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FL: Profits of doom: Military contractors decry spending cuts but keep raking in cash

By   /   December 6, 2012  /   1 Comment

By Yaël Ossowski | Florida Watchdog

ST. PETERSBURG — The nation’s largest military contractors may be doing everything they can to warn Floridians of impending doom coming in the form of military-spending cuts, but newly announced defense contracts may leave their claims falling on deaf ears.

DOOM: Military contractors warn of coming defense cuts, but are still receiving millions in contracts from the Pentagon.

Just a few weeks before automatic-spending cuts are set to eliminate $500 billion in military spending over the next decade, the U.S. Department of Defense has promised millions of dollars in contracts to Florida-based corporations and businesses.

On Dec. 3, it was announced that Honeywell International Inc., one of the largest weapons manufacturers in the country, as well as one of the largest campaign donors to U.S. Rep. Bill Young, of District 10, received nearly $7.9 million for construction of parts for missile systems at its plant in Clearwater, projected to be completed in December 2014.

A previous Florida Watchdog investigation revealed the extent of the earmarks secured by Young for defense contractors who donated to his 2012 re-election.

AAR Airlift Group Inc., a defense contractor based in Palm Bay, received a contract for $143.7 million to supervise maintenance for jets coming back from Afghanistan.

On Nov. 30, CCI Group L.L.C., based in Shalimar, won a $10 million contract for repairs and engineering work at Eglin Air Force Base outside Pensacola. Lockheed Martin, the largest weapons manufacturer in the nation, announced a $31.9 million order to ship arms from its Orlando warehouse to the newly formed army of Iraq.

GOT YOUR BACK: Young has used his position on the Appropriations Committee to alloacate millions to defense contractors who donated to his campaign.

According to a 2011 report by nonprofit investigative group Public Campaign, Honeywell Inc. paid nearly $45 million more for lobbying than it paid taxes, thanks in part to generous tax incentives provided by the state and federal governments. That report revealed that the defense contractor received a net benefit of more than $34 million in government grants.

None of the defense contractors returned calls to Florida Watchdog.

Industries across Florida have been proficient in acquiring federal defense dollars, scoring nearly 26,635 defense contracts in 2011, totaling more than $13 billion, according to the Congressional Budget Office.

“Contract awards are still going out, but it’s been more of a slowdown with more delays,” said Joe Marino, president of the Florida League of Defense Contractors, the state’s premier trade association for companies wishing to do business with the Pentagon.

HURT: Florida’s defense contractors say defense cuts may hurt tens of thousands of jobs across the state.

“Now, throw on a huge level of uncertainty with these sequestration cuts and we see how significant of a challenge it’s been,” Marino told Florida Watchdog. “How is any business supposed to operate in an environment like that?”

Marino said the state depends on federal contracts for jobs and economic impact, estimating that military cuts could jeopardize between 40,000 and 80,000 jobs in the Sunshine State, most of which are high-skilled positions in large metropolitan areas like Orlando and the panhandle.

“The Department of Defense and defense companies are bringing the type of high-wage, high-tech jobs that people want in Florida,” Marino said. “Florida is not an orange grove, beaches and Mickey Mouse state anymore. We’re about high technology and innovation.”

He said military contractors produce nearly $60 billion in economic impact in the state of Florida, making them an integral part of the state’s employment base.

RISK: Jones says the military budget has grown too large and is endangering the security of the nation by creating more enemies abroad.

But critics remain skeptical that any significant cuts will take place, allowing the Defense Department to continue to hand out billions in contracts to local companies across Florida and the rest of the country.

“There’s a lot of war profiteering going on. They just want to keep making money,” said Gene Jones, president of Florida Veterans for Common Sense, a group of military veterans based in Sarasota. “The Defense Department is the largest agency in the government that remains uncountable to its citizens. We have to keep the Pentagon accountable.”

Jones said bloated spending by the Pentagon is doing more to endanger American citizens than protect them, especially if the government continues “making more enemies” in places like Afghanistan, Iraq and Libya.

“We’re spending way more on defense than we ought to,” Jones told Florida Watchdog. “We need to spend an adequate amount to keep us safe from foreseeable threats, but to have all these billions in expenditures overseas just isn’t necessary for national defense.

“Americans are very patriotic and we care about our country, that’s why we want to see it be accountable to the people,” said Jones.

Contact Yaël Ossowski, Watchdog.org’s Florida Bureau Chief, at Yael@Watchdog.org

— Edited by Kelly Carson, kcarson@watchdog.org

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Yaël has worked as a multimedia journalist in Philadelphia, Charlotte, Tampa, and Vienna, and his writings have appeared in the Washington Examiner, The Gaston Gazette, Reason Magazine, Sunshine State News, Wisconsin Reporter, and PanAmerican Post. He speaks four languages and his hometown is Saint-Hyainthe, Québec. His personal website is Yael.ca and his PGP key is available here.

  • http://www.facebook.com/mike.shotts1 Mike Shotts

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