
The Senate voted 58-40 Tuesday to block expansion of the expensive and controversial new jet, CNN reported, and in the process $1.75 billion will be saved.
A matter of defense spending priorities
The jet would not strengthen national security, and would invariably take dollars away from where they're really needed: for armament and supplies for U.S. Armed Forces on the ground fighting in Afghanistan and in Iraq. President Obama said as much shortly after the vote.
"At a time when we're fighting two wars and facing a serious deficit, [expanding the F-22] would have been an inexcusable waste of money," Obama said, CNN reported. The big defense contractor losers will be manufacturer Lockheed Martin (NYSE: LMT), which Tuesday closed down $6.98 to $75.13, and engine manufacturer United Technologies (NYSE: UTX), down $1 to $53.97.
Stock Analysis: Lockheed should be able to make up for the F-22 production loss with increased production of the F-35. Still, concerning defense spending in general, there may be cuts to other Pentagon programs, particularly if the U.S. has to increase troop deployment to Afghanistan to more than 150,000 in order to defeat the Taliban.
Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.



Reader Comments (Page 1 of 1)
7-23-2009 @ 1:14PM
LARRY said...
CONGRESS DOES THE RIGHT THING CUTS THE F-22 TO WEAKEN OUR DEFENSE AND LAYS OFF 20,000 EMPLOYEES AT LOCKHEED AT THE SAME TIME -- CONGRESS SHOULD BE IMPEACHED ALONG WITH THE IDIOT OBAMA----------
7-22-2009 @ 12:20PM
Iridium said...
Wow $1.75 billion saved. That's like 30 seconds in the Obamaverse.
Providing for the defense of the country is a mandate of the federal government. Spending $1.4 trillion of health care is not. Or loading up $24 trillion in bank bailouts.
This is like someone who pricks his finger and tells someone who has had his leg cut off that he feels the guys pain.
The US government is going to spend over $1.5 billion over the next 10 years on wild horses. I think that money could be better spent giving our fighter pilots the most advanced plane ever created. You know so they have the greatest advantage.
Maybe we should just rebuild WWII fighters and give them to the Air Force. Or better yet we'll just scrap the armed forces all together and use the defense budget, which pales in comparison to Social Security, Medicare, and Welfare, for national healthcare.
You liberals would love that.
7-22-2009 @ 1:51PM
ij70 said...
Another green shoot is stomped into dirt. lol
7-22-2009 @ 2:30PM
sxt173 said...
I don't see the big deal, with the F-35 being a just as capable and in some respects much more advanced fighter then the F-22. The F-22 would have been a waste, since it's a fix to a problem that does not and will not exist for the foreseeable future, the theoretical problem being air-to-air combat against technologically advanced adversaries. With any possible foe being far behind even the current US arsenal, this is a surprisingly responsible move by congress.
And those who say that congress is throwing away national security for healthcare, I guess you didn't catch the increase of orders for F-35's to 3500 planes by 2020. And the F-35 program will more then make up for the jobs lost on the F-22 project, which was already multiple times above budget.
7-22-2009 @ 11:59PM
gtspm10000 said...
@sxt173
Do not presume to offer analysis if you have no understanding of the issue. The F-35 is an inferior airframe and weapons platform in nearly every measurable way compared to the F-22; Acceleration, cruise speed, combat ceiling, time to altitude, maneuverability, air-to-air weapons capacity, and most importantly, radar cross section and infrared signature to name a few. The F-22 is NOT merely an air-to-air platform; the additional kinetic energy imparted from cruising at Mach 1.6 at 50,000 feet allows an F-22 to almost double the range of a 500lb JDAM compared to legacy fighter platforms- thus minimizing time spent within the engagement envelope of hostile air defense systems. The F-22 and F-35 were developed to continue the traditional high/low fighter mix that has served the USAF well for over two decades. This administration's ill-considered decision will expose American aviators to unnecessary risks when facing any near-peer force for the next 30 years.
7-23-2009 @ 6:25AM
down2earth1al said...
My favorite plane was the Balsa wood one that came in the package with the red propeller...fun times!
Actually if drones take off..( no pun intended) they might be back in vogue as the pilot becomes extinct.... This new generation LOVES video games and hey! why not fight war from your living room couch!! Isn't that the American way these days!??
7-25-2009 @ 8:24PM
william lane said...
I agree 100% with gtspm10000. The F-35A-C is nowhere near as capable an aircraft ( in the air to air role) as the f-22A. While it is not an air-to-ground attack platform, it is unparalleled at quickly establishing air superiority (at least locally, depending on the threat nation). The 4th generation strike fighter aircraft and other ground attack / support aircraft can't provide dedicated support to the troops on the ground without air superiority. There are rapidly proliferating aircraft out there (with the corresponding weapons loadouts) that can match in in some categories outperform anything in the inventory except the f-22. The threat nations will not always be without significant air power.
9-15-2009 @ 9:20AM
Colonel Louie McFeron said...
My question is - How can Most Senators and Representatives + this crazed Muslim President determine what we need and do not need to gurantee our National security when they've never seen a day of Military Service? It really frightens me that Americans couldn"t see through this H---A---- President when they voted. They have one other chance during mid term elections -- vote to rid the U.S. Government of Liberals such as Nancy Pelosi, that Reid guy and others. One other comment--I cannot understand why Sec Defense couldn't challenge Mr. Obama with more positive actions when it was decided USAF didn't need the F-22. A great mistake by a Consertive turned Liberal [apparently to save his job].