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theodore M I R A L D I mpa ... editor, publisher, writer
Wednesday, January 4, 2017
Trump BLASTS Defense Contracting Titans for OVERPRICED Weapons
Military reformers in the nation’s capital may have found a soul mate in a billionaire real estate magnate who takes a keen interest in what things cost, including big weapons systems.
The reformers — an alliance of watchdog activists, technocrats and former government auditors — have long bemoaned the delays and cost overruns that plague the Pentagon’s procurement of ships, guns and planes.
Now, President-elect Donald Trump seems to have joined them. He has taken to Twitter to blast the titans of defense contracting for what he sees as overpriced weapons, suggesting a procurement overhaul may be a top priority to Defense Secretary-nominee James N. Mattis.
“To say the least, we are a bit stunned, albeit pleasantly so,” said Thomas P. Christie, the Pentagon’s former top weapons tester who has long advocated lower-cost alternatives.
Mr. Trump met Dec. 21 at his Mar-a-Lago mansion in Palm Beach, Florida, with the Joint Chiefs of Staff and senior officers who will oversee the procurement side of a $619 billion defense budget this year.
Before the Florida summit, Mr. Trump tweeted a cancellation warning to Boeing Co. about the long-term costs of two new Air Force One planes. Then he took on the costliest weapon system in U.S. history: the Lockheed Martin F-35 Lightning II. The procurement history of the joint strike fighter jet is so pocked with trouble that Senate Armed Services Committee Chairman John McCain, Arizona Republican, has called it a “scandal and tragedy.”
Lockheed Martin Corp. and Boeing rank No. 1 and No. 2, respectively, as the Defense Department’s largest contractors based on revenue, according to Defense News.
If there is a networking headquarters for the military reform movement, it would be the Project On Government Oversight in Washington. For years, POGO has exposed defense industry malpractice while promoting what it sees as less-costly weapons options.
Dan Grazier, a former Marine captain who joined POGO in 2015 as a budget and weapons analyst, said he is “cautiously optimistic” about Mr. Trump’s tilt toward Pentagon reforms.
“It’s refreshing to hear someone taking on the military-industrial-congressional complex this way, because this is something we haven’t seen for many, many, many years,” Mr. Grazier said. “The fact that he’s able to at least get Boeing and Lockheed working to reduce cost, it’s a good shot across the bow. But there’s a big difference between words and action. He’s talking a really good game now. Now let’s see if he can actually translate it into action.”
Winslow Wheeler, a longtime reformer government auditor and Senate aide, said it’s impossible to predict what actions Mr. Trump will take but that the right path is a “drain the swamp” option of canceling the F-35 and building separate replacements for the A-10 close-air support jet used effectively against the Islamic State group, as well as follow-ons for the Navy F-18 Hornet and the Air Force F-16.
A big complaint from reformers is that the F-35 was doomed to cost explosions from the start because Les Aspin, defense secretary at the time, decided to make it a “joint” fighter — a single aircraft to serve the various and specific needs of the Air Force, Navy and Marine Corps.
Reformers say Lockheed’s F-16 Falcon is perhaps the most successful fighter program in history because the Pentagon forced the Air Force to design and build it only to its specifications. To a certain extent, the same holds true for the Navy and its carrier-based F-18.
The defense industry and its many supporters on Capitol Hill generally got what they wanted during a decade and a half in the war on Islamic terrorism. With weapons systems wearing out, even programs such as the $379 billion F-35, with its myriad problems, won the budget battle every year.
But their serenity was shattered by a White House-congressional budget deal known as “sequestration,” or mandatory spending cuts.
“The F-35 program and cost is out of control,” he tweeted on Dec. 12. “Billions of dollars can and will be saved on military (and other) purchases after January 20th.”
Ten days later, the president-elect met with Boeing’s CEO and announced via Twitter that he asked the company to price its F-18 Super Hornet as a possible competitor to the F-35.
Only a few F-35s delivered
On paper, the F-35’s stealth, a 360-degree-vision helmet, and advanced software make the single-engine jet more capable than the twin-engine Hornet. But some Navy leaders said their service branch was left out of the expensive F-35 development in favor of continuing buys of the F-18 Super Hornet. The motive: The savings could be used to build more ships.
Boeing has not escaped Mr. Trump’s wrath. He flatly threatened to cancel plans to build two Air Force One craft slated for completion in 2022. “Costs are out of control, more than $4 billion. Cancel order!” he tweeted.
The Government Accountability Office estimates the development and procurement costs at $3 billion for what are essentially flying White Houses. The 747s will come with grand living quarters, advanced communications, defensive systems and avionics technology.
Mr. Trump’s $4 billion figure may include what are called “life cycle costs” from the program’s beginning through its service life, with repairs, new parts and maintenance.
The GAO and Pentagon testers have documented the F-35’s cost overruns, production delays and performance shortfalls for nearly a decade.
Planners for the Air Force, Navy and Marine Corps were wildly off base when predicting its price and schedule. The $379 billion total acquisition cost is double their initial estimates. The military was supposed to be flying more than 1,000 F-35s by now but has received fewer than 200.
In April, GAO examiners concluded that the F-35 may not be affordable because budget restraints limit yearly production, driving up per-plane costs. Soon, the Pentagon will need to spend more than $12 billion a year on procurement until 2038 to purchase 2,457 planes.
“It is unlikely the program will be able to sustain such a high level of annual funding and if required funding levels are not reached, the program’s procurement plan may not be affordable,” the GAO said.
Mr. McCain subsequently summoned the F-35 brain trust to a Senate hearing.
“Aircraft deliveries amount to no more than a mere trickle relative to the original promises of the program,” said Mr. McCain, who served as a Navy fighter pilot in Vietnam. “Because the Air Force, Marines and Navy were all counting on the F-35s that never appeared, combat aircraft and strike fighter capacity shortfalls in all three services have reached critical levels, severely impacting readiness.”
The few F-35s that have reached the services were operationally flawed. Mr. McCain had a list: “They have problems with maintenance diagnostic software, radar instabilities, sensor fusion shortfalls, fuel system problems, structural cracks from service life testing, engine reliability deficits, limitations on the crew escape system that cause pilot weight restrictions, and potential cyber vulnerabilities. This list is as troubling as it is long.”
Mr. Grazier said the F-35 is an example of “political engineering,” creating such broad grass-roots support that lawmakers do not dare vote against it.
“Contracts for the F-35 have been spread across the 45 states,” he said. “We estimate around 350 different congressional districts all over the country. So that is a lot of political support on Capitol Hill. Overcoming that is going to be a very difficult endeavor.”
Mr. Grazier would like the Trump administration to stop buying F-35s at least until initial tests and evaluations are completed to rule out even more defects. Lockheed built the F-35 concurrently, meaning the plane’s development overlapped its production.
‘Who is whispering in his ear?’
The reality is the F-35 program, begun 20 years ago, is so big and the fighter jets are so needed in the field that outright cancellation is unlikely. Eight NATO countries are partners with Lockheed. The Air Force and Marine Corps have declared initial operational capability for their deliveries.
But contracts with Lockheed Martin are negotiated at certain production stages, meaning Mr. Trump’s “Art of the Deal” approach may come into play to lower the price.
“It’s great that Donald Trump is having all the other execs in the defense industry sort of hopping to his tune, but the reality is Congress gets a vote on this,” Mr. Grazier said.
How true. For all the complaints, Congress increased the buy from 63 F-35s requested by President Obama to 74 in this year’s budget.
Reformers wonder who among Mr. Trump’s advisers is steering his focus to costly weapons. One Trump supporter said people should remember that Mr. Trump has spent his business career negotiating prices, including for his own airplanes.
“Who is whispering in his ear?” said Mr. Christie, who was in charge of weapons testing in President George W. Bush’s first term. “Surely, he hasn’t come down this hard strictly on his own. However he has come to issuing these tweets, he has certainly picked deserving fiascoes, especially the F-35. It will be interesting to see if his administration goes after these ‘out of control’ programs after Jan. 20. We are hopeful Mattis will be more than happy to follow through to crack down and, hopefully, roll back both the F-35 and Air Force One, as well as turn his attention to other debacles.”
Mr. Christie mentioned the Navy’s littoral combat ship and aircraft carrier USS Gerald R. Ford as other major programs that need the Trump treatment.
One of the top brass who visited Mr. Trump at Mar-a-Lago was Air Force Lt. Gen. Christopher Bogdan, who runs the F-35 program office. Whether he changed Mr. Trump’s mind is unclear.
Days later, Gen. Bogdan met with reporters to assert that the plane’s major problems had been eliminated.
“This program is not out of control,” Gen. Bogdan said, according to Bloomberg News. “Since 2011, we have basically been on schedule. Since 2011, we have basically been on budget.”
The history is, he said: “We put unrealistic schedules and budgets together. And then when we ran into problems we did not manage them very well.”
The program office says the total acquisition cost has decreased since 2014 from $400 billion to $379 billion.