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Commentary: The Real Math Of Military Shutdowns


Commentary: The Real Math of Military Shutdowns

A decade ago, the folks in Portsmouth, N.H., thought a diversified economy meant you could get a job with the Army, Navy, Air Force, or Coast Guard. All of them were there. Today, Pease Air Force Base is closed, and the other services have slashed their workforces.

In their place have come employers such as Red Hook Ale Brewery and Cabletron Corp., which makes communications-network switches. When Pan Am Corp. opens a maintenance facility and several other companies are ready for business, 4,500 people will work at the site, dwarfing the 400 civilian jobs when the base was open. "We are doing very, very well," says Eileen D. Foley, who was Portsmouth's mayor when the Pease shutdown was announced in 1988.

There's a lesson there for Congress. Although lawmakers want to delay another politically sensitive round of base closings requested by the Pentagon, there's no real reason to wait--and plenty of reason to double-time. For one thing, in this age of expansion, the economic downside of shuttering a military base can be negligible.POKY POLS. It's clear that Washington needs to close more sites. The uniformed force has shrunk 34%, from 2.2 million in 1989 to 1.5 million today. Although 97 of 495 major bases have been eliminated--producing annual savings estimated at $5.7 billion--base capacity has fallen just 26%. The Pentagon says it still will have 23% more capacity than it will need in 2003.

Congress is balking at new shutdowns partly because it fears a political backlash from job losses. And governors such as George W. Bush of Texas are hiring consultants to argue the case against base closings. But the pols may have less to worry about than they think. A recent General Accounting Office report shows that two-thirds of the towns hit with major base closings have unemployment rates at or below the national average. "Not only is there life after base closure, there is robust life after base closure," says Paul J. Dempsey, director of a Pentagon office that aids towns facing the loss of a military facility.

When a base closes, few workers lose jobs. About 76% continue to work for Uncle Sam or retire. Only 8% are laid off, according to the Pentagon. And new jobs totaling 60% of the lost slots have been created at bases closed for at least two years.

Alexandria, La., which saw England Air Force base shuttered in 1992, is one town that thinks it's better off. Loren C. Scott, an economist at Louisiana State University, recalls that he predicted the region "would lose almost a decade of employment growth" when the base closed. Instead, nonagricultural employment, which had inched up 8.4% during the 1980s, jumped 15.9% from 1992 to last year. And sales tax revenue, also supposedly headed for a slump, has increased 4% to 8% every year.

One reason: Economists overstate the impact of a military pullout. Jon W. Grafton, an economic-development official in Alexandria, says that because troops buy food at commissaries and other goods at the post exchange, the loss of a military job is equivalent to the loss of just a third of a civilian job.

Certainly, experience helps ease a transition. That's why the Defense Dept. runs conferences for local planners to help them avoid traps, assess an area's strengths, and duplicate winning strategies. And to reduce the uncertainty that crimps investment, the Pentagon has halved the original six-year lag between announcement of a closing and its completion.

Town after town has shown that the sky doesn't have to fall when the military marches off. And if lawmakers act swiftly to close more bases, the expansion will provide a soft cushion to the economic blows.By Stan Crock

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