GUAM – When President Obama presented a $447 billion plan Thursday to stimulate a U.S. economy on the verge of a double-dip recession and put unemployed Americans back to work, the implications for Guam’s own $17.4 billion military buildup bubbled up almost immediately.

The President will leave it up to the congressional super committee, the 12 lawmakers charged with finding at least $1.2 trillion in deficit savings by Thanksgiving, to come up with another $447 billion in savings that will pay for the American Jobs Act. By adding to Federal spending, the new Act heaps additional pressure on the super committee to truly cut the fat by trimming away any spending that does not treat American jobs and economic recovery as priority number one.

Defense hawks will have a tough time justifying taking a scalpel instead of an axe to a budget that already represents 20 percent of all Federal spending. While the Guam buildup is one of the island’s greatest hopes for stemming its own rising unemployment and economic decline, few Americans outside the Defense industry see any military expansion as justifiable, particularly now that a decade of war has left the country exhausted and depleted.

With national elections just 14 months away, Washington politicians are already consumed with how to win, or more cynically, how to defeat their rivals. Against this backdrop, military expansion on Guam can easily become a political hot potato for which it is not worth burning one’s hand.

For Tokyo, the Pentagon and many global security experts, the fiscal debate should be counterbalanced with a discussion of national security and regional interests. From that standpoint, the expansion of military capabilities in Guam is a hot potato worth its heat, as it would enable the U.S. to more effectively project its strength and deter aggression in an increasingly unstable Asia-Pacific. These policy makers find China’s own relentless military buildup alarming and worry that America’s allies in the region will lose confidence, throwing the entire neighborhood off-balance.

But austere times in the homeland will make it harder and harder for the Obama Administration to sell the notion of spending billions of dollars in Asia, and leaders will have to do far better job of explaining the nation’s interests and commitments in the region.

Japan meanwhile gets the urgency and seems prepared to go the distance even if it means setting aside $6 billion for the Guam buildup in the midst of its own $300 billion domestic reconstruction challenge.

Even the ruling Democratic Party of Japan, which once ran on a platform of reducing the country’s dependence on the U.S. and altogether ejecting a controversial air base off Okinawa, is now redoubling efforts to strengthen the U.S.-Japan alliance and implement the realignment plan. Despite natural disaster, a triple nuclear meltdown, political drift, a tormented yen and a troubled economy, Tokyo is funding the realignment, even to the extent of staring down local opposition it once avoided.

Last month, Parliament voted to finance Japan’s 2011 budget, which includes roughly another $690 million for Guam realignment projects, bringing total money in the bank for the buildup to $2.02 billion. That includes $494.7 million from the U.S. since fiscal year 2008 and $1.5 billion from Japan since fiscal year 2009.

Money in the bank notwithstanding, the call for national austerity in the U.S. and threats of even deeper Defense budget cuts has reduced the Navy to making restrained progress on buildup procurements at best, and has curbed its ability to give Guam and the Defense contractor industry clear answers to how the size and pace of the buildup might change.

Given the debt crisis and the fact that the Navy has only awarded $320 million in relocation contracts since Jan. 2010, one thing seems certain: a procurement pace of even five hundred million dollars a year is certainly a stretch now.

The Navy made a valiant attempt last month to inject some hope when it awarded the first-ever construction contract paid for by Japan, displaying Washington’s willingness to spend its ally’s money and by extension its confidence that hurdles will be overcome. But the gesture – an $89.7 million contract to proceed with Phase One Utilities and Site Improvements for new Marine Corps facilities at Andersen Air Force Base and Apra Harbor — was tinged with tentativeness as the Navy withheld the procurement’s Finegayan options.

Other projects the Navy has postponed include the $100 million Apra Harbor Medical Clinic, a second $50 million architect and engineering contract for design related to Japan-funded buildup projects and roughly $10 million in interim upgrades to the island’s wastewater treatment system.

The Navy’s caution is reverberating throughout industry on Guam. While there is evidence that confidence remains high about the long-term prospects of the buildup, businesses and investors also acknowledge that short-term delays and unknowns will require patience and staying power.

To adapt, contractors are running lean teams, managing their project loads to avoid overstaffing and seeking work outside of the buildup – sometimes even outside of Guam — to sustain their business.

Even the temporary workforce housing sector has tempered its zeal. When Younex Corporation cut the ribbon recently at Ukudu Workforce Village, it very distinctly emphasized the project’s scalability and its usefulness to the wider community beyond the buildup. Though designed to accommodate as many as 14,000 to 18,000 temporary residents, the Village will in the short run only offer 500 to 2,000 beds and will open its onsite medical clinic to residents island-wide.

 

For queries regarding this or other stories, email the editor at sharla@guambuildupnews.com.

 

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