The Obama Jobs Sequester

Dramatic cuts in military spending are beginning to take a toll on defense jobs in battleground states such as Ohio, Virginia and Florida.

• By KIMBERLEY A. STRASSEL

When Barack Obama has lost even liberal Ohio Sen. Sherrod Brown, the White House has a problem. In Washington, that problem is known as the "sequester." In the rest of the country, it's becoming known as a jobs disaster.
Jobs, and his own re-election, were on Mr. Brown's tortured mind this week, when he publicly called on the president to do something about Defense Department cuts that threaten to shutter his state's Mansfield Lahm Air National Guard Base—and with it, 1,000 jobs. The cuts might be "penny wise," griped the senator, but they were "pound foolish."
That was the rebuke that greeted Mr. Obama as he landed in Mansfield for a campaign stop. An editorial in the Mansfield News Journal demanded that the president "explain to the people of Mansfield why the U.S. government wants to eliminate" their jobs and base. A colonel in the local Ohio Air National Guard parked C-27J aircraft (up for elimination) on the tarmac, so Mr. Obama had to see them as Air Force One landed.
As targeted campaign events in swing states go, this was a local bust. Now imagine Mansfield, only bigger, in cities and towns across the country, and you start to see Mr. Obama's problem.

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Bloomberg

Lockheed Martin employees work on an F-35 fighter jet.

A year ago, the president demanded a $500 billion "sequester" of defense dollars as a penalty should Congress fail to cut a grand debt deal. Congress of course failed, and Mr. Obama's sequester is now imminent. The sequester slash comes on top of the $487 billion in defense cuts Mr. Obama had already ordered in January of this year, threatening the likes of Mansfield.

Defense Secretary Leon Panetta has warned of the damage the sequester will do to national security. Yet the far more immediate political problem for Mr. Obama is that the cuts are compounding his domestic jobs liability—in the final stretch of the campaign.
More than one million lost private-sector jobs, to get down to it, as estimated by groups ranging from the National Association of Manufacturers to the Aerospace Industries Association. Military jobs are on the block, but the bulk of the pink slips will come from private businesses—from giant defense companies on down to smaller businesses that are the economic mainstays of their communities. They'll come from states crucial for President Obama's re-election: Virginia, Florida, North Carolina, and more.
And they are starting now. Federal law requires employers to provide 60 days notice of big layoffs, and since sequester hits Jan. 2, pink slips must go out by Nov. 2. While companies may not know the exact cuts, they have a good sense and are already acting. Boeing has announced it is closing a Kansas facility, in light of "defense budget reductions." Lockheed is mapping out 10,000 layoffs. EADS North America, Pratt & Whitney, Northrop Grumman, Raytheon—all have the potential to make those dismal Obama job numbers look worse.
Mr. Obama's strategy has been to bull ahead, refusing to end the sequester unless he gets his tax hikes, and looking to shuffle off any resulting blame on the GOP. The Republicans this week called his bluff and broke for recess.
The GOP also risks some blowback. But it also knows that these are the same tax hikes Mr. Obama couldn't get his own party to pass when he held sweeping majorities.
They are pointing to a bill the House passed that would replace defense cuts with cuts elsewhere in the budget, a bill that Mr. Obama has ignored. And they are betting that when the layoff notices start flowing, communities like Mansfield are going to blame the commander in chief first.
The White House is clearly starting to worry. In a sign of panic, the Obama administration this week moved to hide the coming job losses. The Labor Department directed defense contractors to ignore the law and skip layoff notices, since sequester remains "uncertain." (Companies may well send them out anyway, since Labor can't protect them from lawsuits for failing to give due warning.)
And the president knows his ranks are getting twitchy. Congressional Democrats cracked this week, signing on to Republican legislation that gives the White House 30 days to detail the sequester cuts; they aren't willing to risk looking like White House pawns for secrecy. Republicans are ratcheting up the pressure, with ads targeting vulnerable Democrats in defense-heavy districts, town halls to highlight the sequester threat, and governors calling on Mr. Obama to step up and lead.
Democrats heading home for the August recess will hear an earful from their local defense contractors. And the party is getting equally worried about the other half of the sequester, which will strip hundreds of billions out of their own cherished domestic programs. If this environment gets hot enough, Mr. Obama could find himself alone on the stand-firm-on-sequester ship.
The biggest risk for the White House is that this is, for the moment, a runaway train. The headlines are coming, yet Congress has gone home for the summer with no plans to address the sequester before the election. Mr. Obama got his sequester, and he has refused to budge. So he may well now own it.