President Obama signed an order authorizing the government to begin cutting $85 billion from federal accounts on Friday and defense cuts are to hit states and counties hard according to a report released recently by the Center for Security Policy.
The Pentagon must cut out some $40 billion of cuts between now and September, which equates to about nine percent of its budget through September. Defense chiefs have said that the move will delay deployments, such as a recent move of an aircraft carrier to the Persian Gulf, and hurt national security.
The Center for Security Policy analyzed the effects both on the state and county levels including Paulding County, Georgia.
For Paulding County, the report breaks down defense cuts and economic impacts based on Fiscal Year 2011 defense contract baseline data and includes estimated nine percent annual budget reduction and and an estimated 18% sequestration annual budget reduction this year for fiscal year 2013.
The report states that from 2013 through the year 2021, the military is carrying an unfair burden of deficit cuts in all states. To date, the defense budget has been hit with 50% of deficit reduction, yet it accounts for less than 20% of total federal spending.
The earlier budget cuts, the first nine percent of the defense budget reduction for 2013-2021 equates to $487 billion in cuts, an average nine percent over nine years.
As a result, in 2012, President Obama limited U.S. military capability to fighting one "regional conflict" and one "holding action."
Other aspects of the analysis include the sequestration budget cuts now in effect as the the second nine percent of the defense budget reduction: "Sequestration," also required by law in 2011, mandates $500 billion more in 2013-2021 defense cuts -- an average total 18% cut.
In 2011 President Obama said, "I will veto any effort to get rid of those automatic spending cuts."
Alternative solutions have been proposed to maintain a strong defense, reduce the nation's deficit and avoid tax increases and elected officials have proposed that the President and Congress reduce mandatory entitlement spending and make cuts in the non-security programs in the Federal budget.
The Center for Security Policy said that these reports show how estimates of 2013 defense budget reductions of 9% and 18% could affect Georgia with cuts in defense jobs and businesses.
Paulding County’s share of the defense cuts effects and Baseline Contract Year for 2011:
- Defense Logistics Agency: $1,671,763; (9% reduction: - $150,459); (18% reduction: - $300,917)
- DSC Richmond: $663,480 (9% reduction: - $59,713); (18% reduction: - $119,426)
- OIC Direct Support Stock Control: $27,570 (9% reduction: - $2,481); (18% reduction: - $4,963)
- USA Engineer Div-Huntsville: $3,646 (9% reduction: - $328); (18% reduction: - $656)
- USA Materiel Command Acquisition: $131,991 (9% reduction: - $11879); (18% reduction: - $27,758)
- WR-ALC-LTKC: $39,570 (9% reduction: - $3,561); (18% reduction: - $7,123)
The total amount of the contracts for Paulding County were $2,538,020 with a total loss at nine percent being $228,421 and at 18 percent, $456,843.
Georgia defense prime contractors overall earned over $7.41 billion in 2011 but now they face 18 percent revenue cuts under Sequestration this year in which Georgia defense contractor’s revenue losses could be greater than $1.33 billion each year.
The five counties in Georgia to be hit the hardest are Cobb, Fulton, Gwinnett, Houston, and Chatham.
If left in place, Sequestration will cut our military to its smallest size since before World War II, while we face growing threats from Iran and North Korea, a rising China, regional threats in the Middle East, and an ongoing war in Afghanistan, the report said.
The full impact of the sequestration would be felt by July, August, and September.
The impact of the defense cuts for all states and counties can be found here.