:: October 2005 Letter ::
Do letters hurt? I didnít used to think so. But sometime around 1990 McDonnell Douglas, whose leadership could charitably be termed ďin need of adult supervision,Ē implemented a management philosophy known as TQM. As implemented at Mickey Dís, TQM basically told everyone they were out of a job, and needed to reapply. The resulting fear, insecurity and turmoil played a minor, bizarre role in the ultimate destruction of the company.
As a young industry initiate I was baffled. How could three simple letters cause so much damage? More seriously, how did such dubiously skilled people get in positions of power and authority? Well, itís nearly 2006, and here we go again. The letters this time: QDR, as in Quadrennial Defense Review. And in place of McD management, weíve got DoD.
Itís not my place to rail against the dysfunctions of Rumsfeldís Pentagon. Besides, my old pal Loren Thompson has already done a superlative job (http://www.lexingtoninstitute.org/defense.asp?aid=673). But I will say the current review promises nothing but bad things for our beloved industry.
First, thereís the fear factor. By placing everything on the table and spreading rumors of deep cuts (and deliberately avoiding direct communication with industry), DoDís top leadership has created an insecure procurement environment. This drives up weapons costsócompanies donít invest in a programís future if it could be killed instantly. Worse, QDRís equally dim three-lettered cousin, PBD 753, exacerbated this insecurity by implying that Multi-Year Procurement (MYP, the only benign three letter term in the bunch) contracts were illusions. PBD 753 tried to kill the C-130J, which had a ďsecureĒ MYP. This effort failed, illuminating serious (and embarrassing) miscomprehension at DoD. But from industryís standpoint, if you couldnít trust an MYP, what security did any program have?
QDR, of course, is about realigning strategic priorities. As someone who spent grad school monkeying around with strategic thinking, I can certainly appreciate the impulse to play Major Program Reviewer or Grand Strategy Poobah. But the more I hear about the process the more skeptical I get. Just for starters, here are three questions:
1. DoD tried to kill the C-130J and has no plans to fund more than 180 C-17s, with the line dying in the next two years. If QDR is about force projection for a new, changed world, why is DoD negative on the only two airmobility programs?
2. If itís about Transformation (a buzzword that deserved killing long ago), why is the Research and Development budget shrinking?
3. If DoD genuinely wants to kill JSF variants or programs like the F/A-22, why wasnít it done years ago, before billions more were spent on development? What has really changed? Is this merely an Iraq-related budget crunch? If so, why isnít DoD doing more to promote defense? Defense spending as a percent of GDP is extremely low by historical standards (below 4%); if the budget is the problem, why not reconsider those tax breaks? (Okay, thatís more than one question.)
This isnít to say that threats donít change. But whoís to say what will happen next? Whoís to say retired Rep Zell Miller (D-GA) wonít morph into a huge reptilian monster and attack Chicago? Strategic uncertainty is a fact of life; itís important to deploy dual-use assets. An aircraft carrier can provide disaster relief. An F/A-22 can protect the nationís airspace. Both can play a counter-insurgency role (T.E. Lawrence once said that fighting guerillas with conventional weapons was like eating soup with a knife; itís actually more like eating waffles with a sporkónot perfect, but certainly possible). Capable weapons have a broad utility, even homeland security or fighting guerillas.
But homeland security forces are good for one thing, a Maginot Line defense. Buying lots of border patrol helicopters sounds good, but try using them against conventional forces in the Straits of Taiwan or Hormuz. And re-equipping the military for infantry-intensive counterinsurgency and nation building duties is preparation for the last war. Pre-Iraq nation building operations were on a much smaller scale. For better or worse, our Iraq involvement will be mostly over within four years. And I canít imagine replacing Iraq with a similar nation-building effort of even remote equivalence.
Iím very suspicious about all of this. What if QDR isnít about strategic re-alignment at all? It might be a con job, a politically palatable way of slashing defense procurement to pay for Iraq. Closer inspection looks awfulóthe party faithful are going after anyone who might fund defense programs. Kenneth Krieg, Under Secretary of Defense for Acquisition, Technology & Logistics, recently implied that weapons defenders were tools of the military industrial complex (perhaps he could have sung a few Ď60ís protest songs, too?). Senator John McCain is criticizing programs for high costs, using numbers that are basically deceptive (he recently termed the F/A-22 a $220 million plane, which includes all development costs and makes as much sense as the legendary ď$2.2 billion B-2 bomberĒ a decade ago).
Of course, as weapons costs rise due to program insecurity, politicians will have plenty to criticize. And as CSISís ever-useful Jeremiah Gertler points out, defense spending does best when one party controls Congress and the other controls the White House. Complete one party control eliminates the political tension that guarantees adequate levels of defense spending. So if the budget heads down or if programs are targeted for death (as with airlift), donít expect plus-ups to save the day.
It all comes down to Iraq. Any of the ongoing yearly Iraq War supplementals would obviate DoDís procurement funding woes. The hidden costs of equipment overuse are equally severe. By some accounts, equipment is burning up at five times the normal rate.
Some think the Iraq invasion promoted US security by fighting the enemy on their turf. Some think it hurt US security by creating more enemies and bogging the military in a quagmire. This controversy won't be resolved for years. But if Iraq prevents the military from recapitalizing its current generation of weapons, then the USís superpower status will be seriously hurt. That would make Iraq a strategic miscalculation of the highest order.
Remember: aircraft donít kill people; people kill aircraft. And speaking of which, this month weíve updated the 717, 757, C-5, CRJ, Caravan, Bell 430, OH-1, Il-114, and Premier One. Have a good autumn.
© Richard Aboulafia 1997-2006, All rights reserved.