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billion over the last two years, the report showed.
To add to Virginia’s woes, state officials can’t say what the impact will be should Clinton cut 100,000 federal government jobs through attrition and freeze pay raises for a year. Most of those job-holders either work or live in Northern Virginia.
Highlighting how vital defense spending is to the Virginia economy, state officials say such spending increased 135 percent from 1980 to 1990. Service-related industries grew 422 percent, electronics and communications rose 218 percent, while ship building jumped 69 percent.
State officials could not say specifically how Clinton’s cuts would hurt Virginia. But generally state officials say the victims would be the high-tech contractors and defense employees, both civilian and military, of Northern Virginia as well as the military personnel and shipbuilding industries of the NorfolkVirginia Beach area.
Gov. L. Douglas Wilder and other state officials are worried that Virginia’s economy may suffer dramatically under the defense cuts, as has California’s economy. Since 1991, California’s defense-dependent economy has lost 500,000 jobs and the state government last year had to erase an $18 billion budget shortfall.
“The worst of the defense spending cutbacks and base closings are yet to come,” said Wilder. “Good times are not here, I tell legislators. Be careful. Don’t spend any new money.”
To combat the fallout from defense cutbacks, Wilder is pushing ahead with a plan to convert the state’s vulnerable defense industries and employees toward possible civilian applications. Later this month, state officials will hold a two-day meeting on the issue.
State officials say about $15 billion in federal funding has been earmarked for nationwide defense conversion through the Departments of Energy, Transportation and Commerce as well as NASA. Congress has appropriated but hasn’t spent $1.9 billion for defenseconversion programs.
Besides defense, the state could lose $10 million a year in matching funds for Medicaid and another $8 million in Medicare funds for medical education. In addition, about $8 million would be cut for new law-enforcement training facilities for the Drug Enforcement Agency, the report showed.
On a more upbeat note, state officials say that the state could receive at least $200 million for construction projects, drug treatment, summer youth employment, waste-wrater clean-up and childhood immunization.
Clinton has proposed that about $106 billion from his tax increase would boost spending for infrastructure projects and human services programs such as Head Start and AIDS prevention.
As for new transportation money, the state could get $56 million for highways and $8.1 million for mass transit, the report showed.
95.7%