Bush Budget Boon to Shipyard

$2.9b proposal for next year Shipbuilding in Pascagoula would gain, but big farms in the Delta would lose under President Bush's $2.9b budget proposal for next year. Released Monday, the budget recommends spending $168m to expand the Strategic Petroleum Reserve, a series of underground salt caverns along the Gulf of Mexico that store millions of gallons of oil to be used in emergencies. The Energy Department has identified the salt caverns near Richton as the preferred site to increase the reserve's storage of oil from 691 million barrels to 1.5 billion barrels. The reserve was tapped in 2005 for more than 20 million barrels of oil to respond to shortages and price spikes following Hurricane Katrina. The president's budget proposes spending more than $160 million to replenish the reserve and begin buying oil to reach the goal of 1.5 billion gallons. Mississippi would also benefit from Bush's plan to sharply increase defense spending. The president's 2008 budget would increase the Pentagon's shipbuilding budget by nearly 30 percent, to $14.4 billion. That includes $3.4 billion to complete construction of two DDG 1000 Navy destroyers, built jointly by General Dynamics and Northrop Grumman at Ingalls Shipyard. More shipbuilding money for Mississippi can be found in the president's Homeland Security Department budget - about $788 million to revamp the Coast Guard's aging fleet. Northrop Grumman in Pascagoula and Lockheed Martin have been awarded the contract for the Coast Guard Deepwater program, which is now under congressional scrutiny for cost overruns and construction flaws. Bush's budget would extend a series of tax breaks, eliminate more than 140 small federal programs and slow the growth of Medicare and Medicaid. But it's expected to be modified by the Democrat-controlled Congress. Source: Clarion Ledger