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McCain's Road Trip to Nowhere on Pentagon Spending

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There was a time when Sen. John McCain (R-AZ) was considered a maverick -- admittedly a much overused term, but certainly a fair description of a number of his key positions. The old John McCain had an independent streak, bucking his party on issues like campaign finance reform and fighting Pentagon pork. The old McCain fought against Congressional earmarks and exposed corrupt bargains like the rigged deal to force the U.S. government to lease overpriced aerial refueling tankers from Boeing. Two Boeing executives did jail time as a result of McCain's investigation of the tanker deal. Last but not least, the old John McCain played a leadership role in support of President Obama's successful effort to end funding for the unworkable, unnecessary and unaffordable F-22 fighter plane program, citing President Eisenhower's military-industrial-complex speech on the floor of the Senate in the process.

Unfortunately, the old John McCain is fading from view just when the country needs him most. Rather than going after wasteful weapons systems and a bloated Pentagon budget, McCain has joined hands with his Republican colleagues Sen. Kelly Ayotte (R-NH) and Sen. Lindsey Graham (R-SC) in embarking on a series of meetings entitled "Preserving America's Strength." The meetings -- to be held today in Virginia, North Carolina and Florida and tomorrow in New Hampshire -- have more to do with politics and profits than they do with promoting more effective policies for defending the nation.

It is no accident that the three Senators are broadcasting the propaganda points long promoted by Pentagon contractors and their largest trade group, the Aerospace Industries Association. They have been working hand-in-glove for some time now. McCain's most recent connection to the weapons lobby is his hiring of former Lockheed Martin VP Ann Elise Sauer as a top Republican staffer on the Senate Armed Services Committee (SASC). In 2011, prior to her hiring at SASC, Sauer received a parting gift in the form of a $1.6 million buyout by Lockheed Martin. She has also worked as a consultant to BAE Systems, which will host tomorrow's "Town Hall meeting" in New Hampshire -- a misnomer given that it is not open to the public, but only to BAE employees. The closed nature of the meeting is another indicator that the tour by McCain and his colleagues has more to do with promoting the interests of Pentagon contractors than it does with educating the public about emerging defense policy issues.

And contrary to their desperate cries for help -- in their calls for a continuation of high Pentagon budgets at a time of high deficits -- Pentagon contractors like Lockheed Martin and BAE Systems are doing just fine. Lockheed Martin's profits rose 4.4 percent in the most recent quarter, and they have quadrupled during the 2000s. Lockheed Martin CEO Robert Stevens earned over $19 million in 2011. The company has a backlog of $81 billion, followed by its cohort the Boeing Corporation, which has a backlog of $46 billion. As an analysis by PriceWaterhouseCoopers has noted, "Backlogs provide a significant cushion between demand and current production rates that could absorb any reasonably anticipated softening of demand." To a substantial degree, employees of major Pentagon contractors are being used as pawns in a political game, with threats of mass layoffs far exceeding anything that would be called for by the companies' current financial positions.

This brings us back to McCain and company's road trip to nowhere. It is a font of misleading information, starting with its allegation that reductions from current Pentagon plans would "gut defense." In fact, a freeze in Pentagon spending that would be more than adequate to implement automatic cuts that would be triggered under current law absent passage of a significant deficit reduction package - a process referred to as sequestration. This approach would lock in the Pentagon budget at extremely generous levels by historical standards. Even the Republican-controlled House of Representatives has voted in favor of a one year freeze in Pentagon spending. As Gordon Adams, former director of the Office of Management and Budget for National Security Affairs, has noted, an adjustment along these lines would still leave the United States with far and away the most capable military force in the world.

As for the weapons industry's claims of economic distress -- an assertion fully embraced by Sen. McCain and his colleagues -- they ignore the fact that Pentagon spending is only one element of the federal budget. Keeping the Pentagon budget at current levels would require deeper cuts in domestic investments in areas such as education, infrastructure, and scientific research -- all building blocks of a forward-looking, reinvigorated economy. Military spending is a particularly poor job creator, so if it is sustained at current levels at the expense of deeper cuts in other federal programs there could actually be a net loss of jobs nationwide -- the exact opposite of the impact claimed by biased industry studies.

And a recent Senate study carried out at the request of Sen. Tom Harkin (D-IA) provides a profile of the impacts of domestic cuts on each of the 50 states. For example, in New Hampshire, implementation of the sequester would deprive over 30,000 individuals of basic health and nutrition services, with the majority coming as a result of cuts in child health programs. This is just one element of the potential impacts on the state, which would include the elimination of the jobs of about 1,000 teachers and the curtailment of much needed job training programs. These cuts would go much deeper if the Pentagon were exempted from sequestration or otherwise spared its fare share of cuts as part of a budget deal. As for national impacts, the Harkin report notes that even the most recent Aerospace Industries Association-funded report on this issue asserts that domestic cuts would have a greater negative impact on Gross Domestic Product than Pentagon cuts would.

If McCain were truly interested in educating the public on the budgetary choices we face he would take into account the full range of programs in the federal budget, and he would consider the impact of changes in revenue on the overall picture. Thankfully, there is a small ray of hope suggesting that this could happen, given enough public pressure. On at least one major project -- Lockheed Martin's F-35 combat aircraft -- McCain has described management of the program as "abysmal," and suggested that the program may have to be cancelled if its ballooning costs are not brought under control. Given that the F-35 program is currently slated to be the most expensive weapons programs in the history of Pentagon procurement, reining in the program could be one element of a broader strategy for making necessary cuts in Pentagon spending.

And, to his credit, McCain's cohort Lindsey Graham has acknowledged that any budget deal will have to include some increases in revenue.

Most hopefully of all, a recent poll sponsored by the Stimson Center and the Center for Public Integrity found widespread support for sensible cuts in Pentagon spending -- beyond what would be required by the sequester. This was true in red states and blue states, and even in states with heavy concentrations of Pentagon spending.

As noted by veteran Pentagon budget analyst Winslow Wheeler, It could well be that the industry's scare campaign -- aided and abetted by politicians like Sen. McCain -- will increasingly be ignored as the public comes to understand the true nature of our current budget dilemma. It's not too late for Sen. McCain and his colleagues to reverse course and join the fight for a responsible solution to the deficit crisis.

William D. Hartung is the director of the Arms and Security Project at the Center for International Policy and the author of 'Prophets of War: Lockheed Martin and the Making of the Military-Industrial-Complex.'