New deadline for sequestration
Late in 2012, Congress was up against a hard deadline to avert the aptly named “fiscal cliff” which encompassed numerous parts – among them, sequestration and a January 2, 2013 inaction date. Due to fundamental differences in opinion over how to avert the crisis, Republicans and Democrats were unable to come to a compromise earlier in the 2012. As the debt ceiling and tax levels were set to expire at year’s end national urgency drove our leaders in Washington to address the fiscal cliff, but unfortunately only taxes and the debt ceiling received the necessary attention.
The issue of sequestration was given a band-aid for 57 day as Congress ran out of time to address the issue during cliff deliberations. As a short-term fix they did include a stop-gap funding measure in the continuing resolution which allowed 2012 funding levels to be maintained through March 1, 2013. This resolution provided temporary relief for agency budgets, however it did not solve the problem. In some instances it actually furthered an already festering question for defense contractors, which is “what programs will be affected by these cuts if they occur?” Due to this uncertainty contractors are again left waiting for crucial answers which factor into how they make strategic and long-term business decisions.
The Aerospace Industries Association is pushing hard for a long-term bipartisan solution to this serious problem. For more information please read a statement by the Associations CEO, Marion C. Blakey by clicking here.
Help us continue the fight against sequestration by getting active online. Tweet using the hashtag #StopSequestration to let everyone know that you think this bad policy must go.
Mobilizing Against the Sequestration Threat
BAE Systems is mobilizing against the threat of sequestration, warning that steep, automatic federal spending cuts called for by deficit-reduction legislation would weaken national security and put 2 million jobs at risk. The CEO of BAE Systems, Inc., the company’s U.S. subsidiary, outlined the threat in a message to employees, some of whom joined in rallies aimed at calling attention to the issue and urging Congress to take action.
“Sequestration is worrisome on many levels,” President and CEO Linda Hudson wrote in her blog on the company’s intranet. “Half of the cuts are designated to come from the defense budget, the primary source of funding for our programs. The arbitrary, across-the-board cuts would likely create chaos and could tangle contracts and bring government procurement to a standstill for months.”
On July 30, BAE Systems employees from around the Washington metropolitan area joined industry partners at a Stop Sequestration rally in Arlington, Va., attended by Virginia Reps. Frank Wolf, Jim Moran, and Gerry Connolly, and Virginia Gov. Bob McDonnell. The bipartisan group addressed the impact sequestration would have on Virginia’s economy — up to 200,000 lost jobs — if Congress does not act to prevent the cuts mandated by the Budget Control Act of 2011.
“A third of our economy here in northern Virginia and in the national capital region is dependent directly on federal investment and spending,” Connolly said.
The following day, Sens. John McCain of Arizona and Kelly Ayotte of New Hampshire spoke at a rally at a BAE Systems plant in Merrimack, N.H. “The Department of Defense has already agreed to reduce defense spending by nearly $500 billion over 10 years,” McCain said. The added military funding cuts called for under “sequestration” — a $1.2 trillion package of cuts set to take effect in January — would add $500 billion to that figure, he said.
Addressing 300 BAE Systems employees, Ayotte spoke of the impact the budget cuts would have on her home state, where the company is the top industrial employer. “BAE Systems is the largest manufacturer in the state of New Hampshire,” Ayotte said. “Sequestration could devastate the state.” According to a George Mason University study, defense cuts of $500 billion over the next decade would eliminate 3,600 jobs in the aerospace and defense industry in the Granite State alone.
Tom Arseneault, who leads the BAE Systems products businesses that include the Merrimack plant, also warned of dire consequences if the cuts are not averted. “We’ve been long anticipating budget pressure and have been making adjustments, as we are now in the cloud of uncertainty of sequestration,” Arseneault said. “If this goes through, approximately 10 percent of our workforce in the United States will be impacted.”
Second to None Press Highlights
Please refer to the following links for highlights of the Second to None campaign coverage.
5/18/2012 Washington Times: Defense contractors eye cuts to jobs, plants
5/9/2012 Politico: Labor, aerospace industry unite against cuts
4/30/2012 Bloomberg: Pratt & Whitney’s Hess on Airlines, Engines
4/17/2012 KUSI TV San Diego: Special Report
3/4/2012 Washington Post: Budget sequestration would be a dagger to defense
3/2 Wall Street Journal: Tank Plant Takes Cover Amid Military Cuts
2/13 Industry Week: Blakey: Pentagon Budget Would Be a ‘Direct Hit’ To Aerospace and Defense Industry2/13 Wall Street Journal: Proposed Spending Cuts Trigger Complaints
2/13 New York Times: Military Cuts and Tax Plan Are Central to Obama Budget
2/7 Washington Business Journal: 270,000 Aerospace Jobs Lost to Export Controls in 10 Years
2/7 Defense News: Support Grows for Easing of U.S. Export Controls
2/7 Space Policy Online: AIA: U.S. Lost Thousands of Jobs, Billions of Dollars Because of Export Law
2/6 Wall Street Journal: Aerospace Report Hits Rules On Exports
1/20 New York Times: Military-Related Investments
1/18 Fox Business News: Can the U.S. Recover From Big Defense Cuts?
11/21/2011 The York Dispatch: BAE employees rally against cuts in defense spending
11/21/2011 The York Daily Record: More than 300 BAE Systems employees attend “Second to None” rally to protest looming budget cuts
11/17 The York Daily Record: BAE Systems hosting employee rally today
11/8 Houston Chronicle: Military in Texas could take big budget hit
11/8 Birmingham News: Aerospace Industries Association says 24,600 Alabama jobs on line
11/4 Orlando Sentinel: Florida could lose nearly 40K defense jobs if military budget takes worst-case cuts
10/29 Richmond Times-Dispatch: Rep. Randy Forbes says 1.53 million defense jobs are “at risk”
10/29 Fort Worth Star-Telegram: Congressional supercommittee mustn’t undermine military
10/26 Washington Post: Defense cuts would cost U.S. more than 1 million jobs, economist says
10/26 Virginia Business: Study predicts high job losses in Virginia if budget committee fails
10/26 ExecutiveGov: House Panel Told Defense Cuts Put 880K ‘Main St.’ Jobs At Risk
10/26 Wired Danger Room: Defense: Keep Paying Us or the Economy Dies
10/26 Mississippi Press: Defense industry study: Budget cuts could cost 1 million jobs
10/26 Aerospace Diary: Analysis Projects One Million Jobs at Risk from Defense Cuts
10/25 WSJ Market Watch: Cut $1 trillion, lose 1 million jobs, defense industry warns
10/25 Washington Post: 1 million jobs could be lost if supercommittee fails to act, defense industry says
10/25 Washington Business Journal: Failure by supercommittee to reach a deal could cost Virginia more than 100,000 jobs
10/25 CNN Security Clearance: Defense cuts would hurt some states more than others
10/25 Washington Times: Democrats don’t prefer automatic debt cuts
10/25 The Hill: Waging war over Pentagon budget cuts
10/25 Bloomberg: Defense Industry Says $1 Trillion Cut Equals 1 Million Lost Jobs
10/25 DefenseNews: AIA: Budget Cuts Will Cripple U.S. Defense
10/25 Defense Industry Daily: Rapid Fire: Job Scenarios
10/13 Cedar Rapids Gazette: Rockwell Collins exec says looming defense cuts could be ‘pretty devastating’ for Iowa
10/11 Boston Globe: Defense lobbyists say cuts mean jobs
10/9 USA Today: Fearing budget cuts, interest groups take lobbying local
9/16 CBS News: Facing huge potential cuts, defense industry goes on offense
9/15 Politico: AIA lobbies supercommittee against DOD cuts
9/15 National Journal: Aerospace Industry Launches Campaign to Fight Cuts
9/14 Financial Times: US defence sector attacks further cuts
9/14 DoDBuzz.com: The aerospace industry’s full court press
9/14 Los Angeles Times: Defense contractors launch campaign to end military spending cuts
9/14 Reuters: Contractors appeal for no more military cuts
9/14 The Hill: Aerospace industry campaigns against further defense cuts
9/14 Defense News: AIA Starts PR Press Against Cuts
9/14 Bloomberg: Aerospace Association Chief Says Defense Industry Is Fragile
9/14 AOL Defense: Defense Industry Comes Out Swinging: Don’t Cut Us!
9/14 International Business Times: Defense Industry Lobbies Congress Against Future Spending Cuts
9/14 Washington Times: Republicans seek a ceiling on defense cuts
9/14 AIA: Video of Press Event
9/13 AIA: Second to None Launch Video
Great Achievements Begin with Bold Ideas
By Jim Albaugh, president and chief executive officer of Boeing Commercial Airplanes
The challenges we face as a nation have been well-documented — what’s lacking is a clear national consensus about how best to meet them.
To a large degree, restoring America’s economic health starts with restoring our collective confidence. So let’s contemplate some of the things Americans have accomplished in just the last half century that have changed the world: curing polio, inventing the integrated circuit, putting men on the moon, winning the Cold War, and developing the Internet and GPS, to name a few.
Economists say the recent recession was the worst downturn since the Great Depression. We can draw lessons from how our nation responded to that crisis more than eight decades ago.
I grew up near the Grand Coulee Dam, and its construction put people to work. But it did much more than create jobs over the short term. The dam powered the Hanford Nuclear Reservation; it provided the electricity that created a vibrant aluminum industry in the Pacific Northwest and irrigated thousands of acres that had been desert. The impact of this project is still being felt more than 70 years later.
What are the great things our country is doing today? Recently, author Shelby Steele wrote, “When greatness fades, when a nation contracts to a middling place in the world, then the world in fact no longer knocks on its door.” Is that our future?
© Copyright 2011 The Hill
National Aerospace Week on Capitol Hill
This week, groups from across the spectrum of the aerospace and defense industry will be gathering in our nation’s capital to address America’s fiscal problems that are threatening to undermine our technological superiority, economic and national security.
“Since the Wright Brothers and the dawn of flight, the contribution aerospace has made to America has been a true national treasure,” said AIA President and CEO Marion C. Blakey. “We are the world’s leader in aerospace and the men and women who provide the backbone of our economy and national security are truly Second to None.”
Established by Congress, National Aerospace Week is planned for September 11-17. On Tuesday evening, AIA will be honoring Senator Patty Murray of Washington State with the Aerospace Wings of Liberty Award. Honorees are members of Congress who have made significant contributions to the aerospace industry, and have reflected credit upon America and themselves. The award derives its name from a description of aviation’s early years from the 1919 Yearbook of the Aeronautical Chamber of Commerce, which was the predecessor organization of AIA.
On Wednesday afternoon, AIA will host a Senate Luncheon in the Kennedy Caucus Room with Senators Patty Murray (D-WA) and Saxby Chambliss (R-GA). The topic at hand will be “Why Trade Matters” with USTR Representative Ron Kirk.
The conversation continues the next day with members of the House of Representatives at the House Luncheon, which will take place in the Rayburn House Office Building. Representatives Pete Olson (R-TX) and Jerry Costello (D-IL) will lead the discussion. The theme is emerging aerospace technologies, featuring Charles Brink, the Air Force Research Laboratory’s X-51A Scramjet Engine Demonstrator program manager and Dr. Jaiwon Shin, Associate Administrator for Aeronautics Research Mission Directorate at NASA.
An exhibit in the Rayburn House Office Building on Thursday will feature exhibits from AIA and 11 of AIA’s members. The exhibits represent an exciting set of displays representing a cross section of the industry and everything from sustainable fuels to propulsion and unmanned vehicles.
The aerospace and defense industry is the lifeblood of America’s industrial base, employing more than one million workers and supporting more than two million middle-class jobs in related fields. Thirty-thousand suppliers in the industry provide high-skill, high-paying jobs in all 50 states.
CEO of Northrop Grumman: Unmanned Systems – the Value of Innovation
On August 17th, Wes Bush, CEO and President of Northop Grumman, addressed the Association for Unmanned Vehicle Systems International North American 2011 Forum. Bush deemed this to “be an exciting time” for those companies aligned with the forum as “each week seems to bring another news story of the value of an unmanned or autonomous system demonstrating its value in the air, on the land, or with growing frequency, at sea.”
“No longer are these systems confined to military uses… Unmanned systems have demonstrated their value … they are truly indispensible … to humanitarian [projects].” Indonesia, Haiti, Japan, Antarctica and regions of the Pacific Ocean’s depths are a few of the locations, that Bush detailed, where unmanned systems have saved lives and assisted in recovery efforts by allowing humans to remain a distance from the danger of certain missions.
“This is indeed a golden age for these technologies,” Bush extolled to the crowd, emphasizing that the United States is still the world’s leader but that competition in the industry is heating up. He quoted a story from the Washington Post, “Global Rush is on to Match U.S. Drones,” noting that more than 50 countries are stepping up their development programs of [UVS’s]. The article “pointed out that in the coming decade global spending on unmanned systems will reach $94 billion.” As global competition increases, American firms are being placed at a disadvantage due to outdated “export restrictions.”
Bush explained that years ago the government placed export controls on satellite technology, which “made it impossible for U.S. companies to sell communications satellites to our allies.” These actions, Bush noted, reduced American competitiveness in the industry, “without making us any safer.” Bush did praise the Defense Department for “what is clearly the best export reform policy” in recent years.
Bush concluded his remarks by pointing, that “growing up during the Cold War, the security model was one of massive military forces controlled by nation states… but today we must meet the challenges of adversaries not connected with familiar nation-states, who strike unconventionally.” It is on these unconventional battlefields that [UVI’s] will free our military “from the dull, dirty and dangerous jobs … [that] will allow them to perform more complex tasks.” Bush praised the AUVSI for its activities in advancing the field and repeated that “these are exciting times” for all those involved in the industry.
Boeing’s Albaugh: U.S. Risks “Intellectual Disarmament”
(Crystal City, VA) Jim Albaugh, President and CEO of Boeing Commercial Airplanes cautioned members of the National Aeronautics Association that the nation could lose its global lead in aerospace if the combination of budget cuts and workforce retirements robbed the nation of the next generation of technological innovators in the industry.
Albaugh described the situation facing American aerospace and defense in coming years as “intellectual disarmament,” with firms becoming unable to replace engineering talent because of R&D cuts, program cancellations, and retirements. “If we continue along this path, America could lose its lead in aerospace and break a long-standing continuum of capability in our industry,” Albaugh concluded.
Boeing and other manufacturers expect half of their engineering workforce to retire by 2015, with not enough qualified engineers available to replace them. Furthermore, with the cancellation of programs like the space shuttle, tens of thousands of engineers have lost their jobs. With no replacement program on the immediate horizon to re-employ these workers, Albaugh warned of an experience gap that could hamper future spacefaring efforts.
Despite federal spending cuts, Albaugh cited tremendous future opportunities in aircraft manufacturing that promise to keep the industry vibrant.
- His own company has a 7-year backlog in commercial airplane orders, and recently took $22 billion in more orders at the Paris Air Show in June.
- Air traffic is expected to along with global Gross Domestic Product, which is on track for a 3 to 4 percent increase despite the recent spike in oil prices.
- Boeing estimates that the world’s travelers will need 33,500 new airplanes over the next 20 years, or a market of $4 trillion.
For American aerospace to take advantage of these opportunities, Albaugh said, companies need to build upon their record of technological innovation. Advances like composite-material airframes that change shape during flight, hypersonic aircraft, and engines that use plant-based renewable fuels are within reach, but only with enough R&D funding to make them a reality.
While an older generation of engineers met challenges like putting a man on the Moon, Albaugh worried that younger American will not be excited by aerospace as a career field in an absence of ambitious manned spaceflight endeavors. He told the audience, “without exciting programs to work on, companies won’t be able to attract the best engineering talent to create the next great innovation.”
U.S. Airpower Crucial To Libyan Conflict
As the Libyan air conflict runs into its fourth month, U.S. airpower remains crucial to the fight. According to one expert, “without significant U.S. assistance, NATO would not have been able to initiate the air campaign and the Alliance’s air armada would be grounded today.” According to the New York Times, “the United States is supplying much more firepower than any other country.”
This is because U.S. aerospace defense capabilities are so varied and unique. While fighter jets like the F-16 and the Navy’s EA-18G growlers often grab the headlines, the Libyan operation has also employed B-1B and B-2 Spirit bombers, A-10 and AC-130 attack planes, and a barrage of jammers, refueling tankers, and manned and unmanned reconnaissance aircraft – even the venerable U-2 has made an appearance in the conflict. Armed drones have also joined the fight, allowing even the most heavily guarded targets to be reached without risk to U.S. or NATO pilots, and the opening salvo in the operation was an onslaught of roughly 200 cruise missiles, all but 7 supplied by the United States.
As Washington debates significant cuts to our aerospace defense budget, the diversity and potency of U.S. air power at work in Libya is a compelling reminder of what is at stake.