Industry

OVERNIGHT DEFENSE: Industry presents ‘optimistic’ outlook on sequester

by Jeremy Herb and Carlo Muñoz 12/05/12 11:39 PM ET

The countdown clock to the day sequestration hits was just
one way that the AIA event — full of reporters and industry officials — was
different from prior years.

Blakey has given six speeches now as head of the AIA, but
her typical focus on numbers and graphs was replaced with a more political
speech on why sequestration should be stopped (there were still some graphs).

{mosads}Blakey was critical of Washington as a whole for even making
sequestration a possibility, a reminder that AIA has been fighting it since the
policy became a possibility in the debt-limit deal last August.

“The fact that the world’s arsenal of democracy has been
relegated to the status of a political bargaining chip is difficult to fathom,”
Blakey said.

Still, the defense industry faces an uphill battle to avoid
further cuts amid fiscal cliff negotiations that have focused mostly on taxes
and entitlements, a reality that defense-minded lawmakers and some industry
leaders have begun to acknowledge publicly.

The Pentagon is
(officially) planning for it, too: Well, it was inevitable.

With less than a month before $500 billion in automatic
budget cuts come barreling down on the Pentagon, the White House finally
ordered DOD to begin preparing for the worst.

DOD press secretary George Little announced on Wednesday
that the Office of Management and Budget had given the Pentagon’s cadre of
number crunchers the green light to start planning for sequestration.

While behind closed doors, it was widely assumed that DOD
was already wargaming the impact sequestration could have on its bottom line,
given the military’s penchant for planning and pre-planning for any given
situation.

But Wednesday’s announcement officially let the department
loose to prepare for the tremendous fiscal pressure coming from across the
Potomac via sequestration. That said, Little assured reporters at the Pentagon
the move was not akin to putting the department at DEFCON 5 regarding
sequestration.

“We don’t have all the specifics yet,” Little said during
Wednesday’s briefing. “This really just has begun. We don’t have
specifics on programs or personnel actions.”

But that veneer of calm could give way to panic, as the clock
continues to tick away toward Jan. 2, which is when the defense cuts under
sequestration are set to go into place.

With congressional negotiations moving at a snail’s pace, we
will have to see if the Pentagon and White House end up calling all hands on
deck to keep the department’s fiscal boat from going under.

Blacklisted: Since
the beginning of the 18-month civil war between Syrian rebels and forces loyal
to President Bashar Assad, the Pentagon has been concerned about possible al
Qaeda influence within the rebel movement.

Those fears may have been realized when U.S. officials on
Wednesday announced the White House was considering placing factions of Syria’s
rebels onto the State Department’s terror watch list.

At the top of that list is Jabhat al-Nusra, a known al
Qaeda affiliate that has been carrying out strikes against Assad’s forces with
the support of Turkish forces near the northern Syrian city of Aleppo, according
to recent reports.

If listed, the group would join current residents on the
terror list, including al Qaeda and the Haqqani Network, and be officially
labeled as enemies of the state.

The growing influence by al Qaeda and other radical Islamic
groups fighting alongside Syria’s rebels is one of the main reasons why
Washington has been hesitant to supply arms directly to rebel forces.

In October, a classified U.S. review found the majority of
small arms and munitions already sent to Syrian rebels by Arab nations has
fallen into the hands of terror groups such as Jabhat al-Nusra and
others.

Those reports in October coincided with news that formerly
disparate groups of al Qaeda militants operating in Syria are now coordinating
themselves into functional terror cells.

That type of consolidation among al Qaeda forces in the
country could lead to the growth of al Qaeda faction in Syria, akin to those
headquartered in Yemen, Africa and Iraq, according to U.S. intelligence.

Michaud named top Dem
on Veterans Affairs: Rep. Mike Michaud (D-Maine) is replacing Rep. Bob
Filner (D-Calif.) on the House Veterans Affairs Committee.

Michaud was chosen Wednesday by the Democratic Steering Committee, and will immediately replace Filner, who was elected mayor of San
Diego and resigned from the House.

Rep. Adam Smith (D-Wash.) retained his spot as ranking
member of the House Armed Services Committee, and the Appropriations Committee
has not yet chosen who will replace retiring Rep. Norm Dicks (D-Wash.) as top
Democrats on the Defense subcommittee.

FBI investigating hacker attack on Mullen: The FBI is investigating an attack by foreign hackers on retired Adm. Mike Mullen’s personal computers, The Wall Street Journal reports. Mullen is the former chairman of the Joint Chiefs of Staff. Early evidence suggests the hacker attack stems from China, an offical told the WSJ.

— Jennifer Martinez contributed.