments, said Werner Dahm, director of the Security & Defense Systems Initiative at Arizona State University and former chief scientist of the U.S. Air Force.

Dahm pointed to the decision to base three squadrons of F-35 jet fighters at Luke Air Force Base as well as Marine Corps Air Station Yuma awaiting the arrival of the first F-35B Joint Strike Fighter jets this winter.

“If we weren’t talking about sequestration the net positive impact of that on the state would be enormous,” Dahm said. “Sequestration will offset some of those wins, but that’s huge.”

Mark Muro, director of policy for the Metropolitan Policy Program at Brookings Institution, said military budgets are likely to decline long-term regardless of whether sequestration occurs.

“The great challenge now is for these government-related industries and firms to begin moving to ‘get off the dole’ of U.S. military contracting and seek new, more commercial business opportunities,” Muro said in an email.

Boeing is focusing on growth in its commercial business and international sales, said Beck, the company’s spokesman.

“There are a number of things that will be a hedge,” he said. “But we don’t want to overstate that because [sequestration] will have an effect.”

More about

More about

  • Discuss

7 Things to Know About Secretary of Defense Nominee James Mattis

SIGN UP FOR OUR NEWSLETTER 1. His nicknames include “Chaos,” “Mad Dog,” and “The Warrior Monk.” The most commonly used of these nicknames is “…

Published: December 2, 2016 - 10:39 pm @ http://www.breitbart.com/national-security/2016/12…

FACT CHECK: Trump Won 3,084 of 3,141 Counties, Clinton Won 57

Claim: President-elect Donald Trump won 3,084 of America's 3,141 counties; Hillary Clinton won just 57. false Example: [Collected via e-mail a…

Published: December 2, 2016 - 10:09 pm @ http://www.snopes.com/trump-won-3084-of-3141-count…

Car plows into Phoenix restaurant; impairment suspected

PHOENIX - Police took one person into custody after a car rammed into a restaurant in central Phoenix on Friday evening.  According to the Pho…

Published: December 2, 2016 - 9:31 pm @ http://www.abc15.com/news/region-phoenix-metro/cen…

Remains of Pfc. Daniel Hunt, killed in Korea, find final resting place in Arizona 65 years later

PHOENIX - The homecoming more than a generation in the waiting finally happened this week.

Published: December 2, 2016 - 9:30 pm @ http://www.abc15.com/news/region-phoenix-metro/nor…

Department of Homeland Security Will Continue Contracting With Private Prison Companies

A Department of Homeland Security (DHS) subcommittee has decided that Immigration and Customs Enforcement (ICE) should continue contracting wi…

Published: December 2, 2016 - 8:38 pm @ https://rewire.news/article/2016/12/02/department-…

Nurses Donate $50,000 to Aid Veterans Stand with Standing Rock

National Nurses UnitedContact: Charles Idelson, 510-273-2246 National Nurses United today announced that it is donating $50,000 to support U.S…

Published: December 2, 2016 - 7:37 pm @ http://www.commondreams.org/newswire/2016/12/02/nu…

Chandler father, teen use survival skills after becoming stranded

CHANDLER, AZ - Survival smarts saved a Chandler man and his son after they were stranded in the wilderness near Globe. Tim Corbitt and his 13-…

Published: December 2, 2016 - 7:37 pm @ http://www.abc15.com/news/region-southeast-valley/…

Man Who Invented General Tso’s Chicken Dead at Age 98

Editor's Picks Kanye West Is Living Apart From Kim Kardashian Sherri Papini Screamed So Much ‘She Was Coughing Up Blood’ Trying to Get Help Si…

Published: December 2, 2016 - 7:30 pm @ http://www.usmagazine.com/entertainment/news/man-w…

Why Trump Should Embrace – Not Ditch – Green Energy

Email Print Comment Quote Arthur van Benthem, a Wharton professor of business economics and public policy, argues in this opinion piece that t…

Published: December 2, 2016 - 7:07 pm @ http://knowledge.wharton.upenn.edu/article/why-tru…

Arizona Coyotes make holiday visit to Phoenix Children's Hospital

PHOENIX — The Arizona Coyotes took some time Friday afternoon to put smiles on children’s faces. The hockey team visited Phoenix Children’s Ho…

Published: December 2, 2016 - 7:04 pm @ http://ktar.com/story/1377129/arizona-coyotes-make…

Facebook

ahwatukee.com on Facebook

Twitter

ahwatukee.com on Twitter

RSS

Subscribe to ahwatukee.com via RSS

RSS Feeds

Spacer4px

Most Popular

Online poll

Loading…