Potential Defense Cuts Continue to Cause Alarm

If you work in the D.C. area, there is a good chance that your work is impacted by the federal government and the ebb and flow of today’s federal budget back-and-forth. In the past year, there has been a great deal of debate and concern regarding proposed cuts to the Department of Defense budget, and it has many in the defense contracting community concerned.

Much of the news coverage is setting an alarming tone. A recent Bloomberg Business article noted: “Contractors worry about a lack of leeway if the full $55 billion in cuts goes into effect. Last year’s Budget Control Act, which established the sequestration process, said cuts should be made at the “programs, projects and activities” level. Meaning that depending on which program or project you support, significant cuts are likely on the way.

The article went on to say, “Not all companies will be affected in the same way. If the budget ax falls, contractors that provide services to the Pentagon, such as Virginia-based Computer Sciences Corp. (CSC) (CSC) in Falls Church or SAIC Inc. (SAI) (SAI) of McLean, probably will see a drop in revenue faster than weapons makers such as Lockheed Martin, analysts said.”

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Potential Defense Cuts Continue to Cause Alarm