As budgets shrink, we can bring down military costs at home and keep American assembly lines at work by selling some of our best equipment to allies abroad, from the legendary F-16 – now flown by over 20 allies (soon to include Iraq) – to the state-of-the-art F-35s that our friends are lining up to buy – from Turkey to Japan.
But massive cuts to the Pentagon’s research-and-development budget resulting from “sequestration” will decimate the innovation and engineering industrial base that is the backbone of our military superiority and the driver of defense exports.
After years of cuts, defense has already been slashed to just 16% of federal spending (it was 40% during Vietnam) and R&D is down to just 1.3% of GDP, not nearly enough to maintain the high-tech edge that wins export competitions. Defense Secretary Panetta says the next round of cuts will fall even harder on research and investment; over half the total hit, because items like personnel will be exempted.
America lost the largest foreign fighter jet deal in decades last year when India selected a European plane.
If Congress cuts research budgets further, we can expect losing more export deals, instead of winning them as we did with Turkey and Japan.