A DISARMING SOLUTION By Michael Closson Michael Closson is executive director of the Center for Economic Conversion in Mountain View, California. LAST YEAR, THE San Jose Economic Stability and Conversion Committee attempted unsuccessfully to place an economic conversion ordinance on the city's ballot. The ordinance would have established a commission to plan ways to reduce the dependency of San Jose's economy on military contracts. When a union official who represented over 4,000 defense workers at the local plant of FMC Corp. was asked his reaction to the conversion planning ordinance, he responded bluntly. "We used to love farm equipment, now we love tanks. If our union supports this initiative, the company will take it out of our hides." The local labor leader's comments reflect a harsh economic reality in America. Millions of workers and hundreds of communities across the country are hostages to Pentagon spending. If a nuclear freeze were abruptly implemented, over 200,000 defense workers in California alone would lose their jobs. Several hundred thousand more workers, providing services to the affected defense plants and workforce, would have their jobs jeopardized. Overnight, in communities all over the United States, severe economic dislocation would occur. Military Industry Power Many sections of the country and a number of industrial sectors- -particularly shipbuilding and aerospace--are heavily dependent upon military spending or foreign arms sales. In 1985 Boeing garnered 35 percent of its revenues and 50 percent of its profits from military sales. The respective figures for other top defense firms in 1985 are: Grumman--85 percent and 78 percent, General Dynamics--88 percent and 99 percent, Lockheed- -88 percent and 99 percent, and McDonnell Douglas--47 percent and 98 percent. Heavy military dependency is synonymous with vulnerability. The dependency/vulnerability factor leads many citizens and their elected representatives--liberals as well as conservatives--to support continued Pentagon spending, especially in their own backyards. The upshot is that military spending has become a giant and largely sacrosanct jobs program employing directly and indirectly significant, though declining, numbers of blue collar workers and increasing numbers of technical professionals. The Department of Defense's (DoD) power is immense. It now controls the largest coordinated bloc of industry in America. Military-serving firms, through the campaign contributions of their political action committee, have demonstrated time and again throughout the post-World War II era their ability to survive and prosper. During the 1986 congressional elections, the PACs of the top 10 defense contractors contributed nearly $3 million to congressional candidates. The Pentagon's practice of distributing the work on weapons systems across the country further ensures that a broad constituency supports military spending as a jobs program. In 1984, when the B-1 Bomber came under attack, the nearly 400 congressional districts hosting companies doing work on the bomber had a vested interest in urging Congress to keep the bomber. Fear of job loss and the attendant economic chaos is used to keep defense workers in line and to thwart efforts to scale back military production or to convert it to socially useful purposes. In 1986, Lawrence Kitchen, Chairman of Lockheed Corp., the nation's sixth largest military contractor, sent a packet of materials to each of that company's 86,000 employees. It contained a cover letter urging them to support President Reagan's budget, three letters carrying that message bearing the employee's name and addressed to his or her two senators and representative, and a business reply postcard to be returned to the company indicating compliance with the request. It was blatant but effective lobbying. The message was clear to Lockheed's employees: active support for the military buildup was necessary in order to keep jobs. And in Sonoma County, an area of burgeoning high-tech industry north of San Francisco, when activists succeeded in qualifying a nuclear free zone (NFZ) initiative for the ballot, an opposition group immediately formed under the banner of "Citizens Against Economic Decline." They produced a study purporting to show that 24,000 jobs would be lost in the county if the initiative were enacted. A subsequent study done by the Center for Economic Conversion determined that fewer than 500 jobs would be affected by the initiative. But the damage was done. Opponents of the initiative raised over $400,000 for a nationwide consortium of weapons contractors and used it to publicize the alleged dire consequences of the proposed NFZ. In the face of this onslaught, 40 percent voted in favor of the initiative. Military Spending - Economic Decline In addition to the burgeoning annual budget of the DoD, military spending makes up much of the budgets of the Department of Energy and the National Aeronautics and Space Administration. Currently, it consumes about 55 percent of the federal government's discretionary expenditures. Military orders drive America's manufacturing sector, accounting for 30 percent of technological growth in 1985 and 20 percent of GNP growth. Three-quarters of federal research and development spending is devoted to military projects. Over one-third of all engineers and scientists in America are now engaged in military-related work. The military's dominance over the U.S. economy results in a massive diversion of scarce resources--especially skilled workers and capital--from the commercial to the military sector. This diversion contributes significantly to the declining ability of the United States to compete in the international-- and domestic--marketplace. While other industrial countries devote the lion's share of their R&D to the commercial sector, the United States pursues military technologies and hopes that a declining number of spinoffs will benefit the commercial sector. A Strategy for Change The economic might of the military-industrial complex affords it immense political power. But the direct causal relationship between massive military spending and U.S. economic decline is its Achilles heel. Most Americans readily acknowledge that economic vitality is critical to the well being of the United States. Real national security requires a healthy economy as well as adequate military defense. The problem of excessive military spending can find a receptive audience in mainstream America, especially if the problem is linked to solutions designed to revitalize the economy and enhance overall security. This is the domain of economic conversion planning. Economic conversion involves the orderly redirection of resources from the military economy to socially useful endeavors. It includes converting defense plants from the production of submarines to subway cars, diversifying the economies of military-dependent communities, and establishing new national priorities designed to revitalize society, restore the natural environment, and educate the population. Conversion planning is necessary not only to overcome the entrenched power and "job blackmail" of the military-industrial complex, but also to facilitate a smooth transition to a peace economy for military-dependent workers and communities, and to insure the best possible uses of the resources released by disarmament. Traditionally, economic conversion advocates have concentrated upon strategies for transforming defense plants to the production of civilian goods. National legislation was first sponsored by former Sen. George McGovern, D-S.D., in the 1960s. Today, the Defense Economic Adjustment Act (H.R. 813), legislation which would require every company employing 100 or more people and receiving a military contract to establish an alternative use planning committee composed of managers and workers, is pending in Congress. Each committee would develop detailed plans for converting the facility and reemploying the workforce in commercial production upon termination of the military contract. This proposed legislation and plant-level conversion in general is vigorously resisted by the defense industry. Support for it among rank-and-file defense workers is lukewarm at best. Defense industry managers recognize that their companies' inability to make a rapid or smooth transition to non-military work discourages attempts to cut the Pentagon budget. Furthermore, like most American managers, they are resistant to sharing their decision-making authority with workers. Conversely, defense workers tend to see Pentagon contracts as "a bird in the hand" providing short-term job security. Local union leadership is particularly uneasy about advocating conversion planning in the face of management hostility to it. Given the power of the military industrial complex in Congress, national conversion legislation will pass only when a large and diverse constituency of voters actively supports it. The fact that such a constituency has not emerged over the past 20 years has compelled some conversion advocates to reassess their strategy. A New Approach The outgrowth of this reassessment process is a number of local and state conversion planning efforts. Like defense plants, geographic areas dependent upon Pentagon spending are highly vulnerable to cuts in the military budget. But unlike the defense industry, most of these cities and regions encompass relatively heterogeneous populations including many people wary of excessive military spending and interested in a diversified economic base. By publicizing the impact of excessive military spending and promoting economic alternatives to it at the local and regional levels, activists hope to alleviate the problem of military dependency and, in the process, build the informed constituency necessary for the passage of national conversion legislation. In addition to the abortive conversion ordinance campaign in San Jose, a number of other local and regional conversion planning efforts are underway: In Seattle, local activists are promoting a conversion planning ordinance that would mandate an ongoing study of the city's military dependency, establish voluntary training programs for defense workers, and require "emergency peace plans" for companies that make 25 percent or more of their revenue from military related products. In San Diego, the San Diego Economic Conversion Council has undertaken a program to educate the public and local officials about the problem of military dependency. In addition, they are developing a "defense worker support system" and exploring the establishment of a fund to assist defense workers in developing socially-useful business ventures. In Connecticut, after several years of concerted effort, Freeze activists recently succeeded in gaining passage of a bill which establishes a state Task Force on Manufacturing charged with developing plans to preserve manufacturing jobs, stabilize the state's manufacturing base, and assist workers and communities affected by unstable industries--including defense plants. In Minnesota, a state Economic Conversion Task Force is in operation providing economic development and other technical expertise to military-dependent and other vulnerable industries. In Massachusetts, the legislature recently established a Joint Commission on Economic Conversion. In addition, the legislature is considering a bill to establish an Economic Development Corporation to assist military-dependent high tech firms in developing and marketing non-military products. By design, these local and regional approaches to conversion planning directly address the issues of jobs and economic vitality. Instead of working to cut military contracts, they concentrate on reducing dependency upon them by building up the civilian sector of the economy and weaning military-serving firms from the Pentagon. This approach has the potential for broad appeal. It serves as an insurance policy for vulnerable defense workers and communities. In addition, it starts to answer the critical question, "conversion to what?" by identifying many crucial work opportunities which need to be accomplished to revitalize America, locally and nationally. And, by carrying the promise of viable economic alternatives to military production, it will enable elected officials to judge military spending on its own merits and not in terms of the jobs it generates. Local and regional conversion initiatives are more than simply vehicles for stimulating the passage of national legislation. They are valuable in their own right, they can contribute to building a "peace economy." Efforts to demilitarize local and regional economies can serve as models for citizen participation in economic renewal. Indeed, if the goal of conversion is to revitalize the American economy in a way that truly addresses critical human and environmental needs, then it is better to not concentrate all efforts on converting the giant corporations that dominate the military economy. Behemoths like General Dynamics and Lockheed mirror the hand that feeds them, the Pentagon. They are bureaucratic, authoritarian and not particulary innovative organizations. They are best suited to large centralized projects such as space stations and huge solar collectors. The work necessary to rebuild America requires creative and entrepreneurial talent more likely to be found in smaller firms- -the kind of enterprises more likely to be stimulated by local and regional conversion efforts. A window of opportunity confronts post-Reagan America. The massive federal budget deficit and arms control breakthroughs have started a slow leak in the Pentagon's balloon. The challenge for concerned citizens is to develop an array of creative alternative strategies for building a healthy peace economy.