Economic Earthquakes: Converting Defense Cuts to Economic Opportunities
Economic Earthquakes: Converting Defense Cuts to Economic Opportunities
Patrick Lloyd Hatcher., 221pp., Book # 3575, $21.95
Throughout the Cold War, America and the Soviet Union spent vast national fortunes on military forces. Defense expenditures rose and fell depending on leaders and events, but costs remained high. In 1989 the Cold War finally expired from exhaustion. Orphaned by its demise were thousands of military and civilian personnel, a major segment of the defense industry, and huge military installations.
Defense reductions, begun under President Bush, have continued under President Clinton, and a major portion of their cuts have come in California. This is the story of those reductions, their impact in California, and their national and international implications. Adjusting to the loss of tax revenues from defense sales and employment in the midst of a deep recession, California faced severe budget cuts. The Los Angeles Basin suffered increased unemployment among high-income aerospace technicians, along with the natural calamities of fires and earthquakes. San Francisco watched the navy steam away from its many bases to facilities in San Diego or Puget Sound, and the army close the famed Presidio. High-tech purchases from Silicon Valley defense contractors declined, and the Bay Area economy stagnated.
But there are ways to manage defense conversion, whether it be a defense worker reemployed, an industry restructured, or a military base reused. Each of these is a significant economic asset; the key to success lies in how they are redirected. The three case studies detailed here are political histories of the Golden State, allowing the reader to understand the ingredients for success or failure in the long, complex process of defense conversion. In the 1990s, defense conversion will continue to have a significant impact on the political economy of California, the nation, and the international community.