Booming Middle East purchases of U.S. fighter jets will be a bright spot in what is expected to be a sluggish economy in 2012, possibly paying dividends for President Barack Obama’s bid for a second term.
Beneficiaries include Lockheed Martin Corp. and Boeing Co., whose respective F-16 and F-15 production lines are being extended by U.S. government sales to Iraq, Saudi Arabia and Oman, among other rich arms deals announced in recent weeks.
The foreign sales will help offset expected cuts in big-ticket purchases by the Defense Department, which is set to lose at least $450 billion in previously projected funding through 2021 as part of a deficit-reduction push. Additional cuts totaling another $500 billion to $600 billion over the same period are scheduled to kick in next year unless a new deficit-reduction plan is adopted by Congress.
The sales of fighters, missiles and other advanced U.S. weapons will help provide jobs as the United States heads into an election campaign expected to focus on the domestic economy. It has been growing at only half the pace needed to get the jobless rate down from 8.6 percent, a problem for Obama as the incumbent.
The Obama administration announced last week it had finalized a record $29.4 billion Boeing F-15 sale to Saudi Arabia, dwarfing previous individual U.S. arms deals and supporting jobs by increasing exports. reuters