At the end of the White House Summit on Fiscal Responsibility, in February 2009, Senator John McCain steered the conversation toward one of his favorite topics, military waste. "Your helicopter is now going to cost as much as Air Force One," he taunted the president with a smile, urging Obama to cancel the program. "The helicopter I have now seems perfectly adequate to me," the president agreed, smiling back, and then pivoted to the larger lesson: the gold-plated presidential helicopter program is "an example of the procurement process gone amok. And we’re going to have to fix it."
Last May I got to see one of the "fixes" get launched, with a front-row seat in the Rose Garden, as Obama signed the Weapons Systems Acquisition Reform Act of 2009. My euphoria lasted until about ten minutes after I’d watched him whir away in one of those helicopters. That was when I let myself dwell on the Senate vote for the legislation: 93-0, an indicator of how worried all those senators were about the "change" this bill purported to bring to their way of doing business.
On the other hand, Obama did act on this "example of the procurement process gone amok" by canceling the helicopter program. What did he mean by "amok"? Three main things: cost overruns, which are nearly universal in military procurement; ever-changing technical specifications for weapons already in production, which is one of the main reasons for those overruns; and contracts spread out into as many Congressional districts as possible, creating a system of political protection that would impress the Mafia.
In the case of the presidential helicopter, though, the brunt of the jobs impact was going to be concentrated in Owego, New York, a town of about 20,000 outside Binghamton. The main remnant of Owego’s once-vibrant manufacturing base is the Lockheed Martin Systems Integration center, where the helicopter is designed and parts of it produced. When news of the cancellation got out, Hailey Bell, the 11-year-old daughter of two employees, wrote to Obama, pleading with him to reconsider. Without the program, she said, "Owego will be a ghost town."
Enter her Congressman, Maurice Hinchey. While he is justifiably proud of one of the most progressive voting records in Congress, Hinchey felt compelled to defend his corner of the military-industrial complex as a linchpin of good union jobs in his district. And he had one very important tool to wield on their behalf: his seat on the defense appropriations subcommittee, the epicenter of the real action in decision-making about what money gets spent on which weapons programs. When all the Congressional sausage got made, Hinchey had salvaged about $130 million to keep the helicopter production lines lukewarm. Nevertheless, nearly 1,000 Owego workers had lost their jobs. All they can do now is hope that when the Obama administration puts out the contract for a scaled-back program, Lockheed wins it, and at least some of them get rehired.
Or is there another way to create jobs in Owego? I submit that there is.
The Obama administration is interested in holistic solutions to national problems. It has hired a manufacturing czar. Its speeches and position papers about the revival of manufacturing invariably focus on building green jobs in a green economy. And it shares McCain’s good intentions about cutting Pentagon waste. The administration’s $787 billion economic stimulus package reflected those priorities. About $80 billion was allocated to green infrastructure. In future years, we could look back on this legislation as the opening act of a new green industrial policy, one that connects the dots between cutting Pentagon waste and building a green economy.
As an example of what’s possible, let’s take Owego, which is about fifty miles from Corning. Corning glass, the town’s main employer, is working to improve on the solar collector technology that made its partner, Dow Corning, profitable in 2008. This could be a beachhead for solar industry manufacturing in New York’s struggling Southern Tier. The Obama administration could nurture a local supplier chain by coordinating direct federal investment, loan guarantees and green job retraining. Technical assistance could be provided by a local branch of the federal Manufacturing Extension Partnership, which could develop a specialty in solar industry manufacturing.
Any attempt to create a coherent industrial policy will no doubt be attacked as socialistic central planning. The charge is spurious, for many reasons, but the fact is that central planning won’t be enough. States and localities have been given a great deal of discretion on how to use stimulus bill funding. Critics have argued that this has resulted in policy incoherence, and there is certainly some truth to this. But there is a balance to be found between policy coherence and local control.
If this scenario for creating solar jobs in Owego is to succeed, it will need the active involvement of Owego itself. Citizens and local organizations will have to build support for the plan among local economic development officials and the private sector. They will have to persuade Hinchey to work on getting those green federal dollars steered to the Southern Tier. To help make the connection between the federal and the local, the next jobs bill could contain money for green economic development planning grants, and Owego could apply.
In November the City Council of next-door Binghamton appropriated $56,000, about 15 percent of the cost of installing solar panels at its water filtration plant. The city, which estimates the project will save about $7,500 a year in electricity costs, is hoping for a state grant to fund the rest. If Owego and its potential federal partners play their cards right, the project could be supplied by local manufacturing, which would sustain local jobs.