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Defense Roundup: Contractors, Civilians, and Vets Affected by Lack of Budget Agreement

Posted by Fred Wellman

Hardships also Hit Contractor Employees

Nicole Blake Johnson, Federal Times. Most of the stories on the personal cost of the shutdown have focused on the problems for service members, veterans and civil servants, but another key population is taking a haircut on this deal. And they probably won’t be getting their money back as federal employees now will. Thousands of contractors are now on furlough and the picture gets murkier the longer the shutdown continues. Many contracts have simply run out of money using previously obligated 2013 funds, while contracts that relied on new 2014 funds are in a strange limbo as those funds haven’t been released and may not be with a Continuing Resolution. Many contracts and small businesses are simply on ice because the worksites aren’t open at all including such diverse things as restaurants in national parks or on-site IT support personnel in federal agencies. The key here is that this isn’t going to hurt the big players who can afford to lay off a couple of thousand folks here and there without missing a beat. The bill payer is going to be small businesses that rely exclusively on one or two contracts to support their firms. Losing their income and furloughing employees even temporarily could prove unrecoverable for many of them.

In Big Win for Defense Industry, Obama Rolls Back Limits on Arms Exports

Cora Currier, ProPublica. New rules are going into place this week after years of lobbying by the defense industry that will loosen the restrictions of many military exports and shift management of those exports from the State Department to Commerce. What this all means clearly varies by where you sit. Anti-arms proliferation activists see it as a dangerous reduction in oversight that will result in potential foes or human rights violators gaining newer weapons they wouldn’t have been able to reach before. Those in the defense industry see it as a much-needed expansion of their business to allow them to remain afloat while U.S. defense cuts undermine their revenues. In the end, the only real change is small parts like aircraft brake pads and bolts that support military engines won’t need to go through a somewhat onerous approval process for sale to foreign nations. Major weapons systems will remain under tight control by the U.S. government including small arms and aircraft that will remain under State Department control. In the end there will be much hand wringing over the possibilities and dangers but the changes will go quietly into effect.

Pentagon Stops Development of BAE Systems F-35 Helmet

Tony Capaccio (@acapaccio), Bloomberg. One of the major issues for the F-35 Joint Strike Fighter during testing has surrounded the advanced helmet worn by pilots. The system calls for data to be projected onto the inside of the visor worn by the pilot including from a nose-mounted camera, allowing better targeting and wider field of views than the naked eye. Consistently the helmet has faced lag in the data or jiggling that would make pilots sick or distracted and forced the Pentagon to continue pursuing competing helmet designs by Rockwell Collins and BAE Systems. This week, the JSF office sited progress by Rockwell, including a fairly substantial 12% price cut, as reason to select it as the sole provider of the new helmet and a cut of the parallel BAE design. The selection will save DoD about $45 million in set aside funds for the second system. At the selection, Rockwell announced they would go into production with Elbit Systems of Israel as their major partner. It’s another major step for the most scrutinized weapons system ever developed and comes the same week that cracks in the fuselage of one of the Marine Corps STOVL versions were announced. The F-35B has been cited as the most difficult of the three variants to build because of the modifications to make it able to take off vertically. There is always something for this program.

Cyber Warrior Shortage Hits Anti-Hacker Fightback

Peter Apps and Brenda Goh, Reuters. You’ve probably heard us talk about the skills gap facing the manufacturing industry in this report, but there is another fast growing skills gap in the technology industry developing as well. There is simply not enough qualified cyber defense talent on the market as the U.S. government tries to rapidly grow its Cyber Command and private companies find themselves fighting off attacks costing tens of millions of dollars a year. Now the two are competing against each other to fill an estimated 67,000 or more jobs that will be created between now and 2020 and salaries are rising 5-7% a year in the industry.  Unfortunately for the government, a qualified graduate from a good program can walk directly into a job paying well over $100,000 in the private sector. A government shutdown, three-year-long pay freeze, and six-month hiring process puts the federal agencies in very tough competition to find the best talent available. In turn, they look to private contractors to fill the gap, explaining the increasing shift to cyber security by major defense services contractors. This is one issue that won’t be going away anytime soon.

Federal IOUs Pile Up to Workers, Contractors, and States with No Deal on Spending

John Grady, ScoutComms. The shutdown battle still owns the spotlight in Washington D.C. for the foreseeable future. Our John Grady takes a look at the silliness and the effect it’s going to have on paying our bills. We are moving to a point where all we are giving out are IOUs for contractors, doctors, and even our own federal employees until Congress passes a spending bill.

November Payments to 5.18 Million VA Beneficiaries Very Much in Question

John Grady, ScoutComms. As veterans continue to be the pawns used by both sides of the political spectrum on the shutdown, our John Grady drills down to what Veterans Affairs Secretary Shinseki says is in the future without a functioning government. It’s not pretty. Over 5 million veterans, surviving spouses, and children are at risk to miss their benefits in November without a budget deal.

The Veterans Twitterati Project

Leo Shane, Stars and Stripes. Speaking of Twitter, this week Stars and Stripes came out with its list of top Twitter users in the veteran world. Much to our delight, @ScoutComms was named the number one account to follow in the “Other voices” category alongside much more notable organizations such as @pattillmanfdn and @military_family #humblebrag. Also worth noting is that our Lauren Jenkins (@laurenist) was named a “Personality to follow” in part due to her constant panda Tweets and, presumably, links to veterans news and views. Our most gracious thanks to those who nominated us!

Veterans, Benefits Threatened, to Rally Against Shutdown

John Bacon, USA Today. Over the weekend, a “1 Million Veteran” March that was about 2,500 strong gained a lot of attention thanks to the PR machines of the politicians attending. Today, 33 veterans organizations representing millions of veterans, service members, and their families will come together to demand an end to the government shutdown. Rather than demand the removal of barriers at a memorial, the groups will call for real action by politicians to end the impasse currently threatening the benefits of over 5 million veterans. The effects are far more pernicious, though, as government civilians—many veterans—are not getting paid, small businesses that depend on government contracts are stifled, and even service members careers are affected as career development classes are cancelled. It’s refreshing to see 33 veterans’ organizations that often disagree put their differences aside—if only politicians could do the same thing.

For Medal of Honor Recipient Capt. William Swenson, a Rocky Path to the White House

David Nakamura, The Washington Post. Much ink has been spilled on the circuitous route Capt. Will Swenson’s Medal of Honor packet took from his 2009 engagement in the Ganjgal valley until today when he receives the nation’s highest honor from the president. What isn’t in question is that Swenson showed immense bravery on the battlefield. He also questioned the rules of engagement leading the reprimand of two officers who gave the troops on the ground insufficient air and artillery support. But perhaps most awkward were the doubts his version of events cast on the exploits of his fellow Medal of Honor recipient Dakota Meyer. Swenson encouraged the Army to use his own documents from the battle in its website about his MOH which Swenson frankly said would not “mutually support other stories” of the day. Swenson, it seems, has taken the Army values to heart having certainly demonstrated selfless service, honor, integrity, and personal courage.

Medical Reports, Veterans’ Families Suggest VA Is Overmedicating Vets

Elizabeth Flock, U.S. News & World Report. The less covered House Veterans Affairs Committee hearing this week looked at something nearly as troubling as the shutdown: overmedication of veterans leading to tragic deaths. A widow and surviving sister of two veterans testified at the hearing about their loved ones’ endless supply of opiates and narcotics prescribed by VA doctors that eventually led the veterans to their deaths, not to recovery from pain or illness.

Veterans and the Shutdown

From the editor: Politicians rarely pass up the opportunity to capitalize on the national zeitgeist for personal gain. Ever since the first World War II veteran entered a closed memorial to honor his brothers in arms, members of both political parties have used veterans to score points rather than seize the moment to solve a grave national crisis. When you see images of attention-seeking politicians using veterans for a photo opportunity, remember there were veterans from organizations like Team Rubicon, Team Red White & Blue, and The Mission Continues out on the Mall this weekend cleaning up the mess left by our government—literally. As my friend Nick McCormick from IAVA says, “Veterans deserve services, not political posturing”.

Lamothe to Foreign Policy

The Marine Corps Times’ loses an experienced reporter as Dan Lamothe announced yesterday he will be joining Foreign Policy to cover military and Pentagon issues. Lamothe has been doggedly covering USMC personnel and readiness issues for the Times family of papers to include embedding with Marines overseas. We’ll be interested to see how he more broadly covers military issues for FP.

Tradeshows & Conferences

No major tradeshows this week. AUSA still a go–get your swag bags ready.

Our website has a full list of upcoming tradeshows.

Congressional Hearings

Congress is too busy posing in front of the World War II Memorial to hold relevant hearings this week.

Think Tanks & Other Events

No relevant events this week.

Fred Wellman, President ScoutComms, brings us his weekly review of defense industry news via The Scout Report. Fred served over twenty years as an Army officer in both aviation and public affairs. You can follow Fred on Twitter @ScoutComms.

This entry was posted on Tuesday, October 15, 2013 9:30 am

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