The Pentagon released its
end-of-year progress report for 2016 on the F-35, and once again, the
news
isn’t very good. This is nothing new for the F-35, which has been bombarded
by poor performance reviews, cost overruns, and directly subject to criticism
by President-elect Donald Trump. On paper, the F-35 is supposed to complete its
System Development and Demonstration (SDD) and begin its Initial Operational
Test and Evaluation (IOT&E) by August, 2017. The Joint Strike Fighter
(F-35) has been in SDD since 2001 and was expected to complete that process
this year. That’s no longer going to happen. Instead, the report indicates the
F-35 will not be able to start IOT&E with full combat capability until late
CY18 or early CY19, at the soonest.
The F-35’s problems are at least
partially the result of allowing Lockheed Martin to pursue concurrent flight
design and active deployment. The idea behind concurrency was that Lockheed
Martin could begin building an aircraft while still fine-tuning various aspects
of its de
sign. In theory, applied to much simpler vehicles, it might have
worked, especially if the F-35 had been modeled from an existing aircraft. For
the F-35, concurrency has been a disaster. Right now, every single F-35 already
built will need to be extensively overhauled to meet its minimum performance
targets. All the while, Lockheed Martin rakes in the cash.
Despite the negative press, the
F-35 is a “too big to fail” program, partly because of the
military–industrial–congressional complex, aka the “Iron Triangle”. The
F-35 funnels business to a global network of contractors that includes Northrop
Grumman Corp. It counts 1,300 suppliers in 45 states supporting 133,000 jobs,
according to Lockheed. The F-35 is an example of how large weapons programs can
plow ahead amid questions about their strategic necessity and their failure to
arrive on time and on budget.
This economic integration is just
one aspect of the Iron Triangle. The defense industry is unique in that there
is much more cooperation among companies than in other industries. Defense
companies not only compete against one another, but also supply one another for
projects. For example, Lockheed Martin competes against Northrop Grumman in the
airborne surveillance market; however, the two companies are partners on the
F-35 Joint Strike Fighter development program and have a joint venture to
produce missiles for helicopters. Boeing as a supplier of combat aircraft, but
Raytheon supplies the radar, Northrop Grumman the navigation and guidance
systems, and BAE Systems some of the avionics that are used on these aircraft. This
industry wide cooperation leads to a lack of competition, thus ensuring high
prices for acquisitions.
Another cause for concern with
the Iron Triangle is “buy America” restrictions. Senator Chris Murphy (D–CT)
filed an amendment to the 2016 National Defense Authorization Act (NDAA) that
significantly expanded “buy America” restrictions. The Murphy amendment
effectively expanded Buy America restrictions globally with only the narrowest
of exemptions for “urgent” national security needs. There are a number of “buy
American” provisions relating to defense spending. The Buy American Act
requires the U.S. government to give preference to products made in the United
States. Bulk purchases of more than $3,000 are subject to this act. The Berry
Amendment specifically prevents the DoD from buying products such as clothing
and textiles outside of the United States. The amendment is applied to
purchases of at least $150,000.
From a national security
perspective, there are reasons to closely consider who is selling a product or
service to the DOD. The United States does not want to find itself relying on a
potential adversary for a critical resource or capability. It is reasonable for
the DOD to ensure that critical capabilities, resources, and technologies are
not bought from adversaries or potential adversaries. However, countries that
are U.S. allies pose no serious threat. Therefore, U.S. allies should be able
to compete for DOD business without any hurdles. U.S. war-fighters and taxpayers
will be best served by free and open competition that includes companies from
allied countries.
There are many reasons why
“buy
American” is bad policy. As previously state, the Berry Amendment, a law
that dates from 1941, requires the U.S. military to buy food and clothing sold
to the military to have been grown or made in the U.S. with few exceptions.
This prohibition is important because Operations and Maintenance is one of the
biggest spending categories of the defense budget. Operations and Maintenance
includes spending on fuel, food, base and depot maintenance, training,
recruiting, space control facilities, transportation, medical and other
services. The Murphy amendment imposes enormous costs in time and money on
war-fighters and taxpayers. This amendment is not frugal. The Murphy amendment
also severely harms national security in that the military has difficulties and
delays obtaining the supplies that it needs when operating overseas. This
policy also sends a message of distrust to U.S. allies. When Congress passed
the defense spending bill,
Murphy
praised the robust funding for Connecticut defense jobs, stating, “The
security initiatives authorized in this bill solidify Connecticut’s role as a
national leader in American defense,” clearly displaying the workings of the
Iron Triangle.
In conclusion, there is too much
cooperation and a lack of competition in the American defense industry to
effectively lower prices. Also, “buy America” provisions do not save the
taxpayer money and there is no national security reason to exclude companies in
allied countries from competing for DOD contracts. Free and open competition
among friendly countries will produce the best products for our military at the
best prices. Therefore, to “make America strong again”, the answer isn’t simply
to increase defense spending but rather to break the Iron Triangle.
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