Job Blackmail: a Substitute for Defense Cuts

ROBERT BOROSAGE

May 20, 1992|By ROBERT BOROSAGE

WASHINGTON — Washington.-- In resorting to job blackmail to defend its military budget, the Bush administration is playing on the distress of the very workers it has abandoned. When challenged to save more from the military to reinvest in domestic programs, the president recently replied: ''What areas do you want to shut down? Or do you want to lay off the people?''

The president's own plans call for laying off an estimated 1.1 million defense-related workers by 1995. Yet the administration has no plan for conversion of plants or retraining of those workers. It has offered no support for a comprehensive GI Bill for defense workers and soldiers. And it has stubbornly blocked efforts to reinvest savings at home.

For more than a year, the Pentagon has sat on $200 million provided by Congress for defense-worker retraining and adjustment programs for communities hard hit by defense cutbacks. The president's 1993 budget even seeks to eliminate the Economic Development Agency, which the Pentagon designated for community-based conversion efforts.

Naturally, the administration's unwillingness to assist furloughed workers has muted the call for greater defense savings and strengthened congressional opposition to cutbacks in weapons systems that are needed only for the jobs they create. But at a time when we need to rebuild this country, we cannot afford to sustain the military as a jobs program and waste the skills of defense workers and soldiers.

For years, we have slighted investments vital to our nation's economy -- investments in children, in education and training, in rebuilding our roads, bridges and sewers, in civilian research and development. Now, with the collapse of the Soviet Union, we can reinvest in this country with funds devoted to the defense of allies against a threat that no longer exists.

Over the long term, these investments will generate jobs while adding to our economy's productivity, enabling us to better compete in the global marketplace. Numerous studies have shown that a shift in federal spending to key domestic investments would generate more jobs and higher levels of growth than military spending.

A sensible conversion program can ease the transition for workers and communities impacted by defense cuts. After World War II, 24.8 million people left defense-related jobs in three years. This huge adjustment was made with little difficulty. Corporations planned for conversion during the war. The government provided incentives for retooling of plants. A

comprehensive GI Bill enabled 11 million veterans to re-enter the labor market gradually. And the pent-up wartime demand fueled a period of growth and prosperity.

Economic conditions today are more constrained, but the task is of far less magnitude. Even with military savings double those recommended by the president, defense-related employment would drop at an average of 250,000 to 300,000 a year -- a substantial number, but only about 0.2 percent of the 120 million jobs in the U.S. economy. Even in the ''good times'' of the late 1980s, an average of 1.8 million workers a year lost their jobs due to plant closings or cutbacks.

Given a sensible conversion program today, most displaced defense workers, a majority of whom have easily transferable skills, could fare well if the economy were growing. But military contracting tends to be concentrated; more than half of defense contracting was in just eight states in 1991. Many communities are dependent on defense firms for bases. Fifty-seven percent of defense employment is in manufacturing, compared to only 17 percent of the economy at large. Community and worker distress can be severe without a conversion program with two related aspects.

First, any plan needs to provide for structural dislocation. Communities dependent on defense industries require targeted economic development assistance. And to small defense subcontractors, incentives to retool plants and restructure for civilian production are as vital as retraining programs are to workers. Sen. Sam Nunn, D-Ga., is now putting together legislation for a GI Bill. Pending legislation by Sen. Joseph Lieberman, D-Conn., and Rep. Ted Weiss, D-N.Y.) contain many elements of a structural conversion program. Sen. John Seymour, (R-Calif.) is introducing a bill promoting worker retraining.

Second, targeted assistance programs must be combined with a shift in priorities, using military savings to rebuild this country. As Lawrence Klein, the Nobel prize-winning economist at the University of Pennsylvania, has written, to convert to civilian production contractors ''need a medium or long-term commitment from the government that priorities will shift from defense to civilian needs.''

With domestic investment, aerospace workers can be employed building electric cars and fast trains. Skilled veterans can provide vitally needed teachers. Workers and soldiers can rebuild our bridges and roads. Scientists and engineers can design the environmentally sustainable products that will dominate the markets of the future.

Reinvesting in America now will also help generate the long awaited recovery. After all, greater attention to such sectors as education, national infrastructure and civilian research and development will provide a badly needed boost in the short term while setting the nation on a course to long-term economic strength. The administration's strategy of job blackmail must be shifted to one of military-conversion greenmail.

Robert Borosage is a fellow at the Institute for Policy Studies.

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