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“Modest reforms to pay and compensation will improve readiness and modernization. It will help keep our all-volunteer force sustainable and strong. Keeping faith also means investing sufficient resources so that we can uphold our sacred obligations to defend the nation and to send our sons and daughters to war with only the best training, leadership and equipment. We can’t shrink from our obligations to one another. The stakes are too high.”

Gen. Martin E. Dempsey

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Littoral Combat Ship: Doubling Down on Uncertainty

The U.S. Navy recently announced that it wants to increase the next stage of its buy of Littoral Combat Ships (LCS) – smaller ships designed for shallow waters and asymmetrical threats – from one line to two. The LCS program has encountered several difficulties during its development, including budget overruns, but the Navy claims that using two designs “can save at least $1 billion on the first 20 ships with possibly as much as $1.9 billion more in savings by 2016.” It wants to apply that money towards buying more seaframes, with the maximum number of ships going from 15 to 20.

Suggestions like these often are the root of fiscal and strategic indiscipline.  Why buy more ships than originally needed instead of saving the extra money? The Pentagon is now facing intense fiscal discipline, so it makes little sense to buy more ships instead of pocketing the savings.

Gambling on uncertainty

The Navy’s new proposal to purchase two different seaframes is basically a doubling-down on the LCS program. The service is heavily invested in this new shallow water capability, both in resources and prestige, and the hope is that adding a second production line can hedge against future difficulties. This assumption looks reasonable on paper.

But doubts persist about the LCS’ viability and usefulness. The program has experienced numerous problems, gone over budget, and several of its concepts “will remain unproven until 2013 or later.” The LCS is supposed to provide such versatility that it can replace a variety of current-generation platforms, yet that premise remains debatable. Despite these serious doubts, the Navy has chosen to ramp up short-term costs in the hopes of attaining some savings further down the line.

Unclear costs

It is also unclear whether using two designs will actually save money. According to the Government Accountability Office, “[i]n the near term, cost increases are likely but it is unknown whether increases will exceed what the Navy has budgeted for fiscal years 2010 and beyond.” The Navy is taking on larger costs now hoping – but not knowing – that it will save money further down the line.

This is a fairly common way for the Pentagon to save money, but circumstances surrounding the program make such a prospect uncertain. In 2007, the Navy had to “substantially” restructure the program “in response to significant cost growth and delays in constructing the first LCS sea frames,” according to Congressional Research Service. The restructuring led to cancellations of a total of five seaframes.

The Navy announced a new acquisition strategy in 2009, but costs still are unknown. Several of the design changes implemented on the latest ships have not been completed. According to GAO, these design changes could mean that the ship specifications might need to be changed. That in turn would necessitate contract modifications (page 5). The costs of the ships could potentially rise further if new problems arise. GAO warns that “the Navy’s ability to deliver a capable, affordable LCS remains unproven. Staying within budget will require the Navy to achieve design stability before beginning construction of future ships.”

The mission

Beyond budgetary questions such as these is a more fundamental issue. The LCS program was set up in 2001 to transform the Navy’s fleet, providing a relatively small surface vessel (i.e. corvette, light frigate) to operate in shallow coastal waters, including visiting ports that are too shallow for cruisers and destroyers. This offers better capabilities against asymmetrical or smaller threats, but does not answer whether this is a probable and necessary mission for the Navy in the years ahead. That discussion must underpin any discussion about the future of LCS.

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[...] and often includes the promotion of varying and conflicting interests. While Hunter brings up legitimate concerns that BFAD has outlined before, his motivations are much [...]

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