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Author: spiritof78 Two stars, 250 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 459925  
Subject: Re: War ends...then, recession Date: 1/16/2007 3:46 PM
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Your bring up an interesting forward looking point. A couple of general notes for which I have no data but just wanted to share the general trends I have noticed from being here with the Army and sharing an office this time around with contractors.

The 1 million U.S. Personnel probably includes people double counted who have served multiple tours. (I reason this because even with the reserves we are barely over a million Soldiers and 45% of the "institutional army" has never deployed).

We have an all-volunteer force this time around as opposed to draftee's who are mostly waiting to get out. Re-enlistment rates are fairly high though based on personal observations your starting to see margins getting pushed a tad more for the Soldiers who have deployed multipletimes. I.E. just my own personal observation the first time I was here for a year long tour re-enlistment was booming. In fact it gave alot of people a higher sense of job satisfaction. This time I'm seeing people approaching the pre-career point 5-8 years in who are more seriously considering seperation. Especially among those who have family's or are encountering marital difficulties due to time away from home. I'm not saying broken just strained.

A great many of your sub-contractors are third country nationals, i.e. your Phillipino's who do the laundry service, Pakistani laborers, Indian Chow Hall workers etc.. By my count on the way to work and then back out to eat and pickup laundry I heard five different languages spoken.

A good number of these contractors are permanently employed in US firms i.e. there are jobs waiting for them back in the states as well. Where they will se a decrease is in their income. For example the chief of the office next to mine is earning roughly $280,000 with hardship, overtime bonuses, and per diem for working here. In the States he makes about 125,000. Ironically he has esentially the same job he had before he retired from the Army. I say good for him though If I were the American taxpayer I would look seriously at the budgetary sense of highering a contractor at 300K per year for a job Soldiers did six years ago for 60K. Note that doesnt include his companies profit margin in this area.

I dont think boosting the amount of deployed Soldiers reduces unemployment greatly it would stand to reason that boosting the military end-strength (i.e. the total number of troops we maintain would). Also consider though the Army and Marines are adding people while the Air Force and Navy are offering seperation packages and increasing attrition to reduce their end-strength. Also the military has a blue to green program that allows these eliminated airmen and sailors to simply corss over to the Army, filling some of the increased end-strength.

I think you will see a reduced negative effect than you have at the conclusion of previous wars, due to changes in productivity type and reducing extra pay for contractors and troops alike.

Additionally if it gets paid for and budgeted immediatly after the war is concluded the Army and Marine Corps reset cost is gonna be eye-popping. Replacing all the equipment that needs to be re-build and purchased anew due to increased wear and tear on them in Iraq is something that I think will knock some socks off when the check comes due.

Will

Just my two cents on the economic effects
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