Today, Defense Secretary Gates announced major changes to the defense budget and the weapons the Pentagon plans to buy. This widely anticipated event signals a transition in defense strategy and priorities. The Secretary outlined a new focus on counterinsurgency deployments and defense acquisitions, and a shift away from old Cold War weapons systems and strategies that are less relevant in today’s world. This major shift in defense spending reflects the first effort by the Pentagon to make tough choices in nearly a decade of unfettered spending.
To put these proposals in context, the defense budget has doubled since FY 2000. Last month, the GAO reported that future planned Pentagon system acquisition will cost $1.6 trillion to complete. This leads to an acquisition budget of more than $120 billion annually over the next 13 years.
The tough choices the Obama administration is making with these proposals will help bring discipline to the Defense Department budgeting, a discipline that has been lacking for the last eight years. The restructuring, cutting, or cancellation of selected programs is likely to save tens of billions of dollars over the next decade. Outlined below the jump are the acquisition programs most effected by Gates’ announcement today:
Airborne Laser (ABL): In development for more than a decade, this anti-ballistic missile laser is designed to disable missiles during their vulnerable ascent into the atmosphere. Mounted on a modified Boeing 747, the specially designed system has experienced integration and miniaturization problems. GAO pegs development costs to more than $8 billion, while an expected procurement of seven systems will cost billions more. Gates’ proposal cancels the second aircraft prototype; the first aircraft will be retained as a test bed.
Ballistic Missile Defense (BMD): This family of theater and national ballistic missile defense programs has recently been funded at more than $10 billion a year. Program costs for R&D and procurement over the next decade run over $100 billion. Gates’ proposal calls for $700 million to be added to the terminal High Altitude Area Defense (THAAD) and Standard Missile 3 (SM-3) systems, along with $200 million for six Aegis ships modified to provide ballistic missile defenses capabilities. However, the total MDA budget would be decreased by $1.4 billion.
CVN Carrier Program: The total cost to design and build this new generation of three carriers is currently estimated at $29.9 billion. Gates’ proposal would change the build cycle to one carrier every five years, from one every four years. This will lead to 10 active carriers in the coming decades. At a program cost of $29.9 billion, the change in build cycle may decrease yearly funding by $1-2 billion.
C-17 Globemaster: The C-17 is a long-range heavy lift cargo aircraft. With 205 C-17s, the Air Force believes that it does not require additional planes. However, some in Congress have continued to fund the program over the objections of the Pentagon. Secretary Gates reiterated his position that the military does not require additional C-17s.
KC-X: The military has used the KC-135 refueling tanker for more than four decades. Some argue that it is nearing the end of its operational lifetime. Its replacement program, the KC-X refueling tanker, has been mishandled and Congressional anger stoked since Sen. McCain (R-AZ) unearthed a bribery scandal within the project five years ago. The subsequent bid contest between Northrop Grumman and Boeing ended with charges of favoritism and played out in the courts. This led the U.S. government to decide that the bidding process was mishandled by the Air Force and Northrop Grumman’s victory was voided. In today’s proposal, Gates called for a new bidding schedule to again attempt to replace the ageing tanker fleet.
DDG-1000 Destroyer: This advanced naval destroyer is a multi-mission ship capable of providing support to U.S. forces ashore and achieving American naval superiority in the littoral regions of the world. Total program cost is currently expected to be $27.6 billion. Gate’s proposal would stop the program at 1-3 copies and revert to buying the DDG-51. Buying one destroyer instead of the expected 7 will save $23.7 billion at a minimum.
F-22 Raptor: The already-deployed stealthy air-superiority fighter, the F-22 Raptor, is designed to destroy enemy aircraft and provide cover to ground forces. The 184 planes already ordered have cost nearly $65 billion to design and produce. Future F-22s, if produced, are likely to cost at least $350 million each when R&D costs are included. Gates’ proposal would stop the F-22 program at 187 (includes four copies expected in the Obama administration war supplemental).
F-35 Joint Strike Fighter (JSF): A stealthy family of multi-purpose aircraft designed and produced by a consortium of US and allied nations. Intended to replace multiple current aircraft models, this system may be the military’s most expensive procurement system with total program development and procurement costing as much as $300 billion. Gates proposed to increase the FY 2010 purchase from 14 to 30 planes, purchase 530 units over the next 10 years and buy a total of 2,443 F-35s over the duration of the program. This will increase the FY 2010 program cost by $4.4 billion.
F/A-18E/F: An upgrade of the F-18C Hornet, these fighters will replace the current Hornets and recently retired F-14 Tomcats and have increased range and payload. Total program costs are expected to be more than $46 billion for 493 aircraft. Gates’ proposal would increase the planned purchase to 31 planes for FY 2010.
Future Combat Systems (FCS): A next-generation, net-centric Army program designed to modernize its ground forces. The FCS consists of new classes of armored vehicles, UAVs (Unmanned Aerial Vehicles) and sensors. Currently estimated as costing $160 billion by the Army, some independent estimates put life cycle costs at more than $300 billion. Gates’ recommended canceling the combat vehicle elements of the FCS while increasing spin-out technologies like sensors and UAVs. This would result in a program cost savings of approximately $87 billion.
Littoral Combat Ship (LCS): The LCS is intended to operate close to land and is equipped with mission packages to support a variety of operations. The Navy wants to procure a total of 55 LCSs as part of its planned fleet of 313 ships. Gates proposed to buy one more LCS in FY 2010 for total of three ships in FY 10.
Long Range Bomber: The Air Force is in the initial stages of developing a new bomber acquisition program. The program is intended to produce a new long-range strike aircraft that is operational by 2018. Defense analysts have estimated that it will cost between $8 and $10 billion to develop a new bomber using current or “soon-to-mature” technologies. Gates proposed to delay the Long Range Bomber, potentially saving between $8-10 billion.
Transformational Communications Satellite (T-SAT) TSAT is an Air Force satellite system intended to provide high data rate communications services to DOD users worldwide. The final cost for TSAT has been quoted to range from $14-26 billion through 2016. Gates proposed canceling the TSAT which could save up to $26 billion.
VH-71: The VH-71 is the replacement program for the Marine Helicopter Squadron One used by the President, Vice President, heads of state and others. It will replace the VH-3D and VH-60N. Procurement costs are projected at more than $13 billion. Gates recommend canceling the VH-71 program and reexamining the program’s requirements.
These proposals go along way toward establishing discipline to the defense budget process. However, these recommendations will not be enough without support from Congress and the White House. Implementing these changes will require working with Congress to ensure that parochial interests do not trump national interests as programs on the cutting block like the F-22 and the Future Combat System will be pushed hard by the Congress.