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Defense Cuts Put Small–Business Jobs in Jeopardy

Posted By Ericka Andersen On December 7, 2011 @ 12:00 pm In Security | Comments Disabled

Small businesses that are important to the safety and security of the nation are being gravely threatened by deep defense spending cuts.

The NAVSYS Corporation [1] is a small business in Colorado that developed the first GPS cell phone to provide the 911 cellular location services that exist today. That first cell phone will soon be displayed in the Smithsonian. NAVSYS has gone on to create other innovations, and many of its products play an important role in America’s defense technologies.

On Monday, Representative Cathy McMorris Rodgers (R–WA) hosted a panel [2] featuring female Representatives, CEOs, and small-business owners. Dr. Allison Brown, CEO and founder of NAVSYS, spoke specifically about the effects that regulations, defense cuts, and uncertainty in the financial market have had on her business.

In particular, Brown highlighted a network called Nameth, an innovative system that makes GPS-guided weapons more precise, improving their effectiveness and limiting collateral damage. Due to defense cuts, Nameth may be in jeopardy, and Brown said the Air Force is cutting funds too quickly to analyze how they might affect this significant system.

NAVSYS also develops technology for the Federal Aviation Administration to ensure the safety of aircrafts using GPS navigation, and has been a crucial asset to the cultivation of aerospace technology. Defense dollars moving towards NAVSYS and other companies developing products to keep America safe are important, but President Obama and Congress continue cutting without acknowledgment.

“In fiscal year 2011, we saw significant delays in the award of new contracts by the Department of Defense…mainly due to the congressional budget not being passed until April of that year,” Brown said. “Because of continued uncertainty over the defense budget, we’ve been waiting for over a year for some of these contracts to be put in place.”

She said 2012 doesn’t look much better, resulting in a hiring freeze for 2012 at NAVSYS. While Brown could have tried to manage spending cuts in the past by investing in new product development through a working line of credit, the financial crisis has eliminated that option. Brown calls it “a serious problem for any small business prime growth.”

Heritage defense expert Mackenzie Eaglen recently spotlighted [3] the congressional “super committee’s” failure to come to any agreement, which will have devastating effects on military plans and programs:

Unlike other federal entities and departments, the U.S. military and DOD civilian workforce have been enduring budget cuts long before Congress passed the Budget Control Act. …Not much is left to cut that would not force a redefinition of America’s position as a global leader in the world—a fact that Secretary Gates repeatedly made before leaving office.

For NAVSYS and other small businesses in the defense industry that are working to provide America with cutting-edge technology, defense cuts and unnecessary business regulations are extremely harmful.

“The worst case situation for businesses in developing our own strategic plans for growth is the ‘no plan’ condition that currently exists due to the congressional deadlock and the inability of the super committee could come up with resolutions,” Brown said.

It’s time for Congress to recognize and implement a plan [4] to cut spending—by fundamentally reforming entitlement programs and balancing the budget. Until they wholeheartedly tackle those areas, America’s financial crisis will continue, small businesses like NAVSYS will be unable to hire, and Americans will reap the consequences.


Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org

URL to article: http://blog.heritage.org/2011/12/07/defense-cuts-put-small%e2%80%93business-jobs-in-jeopardy/

URLs in this post:

[1] The NAVSYS Corporation: http://www.navsys.com/

[2] hosted a panel: http://www.ustream.tv/recorded/18952416

[3] recently spotlighted: http://www.heritage.org/research/reports/2011/12/debt-ceiling-deal-puts-at-risk-ever-more-military-plans-and-programs

[4] recognize and implement a plan: http://savingthedream.org/what-it-covers/government-spending/

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