In the shadow of the Pentagon, businesses concerned over defense spending cuts

Now that the Super Committee has failed to come up with a plan to cut the deficit, the Pentagon faces cuts of about $500 billion over the next 10 years.

Those cuts would have an impact on the Defense Department, but they could also have a ripple effect on the stores and restaurants near military bases that cater to service members and their families.

Hamburger Hamlet has been grilling up burgers and steaks in Crystal City, in the shadow of the Pentagon, for 27 years. District manager Steven Korbett knows who pays the bills.

“It’s probably 80 percent contractors, defense contractors, military, and government employees,” he said.

And he’s “absolutely” worried about a 10 percent cut to the department of defense budget.

David Anderson, the general manager of Jaleo, a trendy tapas restaurant near the Pentagon, is trying to look at the brighter side.

“I mean it’s great. We have a great story to tell here in Jaleo. And we are really excited for the opportunity of new companies and people to come to the area. And it’s actually kind of exciting.”

Really.

“We have a great story and we’re optimistic so it’s exciting to have new people, fresh faces and new companies come to the area.”

Anderson’s not the only one embracing the positive spin. Walking around Crystal City with Angie Fox, president of the Crystal City Business Improvement District, is eye-opening. Her job is the be optimistic, but she is.

“We are changing the way people see, perceive, and experience Crystal City. A lot of repositioning, a reinvention, a transformation, those are words that we like to use,” she said.

Crystal City has been dealing with a shrinking military presence for a while. In 2005, the Base Realignment And Closure commission, better known as BRAC, decided to move 13,000 jobs away from the area. It’s been a long, slow departure that’s still ongoing. But it’s given civic leaders a long time to rethink Crystal City.

Standing in front of a 1960’s-era government building it’s easy to see ugly architecture. But Fox sees potential.

“It still feels very much like that old concrete brutalist architecture,” she said. But “it is a phenomenal place for a farmers market.”

There’s a weekly farmers’ market right in front. They also have a new performing arts theatre, outdoor movie night and lots of public art. It’s all part of a bigger plan to make Crystal City a neighborhood where people live and play, and not just work.

“In the winter, we are doing a 1k wine walk and a 1k beer walk, so basically you have seven or eight stations, almost 30 different winesm,” she said. “People literally get race numbers and they kind of walk from station to station, we call it a sip and stumble.”

Community leaders are hoping their strategy works, but defense analyst Loren Thompson with the nearby Lexington Institute said there’s no denying this is a military town.

“If there was a substantial cut in weapons spending, there would be a major local impact,” he said. “It wouldn’t make the people here poorer then the rest of America, but it would make them a good deal less affluent.”

Still, Thompson said it’s hard to feel too bad for the people in Crystal City, and the Virginia and Maryland counties that neighbor Washington. It’s been a good run. The defense budget has basically doubled in the past 10 years.

“If there is one good thing, one benefit that could come out of a defense downturn in Washington, D.C., is that maybe the people who live here could have a little more empathy for the rest of the country,” he said. “This really is like a bubble here. People don’t understand what it’s like in most of the country because it is so affluent here and so much money comes here from other places.”

That’s cold comfort to some. The walls of the Crystal City Sports Pub are plastered with decades of sports memorabilia. Owner Art Dougherty has been listening to the deliberations of the Congressional Super Committee, but admitted he’s disgusted with the economy as a whole and the process in general.

“I think a lot of people are very turned off by this government,” he said. “There are definitely going to be businesses going to be failing because of this. There’s no question about it. You just hope you’re not the one.”