Illinois ranks last in war spending. That’s bad?
April 26, 1994
So voracious is the appetite for federal pork in Illinois that many a public official is willing to eat Pentagon spending even if it’s rancid.
Not long ago the New York Times, that archive of folly, told the story of the U.S. Army's new Sergeant York air defense gun. Computerized, radar-guided, mounted on an armored tank chassis, the Sergeant York is designed to shoot down prop-driven planes and helicopters. To accomplish this useful chore, the Sergeant York is programmed to fire at whirring blades.
On the face of it, such a gun would seem unnecessary. Combat in Vietnam proved that helicopters can be brought down by conventional small arms fire. (This is not something most generals would be likely to know; the only potshots they received came from the press.) Helicopters seem unlikely to be brought down by the Sergeant York, unfortunately. During tests the gun refused to fire at any of the whirring targets offered to it. Instead (quoting the Times) it "zeroed in on what it considered a more promising target: the exhaust fan in a nearby latrine."
Well, what do you expect for $4.2 billion? The story of waste in Pentagon procurement is a familiar one by now. The Department of Defense is rivaled only by the Social Security Administration when it comes to spending tax money on obsolete equipment. Yet, if I take the meaning of editorialists correctly, the fact that such a useless weapon is being built at such a staggering cost should irk me less than the fact that it is not being built in Illinois.
Illinois ranks forty-eighth among the states in the share of the Pentagon budget which is spent within its borders. This fact has always left me well disposed toward life here where the corn grows as high as a whistle-blower's eye. The pacifist in me is proud that the most lethal product we Illinoisans loose upon the peoples of the world is pork chops.
Alas, our politicians are not content with real pork. Sen. "Charles" Percy, for example, tried and failed in recent weeks to get the Army to station a division at Joliet. Given the deteriorating state of Chicago politics, this might actually be prudent public policy. But the Army said no. Percy is on the wrong Senate committee.
The right committee is, of course, the Senate Armed Services Committee, one of whose proud members is Illinois' own Alan Dixon. No sooner had the ink dried on his new stationery than Dixon clambered atop an ammo box to shout his intention to right this historic wrong and get more bucks for the bang in Illinois.
The case for more war spending in the Midwest being advanced by Dixon and likeminded thinkers transcends partisan affiliations, as well as the usual philosophical ones. (Dixon, for example, is less a hawk or a dove than he is a vulture.) Their pleas often are as ingenuous as they are ingenious. In February, Springfield's State Journal-Register decried what it called "the negligible defense spending, that trickles into our area." "It is in the long-term interest of the nation that the Defense Department help keep industry in the Midwest . . . viable," the SJR went on, "so that it is available in case of emergencies." What emergencies? In case Florida is hijacked to Cuba? In case the Japanese take out an option on California? What the paper meant by "emergency" is a general mobilization of the sort which attends major conventional wars.
We should all live so long. It is one of the doleful aspects of the nuclear age that major wars will no longer last long enough for anyone to make money from them.
The blizzard of stories about Pentagon waste has left Dixon and others careful not to phrase their ambitions for their states in terms of bacon. Instead, he couches his plea in terms of the need for more competitive bidding and "regional balance" in military spending. For those who have not followed the issue, competitive bidding is to Midwest industry what affirmative action is to black construction workers. The dilemma is much the same. In both cases economic grievances can be redressed only at the cost of economic inefficiency. The aim of competitive bidding, for example, is to achieve lower costs. Yet lower costs and regional balance must remain contradictory hopes as long as the Sunbelt states pay lower wages and build in more efficient plants than their Midwest competitors.
Regional disparities are not necessarily political in origin, either. Illinois doesn't get a lot of contracts to build aircraft carriers, for example. One of the reasons is that aircraft carriers still need to be built fairly close to an ocean. (Can you imagine what UPS would have to charge to get the Enterprise from here to San Diego? And what if nobody was home when it got there?) Even given the stunning floods which a generation of dam-building and channelizing has produced in the Mississippi Valley, it is difficult to envision a missile cruiser being built in, say, Aurora and floated down to the Gulf for launch. Illinois is not" even well placed to land a toilet paper contract, at least not until a way is found to make it from corn cobs instead of trees. (Yes, I know. But the generals would never stand for it.) A certain regional imbalance in military spending, in short, is necessary and wise.
We may live to see a shipyard in Aurora yet, if the boys in the war room manage to avoid blowing us all up before Dixon attains the chairmanship of the Armed Services Committee. We may also live to regret it. Economist Wilbur Maki of the University of Minnesota—a state which does rather better than Illinois in the arms lottery—explained why not long ago to the Twin Cities' City Pages newspaper. Big contractors will often fabricate components in other states, where costs are lower or facilities are better equipped. The result is that Pentagon dollars spent with Illinois firms aren't necessarily spent in Illinois.
However, those dollars flow across state borders in both directions. James Fossett and Fred Giertz, both staff members of the Institute of Government and Public Affairs at the University of Illinois, pointed out this fact in a guest essay in the Chicago Tribune the other day. Much of the employment gains from Pentagon spending result from increased orders for the material used to build ships, tanks, and other such equipment.
And Illinois is a major supplier of the steel, metal castings, machine tools, and electrical components which go into that equipment. The result, say Fossett and Giertz, are "increases in production and employment in the state which are not reflected in the original distribution of contracts."
Some Illinois firms, heavy construction equipment manufacturers especially, are uniquely qualified to offer lowest-cost goods to Pentagon buyers. Caterpillar earlier this year landed contracts worth more than $112 million over five years for road graders. The problem (if you consider it a problem) is that the kinds of goods which Illinois manufacturers make are small potatoes compared to aircraft carriers and nuclear submarines. The $112 million spent on road graders is barely enough to re-sod one of the generals' private golf courses in Virginia.
Worse, while such contracts are coveted because they produce short-term distortions in the political opinion polls, they also produce longer-term distortions in state economies. Companies are forced to compete for limited numbers of skilled workers. This tends to drive up salary levels artificially, since the Pentagon will always outbid the private sector, raising the cost of doing business for everyone. These distortions are all the more pronounced since much recent spending for the military is in high-tech fields whose beneficiaries are not the unskilled and semiskilled who populate the unemployment offices, but engineers, systems analysts, programmers, and so on. And since military spending tends to be unstable, any shift of resources toward that sector means cheating the civilian sector of resources needed for more sustainable growth. When the Pentagon contract runs out, the state ends up looking like Texas after the bottom fell out of oil prices.
The people who complain about paying federal taxes don't mind wasting them, in short, provided always that the waste ends up in their pockets. Maybe the Army can find a use for the Sergeant York after all. Just re-program its target radar to focus on flapping jaws. ●
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