Army’s Plans to Cut 60,000 Could Be a Major Blow to the Economy
Policy + Politics

Army’s Plans to Cut 60,000 Could Be a Major Blow to the Economy

iStockphoto/The Fiscal Times

The U.S. Army’s plan to cut nearly 60,000 military and civilian employees in the next few years has sent shockwaves through Congress and sparked fears about the adverse effect it could have on a still-struggling economy and scores of military communities across the county.

The proposals revealed by the military over the past couple of days – calling for the elimination of 40,000 military personnel and 17,000 civilian workers – is also raising concerns about the impact it might have on military readiness and morale as the threats from ISIS, Russia and North Korea continue to build.

The cuts have been in the works for years and so cannot come as a huge surprise to lawmakers and state officials. Moreover, after years of bloat and unfathomable waste in the Pentagon, the White House and military officials are beginning to deliver on the more nimble and better focused military that President Obama spoke of on Monday after being briefed on the status of the U.S.-allied war against ISIS in Iraq and Syria.

Related: Defense Budget Fight: Obama Won’t Back Down on Veto Threat   

Yet the plan to slash the Army’s current military force of 490,000 by 40,000 active duty soldiers, or nine percent, while reducing the number of brigade combat teams from roughly 42 to 35 are viewed as harrowing to many. The military is also concerned that there could be additional cuts of 30,000 or more soldiers in the coming years unless Congress decides to lift spending caps under the 2011 Budget Control Act, according to some experts.

During a time of economic uncertainty, even as the national unemployment average dipped to 5.3 percent last month, the announced Army personnel cuts will be felt hardest in the South, with its major concentration of military and naval bases, parts of the Midwest and Southwest, and Alaska. In many of these places, Army installations are the driving engine of the local economies.

“Where you have military installations – typically larger bases – you have towns that grow up around them over the years or decades,” Dakota Wood, a senior research fellow with the Heritage Foundation said in an interview on Thursday. “And it’s the service members and their families who make up a huge chunk of the economic activity of whatever that town is.”

That means that car dealerships, barbershops, grocery stores, movie theaters, dry cleaners and a plethora of other businesses all depend on military family’s salaries to make ends meet. And the salaries and expenditures of service men and their families help to prop up the local tax base, Wood said. ” 

Related: House GOP’s Creative Accounting Lifts Defense Budget

“So roads and school systems and public officials – just all the things that would normally happen in a town – depend on military family spending,” he said. “When you take a large cut to a [military] unit . . . that’s a lot of salaries that go away.”

Criticism began to build yesterday as Army Secretary John McHugh notified members of Congress about military units that would be reduced and how states would be affected.

USA Today, which first reported on the plan, reported that the hardest-hit bases would include Fort Benning, Georgia, and Joint Base Elmendorf-Richardson, in Alaska. Army officials plan to convert a 4,000-member brigade combat team at each base into a 1,050-member battalion task force, a loss of nearly 3,000 soldiers apiece, according to media reports. 

Sen. Johnny Isakson (R-GA) told Reuters that he learned from McHugh that the Army intended to cut 4,350 soldiers in Georgia including 950 at Fort Stewart and 3,400 at Fort Benning – cuts that would take place by the end of 2017. 

Related: Pentagon’s $90 Billion ‘Slush Fund’ Comes Under Attack    

"I am demanding answers from the Department of Defense on how they are justifying these troop cuts in Georgia," Isakson said in a statement. "We cannot afford to reduce our military readiness at a time when the threats to our security here at home and throughout the world are growing at an alarming rate."

Republican Sen. Lisa Murkowski of Alaska called the cuts in her state "devastating" and "short-sighted.” She argued that they make no sense when the country needs a tough defense in the Arctic as well as responding to potential threats from Russia, China and North Korea.

“Along with thousands of Alaskans, I find this decision devastating, far beyond what it means to our state economy, but what it means to America’s defense,” she said in a statement.

Among the many uncertainties is how the Army will go about culling the ranks of the all-volunteer  military and civilian forces and whether – for example – older enlisted men and civilian workers may be targeted before they reach retirement age.

Related: What Balanced Budget? GOP Pushes a 'Spend More' Blueprint 

For generations, the Army was viewed as one of the few major institutions that provided low income or poorly educated Americans with a path to educational opportunities through training and the GI bill and a shot at upward social mobility.

Yet research suggests that over the years military recruits are better educated and have higher aptitudes than average American youths; they mirror the U.S. population, and are solidly middle class.

For instance, an August 2008 study by Heritage labor economists Shanea Watkins and James Sherk, had these findings:

  • U.S. military service disproportionately attracts enlisted personnel and officers who do not come from disadvantaged backgrounds.

  • Members of the all-volunteer military are significantly more likely to come from high-income neighborhoods than from low-income neighborhoods.

  • American soldiers are more educated than their peers. A little more than one percent of enlisted personnel lack a high school diploma, compared to 21 percent of men 18-24 years old, and 95 percent of officer accessions have at least a bachelor's degree.

  • Minorities are not overrepresented in military service. Enlisted troops are somewhat more likely to be white or black than their non-military peers are. Whites are proportionately represented in the officer corps, and blacks are overrepresented, but their rate of overrepresentation has declined each year from 2004 to 2007.

  • Finally, newer recruits are also disproportionately likely to come from the South, which is in line with the history of Southern military tradition.

These findings may be useful in gauging the demographics of military personnel and their families who will be hardest hit by the cuts.

Top Reads from The Fiscal Times: