New York City politicians were made glad last week by the Pentagon's decision to dock a refurbished battleship at Staten Island. Local officials had been worried that Defense Secretary Caspar Weinberger, annoyed by the concern of some community groups that the ship would bear nuclear weapons, would move the the U.S.S. Iowa to a more welcoming port.
Mayor Edward Koch and members of the New York congressional delegation are enthusiastic boosters of the Iowa less for its possible contribution to the nation's defense than for its much- touted job-creating capability. The Navy estimates that the resuscitated battleship and its supporting six-ship fleet will pump as much as half a billion dollars into the area and create as many as 9,000 jobs.
Does it surprise you that other areas scrambled for the Iowa's dollars when the New York location was put in doubt? Or that the New Yorkers launched a major lobbying effort to reassure Mr. Weinberger of their support? What better way for the Pentagon to build durable support for items in its budget whose importance to the nation's defense may not be readily apparent to many observers?
It's interesting, however, to compare the administration's unabashed promotion of the Keynesian potential of Pentagon spending with its position on domestic programs, whose relationship to job creation is, at least, more direct. Take, for example, the Urban Development Action Grant program. State and local officials like UDAG because, by using a relatively small amount of federal money as leverage, they have attracted large sums of private capital for hotels, trade marts, shopping centers and other developments into declining areas. But the Reagan administration takes a dim view of the jobs produced by UDAG. In proposing to abolish the program, it argues that UDAG merely shifts capital from one location to another. Never mind the lost public and private investment or the social costs that may come from letting areas decay. The economy will be better off by eliminating this and other sorts of federal spending and letting the private market decide where and when to invest.
Whether or not you agree with the administration's arguments about UDAG, you will probably be struck by the difference between its views on federal job creation through the domestic and defense budgets. One other difference you might keep in mind: When the UDAG projects are finished, they become self-sustaining, and the jobs continue. A port facility for a battleship contributes to employment only so long as the appropriations keep coming, and no longer.