Fixing Procurement - Part 3

What Can Be Done

(Final part of a three-part discussion on government procurement)

None of this is meant to defend cost overruns. Rather, the point is that they have been a fact of life in this country since our founding. Similar examples abound for the various navies of Europe running back for several centuries before our independence. There is even commentary from the Rome of the Caesars about merchants taking advantage of the army with the open endorsement of the Roman Senate.

So, what if anything can be done to, if not eliminate it, to mitigate it?

First, let’s look at some ideas that may sound good (I have taken some ideas I have found in recent articles in the press), but aren’t going to be of any real help:

* Structure contracts so that they motivate contractors to achieve desired outcomes -- withhold fees in response to cost, schedule, or performance shortfalls, and provide extra payments to reward outcomes that exceed contract parameters.

What’s wrong with this? On the face of it, nothing. Each idea in fact has merit and can and should be used in as part of proper, comprehensive oversight. But, as noted already, how contracts are pieced together is not simply the purview of the contractor. And accurately identifying why a program hasn’t met performance specifications isn’t as easy as it looks. The B-1 was cancelled during the Carter administration. The Reagan administration restarted it. By the time the aircraft was delivered the design had changed (as had the mission), it’s performance had changed and the price had increased. Those changes were the result of both changes in technology, changes in the threat and changes in how the mission was perceived, as well as the cost of closing a production line and then reopening it. And the B-1 was a relatively simple aircraft compared to some of the aircraft now being produced. While the expansion in software coding has added immeasurably to the capabilities of aircraft, the vagaries of software coding have turned out to be more difficult to predict.

* Require more rigorous testing of new technologies before decisions are made to go forward with full-scale development and production of weapons systems. More time and money invested in testing early in the process will prevent major problems later.

Again, sounds good. But, how much is enough? The fact is the US has a massive RDT&E process – the best in the world. And it has been as often as not accused of being responsible for cost overruns. The F-22 was in RDT&E for well more than a decade before the first operational aircraft was built, the F-35 a similar amount of time. Is there a way to place a dividing line between pure R&D and follow-on Testing for the purpose of production? There may be. Defense industry magazines often feature this idea in editorials about controlling procurement. But no one has actually presented specific ideas that work.

* Assess whether a major acquisition program is needed based on national security needs.

This is what might be called a ‘BFO’ (Blinding Flash of the Obvious) right? Well, maybe yes and maybe no. In the 1950s it was the considered the learned opinion of a fair chunk of the US defense establishment that the US had no need for a standing Army, no need for a Marine Corps and little if any need for a Navy. The world had moved to intercontinental bombers, intercontinental ballistic missiles and nuclear warheads. Four decades before that a band of airmen worldwide, under the intellectual leadership of an Italian, General Giulio Douhet, a Brit, Marshal Sir Hugh Montague ‘Boom’ Trenchard, and a Yank, Brigadier William ‘Billy’ Mitchell, advocated for a switch of armed forces to strategic bombing forces, arguing that airpower had made all other military arms obsolete.

These men weren’t stupid and their ideas weren’t insane. But they weren’t right. Just a few decades ago the US built an entire generation of aircraft without any internal guns – they weren’t needed and it saved both weight and cost. Vietnam proved them wrong. We currently have a wide range of thinkers suggesting that the days of manned combat aircraft are drawing to a close, and that we need to stop building these obsolete weapons and move rapidly into unmanned, autonomous combat aircraft. It certainly seems plausible. Is it right? Do we bet everything on this belief, this vision of the future?

Every year each of the Combatant Commanders – the senior operational commanders in the US military, submit their own thoughts on what is needed to best fight the possible conflicts in their theaters. The Joint Staff spends literally hundreds of thousands of man-hours trying to balance of the requirements of each commander against the requirements of all the others. It is fair to say that in the end none of them is ever completely satisfied, and programs that have great intellectual appeal are often negatively affected to meet more requirements of more Combatant Commanders. And these debates are echoed in debates with various Congressmen and Senators in various committees and subcommittees. And it is fair to say that, despite appearances, the overwhelming majority of the Senators, Congressmen, staffers, admirals and generals, and yes, contractors, feel deeply about providing the best for the nation, not simply making sure this or that program gets funded. And still decisions are made that leave nearly everyone upset.

*An Attempted Solution - Since the 1980s the services have taken ‘line officers,’ that is, the officers who actually command the various vehicles, such as pilots or submariners, and send them through a certification process and turn them into ‘contract specialists.’ This program was begun by the services in order to ‘fix’ procurement. Since the program began procurement overruns have actually increased.

There have been numerous suggestions made on how to fix procurement, and many of them make excellent points about returning control to DOD personnel, eliminating the atmosphere of continual engineering development irrespective of cost, the lack of competition in the market, bloated staffs and poor decision-making. All of these are excellent points and should all be implemented as soon as possible.

But, by themselves they won’t end the never-ending cycle of cost overruns. At the very root of the problem of cost overruns are two overriding facts: the first is that it is usually in everyone’s interest to continue various programs whether there has been an overrun or not, and second, there is no intellectually defendable alternate position.

A Real Solution

The first point above has already been explained: despite protestations to the contrary, Congress likes this situation. The only answer to that situation is a demand by the real government (the voters) for greater discipline by their representatives. The fact is that Congress authorizes and appropriates the money and unless the citizenry actively participates in oversight of their own representatives, all the actions to amend the process will amount to nothing. The taxpayer needs to insist on both discipline and accountability by Congress, and without that no other reform effort will yield any significant results.

The second issue is as important as the first: no intellectually defendable alternate positions. This would provide the ‘ammunition’ for those trying to ensure Congressional discipline. Currently, whenever he submits his budget requests, the Secretary of Defense provides a broad justification of each weapon system to Congress, defended by a series of ‘threat forecasts’ that seek to predict the various capabilities that the US may face in the future. Underlying this forecast is doctrine and planning that match US capabilities to these threats in such a way that US interests are defended and US goals are met. This is a complex process and one not easily disputed by those ‘outside the process.’ Unfortunately, the only people inside the process are all within the DOD. This isn’t meant to insinuate that the DOD is trying to hide anything; it is simply the fact that the only people who engage in any in-depth planning about US goals, and the requirements to meet those goals, are all within the DOD. The House and Senate do not have any real means to engage in alternate planning, and there has never been any concerted effort to insist that DOD produce substantive, detailed alternate paths to achieve specific goals with varied capabilities. And, suggestions that they do so are likely to be met with consternation and the response that doing so will require larger staffs and will further slow an already slow procurement process.

The objection would be false, however. The primary responsibility of government, above all others, is to provide for the defense, the security of the nation. The suggestion that Congress hasn’t enough time to adequately delve into various means by which we might achieve that security is to say Congress can’t do its number one job. Congress must find the time to address the key issues, even if that means it refrains from holding hearings on steroid use in baseball or other similarly ‘vital’ issues. Similarly, DOD must focus its personnel on the central issues – requirements for the nation’s security – even if that means fewer people are committed to equally ‘critical’ issues – such as bands, and color guards and redundant flag staffs.

Finally, focusing on contractor malfeasance as the cause for procurement problems is almost universally a smoke screen by either Congress or the DOD or both. Certainly, there have been contractors who have been either inept or criminal (or both). But the numbers are low. In nearly every case, there has been willing complicity on the part of Congress and DOD to drag out programs, change contract performance requirements, adjust delivery dates, etc., - ad nauseam, and then when it comes to light the contractor takes the blame. In fact, the contractors are usually the least culpable of the three. A history of defense contracts has shown that contractors are more than willing to operate openly and respond to the guidance of Congress and DOD, but that it has been the government – DOD and Congress – that has routinely steered procurement onto the rocks. And it will only be by maintaining clarity on the course ahead, and a firm hand on the helm, that we can hope to keep from continually going up on the rocks. New laws, new regulations and pontificating from various high officials translate into nothing more than smoke screens that hide the facts.

We the voters need to insist that Congress do two things at once: ensure that the DOD and the Executive Branch as a whole has the tools and funding to provide for our security, while ensuring that our money is wisely spent. Meaningless or poorly drafted legislation isn’t the answer, the answer is diligence and focus on the part of Congress.