Monday, August 9, 2010

Uh Oh, Virginia's Economy Just Fell Down

Defense Secretary Gates just announced huge cuts over the next 3 years to the Defense budget with a particular animus towards contractors.

The whole pendulum swing towards in-sourcing Government jobs back to real Government employees has been in full swing under the new administration. I talked with a few contractors today who said they missed being a Federal employee and they just "loved" everything about it. Guaranteed pension, lavish benefits, union bargaining chips, get to make all the decisions, paid training, almost-can't-get-fired -- what's not to love?

Except that Virginia depends overly on the contracting jobs to protect against recession. It's the only game in town, really. It soaks up to 70 percent of the Defense monies. Now, it's looking at a 30% cut in the immediate future -- someone's losing their job and their house.

The only "good" thing I can see is that Gates spread the pain around equally, from a cursory look. Most of the SES, flag officers and below are going to get demoted or offered early retirement, no doubt. Now, if only the civil service could actually be fired in practice, rather than theory it might stand a chance of being fiscally prudent.

In the meantime, hold on to what you have or learn to stand up and salute!

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