Proposed Defense Budget For Fiscal 2016 Brings Cheer To Lockheed
Source: Forbes
Published February 6, 2015
President Obama has proposed a significant hike in the country’s defense budget for the fiscal year 2016, bringing cheer to major defense contractors such as Lockheed and Boeing. Over the past few years, as the government slashed its defense spending due to spending limits mandated by the Budget Control Act of 2011, overall contract volume fell for most defense contractors including Lockheed.
The budget proposes an increase in the overall defense budget by about 4% to $585.2 billion in fiscal 2016, from $560.3 billion in the current fiscal year. However, the base defense budget in this overall budget has been proposed to grow at a much higher rate, as the allocation for overseas contingency operations has been proposed to decline to $50.9 billion, from $64.2 billion. The decline in OCO was expected, as troops continue to withdraw from Afghanistan. After accounting for this decline in OCO, the base defense budget, which includes military personnel and procurement costs, has been proposed to grow by a whopping $38 billion or 7.7% in the fiscal year 2016.
If this budget is approved by Congress, the increase in weapons procurement will benefit Lockheed, which is the largest defense contractor of the U.S. government. Specifically, the defense budget for fiscal year 2016 proposes spending $10.6 billion on purchasing 57 F-35s. Lockheed is the main contractor developing this fighter jet. The company produced and delivered 36 F-35s in 2014.
Read more: http://www.forbes.com/sites/greatspeculations/2015/02/06/proposed-defense-budget-for-fiscal-2016-brings-cheer-to-lockheed/
The article mentions 57 new F-35s - a product already shown to be the worst boondoggle in military aircraft history.
My thanks to NobodyHere, who first brought this article to my attention in an earlier post.
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