State Ranks High on Pentagon Cutback List : Peace impact: California receives more defense dollars than other states but is placed 17th among those most vulnerable to reduced spending, new book says.

California, which receives more defense dollars than any other state, is in the top third of states most likely to be hurt by expected cuts in Pentagon spending, according to a new book on the impact of post-Cold War defense cuts.

Among states whose economies are most vulnerable to reductions in defense spending, California ranks 17th, according to the book, “Building a Peace Economy.”

In addition, the book says California ranks 10th among states likely to be seriously hurt by specific spending cuts that were in the works at the end of 1990.

Orange County received about 11% of the $35.9 billion in defense dollars that rolled into California in the 1989 fiscal year, behind Los Angeles and Santa Clara counties, the book said. The figure was based on a 1990 Sacramento study.

However, John Tepper Martin, one of the authors, said it was all but impossible to precisely calculate the vulnerability of each county to defense cuts.

“We didn’t take it down to that level. It’s very hard to do that,” said Martin, director of the Center for Interregional Conversion, which is studying ways for governments and industry to shift from defense to non-defense activities.

“We took the latest agreement on the defense budget for the coming years (reached in the fall of 1990) and we said, ‘What does this mean?’ ” Martin said. However, he and co-author Betty Goetz Lall did not attempt to rank metropolitan areas on the basis of the anticipated impact, he said. They performed that calculation only for states.

The book mentions that the Pentagon has announced plans to close the Marine Corps Air Station at Tustin, but that “private uses give every indication of being extremely profitable as Orange County is rapidly expanding.”

In addition, the books cites 1990 layoffs at McDonnell Douglas Space Systems Co. in Huntington Beach and the July, 1990, sale of Ford Aerospace in Newport Beach to Loral Corp. as potentially having an impact on the local economy.

Although California has the greatest share of defense dollars, the state ranked 10th in terms of anticipated overall impact because it has a vigorous, diversified economy that does not depend solely on the aerospace and defense industries, Martin said.

By contrast, the most vulnerable state, Missouri, depends disproportionately on the well-being of the troubled McDonnell Douglas Corp., the giant aircraft manufacturer, the book says.

Factors in the state rankings are the total dollars a state receives from defense contracts and direct Pentagon spending, the share of the state’s economy that those dollars represent, the state’s unemployment rate, and anticipated reductions in specific defense programs under way in the state.