by WorldTribune Staff, November 23, 2016
President-elect Donald Trump’s pledge to increase military spending has defense contractors optimistic about the next four years.
“It’s been a challenging couple of years,” said Robert Carullo, executive director of the Mid-Atlantic business group SMART. “We’re looking for that to turn around.”
The defense industry is looking for Republicans, who will control the White House and Congress as of Jan. 20, 2017, to “restore orderly federal budgeting and allow the military to plan for the long term, rather than relying on a succession of short-term spending bills,” according to a report by the Baltimore Sun on Nov. 22.
Andrew Brenner, an executive at the data company Acumen Analytics, said Defense Department agencies have been holding back on spending amid uncertainty over their budgets.
“They’re afraid to spend because the spigot’s going to close,” he told the Baltimore Sun. “You can’t plan on a 90-day schedule.”
Congress instituted strict defense spending limits via the sequester in 2011 to prod lawmakers to strike a better deal before deep cuts took effect. But they proved unable to reach an agreement.
Steve Koster, president of the electronics testing firm Washington Laboratories, said military contracts were almost a third of the company’s business before the sequester. After, they dropped to about five percent.
“It was certainly a financial hardship,” he said. Although the company avoided layoffs, he said, “It really hurts people.”
With Trump’s campaign vow, the mood in the industry is generally optimistic, officials say.
An early indicator of that optimism came as stock prices of Lockheed Martin and Northrop Grumman each jumped about 5 percent after Trump’s election victory.