Defense Cuts Could Hurt Minorities

It accounts for nearly a quarter of the federal budget, five percent of the nation’s Gross Domestic Product, and about half of all defense-related spending on the planet.

It’s the United States Armed Forces. A massive $600 billion-plus per year “military-industrial complex,” including the Department of Defense and every active duty, reserve and civilian individual that works for the powerful behemoth housed in the Pentagon.

But, when Democrats and Republicans are teaming up to dramatically slash its budget as the “fiscal cliff” talks drag on, the U.S. military is faced with its most serious challenge since 2001.

The recipe is brewing into one of the most caustic legislative battles on Capitol Hill. Mix one of the most notorious conservatives in the House of Representatives, Rep. Mick Mulvaney (R-SC), with of one of the most persistent liberals, Congressional Black Caucus member Rep. Keith Ellison (D-MN), and you get an unusual bipartisan tag team to implement some of the deepest defense budget cuts in American history. Actively pre-empting the dreaded sequestration of across-the-board 11 percent automatic spending cuts to the military in the event budget negotiations fail, a strange alliance formed between defense hawk conservatives and rabble rousing liberals.

"As we transition from wartime to peacetime, and as we confront our nation's fiscal challenges, future defense budgets should reflect … that our modern military is able to approach conflicts utilizing fewer – but more advanced – resources," both members wrote in a recent joint letter that shuttled its way into the White House last week. "As you work toward a budget agreement to address our fiscal challenges, we urge you to include substantial defense savings."

Worried that a bloated, unwieldy defense budget was exacerbating the nation’s $1.5 trillion federal deficit and $16 trillion national debt, even defense contractors are pushing for the cuts. "We need to stop believing or pretending that there is a scenario out there that offers no defense cuts,” said David Langstaff, president and CEO of TASC, Inc. “The question is whether we make them responsibly or irresponsibly."

What becomes problematic is the extent of those cuts – whether through a nasty sequestration scenario or a negotiated budget deal – on the nation’s economic recovery and unemployment. Some observers, including those keeping a watchful eye on high Black unemployment, worry that any cuts to the federal budget will further erode a battered Black middle class - considering 20 percent of the federal workforce is African-American.

More worrisome is the fact that the Department of Defense (DoD) is the largest single-agency employer of federal workers in the country. There are over 770,000 DoD civilian workers worldwide – and that doesn’t even include the 1.5 million active and reserve duty troops or the millions of workers employed by large, mid-size and small businesses relying on defense contracts. For example, the controversial F-35 next generation Joint Strike Fighter program has already spread $60 billion throughout the economy, directly or indirectly employing more than 133,000 workers nationwide.

Dramatic cuts have analysts concerned that a ripple effect could take place with minorities – especially African Americans who have longed filled military ranks and trenches – bearing the largest brunt. Between the Obama administration’s shaving of the defense budget, including $400 billion over the next decade, and the move to nix a slew of weapons and other related programs as a result of troop draw downs overseas, some suspect African Americans could take another economic hit.

Analysts, for example, recently looked at the impact of sequestration or defense cuts on Virginia, which houses everything from the Pentagon to major defense contractors, massive bases and the largest naval facility in the world at Norfolk. In a state that’s 30 percent Black, with heavy concentrations in the Hampton-Norfolk metro area, significant cuts to the $60 billion from annual federal spending (most of it from defense) will certainly trickle down to Black households. Minority-owned small businesses in the commonwealth stand to lose anywhere from $3-$6 billion depending on whether or not the government goes over the fiscal cliff.

Also factored into defense cuts, experts warn of emotional debates over benefits for veterans. Former Secretary of Defense Robert Gates complained in 2011 that “healthcare costs are eating the Department of Defense alive.”

“The Defense Department runs the risk of the fate of other corporate and government bureaucracies that were ultimately crippled by personnel costs, in particular, their retiree benefit packages," Gates warned during a congressional budget hearing.

As troops return home from war, many suffering from combat trauma and lost limbs, a big question looms: who will take care of them and how much will it cost?

“Much like what’s happening in the federal budget more broadly, medical and retirement costs are crowding out other spending in the defense budget,” notes Jacob Stokes, Senior Research Associate at the Center for a New American Security. “These are reforms that need to happen, but which have zero support on the Hill. So expect the Pentagon to try to get modest reforms here and fail.”

Talks are already taking place pitting lawmakers with deep veteran support back home against lawmakers willing to navigate the political risk. Unseen, but figuring prominently into the equation are Black veterans, the second largest population in the military. Out of a total of 21 million veterans nationwide, 4 million are Black. In addition, the Veterans Administration, with more than 300,000 federal workers, is the third largest federal employer.

Black veterans also suffer the highest unemployment rates in the nation, accounting for 18 percent of overall veteran unemployment -- which is above the 7.7 percent national average, and the 15 percent Black jobless rate. Of Black veterans returning from Afghanistan and Iraq, 14 percent are either unemployed or underemployed.

Still, Rep. Chaka Fattah (D-Pa.), a senior member on the House Appropriations Committee, explains that while defense cuts are likely, they “won’t be as deep as presently outlined.” Fattah argues that it could all work out, pointing to the bipartisan talks as a sign that the threat of sequestration is actually working. Negotiated in the controversial 2011 debt ceiling deal, sequestration “forces an agreement in which new revenues could obfuscate the need for defense cuts.”

“The whole purpose of sequestration was to be an action-forcing device that brings everyone to the table,” says Fattah.