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Preserve the Industrial Base

Preserve the Industrial Base. Carol A. Cash, Chair Aeronautics Subcommittee VP, Public Policy. Assuring the Viability of the US Aerospace and Defense Industrial Base. Background

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Preserve the Industrial Base

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  1. Preserve the Industrial Base Carol A. Cash, Chair Aeronautics Subcommittee VP, Public Policy

  2. Assuring the Viability of the US Aerospace and Defense Industrial Base • Background • US Aerospace A&D industrial base is critical to our economy, national security, infrastructure and future workforce • Supports 3.5 million jobs • Contributes 2.23% of GDP • Small businesses generate almost half of private sector jobs, 64% of net new private sector jobs, 43% of high tech employment and 33% of exports* • Highly skilled, highly paid workforce • Possesses unique capabilities and expertise *AIA Second to None, 2012

  3. Assuring the Viability of the US Aerospace and Defense Industrial Base • Non-DOD impacts* • NASA • 8.2% cut to agency’s budget in 2013 • potential loss of 20,500 private sector jobs in 2013 • Significant impact to states with aerospace “clusters” (FL, MD, AL, TX, CA, CO, VA, OH, etc) • NOAA • 8.2% cut to agency’s budget in 2013 – loss of more than $154 million • Potential loss of 2,500 jobs in 2013 • Impact to replacement weather satellites *Economic Impact of Sequestration on Civil Space Programs, AIA Second to None, December 2012

  4. Assuring the Viability of the US Aerospace and Defense Industrial Base • Budget Control Act (BCA) of 2011: • Congress has postponed major impacts until March • Sequestration will mandate ~10% cuts to all USG agencies • Additional cuts over next 10 years • Result in reduction of nation’s GDP by $215B, decrease workforce personal earnings by $109.4B and cost 2.14M jobs (1.5% increase in unemployment)* • Other budget decisions in March • Continuing Resolution • Debt Ceiling *AIA Second to None, 2012

  5. Assuring the Viability of the US Aerospace and Defense Industrial Base • BCA 10-year impact • DOD $800 billion • Non-DOD $700 billion – including $200 billion in mandatory programs (mainly from Medicare) BCA Total Spending Reductions (DOD and Non-DOD – in millions of nominal $s* Report for AIA by Stephen S. Fuller, Ph.D., George mason University, July 17, 2012

  6. Assuring the Viability of the US Aerospace and Defense Industrial Base • Recommendations • Carefully consider the impact of budget cuts on continued viability of Industrial Base (especially small businesses) • Eliminate automatic “across-the-board” defense budget reductions • Provide assurances of continuity and sustainability of key programs and budgets

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