Steve Burns
WMAL.com
WASHINGTON – (WMAL) The budget measures proposed by President Trump Monday may have some local government officials starting to worry. Trump proposed a large increase in defense spending with an equally proportional decrease in spending among other federal agencies, spurring fears of less help on social safety net issues and concerns that the DC economy’s reliance on the federal government may come back to bite it.
The defense spending increase doesn’t necessarily mean good news for the region, Dr. Stephen Fuller of George Mason’s Center for Regional Analysis told WMAL.
“We receive about (15 percent) of the defense budget in the Washington area,” Fuller said. “It depends on what (the increase is for). If it all goes to shipbuilding, it doesn’t benefit us a bit. If it goes to troop increases and deployment, it doesn’t have much impact here.”
But the proportional spending reduction among other agencies could bring a more immediate detrimental impact, Fuller said.
“I do think we have to be careful about the winners and losers,” he said. “(D.C. and Arlington County) are concerned about federal reduction in federal housing money. We certainly need to be concerned about support for education and school lunch programs.”
Layoffs may also be imminent, though the fed has been tightening its belt jobs-wise for a while now.
“Since 2010, we’re down about 18,000 net federal workers here, and that’s about $3 billion in payroll,” Fuller said. “It’s $3 billion every year. It isn’t just a one-time cut.”
The impacts, whether positive or negative, may be less drastic than what the region saw in sequestration, thanks to successful efforts to diversify the economy away from the federal government.
“35 percent of our economy now is federally-dependent, whereas in 2010 it was 40 percent,” Fuller said. “We’re not sufficiently diversified yet to not be jerked around by federal spending policy, but the impacts are not as big as they used to be.”
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