Adam B. Sullivan

Press Citizen

A new report from the Center for Security Policy says planned federal budget cuts could lead to thousands of layoffs across Iowa.

As part of a deal to raise the federal government’s borrowing limit last year, policymakers agreed to trim projected budget growth by more than $1 trillion over the next decade. If politicians don’t agree on how to make those cuts, automatic cuts will take hold at the beginning of 2013, including almost 10 percent in military spending each year over the next decade.

Republicans, Democrats, and companies that do business with the military have all warned against letting those cuts kick in. The Iowa impact report from the Center for Security Policysays Iowa defense contractors could see annual revenue dips of $230 million if the cuts happen. That could mean as many as 5,100 jobs, the group says. The organization’s directors and advisors are largely industry insiders, former military personnel, or former government appointees.

However, some organizations say the cuts would be manageable. From the Federal Times:

The Bipartisan Policy Center estimates that even if the sequestration cuts stick, the annual Pentagon budget would dip below $500 billion for just one year, return to current levels by 2017 and approach $600 billion by 2020. … The $500 billion in cuts will be parceled out at $50 billion annually over 10 years. Yet even if they take place, Washington likely still will spend more on its military than the rest of the world combined, experts said.

One Iowa military contractor, Rockwell Collins, cut 140 positions between its Cedar Rapids and Richardson, Texas locations earlier this year. A company spokesman told the Press-Citizen those lay-offs did not take into account the potential impact of sequestration.

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