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Home Front: WoT
Contractors Warned: Weapons Cuts Coming
2005-12-28
Everyone at the conference was hanging on the words of Ryan Henry, and it was not difficult to figure out why. Mr. Henry, a top Pentagon planning official, was giving an early glimpse of the Defense Department's priorities over the next four years to an industry gathering in New York of executives of Lockheed Martin, Boeing, General Dynamics and other leading military contractors.

Mr. Henry, whose official title is principal deputy under secretary of defense for policy, said the Pentagon's spending binge of the last several years - its budget has increased 41 percent since 9/11 - cannot be sustained. "We can't do everything we want to do."

It was a message that the industry has been bracing for. The Pentagon budget, James F. Albaugh, chief executive of Boeing's $30 billion military division, said at the conference, has "been a great ride for the last five years." But, he added: "We will see a flattening of the defense budget. We all know it is coming."

The issue, however, goes beyond tightening budgets. Mr. Henry told the contractors that the Pentagon was redefining the strategic threats facing the United States. No longer are rival nations the primary threat - a type of warfare that calls for naval destroyers and fighter jets. Today the country is facing international networks of terrorists, and the weapons needed are often more technologically advanced, flexible and innovative.

In the years ahead, Mr. Henry said, the Pentagon would like to move "away from massive force." This would mean, for instance, that fewer fighter jets would be needed because the upcoming Joint Strike Fighter F-35 has more capabilities than the existing F-16's.

He noted that special operations forces played a big role in the early days of the Iraq war - once controlling up to two-thirds of the country - and are expected to be used in greater numbers in the future. This would mean the Pentagon would want to buy more of the highly agile and high-technology weapons that they need. Specialized skills like language, intelligence and communication are also becoming top priorities.

As for aerospace, he said the Pentagon would be looking for aircraft with longer ranges, and, therefore, did not need ships or nearby bases for them to land. Increasingly, the Pentagon will be depending on unmanned aerial vehicles, which can work longer hours than piloted craft and do not put Air Force lives at risk. In the future, he said, unmanned craft will be used not only for surveillance, as they are in Iraq, but for combat as well.

To illustrate what the Pentagon envisions as the future, Mr. Henry showed the group a copy of the photograph that is one of Defense Secretary Donald H. Rumsfeld's favorites. It shows American troops on horseback in Afghanistan, calling in air strikes and armed with global positioning devices.

"In terms of our strategic environment," Mr. Henry said, "we are at an inflection point." He argued that the world was vastly different from the world that existed the last time the Pentagon was required to conduct a top-to-bottom review of the military and national security strategy - what is known as the Quadrennial Defense Review - in early 2001.

He outlined these top strategic priorities that will be at the core of the review: defeating global terrorism, defending the nation against terrorist attacks on American soil, preventing other nations from acquiring weapons of mass destruction and influencing countries that Mr. Henry described as at a "strategic crossroads."

The quadrennial review is scheduled to be released in February, the same day as the Pentagon's 2007 budget request, and Mr. Henry said that many of the review's new priorities would be reflected in that budget plan.

There is now greater attention in Washington, both in Congress and at the Pentagon, on out-of-control spending on some weapons. The Pentagon currently has $1.3 trillion of weapons program in its portfolio - with $800 billion of the bills for them still to be paid. The Pentagon has commissioned a major study to make recommendations on curbing these runaway costs.

But given the difficulty the Pentagon has had in getting Congress to kill politically popular weapons systems, many analysts raised questions about whether the Pentagon's efforts will succeed. "There is a big chasm between rhetoric and the budget process," said Winslow T. Wheeler, a military analyst at the Center for Defense Information in Washington, the analytical and research arm of the World Security Institute, which describes itself as an "authoritative and impartial monitor of security issues." Mr. Wheeler criticized the Pentagon's decision to continue financing many weapons systems that some say are ripe for cuts. Among them are the next generation destroyer, the DD(X), which is projected to cost more than $1 billion each; the costly F-22A, which has a total program acquisition cost of $361 million each; and the V-22 Osprey, a Marine aircraft that has had numerous problems in test flights.

The future, Mr. Albaugh of Boeing said, "will be less about innovation and more about cost control. We will see a competition for resources, and cost control will be more of an issue." Boeing has already taken some hits. The Air Force has said it does not want any more of Boeing's C-17 Globemaster cargo planes once it receives those already on order, although the program is so popular in Congress, it may be difficult to kill.

"We're not going to have the flush years of past Pentagon budgets," said Daniel J. Murphy Jr., a former admiral and chief executive of Alliant Techsystems. "We are going to be cutting costs, even on cost-plus contracts. We will produce at cost-plus, but at a lower cost.""
Posted by:Steve White

#5  "We are going to be cutting costs, even on cost-plus contracts. We will produce at cost-plus, but at a lower cost."

Price is what you pay, Value is what you get.
Posted by: DepotGuy   2005-12-28 12:20  

#4  Been in the defense business in one form or another since I raised my right hand in 1966 and am, hence, not a disinterested observer. There are too many weapons systems in the pipeline that no longer have missions. The F-22 Raptor is the poster child for changed realities. There really is no threat to justify the squadrons of Raptors yet to be purchased. If allowed to operate without political restrictions, the existing fleet of F-16s and F-15s can dominate the skies in most of the world. The recent stories about the "success" of the Indian Air Force against the USAF in dogfight exercises neglected to mention that the ROE required closing to visual range instead of hosing the enemy at 80 - 120 miles. The F-22s we have are sufficient to be "silver bullets" if needed. Similarly, the DDX is a Navy wet dream. It is grossly expensive and unsuited for the wars we face. Its primary mission is to keep the naval shipyards warm. If we really needed capability, there are better suited ships slowly rusting at anchor off Bremerton. Best stop before the full rant mode starts.
Posted by: RWV   2005-12-28 10:51  

#3  Me too.
Posted by: raptor   2005-12-28 09:22  

#2  The China problem came to my mind as well, Jackal.
Posted by: Ptah   2005-12-28 08:23  

#1  I'm not a disinerested observer (program cuts == My job lost), but I sure hope they balance this right. Back in the 60s, the Army lost out an entire upgrade cycle because all the defense money was spent for operations in Viet Nam. Then, when the war wound down, the money did not go into rebuilding the lost equipment. It became the years the locusts ate. I'm concerned about China and its military upgrades.
Posted by: Jackal (from Moms house, like people on DU)   2005-12-28 08:06  

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