Defense workers are the next victims of Washington spending battles, and it’s not just the 400,000 Defense Department civilians furloughed this week. As Washington braces for a prolonged government shutdown, defense contractors are starting to send workers on unpaid leave as the Pentagon does not have enough on-duty workers to perform inspections on progress of government contracts.
Defense giant Lockheed Martin announced on Friday it will furlough about 3,000 employees from across all its business areas starting on Monday.
Many defense contracts, technically, should not have been significantly affected by a shutdown, since the money that funds their contracts was largely obligated in prior years. However, since the Defense Contract Management Agency, which monitors those contracts, has furloughed 85 percent of its personnel during the government shutdown, companies’ work has slowed since quality control and certification processes have virtually ceased in many factories.
“This is a domino effect. Because the Defense civilians were laid off, they can’t approve production at the major military contractors,” Lexington Institute chief operating officer Loren Thompson, also a consultant to Lockheed, tells National Journal. “Therefore, the contractors start [temporarily] laying off, and that impacts their suppliers.”
It also jeopardizes production of weapons systems. “What would happen to the sausage industry if all the meat inspectors were laid off?” Thompson continued. “It would grind to a halt, no pun intended. That’s what’s happening here to the defense industry. It’s gradually slowing down.”
Lockheed expects the number of employees affected by the shutdown to grow, Lockheed CEO Marillyn Hewson said in a memo: “I’m disappointed that we must take these actions, and we continue to encourage our lawmakers to come together to pass a funding bill that will end this shutdown.”
More companies are expected to follow suit; 1,000 contractors who work in BAE Systems’ intelligence and security sectors were sent home and up to 15 percent of its workforce could be impacted. “Our Government Relations team is following this closely and is not optimistic for a near-term solution,” CEO Linda Hudson said in a memo. “Just as this is disruptive to our customers… it is disruptive to everyone in our company.”
Defense contractors in many cases have thousands of suppliers spread across the country to support their programs, and disruptions in production at the top of the food chain trickle down to small companies already struggling with the consequences of sequestration and program cancellations and delays. National Journal has reported previously about how the price of top weapons programs could rise as manufacturers lay off employees and costs are passed down the supply chain. The Aerospace Industries Association and the National Defense Industrial Association penned a letter on Thursday to Defense Secretary Chuck Hagel worrying that, like with sequestration cuts, “the prime contractors must pass along their reduced spending in orders to the thousands of small subcontractors that make up the industrial base supply chain.”
The industry associations are also concerned about companies inability to “reconstitute critical talent in the workforce when the shutdown is over.”
What We're Following See More »
Donald Trump "nearly quintupled the monthly rent his presidential campaign pays for its headquarters at Trump Tower to $169,758 in July, when he was raising funds from donors, compared with March, when he was self-funding his campaign." A campaign spokesman "said the increased office space was needed to accommodate an anticipated increase in employees," but the campaign's paid staff has actually dipped by about 25 since March. The campaign has also paid his golf courses and restaurants about $260,000 since mid-May.
“My view is, first you get them to laugh, then you get them to listen," says Michelle Obama in a new profile in Variety. "So I’m always game for a good joke, and I’m not so formal in this role. There’s very little that we can’t do that people wouldn’t appreciate.” According to writer Ted Johnson, Mrs. Obama has leveraged the power of pop culture far beyond her predecessors. "Where are the people?" she asks. "Well, they’re not reading the op-ed pieces in the major newspapers. They’re not watching Sunday morning news talk shows. They’re doing what most people are doing: They are watching TV.”
The FBI and other US security agencies are currently investigating a series of computer breaches found within The New York Times and other news organizations. It is expected that the hacks were carried out by individuals working for Russian intelligence. It is believed that these cyber attacks are part of a "broader series of hacks that also have focused on Democratic Party organizations, the officials said."
In a 3-1 decision, the National Labor Relations Board ruled in favor of Columbia University graduate students, granting them the legal right to unionize. The petition was brought by a number of teaching assistants enrolled in graduate school. This decision could pave the way for thousands of new union members, depending on if students at other schools nationwide wish to join unions. A number of universities spoke out in opposition to this possibility, saying injecting collective bargaining into graduate school could create a host of difficulties.
Donald Trump probably isn't taking seriously John Oliver's suggestion that he quit the race. But he has canceled or rescheduled rallies amid questions over his stance on immigration. Trump rescheduled a speech on the topic that he was set to give later this week. Plus, he's also nixed planned rallies in Oregon and Las Vegas this month.