By Kedar Pavgi
March 4, 2013
This story has been updated.
Deputy Secretary of Defense Ashton Carter warned governors that across-the-board federal cuts from sequestration could have a dire impact on local economies, especially through mass unpaid furloughs and reduced spending on military activities.
In letters sent on March 1 to the governors of 10 states most likely to be impacted by sequestration, Carter said reduced spending would mean major cutbacks at military facilities.
The letters were sent to the governors of Alabama, California, Florida, Georgia, Maryland, Ohio, Pennsylvania, Texas, Virginia and Washington, according to the American Forces Press Service.
Government Executive obtained the letter addressed to Virginia Governor Bob McDonnell. Though the Defense Department did not have “a complete inventory of required cutbacks,” Carter told McDonnell that the state could face a $661 million payroll reduction through a 22-work day furlough for civilian employees. Additionally, projects at the Navy’s Virginia facilities at Dahlgren, Oceana, and Norfolk would face cutbacks, along with $146 million in reduced base operations funding for the Army at Fort Belvoir and Fort Lee.
Carter told McDonnell and the other governors that the cuts would also fall sharply on defense contractors, and the defense industrial base.
“While these reductions are unfortunate and will be damaging, the department is doing everything within our power to minimize adverse effects on our national security mission,” Carter wrote.
President Obama’s sequestration order on Friday mandates that an immediate $47 billion be cut from the Defense Department’s budget for fiscal 2013. Though military personnel are largely exempted from these cuts, civilians face the possibility of unpaid furloughs.
Many governors have long been planning for the worst effects of these cuts. On Friday, Virginia Governor Bob McDonnell signed an executive order mandating that a commission be reinstituted to examine sequestration cuts, analyze possible future activities of a revived Base Closure and Realignment Commission, and develop policies to help the state navigate the sudden cutback in federal spending.
“We are doing all we can on the state level to weather this difficult period,” McDonnell said in a statement. “Now, we need leadership in Washington so all states and all Americans can have certainty about the years ahead.“
In July, a report commissioned by the Aerospace Industries Association –a major industry group – warned that sequestration would cost the economy 2.14 million jobs and knock $215 billion off of the country’s Gross Domestic Product in 2013. Though some analysts questioned the projections made in the report, Macroeconomic Advisers, a forecasting firm, recently told National Journal that sequestration would create a fiscal drag of .6 percent on GDP in 2013.
By Kedar Pavgi
March 4, 2013