Widgets Magazine

Sequester Me

In Washington over the last few months there have been any number of buzz-worthy phrases that caught the public attention. Shortly after the election of 2012, the “Fiscal Cliff” loomed large and was dealt with. This isn’t a political blog, so I’ll let others debate about how well it was handled.
Recently another term has been floated, although not as much in the press. Probably because it doesn’t have the same visual effect as “Fiscal Cliff.” That term is Sequester. Unless another midnight deal is reached, on March 1, 2013 a number of cuts will be put into effect. For those of a Libertarian leaning, the cut to pay to congress is the biggest benefit. However, that also includes cuts to their staffs’ pay as well. Not exactly fair, but it is the deal they made; Congress, not their workers.
The other portion that concern us in AV is the cuts to defense. Not that any of us manufacture tanks or aircraft carriers, but a major portion of some integrators and manufacturers’ sales go directly to the government. Specifically to the defense department.
According to the Economist, the Pentagon had around $600 billion to spend in 2011. If the Sequester goes through, they will have approximately $486 billion. Oh, but what’s a few billion among friends, right? Add to that the fact that military personnel pay cant’ be cut. This is a point I agree with, but I add it in here to let you know the bottom dollar defense will have to play with. Overall, the government will have to cut roughly 15% across the board.
Ok, so we’ll have two less tanks… big deal, right? For us in AV, it comes closer to home than that. Todd Harrison from the Centre for Strategis and Budgetary Assessments says “Large acquisition programmes are large targets”. Read less tanks, more paper clips. However, for those servicing the AV portion of defense and the government in general, this may be the year to step up the press. The article says there will be more spending this year on projects that may not have been planned for.
What does this mean for you? Now is the time. Get out there and shake the hedges. See what projects your contacts had planned over the next three to five year period and see if they can start now. It also means looking to other areas of revenue to compliment your bottom line while the Pentagon goes through this cut in allowance. There is always Digital Signage.

About Author

Tim Albright is the founder of AVNation and is the driving force behind the AVNation network. He carries the InfoComm CTS, a B.S. from Greenville College and is pursuing an M.S. in Mass Communications from Southern Illinois University at Edwardsville. When not steering the AVNation ship, Tim has spent his career designing systems for churches both large and small, Fortune 500 companies, and education facilities.

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