The composition of the bipartisan Debt Ceiling Panel bodes ill for there being serious cuts in the U.S. military budget as part of any "second phase" deal to reduce the U.S. deficit. Put simply, the states with large military contractors are fully, if not overly, represented on the Panel.
Of particular note on the Democratic side is Senator Patty Murray of Washington. Progressive commentators have generally responded favorably to her appointment (and conservative voices have singled it out for criticism), but Boeing is a major employer in Washington (with some 30,000 workers in the state) and its PAC is a major source of campaign funds for Murray. Almost certainly, for example, the cuts in military spending that would be triggered if the panel reaches no compromise would hit, and perhaps eliminate, the 35 billion dollar contract awarded to Boeing this past February to build roughly 200 new refueling "tanker" aircraft for the military.
Murray no doubt will be concerned about higher unemployment in her state should the Panel not reach a compromise and trigger the cuts in military spending that are built in to the debt ceiling bill passed in early August. And of course, she's right. Indeed, the best thing one can say about U.S. military spending is that it (to some extent) functions like both an economic stimulus and a jobs program.
But this also points to one of the problems with "growth" per se as an economic goal (a topic of a forthcoming post). As Keynes argued, any and all government spending -- even paying people to dig and then refill holes -- provides an economic stimulus and thus can promote growth during a recession. Yet, while this is true, it does not follow that there are not other very good reasons to prefer some spending over other spending, some forms of growth of other forms of growth, and some sorts of jobs over others. The problem Murray faces, however, is that so many of the jobs that currently exist in her state are directly or indirectly tied to military spending.
But my immediate point is that the composition of the Debt Panel -- including, as it does, both Murray and Republican Senator Toomey from Pennsylvania, to cite just two notable expamples -- means that the threat of triggered military cuts will loom particularly large in its deliberations. This may well lead the Panel to reach some sort of bipartisan compromise, but almost certainly, if such a compromise is reached, it will not include robust cuts in military spending as part of longterm deficit reduction.