US defense spending cutbacks to impact major Lockheed Martin contracts

New York, USA: Judging by trends, defence spending in the US may decline, as compared to levels just five years ago, according to an analysis released by the director of the Arms Trade Research Center at the NewYork-based World Policy Institute, Bill Hartung.

According to the analysis, released this week, prime defence contractors like Lockheed Martin, with prestigious contracts such as the F-22 Raptor and JSF-35 Lightning II, may be the worst affected.  

Hartung's analysis points out that defence contracts have spiralled to more than double, from $144bn in fiscal year 2001 to $294bn in FY2006, ever since President George W. Bush assumed office. He, however, says that last year the amount of defence spending increased by only 8.7 per cent, the least since Bush took office. The increase, incidentally, was before the Democrats took control of the House and the Senate, campaigning on a platform of reduced defence spending.

"I think we're coming to the end of the boom," Hartung said in an interview with the Dallas Morning News. He however estimates that any drop in defence spending would likely impact roughly five per cent of the 3,000,000 defence industry jobs. He also mentioned that programs like the Raptor would probably be cut back, thought not dropped entirely.

"It's hard to imagine them eliminating a big program like that, but they could certainly cut the number or stretch out the procurement cycle little longer than they already have," Hartung said.

Democratic congressmen have made it clear they want to curb spending on defense programmes.