The Military-Industrial Complex — Where Is The Money?

Bayard & Holmes

~ Jay Holmes

On January 17, 1961, US President Dwight D Eisenhower delivered his farewell speech. The retired five star general had served two presidential terms and was being replaced by his fellow military veteran, the newly elected John F. Kennedy.

 

President Dwight D. Eisenhower receives hydrogen bomb tests report from Lewis Strauss Image public domain.

President Dwight D. Eisenhower receives hydrogen bomb tests report from Lewis Strauss
Image public domain.

 

In that farewell address, Eisenhower warned, “We must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military–industrial complex.”

Left-wing radicals are always quick to oppose military spending, but Eisenhower could hardly be accused of being anything like a left-wing radical. At the peak of his long military career, he skillfully commanded the allied forces in Operation Torch, which was the 1943 Allied invasion of Northwest Africa, as well as the 1944 D-Day invasion of Normandy and the Western Offensive against Nazi Germany and the European Axis powers.

After WW2, Eisenhower served as US Army Chief of Staff and then as Supreme Commander of European Forces. Few Americans could claim to have anything close to Eisenhower’s military experience or expertise.

Eisenhower was no “dove.”

He took the threat of Soviet expansion seriously. As US President, he oversaw the conclusion of the war in Korea in 1953 and approved funding for fledgling US space and satellite programs. Eisenhower also approved expensive Navy projects, such as the nuclear submarine program and the construction of the nuclear carrier, the USS Enterprise. He presided over the growth of expensive jet aircraft in the young US Air Force, and he approved funding for expensive new air defense systems for the US Army.

In spite of the large military budgets that President Eisenhower approved, some military and defense industry leaders saw him as being too frugal. Conversely, Eisenhower and his supporters felt that increasing military budgets threatened the economic health of the US.

Fifty-five years later, the arguments over defense spending continue.

Unlike during Eisenhower’s time, the arguments are now conducted against a backdrop of a frightening budget deficit and an eighteen trillion dollar national debt. The consequences of all government spending have a serious impact on the quality of life for the average American and on national security.

In Eisenhower’s time, the real threat posed by the Soviet Union impacted defense spending. Today, the Soviet Union is gone, but US and European citizens are justifiably concerned by threats from various radical Islamic groups, the increasingly nuclear-equipped North Korean despot Kim, a rapidly growing communist Chinese military capability, and a resurgent and belligerent Russia.

At a glance, it might seem as though a stable status quo has been in effect in military budgets.

In some senses, similar dynamics have remained in force. In 1961, Eisenhower was unable to convince Western allies to commit to adequate defense spending. The allies seemed happy to let the US military and taxpayers carry more than their fair share of the responsibility for the defense of Western Civilization. In 2016, that dynamic continues. US President Obama listens to nations like France, Canada, and the UK proclaim their increased commitment to defeating Islamic radicals, but then he watches as they reduce their defense programs. Eisenhower would recognize his frustration in dealing with NATO partners.

We might be tempted to assume that US defense spending itself is proportionate to what it was in 1961. Let us make some comparisons.

In 1961, US military personnel were badly underpaid. In 2016 this remains true. In 1961, the US defense budget was close to 10% of GDP. Today it is below 5% of GDP. In terms of GDP, the defense budget seems reasonable enough. But let us compare some specific defense project costs.

In 1961, the new Enterprise class nuclear aircraft carrier cost $451 million to build. Due to the escalated cost of construction, the additional three carriers of that class were cancelled. Today the new Ford class nuclear aircraft carrier is, so far, costing the taxpayers $12.8 billion to build, with an additional $4.7 billion in research costs. If we compare the two ships in inflation adjusted costs, then in today’s dollars, the Enterprise would have cost $3.4 billion to build. Where did the other $9.4 billion go?

When the Enterprise was built, it included many state of the art features, but its air defense system had been scaled back to save money. The Gerald Ford class carrier includes state of the art equipment and features, but the overall economics of the two programs are completely out of scale.

 

USS Gerald Ford under construction in Newport News, VA. Image public domain.

USS Gerald Ford under construction in Newport News, VA.
Image public domain.

 

My question is simple. What national defense value are we receiving for the disproportionately high cost of the USS Gerald Ford?

We could make similar comparisons with nuclear submarine programs, but let us instead apply the scrutiny to a broader defense project, the F-35 fighter program. The F-35 was developed as a low cost alternative to the F-22 Raptor. So what does “low cost alternative” mean in the defense industry?

The F-22 cost a frightening $150 million per plane. No wonder we wanted a “low cost alternative.” The F-35, so far, cost between $100 million for the basic model and $104 million for the VSTOL version. I’m grateful that we decided to pursue a “low cost” fighter plane.

Let’s compare the F-35 to the infamously expensive Republic F-105D fighter. In 1960, the year before Eisenhower’s farewell speech, the outlandishly expensive F-105D cost $2.1 million each. In 1960, it was the state of the art fighter, and it incorporated many new technologies. It was plagued by cost overruns, and its development was every bit as contentious as the F-35 development has become. In 2016 dollars the F-105D cost $17 million apiece. As with the Gerald Ford Carrier, the cost of the F-35 has wildly outpaced inflation.

 

F-35 Joint Strike Fighter at Edwards Air Force Base Image public domain.

F-35 Joint Strike Fighter at Edwards Air Force Base
Image public domain.

 

What defense benefit are we getting for the additional $80 million per each F-35? Is the F-35 going to bring us more security today than the F-105D brought us in 1960? I don’t see it.

The defense industry would counter my concerns with comforting catch phrases. They tell us that it is “stealth,” and that it employs more “net centric ability” than previously imagined. For less than $100 my house is “net centric.” So how does the marvelous net centric ability account for the cost of the F-35? From my point of view, it doesn’t.

Defense contractor PR players would likely question my patriotism. Am I not aware of all the real threats in the world? Do I not want the best possible defense for my family’s safety? In fact, I am very much aware of the many threats to our national security, and I do want the best possible defense capabilities for our nation. That’s precisely why I question our $100+ million fighters and our $13 billion aircraft carriers.

Every dollar wasted or overpaid is a dollar that does not help our national defense. At the same time, high costs work to erode our national defense by damaging our economy.

The F-35 and the Ford Carrier are only two of many defense projects that beg closer scrutiny. These high cost programs are being funded at the same time the US Marine Corps is undergoing a 30,000-man reduction in force. The Pentagon and the White House tell us that we are more committed than ever to fighting the increasing terrorist threats, so how is it that we justify large cuts in our premier expeditionary force? The numbers just don’t add up. In some cases, they don’t come close to adding up.

President Eisenhower’s words are even more appropriate today than they were in 1961. Think twice before you quietly accept every extravagant defense expenditure. Let your congressmen know you are watching.

Buyer Beware!

 

America’s Future Low-Budget Bomber–When $550M Just Isn’t Enough

Bayard & Holmes

~ Jay Holmes

For the last six months American and foreign intelligence agencies have been reading about a new stealth bomber that is being developed for the US Air Force. Most of what has been published about the new plane has not been published by the Pentagon or the US Air Force, but rather by a variety of “defense experts” and “aviation writers.”

 

Canstock 2015 Aug Money going down the toilet

 

The US Air Force and Pentagon are suggesting a cost limit of $550,000,000 per new bomber.

I am not a bomber expert, so I am happy to disclose my limitations in assessing bomber development. I am not a bomber pilot or even a pilot at all. I have never served in the US Air Force or anyone else’s air force. I am not any type of aviation engineer, nor have I ever dated one. It’s fair to say that I am not an aviation expert.

My qualifications for having an opinion on the US Air Force’s new bomber program are thus:

  • I don’t have $550,000,000.00 to give the US Air Force to pay for each bomber, and I don’t know anyone that does.
  • I am a happy US taxpayer. I don’t mind paying taxes, but I want the money to be used efficiently.
  • In the past, I have been a casual consumer of valuable products and services offered by the US Air Force, along with Marine Corps and Naval Aviation groups.

So, from this limited perspective, I offer my response to the scarce actual information and abundant “expert” opinions that have been published about the next US Air Force bomber.

For ease of communication, let’s refer to the imaginary new bomber as the “FD”—short for Flying Deficit.

Aviation “experts” thus far all agree that the greatest challenge to producing FD bomber will be the unreasonably tight price limitation of $550,000,000 per plane. To mere mortals, the price tag sounds dizzyingly high. Count me with the mere mortals.

So what does it mean that so many “aviation experts” are in a state of “deep concern” over the $550,000,000 suggested retail value for each FD bomber?

Are all of us non-aviation experts confused about the value of cash? Do we all fail to understand how difficult it is to make something fly and drop stuff on people we don’t like? Perhaps we are not all that confused.

Let us first examine what is known about the FD bomber. We know next to nothing.

We know that it will be “stealth,” like the B-2 already is. We know that it will be built for both conventional and nuclear payloads, like the B-2 already is. And we know that it will include the defense industry’s most important buzzwords. Yes, it will be like my house and my car. It will be “net centric.” Let’s all cheer for “net centric.” It sounds so nice and must cost a bunch. Right?

 

B-2 Stealth Bomber Image by Dept. of Defense, public domain

B-2 Stealth Bomber
Image by Dept. of Defense, public domain

 

You might find it interesting that the “experts” that are concerned about the suggested budget limitation for the FD bomber have yet to review the US Air Force’s requirements for the FD. Without knowing what the US Air Force wants to buy, they are already certain that a $550,000,000 price tag means that the next bomber will not be the best technology on the best bomber. I’m heartbroken . . . Not really.

How can well educated, experienced aviation experts suggest that the FD bomber will be an underpriced failure when the US Air Force has yet to release the actual requirements for the project?

To understand the answer to that critical question we must first understand who these “experts” are. So far, as near as I have been able to determine, they are not “aviation experts” in the traditional sense. The “experts” publishing those articles are not aviation engineers, retired US Air Force bomber pilots, or US Air Force project managers. They are, in fact, people with degrees and expertise in marketing, communications, public relations, and sales.

I was not surprised to discover that members of the Chicken Little’s The Bomber is Falling Choral Group are not bomber experts.

They harmonize well, but they don’t appear to know much about aviation, the sky, or falling bombs. What I have not been able to determine is how many of these “experts” have received free pens, free lunches, free junkets, free prostitutes, jobs, etc., from corporations that are hoping to receive a share of the “bomber windfall.” Thus far, the two competing potential prime contractors are Northrup Grumman and a team comprised of Lockheed Martin and Boeing. As is always the case when we consider opinions on large government projects, we must consider the source.

As of the time of this article, the US is in debt to the tune of $18 trillion. That figure is increasing every day, but what’s a few hundred billion between friends?

So while we accumulate debt faster than teenagers can consume pizza or congressional aids can snort cocaine, we are being told that rather than questioning the high price tag for FD bomber, we should actually be apologizing to the defense industry for expecting them to produce an adequate bomber for a measly $550,000,000 each. Shame on us . . . Not really.

My best guess is that a bomber that costs $550,000,000 each leaves lots of cash for PR campaigns peddled as “expert opinions.” Before you are overcome by shame for making the US Air Force use such a low budget bomber, you might want to drop a line to your elected officials to ask them why this, and other future projects, and so many current projects, cost as much as they do. Efficiency in defense spending will not get better until we, the taxpayers, convince Congress that, unlike them, we are not so easily boondoggled.