By Gregg Aramanda
Soccer moms. NASCAR dads. During election season, it seems like we’re not even people anymore – just voting blocs.
This year, it’s small businesses, but amazingly, for all the rhetoric, no one seems to be talking about the biggest threat to smaller firms – trillion-dollar “sequestration” cuts set to begin Jan. 2.
It’s not surprising, since when people think of defense cuts they probably imagine corporate giants on the chopping block. Most don’t realize that 70 cents out of every military purchasing dollar goes to smaller suppliers that are home to two-thirds of defense manufacturing jobs.
But it’s a dangerous oversight. Economists predict the sequester will destroy 2.14 million jobs, half of them at supply chain firms. According to the latest studies, sequestration will destroy more than 30,000 small-business jobs in New York State alone.
It’s the worst possible strategy for cutting budgets – mechanical across-the-board reductions instead of targeting cuts on things we don’t need or can’t afford. This makes it a threat to every company up and down the supply chain, even healthy firms like mine, CPI Aerostructures on Long Island.
Business is good at CPI; we recently expanded and employ 200 people, manufacturing aircraft components such as wing assemblies and surface skins. We serve some of the highest-value programs in our military – retrofits that add years of service life to older aircraft like the A-10 Warthog and making parts for the Blackhawk helicopter and the E-2D Hawkeye. And while CPI is strong and will find a way to weather cuts, that won’t be true for other firms still struggling to get back on their feet after the system shock of the Great Recession.
The experienced workers at companies like CPI possess highly specialized skills needed to manufacture complex military equipment. This expertise has been built up through decades of R&D investment and training on the job. The same is true at our peers and for many technologies, there may be only a few firms that can do the job. If they go under, the loss could send shock waves through American military capabilities.
Rep. Richard Hanna, R-Utica, has warned that sequestration could hit the Rome Air Force research lab. That hurts New York, but shutting down cutting-edge facilities also hurts our future military capabilities. That’s why Defense Secretary Leon Panetta predicts that sequestration would “lead to “unacceptable risk in future combat operations”.
As both parties clamor for the mantle of “friend to small business,” the problem of sequestration is the elephant in the budgetary room. It’s the biggest danger out there for smaller firms.
Want to help small business? Don’t give us talking points; give us a solution to sequestration.
Gregg Aramanda is vice president of CPI Aerostructures Inc. of Edgewood, N.Y.