Contractors fight for Defense budget

U.S. Secretary of Defense Robert Gates at a Pentagon news conference discussing proposed changes to the Defense budget

TEXT OF INTERVIEW

Steve Chiotakis: Today, no doubt, lawmakers and defense experts will be making their rounds trying to put their own spin on a Defense Department budget that cuts some and expands other programs.

But it's the cuts that are making the headlines this morning. Missile systems, high-tech helicopters, an expensive fighter jet program, the F-22 Raptor as it's known. That's where a lot of the debate will be centered -- a jobs debate, indeed. Defense Secretary Robert Gates says while the budget is higher than last year's at $534 billion, it is a smarter plan.

Robert Gates: This department must consistently demonstrate the commitment and leadership to stop programs that significantly exceed their budget, or which spend limited tax dollars to buy more capability than the nation needs.

Let's bring in Marketplace's Steve Henn, joining us from Washington. Steve, boy this has got to be some congressional fodder this morning.

Steve Henn: Oh, tons. You know, the F-22 program, the construction of this is largely based in Mississippi, but different pieces of this plane are made in 44 different states across America. So as you can imagine, you know, everyone who represents a congressional district or a state that has jobs tied to the F-22 is going to be under a lot of pressure and fight for those jobs -- especially in this economy. And then the big defense contractors that help make this plane, Lockheed Martin and Boeing, are going to be spending lots of money and lots of time on the Hill doing everything they can to make sure the Pentagon keeps buying these planes for the forseeable future. So this is going to be a big fight.

Chiotakis: So from an employment standpoint, Steve, what are we talking here?

Henn: Well, Lockheed Martin says the production of this plane employs 25,000 workers at 1,000 different suppliers in 44 states. So they've been actually buying newspaper ads in D.C. publications tauting those numbers. But that's just part of the sort of total job figure that's in play in the Pentagon budget. In Washington, D.C. alone, there are almost 300,000 jobs that are related to Pentagon contracting. These aren't folks who actually work for the Defense Department, but work for contractors who build weapons or help the Pentagon manage its enormous budget, its acquisition process. And Gates has put those folks in the crosshairs as well, saying that he wants to reduce the number of contractors the Pentagon depends on and move more jobs back into the civil service. So, you know, hundreds of billions of dollars are at stake, this budget is a half a trillion dollars this year. It's actually bigger than it was last year, but because so many high-profile weapons systems are targeted for cuts, it's gonna be a big fight.

Chiotakis: All right. Marketplace's Steve Henn from Washington. Steve, thanks.

Henn: Sure thing.

About the author

Steve Chiotakis was the host of Marketplace Morning Report until January 2012.

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