A political deal struck in the summer of 2011 could begin to influence the economy in late winter 2013, unless feuding lawmakers can agree on a compromise by Friday.
The sequester mandates significant cuts to the federal budget, with few if any government agencies immune to reductions in funding. Defense and domestic spending will be evenly slashed, and the impacts on local economies are far from clear.
According to a 2011 list compiled from a federal database of government contracts, a number of businesses that claim a Coronado address hold such contracts – as large as $5 million – and could be affected:
|Tactical Air Operations Inc.||$5.16 million|
|Nathan Kunes Inc.||$2.2 million|
|Dr. George Luiken||$751,000|
|J.D.A. Maritime Inc.||$734,000|
|Factory Direct Distribution Corp.||$166,000|
|Coronado Business Supplies||$103,000|
|USMS Swim Instructor||$39,000|
|Leon A. Edney||$24,000|
|Global Product Manufacturing||$17,370|
|Host Hotels & Resorts||$7,440|
|Karen A. Rodgers||$6,000|
|Malcom N. Danoff, Ph.D||$5,530|
|Farrelly Building Services Inc.||$3,800|
|Strategic Support Group Inc.||$2,500|
|Kaupp & Associates Inc.||0|
San Diego County has almost 70,000 federal employees and retirees, according to Eye on Washington, and their fate could include furloughs or worse.
Media reports include warnings that delays could result on everything from air travel to tax refunds. KPBS notes that North Island Naval Air Station could lose aircraft depot maintenance as a result of the cuts, while:
- K-12 education would lost more than $150 million.
- Environmental protection could be cut back by nearly $15 million.
Civilians employed by the Department of Defense also face furloughs.
“The possibility exists for a 22-day furlough of Federal employees,” said Brian O’Rourke, spokesman for Navy Region Southwest.
The San Diego Military Advisor Council estimates that between 4,000 and 5,000 ship repair jobs could be lost due to fewer surface ship availabilities, at a possible loss of $219 million to the local economy.
Rep. Scott Peters (D-San Diego) spoke out on the House floor on Feb. 15, saying:
“San Diego is the largest metropolitan area for military personnel and base operations. My district is home to seven military bases and sequestration will have a broad and devastating effect on our military families and economy. In total, defense spending is responsible for 25 percent of San Diego’s GDP. This means that one out of every four dollars generated in San Diego is achieved as a result of defense spending. The proposed cuts to the defense budget will cost San Diego more than 30,000 defense related jobs.”
The Obama administration has released a report for each state detailing the impacts of the sequester’s budget cuts. Republicans have accused the president of using scare tactics for political gain, while Democrats accuse the right of inaction for the same purpose.
The seven-page report for California paints a grim picture for education, environmental protections, the military, law enforcement, child care, public health and government services. The report is attached to this article in the PDF section.
The country has been through this drill before: The words debt ceiling and sequestration have become part of the national conversation.
The sequester was set to begin on Jan. 1, 2013, if lawmakers weren’t able to reduce the budget deficit. That deadline came and went, but they were able to agree on postponing the sequester for two months. That time is running out.