Even if Congress somehow averts sequestration, the defense industry is headed for layoffs and, at best, anemic growth, and the much-vaunted surge in foreign military sales won’t turn that around.

If the automatic cuts known as sequestration do take effect as currently scheduled in January, the impact would be “a devastating blow.” Keep reading →

WASHINGTON: Even with Congress in recess until after the November elections, the Pentagon remains focused on avoiding sequestration — which would require Congressional action before January — rather than planning the least painful way to implement the automatic budget cuts.

“There isn’t a plan. I know this frustrates people, but we haven’t done detailed planning,” Defense Department Comptroller Robert Hale told the audience at a forum this morning hosted by Government Executive magazine. Even when one federal worker openly angsted that his office was doing nothing to prepare for sequestration although it is just three months away, Hale replied that he not only hoped to avoid sequestration, but even the labor of preparing for it: “I’d like to avoid the planning too because it will be, of itself, disruptive.” Keep reading →

WASHINGTON: Sequestration would force the Defense Department and other federal agencies to lay off workers long before the defense industry had to, said a report released today by the Center for Strategic and Budgetary Assessments.

Though big defense contractors, led by Lockheed Martin, have warned that the threat of sequestration might require them to send layoff notices to tens of thousands of employees just before the November elections, CSBA’s Todd Harrison said the effects of sequestration on defense companies would be delayed for months or years. Keep reading →

CAPITOL HILL [updated 12:40 with Feinstein, Inouye remarks and results of amendment vote]: Sequestration drama roiled an otherwise pro forma mark-up of the Senate’s defense appropriations bill this morning, with a precious flicker of bipartisanship over the need to avert the sequester soon overtaken by disagreement over the legalities of layoff notices.

If the automatic cuts go into effect in January, “everything you achieved in this mark up is going to be wiped out,” Republican Senator Lindsey Graham warned his fellow Senate appropriators. Graham said that averting the sequester was so important that he and his fellow Republicans must “readjust” their no-new-taxes pledge and make a deal with Democrats to raise revenues. Keep reading →

WASHINGTON [updated 6:45 pm with Rep. Smith and AIA comment]: The Labor Department issued guidance today stating that defense companies and other federal contractors do not need to issue layoff notices sixty days in advance of sequestration. House Armed Services Chairman Buck McKeon immediately denounced the guidance as “politically motivated,” and his staff called it legally unsound.

Labor’s legalese boils down to this: It’s uncertain that sequestration will even occur, let alone what specific contracts will be affected, so “[any] potential plant closings or layoffs resulting from such contract terminations or cutbacks are speculative and unforeseeable” — which means that sending out WARN notices at this point would be not merely unnecessary but an abuse of the law in the form of “overbroad notice.” Keep reading →

Labor Dept saying WARN act does NOT require layoff notices re sequester: Story soon @ SydneyFreedberg

WASHINGTON: Congress must act by fall — before the election — and pass some sort of answer to sequestration, says the chairman of the Senate Armed Services Committee.

Sen. Carl Levin told reporters that his colleagues are beginning to focus on the fact that layoff notices for hundreds of thousands of defense and government jobs will begin going out before the election. The top defense policy lawmaker in the Senate pointed to this week’s statement by GOP Sen. Lindsey Graham that he had “crossed a Rubicon” and would agree to — effectively — raising some taxes to avoid a fiscal meltdown before the automatic budget cuts known as sequestration take effect Jan. 3. Keep reading →

CAPITOL HILL: Apologizing to Pakistan, the economic impact of sequestration, and the possibility of a cyber-war “Pearl Harbor” dominated today’s hearing of the defense panel of the all-powerful Senate Appropriations committee.

Sen. Dianne Feinstein — who also chairs the intelligence committee — asks Defense Secretary Leon Panetta why we couldn’t just apologize to Pakistan for the errant airstrikes that killed Pakistani troops and thereby end the long wrangle over reopening supply lines to Afghanistan, which Islamabad closed after the bloody incident. A breakthrough had appeared imminent on the eve of the NATO summit in Chicago, only for negotiations to collapse. Keep reading →

WASHINGTON: Companies that do business with the federal government will have to announce “hundreds of thousands” of lay-offs just days before the November election, predicted the former Pentagon comptroller for George W. Bush.

As sequestration approaches, said Dov Zakheim, the former comptroller, companies large and small will be faced with layoffs, which by law — specifically the 1988 WARN Act — they must announce 60 days in advance. Sequestration would take effect on January 2nd. “60 days before January 2nd is November 2nd,” said Zakheim. Election Day is November 6. “I wonder how many of our politicians went to face the fact that literally hundreds of thousands of people” — all eligible voters, Zakheim noted — “may have gotten notices [four] days before Election Day.” Keep reading →