If Defense Secretary Robert Gates has his way, defense companies should get a nice bump in profits this year.
Urging Congress to give the OK to further funding for both Iraq operations and those continuing in Afghanistan “as quickly as possible,” Gates spoke before a U.S. Senate panel today along with Secretary of State Hillary Clinton.
“After Memorial Day, we will need to consider options to delay running out of funds,” he said.
The $83.4 billion request includes $75.8 billion for combat operations in the two Middle Eastern countries, and another $7.1 billion for State Department programs, including international aid.
Since Obama has declared dealing with terrorist activity in Pakistan and Afghanistan a key part of his presidency, the largely Democratic Congress who have mostly seen eye-to-eye with him so far, will likely agree to the appeal.
And as for the Republican portion, military spending is usually championed much more by the conservative side, so don’t expect much protest on their end either.
Add to that the fact that the U.S. has “huge national security interests in making sure that Pakistan is stable and that you don’t end up having a nuclear-armed militant state,” as the president put it, and you have some very good reasons for why everybody will agree on the budget and pass it as quickly as possible.
And when they do, these stocks could do quite well for themselves…
- Northrop Grumman (NYSE: NOC)
- General Dynamics (NYSE: GD)
- AeroVironment Inc. (Nasdaq: AVAV)
Thursday, April 30, 2009 - by Jeannette Di Louie, Assistant Editor, Mt. Vernon Research
