Virginia politicians from Republican Gov. Bob McDonnell to Democratic Senators Mark Warner and Jim Webb are mobilizing to block the closing of the U.S. Joint Forces Command, which could result in the loss of 6,100 military, civilian and contractor jobs in Hampton Roads. (Read the Washington Post story here.)
At the risk of incurring universal opprobrium among my fellow Virginians, let me stake out a contrarian view: Let it go, guys. Do what’s best for the country. The Defense Department is trying to shave $100 billion a year in spending, which it needs to do, and Virginia is going to share in the pain. Accept the cuts with good grace. Let Defense Secretary Robert Gates do his job.
Massive cuts in federal government spending are coming sooner or later. As I argue in my book, “Boomergeddon,” the feds will go into default within 15 to 20 years, at which point private investors will be unwilling to lend to the government, and spending will be limited to the amount of money generated by taxes (about 60% of spending) plus whatever the Federal Reserve Board can provide by cranking up the printing presses. As the state with the highest level of federal employment and federal spending (excluding only Washington, D.C.), Virginia will get hammered.
We can start taking relatively small lumps now and start diversifying our economy away from its extreme dependence upon federal dollars, or we can be flushed down the sewer drain when Uncle Sam goes broke. Our AAA finance rating and our “best state for business” encomiums will avail us little then.
Now is as good a time as any to start coping with the inevitable retrenchment in military spending. As the Wall Street Journal reported, only three metropolitan areas among the Top 50 last year saw rising wages and rising average incomes: Washington, D.C., Hampton Roads and San Antonio. The common thread: All have strong ties to the federal government. Washington and Hampton Roads have prospered while the rest of the country has suffered. (I would add that the economy of the Richmond region has been bolstered by massive spending around Fort Lee.) Stop bellyaching and take the cuts like real men!
The shuttering of the U.S. Joint Forces command is a warning sign of what lays ahead. Virginians had better start preparing now for the inevitable. Failure to wean ourselves from our dependency upon federal spending — maintained only by federal indebtedness — will lead to the Old Dominion’s downfall.
Repent. Boomergeddon is coming. The end is only 15 to 20 years away.
Update: Norm Leahy with the Tertium Quids blog questions McDonnell’s response to the news. Rather than wean the region from dependency upon the federal government, he notes, the Governor’s Office has created a Commission on Military and National Security Facilities with the objective of bringing in more military-related development to the state.
Uh, oh. Wrong direction. As Leahy points out, we need “private endeavors that do not depend upon the whims of bureaucrats and politicians.”
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