News Scrapbook 1985
Son Diego, CA (Son Diego Co.) Evening Tribune (Cir D. 127,4541 FfB8
1985
engineers and scientists devote their energies to Penta· goo-related work. • "We can build a weapon that can bit w1thm 200 feet of a target from thousands of miles away, yet we can't produce a decent light-rail transit system." The military-industrial complex of the Soviet Union faces similar problems, Yudken said. He predicted that a substantial arms-reduction agreement leading to con- tract termination could cause cml violence there and in the United States. Some U.S. defense industries already face the end of long-term military contracts, a few have succeeded in developing replacement produ ts and many have failed in efforts to diversify, Yudk n said He cited Rohr Corp. of Chula Vista, Boeing Corp. and Grumman Aircraft Corp among companies which sought to diversify into light rail and other rapid-transit equipment production and later dropped the pr~
"The things we export to Japan now include aircraft ngioes and weapons systems. Japan sells us automo- biles, electronics equipment and machine tools. "How do you take a factory and its work force and find a new product that the Germans and the Japanese aren't already producing?" He answered his own question: "We need to send some engineers to Japan for two years to study production." Industries which are largely dependent on defense contracts, he explained, are rarely prepared to intro- duce new products into a competitive civilian market because most have little experience in research and development. The Defense Department either uses its own resources or awards research and development contracts to companies that may not necessarily win the production contract. "There is substantial evidence that overall technical competence in this country is declining. A third of our
interests - the Defense Dep;irtment, peace groups, , academia - scheduled to participate in San Diego's first economic conversion conference to be held tonight through Sunday at the U ve · of San Diego. n ego 1s one of the four counties in the nation which have the highest income from defense contract- n .'' he said. "The others are Los Angeles, Orange and Sao ra couohes - all in California. "And th four are among the top five counties in the n ti n in numbers of non-defense industries shut down. "ThJS is a deadly spiral in which dependence - I also u e the term addiction - to a mihtary economy tends to fuel an increasing feeling that we need an arms race.' The jobs of one in four workers in San Diego County are directly related to defense, he said, and it may not be easy to find other markets, even after converting to 1vihan products. labor uruons, the clergy, politi
San Diego , CA (San Diego Co.) San Diego Business Journal (Cir. M. 7,500) FEB
BUSINESS FORUM
~efr]se-spe_n_n_g_c_uts onerous to business Prudent n1anagers are preparing now for the inpact on San Diego '.s economy B) Douj? Lowe ---- It all boih down to good-old economic self inten:st. And here in San Di go. lhat interest will be moti\11ting man) business executives . labor representatives. go\ernment officials and commurnl\ leaders to attend the I irst on.fcrence on economic T ~e conc~pt of econ~mic conversion is st~rting to look like an idea whose lime has come. On the mternational, national, and local level ii is attracting attention among variou quarters that usually don't agree with each other about much of anything. Thi harmony of interest in planning for economic of downswing that hit Los Angeles when President Carter canceled the B-1 bomber in 1977 . Within three months after the cancellation. Rockwell International laid off 6.300 \\Orkers in Los Angeles: and another 1.700 were laid off ove r the next several months. The massive layoffs and belt
tightening at Rockwell eventually forced other area bu sinesses to cut back . re sulting in lost jobs for an estima ted 10.000 additional Los Angeles residents. All together. some 19 .000 workers lost their jobs as a direct or indirect result of the B- l bomber cutback . Many m onths o f planning. preparation. training. reorgani7ing. and reto oling are needed in order for a company and it s employees to make a successful transition to producing or providing some 11ew product or service pro fitably for the civilian market. Advance economic conversion planning promises lo help San Diego's many defense- oriented businesses and military- related employees make such a transition as quickly and successfully a possible. That's no small promise in light of the current vulnerability of our local economy to any downturn in military spending. Consider the fact that San Diego is home port for one- forth of the Navy's entire fleet. Consider also that more than 200.000 San Diegans get their paychecks either directly from the Navy and the Marine Corps ·or indirectly from a job with a company occupied in supplying or serving the military. In manufacturing. for instance. one out of five workers here are engaged in making a product for the Department of Defense. Obviously. we have an economy that could be hurt. even hurt very badly. by a reduction in defense spending. This vulnerability remains true even though our economy is now diversified so as to not be dependent upon military-related business for a majority of its income. But, economic diversification is not an adequate substitute for economic conversion planning not if we want to emure that our :local prosperity won't suddently plunge belo\\ its current level. For more information regarding registration or other aspects of the San Diego Economic Conversion Conference phone 293-366 I or 297 - 8437. or write 405 West Washington Street. Suite 143. San Diego. CA 92103 • (DouK Lowe i.1 a con.Ill Ii ant hased in /_r., Jolla 11·ho 1pecia/i;:es in .1en•(,1g non- profit i11.1titlllion.1·. citi:en orKani;:a- tiom, anc{go,·ernmr ,J/al aKenciev. He is c11rrent/1 helping to coordinate the San Diego Ec~>nomic Co111·er.1·ion Conference Jor a cualitwn of .1pon.wrinK organ,::ations that includes area clnurche.1 and community groups.)
conven.ion appears to be even more remarkable because it means that people from widely different nations, occupfllitJns, and political persuasions are finding that they can agree upon at lea!.t one thing in what is otherwise an area of great controversy.
conver 10n e\cr held 111 our region I he confcn:ncc \\ill he held 1--cb . 8.9. and 10 at the l'ni,ersi'l of , an Diego . r conomp,ts and busrncss anal:, sh \\ ill help interested San Diegans get started on th e de\ clopment of an economic com crsion plan designed lo protect their personal financial sc urit\ . h us inc s s pro I 1tab I I It y a n.d communit tahi\it\ m the event of an:, cutback 1n militar\ spending. r conom1c conversion is the process of developing a contingency plan that will he put 11110 effect if it becomes nece,sar 1 to change from dependence upon the military budget to reliance upon the civilian market economy I·conomic comcrs1on attempts to amw r the question "\\hat should we be doing no\\ a, prudent individuals. bw,incss managers. community leaders or whatever to t.ditor: I'\\ a local bu,1m:ss \\ ho has enjoyed and rl·,pcctcd ) Our San /Jit'K" H111111c1.1 .Jo11mal lor ,omc time. I wa, e\trcmcl\ d1sappo111ted and upset al the inaccuraC) of )Our rcpor11ng of Pl·n111,ula Rank of San Diego's opcr<11111g result, for 1984 on page 12 of thL" Ian 28 . issue. I am referring. of lourw to po"ihl, lhc t\\O most 1mporlant catcgoril·s. net profit and return on asset, You rcportcd$94.000 111 nl"I pr ofr1, "hen it ,ho11ld ha, c been 918 000 und a 11 pcrccnt r turn on a"cls 11 hen II ,hould haw been 1_1 pcrcenl I think )OU \\Ill agree that thcsc arc s1gnilicant error, ,~h1ch could a
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additional prosperity to the local econom) . But now. the Reagan administration is negotiating for a reduction in armaments. Congressional lead · in both partie~ arc sa) ing that the defense budget must be cut significantly to control deficit spending. And a majority of American citi7ens have told pollster that they want their government to end the arms race. One way or another. sooner or later. there will be a serious reversal in the military's si?Cable contribution to San Diego's prosperous economy. If unprepar- ed. workers and employers may suddenly find themselves in the kind
inevitable
impact of
the
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the cycle of federal pcnd111g'?" So. one can
downs\\ings 111
defense bclicH
in importance of planning for economic conversion rcgardles~ of whether one is in favor of increasing. decreasing or maintaining the current level of America's defense budget. The wisdom in economic conversion planning is especially compelling for an area like ours. One out of ever) four jobs in San Diego County is directly dependent on the 5 billion being spent here annual!) b) the Department of Defense. In recent years. defense allocations have grown and brought the
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Input .from our top, state-of-the-art prognosticators forecasts a bullish year for '85
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