That's easy. It'll put a lot of 12-14 year Sailors, Marines, Soldiers and Airmen in the un-employment ranks, further dragging down our economy, exacerbating the recession, and reducing our load factors. (insert sarcasm exclamation point here...) Actually, I have no idea what effect this will have on us as a company, or country. I have yet to see any ideas coming from this administration that I thought were good ideas....

 

I can't even tell you where I found the avatar! I have a file of them and picked this one up along the way. Could be one of those chain e-mails that I keep getting.

 

As for Guard and Reserves (guys who are pilots), the impact has already started. A lot of the funding for long term orders was slashed. This means they will start to slowly return or have already returned back to the civil cockpits. However, many are volunteering for whatever they can so they can get a 20 year active duty retirement.

I may be wrong, but I suspect several on the long term MLOA or furlough bypass list have been employed by other airlines (SWA, DAL, UPS) -- just that DAL doesn't know it.

Cutting the ranks in the military is chump change considering to what really needs to be cut. And when those other budgets are cut, you will definitely see a reduction of government and charter travel (Iraq is over and Afghanistan is wrapping up soon).

Overall, going forward, our economy is not in good shape. The country either spends itself into bankruptcy and currency collapse, or you cut the massive money train and the economy slows. Double edge sword.

 

It will cause the unemployment numbers to tick up.

 

The Army will cut 90,000 soldiers, and the Corps will cut 75,000 Marines over the next few years. The Air Force & Navy won't be cut nearly as much because of the new strategy's limited focus on Asia & the Pacific.

Mackubin Thomas Owens: The President's Risky Defense Strategy - WSJ.com

The President's cuts do not include the impact of sequestration, which would add an additional $500 Billion in cuts over 10 years.

GOP Moves to Avoid Defense Cuts - By Betsy Woodruff - The Corner - National Review Online

The military is not a secure place to be right now.

 

Most of the above mentioned posts will probably be redacted because they will be perceived as political. However, discussing things that directly affect the economy and our well being as professional pilots is I think germane.

We can't hide our head in the sand and pretend that what goes on in Washington, or London or Paris (can't remember where the darn EU is headquartered) doesn't impact us. Delta just announced new fees (surcharges) to counter the lunacy of carbon offsets and the Chinese are asking the EU to reconsider - read change your mind or we will call your debts due!

I was just thinking that maybe all of this funk we're feeling is a resurgence of the 70's era National Malaise.

 

You don't have to go all the way back to the 70's. Look at what happened in 1992. 20 years ago this year.

Rembember the Gramm-Rudman act? http://en.wikipedia.org/wiki/Gramm%E...ced_Budget_Act


Congress cut the military budget and closed a whole bunch of active duty bases. I was at Pease AFB (NH) when they closed it. Shortly thereafter two malls and 5 car dealerships located near the front gate went bankrupt, the local housing market crashed. Sound familiar?

All that wasted "Military Spending" money was actually being recycled, going from the tax payers, to Uncle Sam, on to our Airmen, and right back into the local economy, which was going right back to those same tax payers, who were complaing about the Miltary Budget.

So, what really happens when they cut Defense Spending?

Amercans become unemployed.

Unemployed Americans don't buy Airline tickets, at any price.

Anyone remember when Delta did it's first ever furlough?

1993, right after all the base closures.

Wash, rinse, repeat.

Turns out War is good for American Business. Ask anyone at Haliburton.

But where would you rather have your tax dollars go? To support the education of, and employment of, a rather large miltary complex, which in turn creates millions of civilian jobs?

Or directly to Welfare Recipients, the same people who were laid off by the budget cuts...

I'd rather my tax dollars were spent on their pay checks, than their welfare checks.

 

The scary part of the unemployment numbers is the long term unemployment rate (unemployed longer than 27 weeks) is unchanged and they account for nearly half of the total unemployment. Once the unemployment rate is seasonally adjusted, the 8.5% will be revised and it usually revises higher (probably 8.6%).

What we should really be focusing on is the U-6 Total Employed number ... which is defined total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force..

and the current unrevised U-6 number is 15.2%.

 

Yes and no.

Yes it will increase but no it won't be counted because come hell or high water unemployment must drop to below 8% by November. So change the numerator or denominator as necessary to achieve that goal so that you can get headlines that read "unemployment rate decreasing, turned the corner, don't change horses midstream..."

Because nobody will report that the U6 sits at around 16% last I heard and real unemployment is around 10.9 to maybe 11.5 and all of that includes a lot of Christmas season part time workers.

 

Good point! I didn't cite that one because it didn't have a catchy phrase associated with it, but it is a much better example. I had numerous friends get cut from the squadron because they didn't go to the academy or have a four year ROTC scholarship - in other words they had an R at the end of their commission.

War has unfortunately made more fortunes throughout history than peace ever did. WWTB (T for Tebow).