As observers of the defense industry will know, recent developments, such as sequestration and contractor consolidation, have squeezed the American defense industry, resulting in the scraping of long-term research and development projects for short-term cost savings. While the effects of defense budget cuts and their impact on national security is often discussed, much more rarely talked about is how defense budgetary pressures will effect the overall strength of the American economy. Even less clear is what types of defense-related research, development, and training for servicemembers pay the greatest long-term dividends, boosting the American technological advantage over rivals, and on the individual level, enhancing employee productivity.
When Congress is away, the economists will play, and last week, Brookings hosted a discussion on the health of the U.S. national security industrial base. The panel, which featured Brookings scholars Michael O'Hanlon, Ben Bernanke, and Mark Muro, looks across the spectrum at both the security and economic sides of the defense economy, evaluating the effects of sequestration, how America’s defense needs are informed by the threats it faces, and exactly what impact defense spending has on regional and national job creation and technological innovation.
You can watch the full event below: