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Defense Sector Won't Push GOP on Immigration Reform

Industry Holds Fire Despite Billions in Potential Deals

Feb. 24, 2014 - 06:24PM   |  
By JOHN T. BENNETT   |   Comments
A pilot with the US Customs and Border Protection agency flies a surveillance mission last fall over the Rio Grande valley on the US-Mexico border.
A pilot with the US Customs and Border Protection agency flies a surveillance mission last fall over the Rio Grande valley on the US-Mexico border. (US Customs and Border Protection)
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WASHINGTON — Immigration reform is a long shot in the US House, and defense firms are doing next to nothing to change that — despite possibly tens of billions of dollars in business for new border-securing systems.

Republicans, who control the chamber, last month briefly raised the prospects for an immigration bill when the caucus unveiled its “standards” for a reform bill. The one-page document stated that steps to bolster border security “must come first.”

A version of an immigration bill that passed the Senate last year called for nearly $40 billion for new US-made combat hardware for that very purpose, meaning the GOP white paper raised the possibility of new, unanticipated business for defense companies.

But within days of the release of the GOP standards, House Speaker Rep. John Boehner and other Republicans began pouring cold water on the narrative that the lower chamber would pass even a pared-down version of the Senate bill.

“Immigration reform is a long shot at best,” one defense industry lobbyist said. “All indications are it’s dead, at least this year, in the House.”

Asked what the Aerospace Industries Association, the US defense sector’s largest lobbying group, is doing to change House Republicans’ minds, spokesman Dan Stohr said, “Immigration reform was not a priority issue for AIA.”

A review of campaign donation data from defense companies to House GOP members and leaders who would be charged with writing an immigration-reform bill, and securing enough votes to pass it, confirms Stohr’s comment.

A Defense News review of data compiled by the Center for Responsive Politics shows no uptick in donations to top Republicans on the House Judiciary Committee — the panel with jurisdiction over immigration policy — nor to GOP leaders.

Based on the Senate bill, US companies that build aircraft, vehicles and other hardware stand to benefit from a border-steeling immigration bill. The upper chamber’s bill would be a boon for Sikorsky Aircraft, Bell Helicopter, surveillance drone makers and other companies feeling the squeeze from sequestration and declining military spending worldwide.

The defense industry lobbyist said companies should be “pushing for new business,” but he and other industry sources said executives see little incentive to get involved in such a hot-button political issue.

“It’s just not a major play among the companies to push for a bill right now. I think this is a decision that’s larger than they are,” the lobbyist said. “I mean, it has already been decided at the [GOP] leadership level, so why try to push a boulder up a hill?”

Loren Thompson, chief operating officer of the Lexington Institute and a consultant to top defense firms, said, “The defense industry is too smart to take sides in a political controversy as highly charged as immigration reform.”

Thompson said border security simply isn’t a big enough market for weapon manufacturers to risk political backlash by upsetting otherwise defense-friendly lawmakers. Plus, “the programs are smaller and the margins are tighter,” he added.

“The proposed investment in border security was supposed to sweeten the deal for Republicans, but not with an eye to rewarding arms makers,” Thompson said. “Companies would still have to compete for the business; $38 billion might sound like big money, but that’s what the Pentagon spends every three weeks or so, spread out over a decade.”

What’s more, after several turbulent years during which defense executives warned of uncertainty in the DoD budget, 2014 “already is a good year,” the lobbyist said.

“You’ve got a defense appropriations bill and an authorization bill. You’ve got a top-line number,” the lobbyist said. “Everyone else is stuck in quicksand.” ■


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