Senators Ask Defense Companies About Pentagon Reductions

A group of U.S. senators asked 15 defense contractors, including Lockheed Martin Corp. (LMT) and Northrop Grumman Corp. (NOC), to assess the potential business effects of across-the-board cuts in military spending set to start in January.

The six Republicans and an independent who serve on the Senate Armed Services Committee, want the companies to detail Pentagon contracts that may end or be reduced if $500 billion in defense cuts over 10 years takes effect starting on Jan. 2. The cuts will begin unless Congress and President Barack Obama intervene.

“We believe that the administration and Congress must re- address sequestration as a deficit-reduction tool as soon as possible to avert the disastrous economic consequences of the automatic budget cuts,” the lawmakers, led by Senator John McCain of Arizona, the committee’s senior Republican, wrote in a letter dated today.

They asked in the letter what effects the cuts may have on workers and suppliers and whether employees would be sent advance notices that they may be fired after the cuts start.

The defense reductions are part of $1.2 trillion in automatic, across-the-board cuts to domestic and national- security programs that will start next year. The cuts were imposed after talks failed last year on a bipartisan plan to curb the nation’s debt.

In addition to the Republicans, Senator Joe Lieberman, a Connecticut independent, signed the letter.

Also among the companies receiving the letter were L-3 Communications Holdings Inc., Raytheon Corp., and Boeing Co.

To contact the reporter on this story: Laura Litvan in Washington at llitvan@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net

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