After Democrats and Republicans on the “Super Committee” failed to create a plan to pay for increasing the debt ceiling last year, a fallback option was adopted to cut more than $500 billion from defense spending over the next 10 years, along with similar cuts to non-defense discretionary spending. The prospect of $50 billion in cuts a year for a decade will have a major effect on the defense industry.
Recently, eight of the nation’s largest defense contractors sent a bill to the Senate Armed Services Committee informing the committee that massive layoffs would take place under the requirements of the legislation to cut funding for defense. By law, under the WARN Act implemented in 1989, employers must “provide notice 60 days in advance of covered plant closings and covered mass layoffs.” The defense cuts will be implemented on January 2, 2013. Sixty days earlier is 3 November 2012, only three days before Election Day.
The major defense contractors must inform employees that they may be laid off by November 3. A study conducted by George Mason University found that over 1 million jobs could be affected by the cuts. According to a study produced by Deloitte, the swing states of Florida, Virginia and Pennsylvania all rank in the top 10 for defense industry employment, with between 30 thousand and 50 thousand direct defense jobs each. Florida’s defense industry directly and indirectly employs 167 thousand, while Virginia’s employs 113 thousand. New Hampshire is another swing state with a large defense industry. The Live Free or Die state is the country’s largest producer of small arms measured by number of people employed.
If the WARN Act is implemented, defense industry employees could find out three days before the election that they are being laid off because of a law signed by President Obama. To prevent that from happening, the President, through Assistant Labor Secretary Jane Oates, has told the defense contractors to ignore the WARN Act’s mandate to inform employees that their jobs may be at risk.
The administration attempts to justify this recommendation using one of the possible exemptions to the law’s requirement of notice that states that if a reasonable possibility exists that the layoffs will not occur, no notice need be given. In a feat of language jiu-jitsu, Assistant Secretary Oates explains that because members of Congress and the Administration don’t want the cuts (which they both already agreed to), defense contractors should assume they will not happen and therefore do not need to send out layoff notices three days before the election. (See section three linked here). Only in the Obama administration could a flip-flop on a law the president signed become part of his campaign strategy.
This is the same type of abuse of executive trust that the Obama administration has mastered in instances such as the withholding of Fast and Furious documents via executive privilege, the partial implementation of the DREAM Act after it was soundly defeated by Congress, and his gutting of the work requirement for welfare recipients. The pattern of executive overreach is disconcerting and one more reason Americans must jettison the Obama administration in November.