Plan targets Maryland's defense jobs

August 28, 1994|By Ted Shelsby | Ted Shelsby,Sun Staff Writer

The Pentagon has sent shock waves through Maryland's already battered military industry by targeting several major weapons systems for potential delay or elimination.

The proposed cuts -- though still preliminary -- are designed to generate funding for military pay raises and help plug an estimated $80 billion defense budget deficit over the next five years.

But they take aim at some of the biggest military contracts in Maryland, which, if implemented, could seriously hurt the companies as well as the state's economy.

They include three contracts at Westinghouse Electric Corp. and one at the Martin Marietta Corp. complex in Middle River -- each with sales potential of between $1 billion and $5 billion each.

Two other programs on the "hit list" -- one for the development of a high speed amphibious craft for the Marine Corps and another for an aircraft flight simulator -- are being counted on by beleaguered AAI Corp. in Cockeysville to help stabilize its business base and end a long employment slide resulting in more than 2,000 layoffs in recent years.

The proposals were listed in a memorandum from Deputy Defense Secretary John M. Deutch that was leaked to the press last week.

If implemented, these proposals would be a staggering blow to Maryland's economy, says Anirban Basu, an economist with the University of Baltimore's Regional Economics Studies Program.

Mr. Basu said they could result in the loss of thousands of good-paying jobs that he described as "the backbone of the state's economy."

The loss of so many highly educated defense workers would also "rob Maryland of one of its greatest competitive advantages" -- the brain power that it is counting on as the "foundation for the state becoming a major player in world of high technology," Mr. Basu said.

These workers, he said, would most likely go to other areas of the country -- such as Washington state, North Carolina's famed Research Triangle and Texas -- to seek employment on similar, but non-defense technologies.

Maryland is the nation's fifth-most Pentagon-dependent state in the nation, and while it prospered during the Reagan administration's military build-up, it has suffered greatly since the fall of the Berlin Wall and the end of the Cold War.

The state's three biggest defense contractors -- Martin Marietta, Westinghouse and AAI -- have already eliminated more than 12,000 jobs since 1988. The decline in military spending is cited as the chief reason that states like Maryland and California are lagging behind the nation's economic recovery.

Clinton administration officials have emphasized that no decisions have been made on the programs included in Mr. Deutch's memo, but officials at several companies say it is nonetheless causing anxiety.

It's the kind of thing "we have nightmares about," said L. Gary Riley, a vice president at Lockheed Corp. and manager for the company's $71.5 billion F-22 stealth fighter plane program. Delaying the F-22 for four years is one of the options included in the Pentagon's document.

Such a delay does not necessarily mean that the program will be canceled, Mr. Riley pointed out, but he said that it could be a step in that direction. A delay or cancellation of the F-22 would be a big setback for the Westinghouse division in Linthicum.

Westinghouse builds the radar for the plane -- the military's next-generation fighter -- and Richard A. Linder, the division president, has called it a huge contract that the company is counting on.

Mr. Linder has previously compared it to the company's contract to supply radar for the F-16 fighter plane, which over the past 15 years was the division's biggest single contract. More than 3,000 units were produced, generating $5 billion in sales.

1991 layoffs

When the Pentagon canceled the Navy's A-12 attack plane in early 1991, Westinghouse was forced to lay off 1,200 workers.

Mr. Deutch's memorandum directs the armed forces to consider changes to at least five other programs that could have a direct impact on Maryland defense contractors:

* Canceling the Army's new Comanche scout helicopter.

* Slowing down the production of Arleigh Burke-class destroyers.

* Canceling the Marine Corps' V-22 Osprey.

* Canceling the Marine Corps' high-speed Advanced Amphibious Assault Vehicle.

* Delaying the introduction of a new trainer aircraft by up to seven years.

A slowdown in the production of the Navy's Arleigh Burke-class destroyers concerns Martin Marietta's plant in Middle River where about 300 workers are involved in the production of a rocket launching system used on the ships.

The vertical launching system is a cluster of canisters that fit below deck on ships. They store and launch a variety of missiles against aircraft, submarines or land-based targets.

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