so I guess you, and Thought are the political forum version of...
I hope you're not Marty....
I don't know who those people are. Is that what the call educational television in Texass?
Economy Fucked Up, This Is One Reason
- Thread starter thoughtone
- Start date
I don't know who those people are. Is that what the call educational television in Texass?
Que and Upgrade knows who they are.
Are we really going to talk down on one of the more successful states in the nation?
So since you are mocking me, tell me who they are.
By who's measure:
The most minimum wage jobs?
Most air pollution"
People with the most uninsured health insurance?
The most on-the-job deaths
The most drunk driving deaths
Death penalty executions
Well, they are only the 7th most violent state.
Compare that to the Democratic/liberal states.
3 years later, economy still fucked up?
Does this mean I have to worry about my gas bill & my mortgage?
Where is Peggy Joseph?
Does this mean I have to worry about my gas bill & my mortgage?
Where is Peggy Joseph?
I really have no idea who they are; but I really care either
But, whoever the fuck they are; they don't take away from my point that you can't see shit, for the blinders, all the comedy notwithstanding.
Obama's policies ARE Bush's policies.....remember peabrain?
Sen. Obama voted for 2005 Bush / Cheney Energy bill
Oh yeah, don't take that as a compliment
you cant say nothin, so keep supporting the 3rd Bush term!
source: 24/7 Wall Str.
Ten Companies Profiting Most from War
The business of war is profitable. In 2011, the 100 largest contractors sold $410 billion in arms and military services. Just 10 of those companies sold over $208 billion. Based on a list of the top 100 arms-producing and military services companies in 2011 compiled by the Stockholm International Peace Research Institute, 24/7 Wall St. reviewed the 10 companies with the most military sales worldwide in 2011.
Ten Companies Profiting Most from War
United Technologies makes a wide range of arms — notably military helicopters, including the Black Hawk helicopter for the U.S. Army and Seahawk helicopter for the U.S. Navy. The company was the most profitable of all companies on this list, making more than $5.3 billion in 2011. It was also the largest company on this list by headcount, employing nearly 200,000 people worldwide as of 2011. Arms comprised just 20% of the company’s $58.2 billion in sales in 2011. Other products made by United Technologies include elevators, escalators, air-conditioners and refrigerators. International sales comprised 60% of the company’s total revenue in 2012.
9. L-3 Communications (NYSE: LLL)
> Arm sales 2011: $12.5 billion
> Total sales 2011: $15.2 billion
> Total profit: $956 million
> Total employment: 61,000
> Sector: Electronics
Some 83% of L-3 Communications sales in 2011 came from arms sales, totaling just over $12.5 billion. This was down, however, from about $13.1 billion in arms sales in 2010. The company has four different business segments: electronic systems; aircraft modernization and maintenance; national security solutions; and command, control, communications, intelligence, surveillance and reconnaissance. Among many products manufactured, the company has become a major provider of unmanned aircraft systems. In 2011, the company turned a profit of $956 million and employed approximately 61,000 people.
8. Finmeccanica
> Arm sales 2011: $14.6 billion
> Total sales 2011: $24.1 billion
> Total profit: $-3.2 billion
> Total employment: 70,470
> Sector: Aircraft, artillery, engines, electronics, military vehicles, missiles, small arms/ammunition
Italian company Finmeccanica makes a wide range of arms, including helicopters and security electronics. Of the company’s nearly $24.1 billion in sales in 2011, 60% were in arms. Finmeccanica lost $3.2 billion in 2011. The Italian company is currently fending off allegation that it paid bribes to win an approximately $750 million contract to provide 12 military helicopters to the Indian government back in 2010. The then-head of the company, Giuseppe Orsi, was arrested in February but has denied wrongdoing. Other executives, including the head of the company’s helicopter unit, have been replaced, and the company has delayed the release of recent financial results until the situation is resolved.
7. EADS
> Arm sales 2011: $16.4 billion
> Total sales 2011: $68.3 billion
> Total profit: $1.4 billion
> Total employment: 133,120
> Sector: Aircraft, electronics, missiles, space
The European Aeronautic Defence and Space Company (EADS), based in the Netherlands, had $16.4 billion worth of arms sales in 2011, roughly in line with 2010. Arms sales, however, comprised just 24% of the company’ entire sales, which totaled about $68.3 billion in 2011. EADS and BAE Systems attempted to merge for $45 billion in 2012, which would have created the world’s largest aerospace company. However, the deal collapsed in October after German Chancellor Angela Merkel expressed concern that the new company would marginalize the influence of the German government and would focus decision making in France and the U.K.
6. Northrop Grumman (NYSE: NOC)
> Arm sales 2011: $21.4 billion
> Total sales 2011: $26.4 billion
> Total profit: $2.1 billion
> Total employment: 72,500
> Sector: Aircraft, electronics, missiles, ships, space
Like many of the companies on this list, Northrop Grumman makes a wide range of arms, including unmanned systems; air and missile defense radars; and critical incident response systems. In 2011, Northrop Grumman reported about $21.4 billion in arms sales, comprising 81% of the company’s $26.4 billion in total sales. But arms sales in 2011 declined from $28.2 billion in arms sales in 2010, after growing by $3.5 billion between 2007 and 2010. The company attributed the decline to reduced government spending on defense projects. Nevertheless, the company reported a profit of more than $2.1 billion in fiscal 2011, slightly better than the company’s earnings the previous year.
5. Raytheon (NYSE: RTN)
> Arm sales 2011: $22.5 billion
> Total sales 2011: $24.9 billion
> Total profit: $1.9 billion
> Total employment: 71,000
> Sector: Electronics, missiles
Raytheon, based in Waltham, Mass., is one of the largest defense contractors in the U.S. The company makes a wide range of defense products, including missiles such as the Tomahawk Cruise Missile. Arms sales totaled about $22.5 billion in 2011, comprising about 90% of the company’s total sales that year. However, these sales were down slightly from the $23 billion in arms sales in 2010.The slide hasn’t let up. Total sales in 2012 fell 1.5%, and Raytheon is expecting sales to fall 3% in 2013, a projection which doesn’t take into account the effects of sequestration on the company. Fortunately, the company can rely on overseas customers to somewhat offset weak sales at home. As of January, approximately 40% of the company’s backlog was booked overseas. The company expects approximately a 5% increase in international sales in 2013.
4. General Dynamics (NYSE: GD)
> Arm sales 2011: $23.8 billion
> Total sales 2011: $32.7 billion
> Total profit: $2.5 billion
> Total employment: 95,100
> Sector: Artillery, electronics, military vehicles, small arms/ammunition, ships
With 18,000 transactions worth $19.5 billion in 2011, General Dynamics was the third-largest contractor to the U.S. government. Of those contracts, approximately $12.9 billion worth went to the Navy, while an additional $4.6 billion went to the Army. The company reported just under $23.8 billion in arms sales in 2011, comprising 73% of the company’s total sales. Arms sales in 2011 were slightly below 2010 levels. The company employs approximately 95,000 workers worldwide and makes a host of products, including electric boats, tracked and wheeled military vehicles, and battle tanks. The company has expressed concern about the potential effects on U.S. military budgets due to sequestration, issuing layoff notices this week.
3. BAE Systems
> Arm sales 2011: $29.2 billion
> Total sales 2011: $30.7 billion
> Total profit: $2.3 billion
> Total employment: 93,500
> Sector: Aircraft, artillery, electronics, military vehicles, missiles, small arms/ammunition, ships
BAE Systems was the largest non-U.S. company based on arms sales, bringing in $29.2 billion worth in 2011. This represented 95% of the company’s total sales that year. Yet 2011’s arms sales were lower than 2010′s, when the company sold $32.9 billion worth of arms. The products that BAE sells include the L-ROD Bar Armor System that shields defense vehicles, and the Hawk Advanced Jet Trainer that provides sophisticated simulation training for military pilots. In 2013, the company said its growth would likely come from outside the United States and Great Britain — its home market. BAE noted that its outlook for those two countries was “constrained,” likely due to the diminished presence in international conflicts and government budget cuts.
2. Boeing (NYSE: BA)
> Arm sales 2011: $31.8 billion
> Total sales 2011: $68.7 billion
> Total profit: $4.0 billion
> Total employment: 171,700
> Sector: Aircraft, electronics, missiles, space
Boeing was the second-largest U.S. government contractor in 2011, with about $21.5 billion worth of goods contracted that year. The Chicago-based company makes a wide range of arms, including strategic missile systems, laser and electro-optical systems and global positioning systems. Despite all these technologies, just 46% of the company’s total sales of $68.7 billion in 2011 came from arms. Boeing is the largest commercial airplane manufacturer in the world, making planes such as the 747, 757 and recently, the 787 Dreamliner. The company is also known for its space technology — Boeing had $1 billion worth of contracts with NASA in 2011.
1. Lockheed Martin (NYSE: LMT)
> Arm sales 2011: $36.3 billion
> Total sales 2011: $46.5 billion
> Total profit: $2.7 billion
> Total employment: 123,000
> Sector: Aircraft, electronics, missiles, space
Lockheed Martin notched $36.3 billion in sales in 2011, slightly higher than the $35.7 billion the company sold in 2010. The 2011 arms sales comprised 78% of the company’s total 2011 sales of $46.5 billion. As of 2011, the company employed 123,000 people worldwide. In the company’s aerospace and defense unit, Lockheed makes a wide range of products, including aircrafts, missiles, unmanned systems and radar systems. The company and its employees have been concerned about the effects of both the fiscal cliff and sequestration, the latter of which includes significant cuts to the U.S. Department of Defense. In the fall of 2012, the company planned on issuing layoff notices to all employees before backing down at the request of the White House.
Ten Companies Profiting Most from War
The business of war is profitable. In 2011, the 100 largest contractors sold $410 billion in arms and military services. Just 10 of those companies sold over $208 billion. Based on a list of the top 100 arms-producing and military services companies in 2011 compiled by the Stockholm International Peace Research Institute, 24/7 Wall St. reviewed the 10 companies with the most military sales worldwide in 2011.
These companies have benefited tremendously from the growth in military spending in the U.S., which by far has the largest military budget in the world. In 2000, the U.S. defense budget was approximately $312 billion. By 2011, that figure had grown to $712 billion. Arm sales grew alongside general defense spending growth. SIPRI noted that between 2002 and 2011, arms sales among the top 100 companies grew by 51%.
However, the trend has reversed recently. In 2011, the top 100 arms dealers sold 5% less compared to 2010. Susan Jackson, a defense expert at SIPRI, said in an email to 24/7 Wall St. that austerity measures in Western Europe and the U.S. have delayed or slowed down the procurement of different weapons systems. Austerity concerns have exacerbated matters since 2011. The U.S. federal government budget cuts that took effect beginning this month — commonly known as sequestration — mean that military spending could contract by more than $500 billion over the coming decade unless some of the cuts are reversed.
In addition, the U.S.’s involvement in conflicts in Iraq and Afghanistan have wound down significantly. The last American convoy in Iraq left the country in December of 2011. Troop withdrawals from Afghanistan also began in 2011. Finally, SIPRI pointed out that sanctions on arms transfers to Libya also played a role in declining arms sales.
Many of these companies are looking overseas to try to make up for slowing sales in the U.S. and Europe. Arms producers are especially keen on areas in Latin America, the Middle East and parts of Asia, Jackson said. For instance, BAE is in the process of securing contracting agreements with Saudi Arabia. Meanwhile, the chief financial officer of Northrop Grumman has recently indicated his company may sell its Global Hawk airplane to South Korea or Japan.
Based on the report, 24/7 Wall St. reviewed the 10 companies with the most arms sales in 2011. Arms were defined as sales to military customers, either for procurement or for export, but do not include sales of general purpose items such as oil or computer equipment to military customers. We also looked at arms sales from 2010, as well as the company’s total sales in 2010. Furthermore, we considered the company’s 2011 total sales, profits and the total number of employees at the company, all provided by SIPRI.
There are the 10 companies profiting the most from war.
Ten Companies Profiting Most from War
<!-- /user_controls -->10. United Technologies (NYSE: UTX)
> Arm sales 2011: $11.6 billion
> Total sales 2011: $58.2 billion
> Total profit: $5.3 billion
> Total employment: 199,900
> Sector: Aircraft, electronics, engines
> Arm sales 2011: $11.6 billion
> Total sales 2011: $58.2 billion
> Total profit: $5.3 billion
> Total employment: 199,900
> Sector: Aircraft, electronics, engines
United Technologies makes a wide range of arms — notably military helicopters, including the Black Hawk helicopter for the U.S. Army and Seahawk helicopter for the U.S. Navy. The company was the most profitable of all companies on this list, making more than $5.3 billion in 2011. It was also the largest company on this list by headcount, employing nearly 200,000 people worldwide as of 2011. Arms comprised just 20% of the company’s $58.2 billion in sales in 2011. Other products made by United Technologies include elevators, escalators, air-conditioners and refrigerators. International sales comprised 60% of the company’s total revenue in 2012.
9. L-3 Communications (NYSE: LLL)
> Arm sales 2011: $12.5 billion
> Total sales 2011: $15.2 billion
> Total profit: $956 million
> Total employment: 61,000
> Sector: Electronics
Some 83% of L-3 Communications sales in 2011 came from arms sales, totaling just over $12.5 billion. This was down, however, from about $13.1 billion in arms sales in 2010. The company has four different business segments: electronic systems; aircraft modernization and maintenance; national security solutions; and command, control, communications, intelligence, surveillance and reconnaissance. Among many products manufactured, the company has become a major provider of unmanned aircraft systems. In 2011, the company turned a profit of $956 million and employed approximately 61,000 people.
8. Finmeccanica
> Arm sales 2011: $14.6 billion
> Total sales 2011: $24.1 billion
> Total profit: $-3.2 billion
> Total employment: 70,470
> Sector: Aircraft, artillery, engines, electronics, military vehicles, missiles, small arms/ammunition
Italian company Finmeccanica makes a wide range of arms, including helicopters and security electronics. Of the company’s nearly $24.1 billion in sales in 2011, 60% were in arms. Finmeccanica lost $3.2 billion in 2011. The Italian company is currently fending off allegation that it paid bribes to win an approximately $750 million contract to provide 12 military helicopters to the Indian government back in 2010. The then-head of the company, Giuseppe Orsi, was arrested in February but has denied wrongdoing. Other executives, including the head of the company’s helicopter unit, have been replaced, and the company has delayed the release of recent financial results until the situation is resolved.
7. EADS
> Arm sales 2011: $16.4 billion
> Total sales 2011: $68.3 billion
> Total profit: $1.4 billion
> Total employment: 133,120
> Sector: Aircraft, electronics, missiles, space
The European Aeronautic Defence and Space Company (EADS), based in the Netherlands, had $16.4 billion worth of arms sales in 2011, roughly in line with 2010. Arms sales, however, comprised just 24% of the company’ entire sales, which totaled about $68.3 billion in 2011. EADS and BAE Systems attempted to merge for $45 billion in 2012, which would have created the world’s largest aerospace company. However, the deal collapsed in October after German Chancellor Angela Merkel expressed concern that the new company would marginalize the influence of the German government and would focus decision making in France and the U.K.
6. Northrop Grumman (NYSE: NOC)
> Arm sales 2011: $21.4 billion
> Total sales 2011: $26.4 billion
> Total profit: $2.1 billion
> Total employment: 72,500
> Sector: Aircraft, electronics, missiles, ships, space
Like many of the companies on this list, Northrop Grumman makes a wide range of arms, including unmanned systems; air and missile defense radars; and critical incident response systems. In 2011, Northrop Grumman reported about $21.4 billion in arms sales, comprising 81% of the company’s $26.4 billion in total sales. But arms sales in 2011 declined from $28.2 billion in arms sales in 2010, after growing by $3.5 billion between 2007 and 2010. The company attributed the decline to reduced government spending on defense projects. Nevertheless, the company reported a profit of more than $2.1 billion in fiscal 2011, slightly better than the company’s earnings the previous year.
5. Raytheon (NYSE: RTN)
> Arm sales 2011: $22.5 billion
> Total sales 2011: $24.9 billion
> Total profit: $1.9 billion
> Total employment: 71,000
> Sector: Electronics, missiles
Raytheon, based in Waltham, Mass., is one of the largest defense contractors in the U.S. The company makes a wide range of defense products, including missiles such as the Tomahawk Cruise Missile. Arms sales totaled about $22.5 billion in 2011, comprising about 90% of the company’s total sales that year. However, these sales were down slightly from the $23 billion in arms sales in 2010.The slide hasn’t let up. Total sales in 2012 fell 1.5%, and Raytheon is expecting sales to fall 3% in 2013, a projection which doesn’t take into account the effects of sequestration on the company. Fortunately, the company can rely on overseas customers to somewhat offset weak sales at home. As of January, approximately 40% of the company’s backlog was booked overseas. The company expects approximately a 5% increase in international sales in 2013.
4. General Dynamics (NYSE: GD)
> Arm sales 2011: $23.8 billion
> Total sales 2011: $32.7 billion
> Total profit: $2.5 billion
> Total employment: 95,100
> Sector: Artillery, electronics, military vehicles, small arms/ammunition, ships
With 18,000 transactions worth $19.5 billion in 2011, General Dynamics was the third-largest contractor to the U.S. government. Of those contracts, approximately $12.9 billion worth went to the Navy, while an additional $4.6 billion went to the Army. The company reported just under $23.8 billion in arms sales in 2011, comprising 73% of the company’s total sales. Arms sales in 2011 were slightly below 2010 levels. The company employs approximately 95,000 workers worldwide and makes a host of products, including electric boats, tracked and wheeled military vehicles, and battle tanks. The company has expressed concern about the potential effects on U.S. military budgets due to sequestration, issuing layoff notices this week.
3. BAE Systems
> Arm sales 2011: $29.2 billion
> Total sales 2011: $30.7 billion
> Total profit: $2.3 billion
> Total employment: 93,500
> Sector: Aircraft, artillery, electronics, military vehicles, missiles, small arms/ammunition, ships
BAE Systems was the largest non-U.S. company based on arms sales, bringing in $29.2 billion worth in 2011. This represented 95% of the company’s total sales that year. Yet 2011’s arms sales were lower than 2010′s, when the company sold $32.9 billion worth of arms. The products that BAE sells include the L-ROD Bar Armor System that shields defense vehicles, and the Hawk Advanced Jet Trainer that provides sophisticated simulation training for military pilots. In 2013, the company said its growth would likely come from outside the United States and Great Britain — its home market. BAE noted that its outlook for those two countries was “constrained,” likely due to the diminished presence in international conflicts and government budget cuts.
2. Boeing (NYSE: BA)
> Arm sales 2011: $31.8 billion
> Total sales 2011: $68.7 billion
> Total profit: $4.0 billion
> Total employment: 171,700
> Sector: Aircraft, electronics, missiles, space
Boeing was the second-largest U.S. government contractor in 2011, with about $21.5 billion worth of goods contracted that year. The Chicago-based company makes a wide range of arms, including strategic missile systems, laser and electro-optical systems and global positioning systems. Despite all these technologies, just 46% of the company’s total sales of $68.7 billion in 2011 came from arms. Boeing is the largest commercial airplane manufacturer in the world, making planes such as the 747, 757 and recently, the 787 Dreamliner. The company is also known for its space technology — Boeing had $1 billion worth of contracts with NASA in 2011.
1. Lockheed Martin (NYSE: LMT)
> Arm sales 2011: $36.3 billion
> Total sales 2011: $46.5 billion
> Total profit: $2.7 billion
> Total employment: 123,000
> Sector: Aircraft, electronics, missiles, space
Lockheed Martin notched $36.3 billion in sales in 2011, slightly higher than the $35.7 billion the company sold in 2010. The 2011 arms sales comprised 78% of the company’s total 2011 sales of $46.5 billion. As of 2011, the company employed 123,000 people worldwide. In the company’s aerospace and defense unit, Lockheed makes a wide range of products, including aircrafts, missiles, unmanned systems and radar systems. The company and its employees have been concerned about the effects of both the fiscal cliff and sequestration, the latter of which includes significant cuts to the U.S. Department of Defense. In the fall of 2012, the company planned on issuing layoff notices to all employees before backing down at the request of the White House.
source: Truthout
F-35 Fighter Is Latest in Long Line of Wasteful Weapon Failures
First, it is too early to tell, second, it is too late to do anything about it." -Ernest Fitzgerald
There has been a flurry of articles in the defense press Tuesday about an internal Department of Defense (DoD) report on how the F-35 Joint Strike Fighter, the Pentagon's newest attempt to buy a fighter jet, is skating toward potential mechanical and monetary disaster. The DoD top civilian weapons buyer put together a team to do a quick look at how the fighter was doing in its journey to become the next main fighter in the DoD arsenal. The report has the usual DoD hedge wording and qualifiers, but the answer is: not too good. There must be some panic and buzz in the Pentagon hallways since the last attempt of making a fighter, the F-22, was surprisingly canceled by the Obama administration and some brave members of Congress. Now, the newest fighter is falling under its own bloated procurement weight. Is the system, which has given us generation after generation of overpriced and technically dubious fighters, tanks, and other weapons finally succumbing to its own folly? This new report, which was leaked to the Project On Government Oversight (POGO) and some reporters, is now posted at POGO's web site. (Full disclosure: I founded POGO and still serve as treasurer and on the board of directors.)
Bill Sweetman, who writes the Ares blog for Aviation Week was not impressed with the F-35's progress:
Ernest Fitzgerald, the well-known Pentagon whistleblower who fought the bureaucracy in hand-to-hand combat for better weapons and realistically priced weapons from the 1960s to 2006, came up with a simple law of why this sordid history keeps repeating itself. Fitzgerald's first law of weapons procurement is: "First it is too early to tell, second, it is too late to do anything about it." I have found that this is the way that the DoD, the military services and the defense contractors squeeze every last dime out of the procurement budget and then even more, while making sure that their weapon doesn't get so obviously gross as to go on the rare weapons' chopping block.
Fitzgerald blew the whistle on the C-5A cargo plane in the late 1960s because of technical problems of the plane and that it had overrun its budget by $2 billion - a huge sum at the time. Lockheed, the manufacturer of the C-5A, had made the plane too heavy to meet its specifications. They, with the tacit blessing of the Air Force, took weight out of the wings of the plane to meet the requirements. Everyone knew that this most likely would affect the service and life of the wings, but it was paramount that the C-5A got into the fleet before someone suggested that the C-5A production run could be lessened or cut. It was important for all sides who were interested in the money flow of this plane, including the Air Force, the DoD, Lockheed and the Congress, to keep it going for jobs, profits and future retirement jobs for the military and civilians who were overseeing this plane.
Besides, even though the laws of physics would tell you that taking weight and strength out of the wings of a big heavy cargo plane would lead to problems, wasn't it really "too early to tell"? Or, as the military called it, the unknown, unknowns or unk-unks. Many a career was made or saved by the mysterious unk-unks where bad things happened, but you couldn't get blamed because the unknowns were unknown.
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I came into this picture in 1979, when the Air Force "discovered" that cracks were developing in the C-5A wings, threatening the safety and life of the planes. Everyone acted surprised even though there were plenty of internal oversight reports warning that this might happen if weight was taken out of the wings in the production process. So, the Air Force told the Congress that there had to be a "wing modification," a nice word for wing fix, and it was going to cost $1.5 billion to fix the wings of the current fleet. In the non-Pentagon normal world, logic would tell you that Lockheed had the liability to pay for this "mistake" because they took the weight out of the wings and the engineers at Lockheed and in the government said, at the time, that the wings would begin to crack. But when I began to investigate this fix and uncover all the evidence of why the taxpayer should not have to pay for this, especially since the plane had already had the largest overrun at that time, the Air Force said that they were responsible to fix the problem because of all the unk-unks at the time. People in the DoD, the Congress and Lockheed all bobbed their heads in unison and insisted that it needed to be done and the government should pay for this mysterious problem because the planes had been bought, the system was counting on them and "it was too late to do anything about it."
This law became even more perfected when the DoD began to use "concurrency" as a regular way of procuring a weapon. Logic would tell you that you build a prototype for a weapon; do developmental testing on it to fix the technical bugs; start an initial, low rate of production after the fixes; and test this small production run with operational testing, using real troops in wartime type situations. Once you identified and fixed problems that showed up when you used the weapon as planned in a war and you made sure that the weapon was truly effective for the troops and not just a box of new gee-whiz technology for technology's sake, you would decide to go to full production with a set blueprint for the weapon. Of course, logic would also tell you that, in these stages toward full production, you may find that some of the technology would never work and if the weapon was only good because of these technologies or that the technologies could not realistically work in a war, it was far better for the troops and the taxpayers to cut the losses and cancel the weapon before sinking any more costs into the project.
However, concurrency blows this logic out of the water. The DoD has increasingly, over decades, blurred the logical lines of production that is used by most of the world. Instead, the bureaucracy finds a way to continue to push the weapon into large production while trying to fix the technical bugs and see if the weapon would truly work on the battlefield. This concurrency of development and production helps to make sure there is never a moment, not even a nanosecond, between "too early to tell" and "too late to do anything about it." This makes sure one is never vulnerable to having the weapon cut back or canceled, threatening one's career in the DoD, the defense company's profit, Congress's access to defense jobs in each district and state and one is more likely to find a nice retirement job because the weapon got through.
As you can imagine, this concurrency has caused weapons failures in the battlefields, technical and expensive nightmares in trying to maintain these weapons and costly fixes for these so-called unknown unknowns leading to astronomical overruns. There have been dozens and dozens of reports and testimony by government oversight agencies on how this is a bad idea and doesn't work, but the beat of the military procurement culture goes on. And as I mentioned in a past column on weapon costs, these overruns and fixes become the historical costs on which all new weapons are priced, so that the waste and disaster of concurrency goes on as high procurement costs and high maintenance costs for each generation of weapons.
In the late 1980s, I was investigating the technical problems of the radar systems on the B-1B bomber. The radar jamming system was jamming the B-1's own radar, rather than the radar on the enemy plane, along with several other problems. I came to a part in the DoD report where the author cheerfully predicted that, even though each radar built and put on production planes was different because of rolling modifications, the radar design would be finally set at the hundredth unit. It took me a minute to realize that we were only buying 100 B-1B bombers, thus, plaguing the fleet with planes where each one would have a unique radar to maintain. What would Henry Ford with his standardization of parts on the Model T think of us now? I wondered at the time.
The Air Force is now scrambling to make sure that it is too late to do anything about the F-35 production in this atmosphere of defense budget cuts. Top DoD officials have been arguing that maybe the costs and the effectiveness of the F-35 should lower the production rate of the plane, and senators on the Senate Armed Services Committee were trying to make sure that the next buy of the F-35 was not cost-plus as in the past, but fixed price where there would be a chance to try to control costs. Reuters reported:
F-35 Fighter Is Latest in Long Line of Wasteful Weapon Failures
First, it is too early to tell, second, it is too late to do anything about it." -Ernest Fitzgerald
There has been a flurry of articles in the defense press Tuesday about an internal Department of Defense (DoD) report on how the F-35 Joint Strike Fighter, the Pentagon's newest attempt to buy a fighter jet, is skating toward potential mechanical and monetary disaster. The DoD top civilian weapons buyer put together a team to do a quick look at how the fighter was doing in its journey to become the next main fighter in the DoD arsenal. The report has the usual DoD hedge wording and qualifiers, but the answer is: not too good. There must be some panic and buzz in the Pentagon hallways since the last attempt of making a fighter, the F-22, was surprisingly canceled by the Obama administration and some brave members of Congress. Now, the newest fighter is falling under its own bloated procurement weight. Is the system, which has given us generation after generation of overpriced and technically dubious fighters, tanks, and other weapons finally succumbing to its own folly? This new report, which was leaked to the Project On Government Oversight (POGO) and some reporters, is now posted at POGO's web site. (Full disclosure: I founded POGO and still serve as treasurer and on the board of directors.)
Bill Sweetman, who writes the Ares blog for Aviation Week was not impressed with the F-35's progress:
When the Joint Strike Fighter team told Guy Norris about the jet's first run to its Mach 1.6 design speed, a couple of minor facts slipped their minds. Nobody remembered that the jet had landed (from either that sortie or another run to Mach 1.6) with "peeling and bubbling" of coatings on the horizontal tails and damage to engine thermal panels. Or that the entire test force was subsequently limited to Mach 1.0.
But selective amnesia is not even one of five "major consequence" problems that have already surfaced with the JSF and are disclosed by a top-level Pentagon review obtained by Ares. Those issues affect flight safety, the basic cockpit design, the carrier suitability of the F-35C and other aspects of the program have been identified and no fixes have been demonstrated yet. Three more "major consequence" problems are "likely" to emerge during tests, including high buffet loads and airframe fatigue.
To understand why this keeps happening to our weapons acquisitions and to try to change it, you have to know some history on how the system works and what has happened in the past. It is a sad tale of déjà vu all over again.But selective amnesia is not even one of five "major consequence" problems that have already surfaced with the JSF and are disclosed by a top-level Pentagon review obtained by Ares. Those issues affect flight safety, the basic cockpit design, the carrier suitability of the F-35C and other aspects of the program have been identified and no fixes have been demonstrated yet. Three more "major consequence" problems are "likely" to emerge during tests, including high buffet loads and airframe fatigue.
Ernest Fitzgerald, the well-known Pentagon whistleblower who fought the bureaucracy in hand-to-hand combat for better weapons and realistically priced weapons from the 1960s to 2006, came up with a simple law of why this sordid history keeps repeating itself. Fitzgerald's first law of weapons procurement is: "First it is too early to tell, second, it is too late to do anything about it." I have found that this is the way that the DoD, the military services and the defense contractors squeeze every last dime out of the procurement budget and then even more, while making sure that their weapon doesn't get so obviously gross as to go on the rare weapons' chopping block.
Fitzgerald blew the whistle on the C-5A cargo plane in the late 1960s because of technical problems of the plane and that it had overrun its budget by $2 billion - a huge sum at the time. Lockheed, the manufacturer of the C-5A, had made the plane too heavy to meet its specifications. They, with the tacit blessing of the Air Force, took weight out of the wings of the plane to meet the requirements. Everyone knew that this most likely would affect the service and life of the wings, but it was paramount that the C-5A got into the fleet before someone suggested that the C-5A production run could be lessened or cut. It was important for all sides who were interested in the money flow of this plane, including the Air Force, the DoD, Lockheed and the Congress, to keep it going for jobs, profits and future retirement jobs for the military and civilians who were overseeing this plane.
Besides, even though the laws of physics would tell you that taking weight and strength out of the wings of a big heavy cargo plane would lead to problems, wasn't it really "too early to tell"? Or, as the military called it, the unknown, unknowns or unk-unks. Many a career was made or saved by the mysterious unk-unks where bad things happened, but you couldn't get blamed because the unknowns were unknown.
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I came into this picture in 1979, when the Air Force "discovered" that cracks were developing in the C-5A wings, threatening the safety and life of the planes. Everyone acted surprised even though there were plenty of internal oversight reports warning that this might happen if weight was taken out of the wings in the production process. So, the Air Force told the Congress that there had to be a "wing modification," a nice word for wing fix, and it was going to cost $1.5 billion to fix the wings of the current fleet. In the non-Pentagon normal world, logic would tell you that Lockheed had the liability to pay for this "mistake" because they took the weight out of the wings and the engineers at Lockheed and in the government said, at the time, that the wings would begin to crack. But when I began to investigate this fix and uncover all the evidence of why the taxpayer should not have to pay for this, especially since the plane had already had the largest overrun at that time, the Air Force said that they were responsible to fix the problem because of all the unk-unks at the time. People in the DoD, the Congress and Lockheed all bobbed their heads in unison and insisted that it needed to be done and the government should pay for this mysterious problem because the planes had been bought, the system was counting on them and "it was too late to do anything about it."
This law became even more perfected when the DoD began to use "concurrency" as a regular way of procuring a weapon. Logic would tell you that you build a prototype for a weapon; do developmental testing on it to fix the technical bugs; start an initial, low rate of production after the fixes; and test this small production run with operational testing, using real troops in wartime type situations. Once you identified and fixed problems that showed up when you used the weapon as planned in a war and you made sure that the weapon was truly effective for the troops and not just a box of new gee-whiz technology for technology's sake, you would decide to go to full production with a set blueprint for the weapon. Of course, logic would also tell you that, in these stages toward full production, you may find that some of the technology would never work and if the weapon was only good because of these technologies or that the technologies could not realistically work in a war, it was far better for the troops and the taxpayers to cut the losses and cancel the weapon before sinking any more costs into the project.
However, concurrency blows this logic out of the water. The DoD has increasingly, over decades, blurred the logical lines of production that is used by most of the world. Instead, the bureaucracy finds a way to continue to push the weapon into large production while trying to fix the technical bugs and see if the weapon would truly work on the battlefield. This concurrency of development and production helps to make sure there is never a moment, not even a nanosecond, between "too early to tell" and "too late to do anything about it." This makes sure one is never vulnerable to having the weapon cut back or canceled, threatening one's career in the DoD, the defense company's profit, Congress's access to defense jobs in each district and state and one is more likely to find a nice retirement job because the weapon got through.
As you can imagine, this concurrency has caused weapons failures in the battlefields, technical and expensive nightmares in trying to maintain these weapons and costly fixes for these so-called unknown unknowns leading to astronomical overruns. There have been dozens and dozens of reports and testimony by government oversight agencies on how this is a bad idea and doesn't work, but the beat of the military procurement culture goes on. And as I mentioned in a past column on weapon costs, these overruns and fixes become the historical costs on which all new weapons are priced, so that the waste and disaster of concurrency goes on as high procurement costs and high maintenance costs for each generation of weapons.
In the late 1980s, I was investigating the technical problems of the radar systems on the B-1B bomber. The radar jamming system was jamming the B-1's own radar, rather than the radar on the enemy plane, along with several other problems. I came to a part in the DoD report where the author cheerfully predicted that, even though each radar built and put on production planes was different because of rolling modifications, the radar design would be finally set at the hundredth unit. It took me a minute to realize that we were only buying 100 B-1B bombers, thus, plaguing the fleet with planes where each one would have a unique radar to maintain. What would Henry Ford with his standardization of parts on the Model T think of us now? I wondered at the time.
The Air Force is now scrambling to make sure that it is too late to do anything about the F-35 production in this atmosphere of defense budget cuts. Top DoD officials have been arguing that maybe the costs and the effectiveness of the F-35 should lower the production rate of the plane, and senators on the Senate Armed Services Committee were trying to make sure that the next buy of the F-35 was not cost-plus as in the past, but fixed price where there would be a chance to try to control costs. Reuters reported:
Lawmakers inserted the fixed-price language into the bill after learning about Lot 5 contract [Pentagon had quickly approved it to be cost-plus], angered that the decision had been taken even as the Senate was debating whether or not to require the deal to be a fixed-cost contract.
Senator Carl Levin, Democratic chairman of the Senate Armed Services Committee, said he and the panel's top Republican, Senator John McCain, were upset that the Pentagon had acted even though it knew lawmakers were looking at the contract language.
McCain and Levin have expressed discontent with previous "cost-plus" contracts that paid Lockheed's costs for producing the aircraft plus a profit margin on top of that.
They believe the contracts have enabled the cost of the F-35 program, the Pentagon's most expensive procurement program, to balloon over the years.
"We take umbrage at the idea that they would proceed on Lot 5 while we are negotiating whether or not there should be a prohibition on a cost-plus contract on Lot 5. So what we did is we said no cost-plus starting on Lot 6," Levin said.
Maybe the F-35 has finally come to that magical moment between "too early to tell" and "too late to do anything about it." With the threat of large budget cutting, there has been more scrambling going on than business as usual with all the parties involved. Defense contractors are beginning to squeal that they are getting cut to the bone and Secretary of Defense Panetta, who has only had the job for six months, has been a disappointment for becoming part of the Pentagon's usual hallelujah chorus despite his past cost-cutting career. This most recent report, even though they hate to say it, is committing a lot of truth about the failures on this plane that are just now starting to come out. Winslow Wheeler, director of the Straus Military Reform Project, has been exposing this game longer than I have. He had some tough comments on the F-35 based on this newest report:Senator Carl Levin, Democratic chairman of the Senate Armed Services Committee, said he and the panel's top Republican, Senator John McCain, were upset that the Pentagon had acted even though it knew lawmakers were looking at the contract language.
McCain and Levin have expressed discontent with previous "cost-plus" contracts that paid Lockheed's costs for producing the aircraft plus a profit margin on top of that.
They believe the contracts have enabled the cost of the F-35 program, the Pentagon's most expensive procurement program, to balloon over the years.
"We take umbrage at the idea that they would proceed on Lot 5 while we are negotiating whether or not there should be a prohibition on a cost-plus contract on Lot 5. So what we did is we said no cost-plus starting on Lot 6," Levin said.
The new revelations are numerous and significant enough to call into question whether F-35 production should be suspended - if not terminated - even in the minds of today's senior managers in the Pentagon. The revelations include, but are not limited to "unsatisfactory progress and the likelihood of severe operational impacts for survivability, lethality, air vehicle performance and employment." Performance vis-à-vis so called "legacy" aircraft is seriously questioned and the individual deficiencies are sometimes so remarkable as to call into question the competence of the designers at Lockheed-Martin, to say nothing of the cost to repair the deficiencies. For example, the naval variant is now incapable of landing on carriers due to the inability of the arresting hook to capture an arresting cable on the carrier deck. And, there are more hard to conceive deficiencies, including airframe buffeting at different angles of attack. Moreover, as the report points out, these problems are appearing only after the easy phases of the test flights. The more exacting/demanding test flights are yet to even start. What unpleasant surprises do they hold?
The report frequently repeats the assertion that nothing so serious was found to "preclude further production." Read the report and decide for yourself if the report supports that conclusion, or actually the reverse. In fact, the oft repeated assurance that nothing too serious is uncovered was, in fact, added on by some in a rather pathetic attempt to convert this report into mush.
So, how can we retire Fitzgerald's law? It won't be easy, but the first place to start is to get rid of concurrency for everything other than the simplest of technologies. We have to go back to logic and not try to develop a weapon while also trying to use it at the same time. It would be crazy to do this in the automobile industry and it doubly more dangerous for our troops that rely on these weapons. Don't allow any full production until standards are set for manufacturing or we will be paying billions of dollars later to fix it. One of the best ways to retire Fitzgerald's law is to make the politically hard decision to cancel early weapons that can't realistically be fixed technically or won't work in real combat. There has to be a tolerance for failure and cancellation at the early stages of a weapon without fear of recrimination by the bureaucracy so that the weapons procurers and engineers can move on to a better and more realistic design instead of spending decades defending bad ideas at great cost to the taxpayer and the troops.The report frequently repeats the assertion that nothing so serious was found to "preclude further production." Read the report and decide for yourself if the report supports that conclusion, or actually the reverse. In fact, the oft repeated assurance that nothing too serious is uncovered was, in fact, added on by some in a rather pathetic attempt to convert this report into mush.
source: Reason
GOP Budget Plan Reverses Some Defense Spending Reductions
Republicans in Congress never really liked sequestration. House Speaker John Boehner (R-Ohio) was always quite clear about this: “I don’t like the sequester,” he said last month. The primary reason that Boehner and other House Republicans didn’t like the sequester was that its spending reductions fell heavily on a top GOP priority—defense spending. But the GOP decided to let the sequester take effect anyway, in part because they felt like they had to. After a defeat at the polls in November and a fiscal cliff deal that raised tax rates without cutting spending, the Republican majority in the House needed to show that they had the power to make something happen in a town run by Democrats.
So they let the sequester go through. They needed to. For show, as much as anything else. But the problem, from the GOP’s perspective, is that doing so leaves those pesky defense reductions in place.
Which is why House Republicans are now trying to make something else happen: a reversal of some of the sequester’s defense spending reductions. On Wednesday, nearly every House Republican voted for a continuing resolution that would provide $982 billion in discretionary funding for the government to stay for the next six months. That keeps spending in line with the sequester’s topline figure. But the House CR also quietly restores about $10 billion in funding to the Department of Defense budget.
Was this always the plan? We’ve seen plenty of warnings that the sequester’s reductions wouldn’t stick. And former Republican House Majority Leader Tom Delay, in the midst of a day of meetings with the current GOP about sequestration strategy, openly suggested that the defense reductions “can always be replaced during the appropriations process, after the cuts are put into place.” So this doesn’t come entirely as a surprise.
This isn’t the final legislation, of course. In order for the continuing resolution to pass, the Senate must still pass its own version, and then any conflicts between the two versions must be ironed out. But it hints at a possible Republican game plan going forward: allow defense budget reductions to occur, at least for a bit. And then quietly start the process of attempting to reverse those reductions a little while later.
GOP Budget Plan Reverses Some Defense Spending Reductions
Republicans in Congress never really liked sequestration. House Speaker John Boehner (R-Ohio) was always quite clear about this: “I don’t like the sequester,” he said last month. The primary reason that Boehner and other House Republicans didn’t like the sequester was that its spending reductions fell heavily on a top GOP priority—defense spending. But the GOP decided to let the sequester take effect anyway, in part because they felt like they had to. After a defeat at the polls in November and a fiscal cliff deal that raised tax rates without cutting spending, the Republican majority in the House needed to show that they had the power to make something happen in a town run by Democrats.
So they let the sequester go through. They needed to. For show, as much as anything else. But the problem, from the GOP’s perspective, is that doing so leaves those pesky defense reductions in place.
Which is why House Republicans are now trying to make something else happen: a reversal of some of the sequester’s defense spending reductions. On Wednesday, nearly every House Republican voted for a continuing resolution that would provide $982 billion in discretionary funding for the government to stay for the next six months. That keeps spending in line with the sequester’s topline figure. But the House CR also quietly restores about $10 billion in funding to the Department of Defense budget.
Was this always the plan? We’ve seen plenty of warnings that the sequester’s reductions wouldn’t stick. And former Republican House Majority Leader Tom Delay, in the midst of a day of meetings with the current GOP about sequestration strategy, openly suggested that the defense reductions “can always be replaced during the appropriations process, after the cuts are put into place.” So this doesn’t come entirely as a surprise.
This isn’t the final legislation, of course. In order for the continuing resolution to pass, the Senate must still pass its own version, and then any conflicts between the two versions must be ironed out. But it hints at a possible Republican game plan going forward: allow defense budget reductions to occur, at least for a bit. And then quietly start the process of attempting to reverse those reductions a little while later.
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source: Mother Jones
Lockheed Martin's Herculean Lobbying Efforts
Thanks to Lockheed, Congress keeps funding more cargo planes the military doesn't need.
When I was a kid obsessed with military aircraft, I loved Chicago's O'Hare airport. If I was lucky and scored a window seat, I might get to see a line of C-130 Hercules transport planes parked on the tarmac in front of the 928th Airlift Wing's hangars. For a precious moment on takeoff or landing, I would have a chance to stare at those giant gray beasts with their snub noses and huge propellersuntil they passed from sight.
What I didn't know then was why the Air Force Reserve, as well as the Air National Guard, had squadrons of these big planes eternally parked at O'Hare and many other airports and air stations around the country. It's a tale made to order for this time of sequestration that makes a mockery of all the hyperboleabout how any spendingcuts will "hollow out" our forces and "devastate" our national security.
Consider this a parable to help us see past the alarmist talking points issued by defense contractor lobbyists, the public relations teams they hire, and the think tanks they fund. It may help us see just how effective defense contractors are in growing their businesses, whatever the mood of the moment.
Meet the Herk
The C-130 Hercules is a mid-sized transport airplane designed to airlift people or cargo around a theater of operations. It dates back to the Korean War, when the Air Force decided that it needed a next generation ("NextGen") transport plane. In 1951, it asked for designs, and Lockheed won the competition. The first C-130s were delivered three years after the war ended.
The C-130 Hercules, or Herk for short, isn't a sexy plane. It hasn't inspired hit Hollywood films, though it has prompted a few photo books, a beer, and a "Robby the C-130" trilogy for children whose military parents are deployed. It has a fat sausage fuselage, that snubnose, overhead wings with two propellers each, and a big back gate that comes down to load and unload up to 21 tons of cargo.
The Herk can land on short runways, even ones made of dirt or grass; it can airdrop parachutists or cargo; it can carry four drones under its wings; it can refuel aircraft; it can fight forest fires; it can morph into a frightening gunship. It's big and strong and can do at least 12 types of labor—hence, Hercules.
Too Much of a Good Thing
Here's where the story starts to get interesting. After 25 years, the Pentagon decided that it was well stocked with C-130s, so President Jimmy Carter's administration stopped asking Congress for more of them.
Lockheed was in trouble. A few years earlier, the Air Force had started looking into replacing the Hercules with a new medium-sized transport plane that could handle really short runways, and Lockheed wasn't selected as one of the finalists. Facing bankruptcy due to cost overruns and cancellations of programs, the company squeezed Uncle Sam for a bailout of around $1 billion in loan guarantees and other relief (which was unusual back then, as William Hartung points out his magisterial Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex).
Then a scandal exploded when it was revealed that Lockheed had proceeded to spend some $22 million of those funds in bribes to foreign officials to persuade them to buy its aircraft. This helped prompt Congress to pass the Foreign Corrupt Practices Act.
So what did Lockheed do about the fate of the C-130? It bypassed the Pentagon and went straight to Congress. Using a procedure known as a congressional "add-on"—that is, an earmark—Lockheed was able to sell the military another fleet of C-130s that it didn't want.
To be fair, the Air Force did request some C-130s. Thanks to Senator John McCain, the Government Accountability Office (GAO) did a study of how many more C-130s the Air Force requested between 1978 and 1998. The answer: Five.
How many did Congress add on? Two hundred and fifty-six.
As Hartung commented, this must "surely [be] a record in pork-barrel politics."
Standard Operating Procedure
Lockheed made this happen by putting its lobbyists to work. They focused on legislators in key committee positions and in states where Lockheed, like others in the defense industry, had strategically located their operations and subcontracts. The company poured millions of dollars into lobbying and political donations.
Tracking lobbying is hard to do, but to give a sense of the scope of the numbers, Lockheed has reported $22,289,859 in political donations since 1990 and millions in lobbying expenses every year, peaking in 2008 at $16,181,506, according to the Center for Responsive Politics. And that doesn't include what it paid its PR people or the work of defense and aerospace industry advocacygroups or the think tanks those industries fund. As an example of the latter, consider the boldly titled "research study," C-130J: How the Best Military Aircraft Became Even Better, written by Lockheed consultant Loren Thompson and published by the Lexington Institute, which was founded by a Lockheed lobbyist. Of course, the puff piece mentions no affiliations with the company. For these reasons, Dina Rasor of the Project on Government Oversight, which ranks the company #1 on its Federal Contractor Misconduct Database, calls Lockheed "the ultimate pay-to-play contractor."
Most of the dollars the company spends on lobbying are tax dollars. According to its 2011 annual report, "82% of our $46.5 billion in net sales were from the US Government, including 61% from the Department of Defense." And don't forget that a significant part of the 17% of its sales that went to international customers in 2011 were actually paid for by Uncle Sam under the rubric of foreign military aid. Only 1% of its sales that year were to "US commercial and other customers." Its CEO made $20,538,981, while the company paid only $722 million in net federal and foreign taxes in that same year.
When it came to the C-130, the process worked like a dream. "By following this strategy from year to year," writes a team of scholars of lobbying, "Lockheed has been able to turn what was to be the C-130's doom in the 1970s into a regularly funded military spending program, all without a single request having been sent by the administration to Congress." Lockheed was so successful on Capitol Hill that its work even garnered a name in honor of the 50 planes bought for every one requested: "C-130 math."
John McCain complained that "we're going to have a C-130 for every schoolyard in America before this is over." The "add-on" legislators were unabashed. Senator Max Cleland of Georgia—where Lockheed assembles the C-130—responded, "I'm for schoolyards being able to be moved anywhere in the world on a moment's notice."
I felt that way, too—when I was five.
How to Win Friends in the States and Influence People in Congress
So what happened to those extra planes? The Air Force didn't have the space for them, so they retired some older models that still had plenty of life in them and shunted most of the rest off to the Air Force Reserves and Air National Guard. That's why I used to see them at O'Hare.
The reason I usually saw them parked in front of the hangars is that sufficient operating and maintenance funds didn't always come with the planes, which mattered even more after Lockheed introduced a new version, the C-130J Super Hercules, in the mid-1990s.
The Air Force's approach of passing unwanted Herks off to the Air Guard and Reserves worked out nicely for Lockheed. The company allied with Air Guard and reservist advocacy groups to lobby Congress further. In an era of base closures, heavily lobbied governors would use the arrival of new planes to argue for the continuing life of bases in their states. In turn, states and their congressional delegations would fight to get new planes or hang onto existing ones. It was a veritable Lockheed feedback loop. Washington Post reporter Walter Pincus quoted a Pentagon official as seeing C-130 politics as a twist on the old military-industrial complex: "a triangle of the Guard, Lockheed, and politicians."
The result: the military was often prevented from retiring the oldest Herks, the ones that really needed to be put out to pasture. For example, as Pincus reported, the Joint Chiefs and the Air Force concluded in 1996 that they had 50 more C-130s than they needed, butCongress stymied efforts to retire any of them. One tactic used was to hold nominees hostage: a Kentucky senator repeatedly held up Air Force promotions until four Kentucky Air Guard C-130s were taken off the chopping block.
And it hasn't ended yet. In its FY2013 budget, the Pentagon planned to retire 65 older C-130s to save a little money. However, National Guard groups successfully mobilized state governors and congressional delegations from states like Alaska to, in the words of Alaska Senator Mark Begich "fight this action every step of the way." Congress managed to save all of them for a year, and half of them permanently.
The Not-So-Super Hercules, or the Program That Just Won't Die
Air Force attempts to replace the C-130 with a new generation of transport planes also have a habit of dying or getting rerouted. The Herk's turf has generally proved remarkably sacrosanct. The "Advanced Medium STOL" (short takeoff and landing) program of the 1970s, for instance, fizzled, possibly due to Lockheed's lobbying. The competing C-27J is being cancelled in favor of more C-130s. The C-130 Avionics Modernization Program (AMP), which in a surprise move was handed to competitor Boeing—as one of several gifts from a senior Pentagon procurement official shortly before she took a high-paying job there (en route to prison)—is being cancelled, too. (Though a new congressional C-130 Modernization Caucus spawned by Boeing and led by the congressman in whose district the AMP's training program is located, is doing its best to cancel the cancellation.)
Knowing that it could keep the C-130 alive through congressional add-ons and foreign sales well into the future, Lockheed took the unusual step of developing the next generation of the plane without newfunding from the Pentagon. It invested $1 billion of its profits from government contracts in the new C-130J Super Hercules. This has kept the factory in Marietta, Georgia, humming, and with over 2,400 C-130s already built, Lockheed calls it "the longest continuously operating military aircraft production line in history."
Humming, yes, but not always in tune. The C-130J has been plagued by problems. In 2004, after the military had acquired 50 of the planes, the Pentagon's Inspector General found that, even while the Air Force and Congress kept ordering more of the planes, they didn't meet contracted standards. The weather chasers couldn't chase storms because propellers would crack in bad weather. The military wouldn't use C-130Js for air drops in Iraq or Afghanistan because they didn't think they were safe. "The design of the C-130J is not stable and the C-130J aircraft has not passed operational testing," the Inspector General concluded. It "is not operationally effective or suitable."
To fix these problems, the unit cost rapidly ran up to $81 million per plane. The problems proved so daunting that Secretary of Defense Donald Rumsfeld axed the C-130J program in 2005—or tried to.
For the lobbyists and the plane's fans in Congress, it was once more unto the breach. Lockheed also got help on the inside. The Air Force made up some numbers indicating that it would be far more expensive to cancel the program than to just keep buying—overstating the possible cancellation cost by at least $1.1 billion. In the end, Rumsfeld surrendered. In 2006, in a relatively rare step, the Pentagon forced Lockheed to take a hit on its profits and negotiate a new contract reducing the sticker price of the planes by several million dollars. But that didn't last long. The unit cost soon bounced back; the basic C-130J now costs$93.6 million.
When it comes to military contracting like this, it doesn't seem to matter which party occupies the White House or controls Congress. It doesn't even seem to matter how many planes the Air Force puts on its additional "unfunded" wish list beyond the Pentagon's official request, because Congress so often buys more. Sure, some years Congress doesn't provide. In 2010, the Air Force asked for 12 Herks in its main request and put two more on its unfunded wish list, yet Congress only gave it six. And sometimes money is pushed around from one year to another or from one bucket to another, making it challenging to track through the intentionally hard-to-understand (and not even auditable) Pentagon labyrinth.
At the present time, the military is asking both for more standard C-130Js (to replace old or heavily used Herks) and for new AC-130 gunships as well as Special Operations MC-130 variants on the plane in the questionable belief that these will be "invaluable" for fighting insurgents and terrorists. This means that the abolition of earmarks isn't all that big a deal for Lockheed.
But that doesn't stop it. Even with the threat of sequestrationlooming, and the Pentagon asking for seven new Herks in 2013, the House still inserted funding for 14.
What will happen in this year's request? We don't know yet, because it's late in coming thanks to sequestration. But Lockheed isn't worried: even while threatening sequestration layoffs, the company forecasts record profits this year.
And why should it worry? As of last October, it had contracts to build 337 more Herks for the Pentagon and a variety of foreign countries. In November, it scored the program's biggest foreign military sale ever, $6.7 billion to build 25 of the planes for the Royal Saudi Air Force. It has three NextGen models in the works, including a wider version (suitably named the XL) to carry oversized new Army equipment. And with the Air Force starting to think about replacing the C-130 (again), Lockheed has already secured a spot as one of the two companies developing prototypes for that future plane with its nifty "Speed Agile" design. Besides, judging by the Pentagon's ongoing experiences with Lockheed's F-22 and F-35 advanced fighters, whose costs have hit the stratosphere, any next generation "trash hauler" is bound to carry a strikingly higher initial sticker price than the C-130J—and that, of course, is before the inevitable cost upticks begin.
Out the Window
C-130s have a special place in my heart. The first military aircraft I got to ride in was a Coast Guard Herk. An Air Force C-130 got me out of Iraq. Now that the 928th Airlift Wing is no more, I get a little wistful when I fly through Chicago and all I see out the window are private cargo hangars.
Or at least I did before I wrote this story.
But not to worry. There are plenty of other airports around the country with excess C-130s just sitting out there on the tarmac, gathering dust.
Lockheed Martin's Herculean Lobbying Efforts
Thanks to Lockheed, Congress keeps funding more cargo planes the military doesn't need.
When I was a kid obsessed with military aircraft, I loved Chicago's O'Hare airport. If I was lucky and scored a window seat, I might get to see a line of C-130 Hercules transport planes parked on the tarmac in front of the 928th Airlift Wing's hangars. For a precious moment on takeoff or landing, I would have a chance to stare at those giant gray beasts with their snub noses and huge propellersuntil they passed from sight.
What I didn't know then was why the Air Force Reserve, as well as the Air National Guard, had squadrons of these big planes eternally parked at O'Hare and many other airports and air stations around the country. It's a tale made to order for this time of sequestration that makes a mockery of all the hyperboleabout how any spendingcuts will "hollow out" our forces and "devastate" our national security.
Consider this a parable to help us see past the alarmist talking points issued by defense contractor lobbyists, the public relations teams they hire, and the think tanks they fund. It may help us see just how effective defense contractors are in growing their businesses, whatever the mood of the moment.
Meet the Herk
The C-130 Hercules is a mid-sized transport airplane designed to airlift people or cargo around a theater of operations. It dates back to the Korean War, when the Air Force decided that it needed a next generation ("NextGen") transport plane. In 1951, it asked for designs, and Lockheed won the competition. The first C-130s were delivered three years after the war ended.
The C-130 Hercules, or Herk for short, isn't a sexy plane. It hasn't inspired hit Hollywood films, though it has prompted a few photo books, a beer, and a "Robby the C-130" trilogy for children whose military parents are deployed. It has a fat sausage fuselage, that snubnose, overhead wings with two propellers each, and a big back gate that comes down to load and unload up to 21 tons of cargo.
The Herk can land on short runways, even ones made of dirt or grass; it can airdrop parachutists or cargo; it can carry four drones under its wings; it can refuel aircraft; it can fight forest fires; it can morph into a frightening gunship. It's big and strong and can do at least 12 types of labor—hence, Hercules.
Too Much of a Good Thing
Here's where the story starts to get interesting. After 25 years, the Pentagon decided that it was well stocked with C-130s, so President Jimmy Carter's administration stopped asking Congress for more of them.
Lockheed was in trouble. A few years earlier, the Air Force had started looking into replacing the Hercules with a new medium-sized transport plane that could handle really short runways, and Lockheed wasn't selected as one of the finalists. Facing bankruptcy due to cost overruns and cancellations of programs, the company squeezed Uncle Sam for a bailout of around $1 billion in loan guarantees and other relief (which was unusual back then, as William Hartung points out his magisterial Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex).
Then a scandal exploded when it was revealed that Lockheed had proceeded to spend some $22 million of those funds in bribes to foreign officials to persuade them to buy its aircraft. This helped prompt Congress to pass the Foreign Corrupt Practices Act.
So what did Lockheed do about the fate of the C-130? It bypassed the Pentagon and went straight to Congress. Using a procedure known as a congressional "add-on"—that is, an earmark—Lockheed was able to sell the military another fleet of C-130s that it didn't want.
To be fair, the Air Force did request some C-130s. Thanks to Senator John McCain, the Government Accountability Office (GAO) did a study of how many more C-130s the Air Force requested between 1978 and 1998. The answer: Five.
How many did Congress add on? Two hundred and fifty-six.
As Hartung commented, this must "surely [be] a record in pork-barrel politics."
Standard Operating Procedure
Lockheed made this happen by putting its lobbyists to work. They focused on legislators in key committee positions and in states where Lockheed, like others in the defense industry, had strategically located their operations and subcontracts. The company poured millions of dollars into lobbying and political donations.
Tracking lobbying is hard to do, but to give a sense of the scope of the numbers, Lockheed has reported $22,289,859 in political donations since 1990 and millions in lobbying expenses every year, peaking in 2008 at $16,181,506, according to the Center for Responsive Politics. And that doesn't include what it paid its PR people or the work of defense and aerospace industry advocacygroups or the think tanks those industries fund. As an example of the latter, consider the boldly titled "research study," C-130J: How the Best Military Aircraft Became Even Better, written by Lockheed consultant Loren Thompson and published by the Lexington Institute, which was founded by a Lockheed lobbyist. Of course, the puff piece mentions no affiliations with the company. For these reasons, Dina Rasor of the Project on Government Oversight, which ranks the company #1 on its Federal Contractor Misconduct Database, calls Lockheed "the ultimate pay-to-play contractor."
Most of the dollars the company spends on lobbying are tax dollars. According to its 2011 annual report, "82% of our $46.5 billion in net sales were from the US Government, including 61% from the Department of Defense." And don't forget that a significant part of the 17% of its sales that went to international customers in 2011 were actually paid for by Uncle Sam under the rubric of foreign military aid. Only 1% of its sales that year were to "US commercial and other customers." Its CEO made $20,538,981, while the company paid only $722 million in net federal and foreign taxes in that same year.
When it came to the C-130, the process worked like a dream. "By following this strategy from year to year," writes a team of scholars of lobbying, "Lockheed has been able to turn what was to be the C-130's doom in the 1970s into a regularly funded military spending program, all without a single request having been sent by the administration to Congress." Lockheed was so successful on Capitol Hill that its work even garnered a name in honor of the 50 planes bought for every one requested: "C-130 math."
John McCain complained that "we're going to have a C-130 for every schoolyard in America before this is over." The "add-on" legislators were unabashed. Senator Max Cleland of Georgia—where Lockheed assembles the C-130—responded, "I'm for schoolyards being able to be moved anywhere in the world on a moment's notice."
I felt that way, too—when I was five.
How to Win Friends in the States and Influence People in Congress
So what happened to those extra planes? The Air Force didn't have the space for them, so they retired some older models that still had plenty of life in them and shunted most of the rest off to the Air Force Reserves and Air National Guard. That's why I used to see them at O'Hare.
The reason I usually saw them parked in front of the hangars is that sufficient operating and maintenance funds didn't always come with the planes, which mattered even more after Lockheed introduced a new version, the C-130J Super Hercules, in the mid-1990s.
The Air Force's approach of passing unwanted Herks off to the Air Guard and Reserves worked out nicely for Lockheed. The company allied with Air Guard and reservist advocacy groups to lobby Congress further. In an era of base closures, heavily lobbied governors would use the arrival of new planes to argue for the continuing life of bases in their states. In turn, states and their congressional delegations would fight to get new planes or hang onto existing ones. It was a veritable Lockheed feedback loop. Washington Post reporter Walter Pincus quoted a Pentagon official as seeing C-130 politics as a twist on the old military-industrial complex: "a triangle of the Guard, Lockheed, and politicians."
The result: the military was often prevented from retiring the oldest Herks, the ones that really needed to be put out to pasture. For example, as Pincus reported, the Joint Chiefs and the Air Force concluded in 1996 that they had 50 more C-130s than they needed, butCongress stymied efforts to retire any of them. One tactic used was to hold nominees hostage: a Kentucky senator repeatedly held up Air Force promotions until four Kentucky Air Guard C-130s were taken off the chopping block.
And it hasn't ended yet. In its FY2013 budget, the Pentagon planned to retire 65 older C-130s to save a little money. However, National Guard groups successfully mobilized state governors and congressional delegations from states like Alaska to, in the words of Alaska Senator Mark Begich "fight this action every step of the way." Congress managed to save all of them for a year, and half of them permanently.
The Not-So-Super Hercules, or the Program That Just Won't Die
Air Force attempts to replace the C-130 with a new generation of transport planes also have a habit of dying or getting rerouted. The Herk's turf has generally proved remarkably sacrosanct. The "Advanced Medium STOL" (short takeoff and landing) program of the 1970s, for instance, fizzled, possibly due to Lockheed's lobbying. The competing C-27J is being cancelled in favor of more C-130s. The C-130 Avionics Modernization Program (AMP), which in a surprise move was handed to competitor Boeing—as one of several gifts from a senior Pentagon procurement official shortly before she took a high-paying job there (en route to prison)—is being cancelled, too. (Though a new congressional C-130 Modernization Caucus spawned by Boeing and led by the congressman in whose district the AMP's training program is located, is doing its best to cancel the cancellation.)
Knowing that it could keep the C-130 alive through congressional add-ons and foreign sales well into the future, Lockheed took the unusual step of developing the next generation of the plane without newfunding from the Pentagon. It invested $1 billion of its profits from government contracts in the new C-130J Super Hercules. This has kept the factory in Marietta, Georgia, humming, and with over 2,400 C-130s already built, Lockheed calls it "the longest continuously operating military aircraft production line in history."
Humming, yes, but not always in tune. The C-130J has been plagued by problems. In 2004, after the military had acquired 50 of the planes, the Pentagon's Inspector General found that, even while the Air Force and Congress kept ordering more of the planes, they didn't meet contracted standards. The weather chasers couldn't chase storms because propellers would crack in bad weather. The military wouldn't use C-130Js for air drops in Iraq or Afghanistan because they didn't think they were safe. "The design of the C-130J is not stable and the C-130J aircraft has not passed operational testing," the Inspector General concluded. It "is not operationally effective or suitable."
To fix these problems, the unit cost rapidly ran up to $81 million per plane. The problems proved so daunting that Secretary of Defense Donald Rumsfeld axed the C-130J program in 2005—or tried to.
For the lobbyists and the plane's fans in Congress, it was once more unto the breach. Lockheed also got help on the inside. The Air Force made up some numbers indicating that it would be far more expensive to cancel the program than to just keep buying—overstating the possible cancellation cost by at least $1.1 billion. In the end, Rumsfeld surrendered. In 2006, in a relatively rare step, the Pentagon forced Lockheed to take a hit on its profits and negotiate a new contract reducing the sticker price of the planes by several million dollars. But that didn't last long. The unit cost soon bounced back; the basic C-130J now costs$93.6 million.
When it comes to military contracting like this, it doesn't seem to matter which party occupies the White House or controls Congress. It doesn't even seem to matter how many planes the Air Force puts on its additional "unfunded" wish list beyond the Pentagon's official request, because Congress so often buys more. Sure, some years Congress doesn't provide. In 2010, the Air Force asked for 12 Herks in its main request and put two more on its unfunded wish list, yet Congress only gave it six. And sometimes money is pushed around from one year to another or from one bucket to another, making it challenging to track through the intentionally hard-to-understand (and not even auditable) Pentagon labyrinth.
At the present time, the military is asking both for more standard C-130Js (to replace old or heavily used Herks) and for new AC-130 gunships as well as Special Operations MC-130 variants on the plane in the questionable belief that these will be "invaluable" for fighting insurgents and terrorists. This means that the abolition of earmarks isn't all that big a deal for Lockheed.
But that doesn't stop it. Even with the threat of sequestrationlooming, and the Pentagon asking for seven new Herks in 2013, the House still inserted funding for 14.
What will happen in this year's request? We don't know yet, because it's late in coming thanks to sequestration. But Lockheed isn't worried: even while threatening sequestration layoffs, the company forecasts record profits this year.
And why should it worry? As of last October, it had contracts to build 337 more Herks for the Pentagon and a variety of foreign countries. In November, it scored the program's biggest foreign military sale ever, $6.7 billion to build 25 of the planes for the Royal Saudi Air Force. It has three NextGen models in the works, including a wider version (suitably named the XL) to carry oversized new Army equipment. And with the Air Force starting to think about replacing the C-130 (again), Lockheed has already secured a spot as one of the two companies developing prototypes for that future plane with its nifty "Speed Agile" design. Besides, judging by the Pentagon's ongoing experiences with Lockheed's F-22 and F-35 advanced fighters, whose costs have hit the stratosphere, any next generation "trash hauler" is bound to carry a strikingly higher initial sticker price than the C-130J—and that, of course, is before the inevitable cost upticks begin.
Out the Window
C-130s have a special place in my heart. The first military aircraft I got to ride in was a Coast Guard Herk. An Air Force C-130 got me out of Iraq. Now that the 928th Airlift Wing is no more, I get a little wistful when I fly through Chicago and all I see out the window are private cargo hangars.
Or at least I did before I wrote this story.
But not to worry. There are plenty of other airports around the country with excess C-130s just sitting out there on the tarmac, gathering dust.
Taxpayers Turn U.S. Farmers Into Fat Cats With Subsidies
http://www.bloomberg.com/news/2013-...enue-sowing-subsidies-for-crop-insurance.html
http://www.bloomberg.com/news/2013-...enue-sowing-subsidies-for-crop-insurance.html
Why Taxpayers Pay For Farmers' Insurance
Why Taxpayers Pay For Farmers' Insurance (16:17)
August 14, 2012 9:35 PM
In spite of the drought, many U.S. farmers will do just fine this year. They are, after all, covered by crop insurance — a program that costs U.S. taxpayers $7 billion a year.
On today's show, we travel to Fairbury, Illinois. We meet three generations of farmers who tell us that, even without government-subsidized crop insurance, their farms would survive the drought.
So why does the government spend so much on crop insurance programs? We talk to an ag economist who has a surprising answer.
http://www.npr.org/blogs/money/2012...e-394-why-taxpayers-pay-for-farmers-insurance
Why Taxpayers Pay For Farmers' Insurance (16:17)
August 14, 2012 9:35 PM
In spite of the drought, many U.S. farmers will do just fine this year. They are, after all, covered by crop insurance — a program that costs U.S. taxpayers $7 billion a year.
On today's show, we travel to Fairbury, Illinois. We meet three generations of farmers who tell us that, even without government-subsidized crop insurance, their farms would survive the drought.
So why does the government spend so much on crop insurance programs? We talk to an ag economist who has a surprising answer.
http://www.npr.org/blogs/money/2012...e-394-why-taxpayers-pay-for-farmers-insurance
Spending on contracts and lobbying propels a wave of new wealth in D .C.
Spending on contracts and lobbying propels a wave of new wealth in D .C.
Spending on contracts and lobbying propels a wave of new wealth in D .C.
source: Morther Jones
Until Sen. Patty Murray (D-Wash.) and Rep. Paul Ryan (R-Wis.) rode to the rescue this week, Pentagon brass and their allies had been issuing dire warnings about the nation's military readiness: The armed services were being decimated, they said, by sequestration—the automatic budget cuts that were set to trim $1 trillion from the Pentagon budget over the next decade. "It's one thing for the Pentagon to go on a diet. It's another for the Pentagon to wear a straitjacket while dieting," grumbled Rep. Jim Cooper (D-Tenn.). The message got through: The House overwhelmingly approved the Ryan-Murray plan just two days after it was introduced.
But now, the Pentagon has once more gotten a reprieve from the budget ax: Under Murray and Ryan's congressional budget deal, the Pentagon will get an additional $32 billion, or 4.4 percent, in 2014, leaving its base budget at a higher level than in 2005 and 2006. (The Department of Defense expects its total 2014 budget, including supplemental war funding, to be more than $600 billion.)
Before the budget deal, some critics of defense spending had been ready to accept sequestration as the blunt, imperfect tool that might force the military to shed some of the bulk it acquired while fighting two of the longest and most expensive wars in our history. Even with the sequester in place, the Pentagon's base budget was set to remain well above pre-9/11 levels for the next decade, and the military would have taken a far smaller haircut than it did after Vietnam and the Cold War wound down.
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The wars in Iraq and Afghanistan cost $1.5 trillion, about twice the cost of the Vietnam War when adjusted for inflation. Those funds came entirely from borrowing, contributing nearly 20 percent to the national debt accrued between 2001 and 2012.
And that's just the "supplemental" military spending passed by Congress for the wars—the regular Pentagon budget also grew nearly 45 percent between 2001 and 2010.
No wonder, perhaps, that defense watchdogs found the Pentagon's wailing about the sequester less than convincing. "These 'terrible' cuts would return us to historically high levels of spending," snapped Winslow Wheeler of the Project on Government Oversight. According to Lawrence J. Korb, a senior fellow at the Center for American Progress, the Pentagon could reduce its budget by $100 billion a year without undermining its readiness. The sequestration cuts for 2013 amounted to $37 billion.
Not so long ago, a hawkish GOP politician called for the "bloated" defense establishment to "be pared down" and retooled for the 21st century. The new budget deal doesn't reissue the blank check the Pentagon received during the past decade, but it may have removed the incentive to pare down. Below, a field guide to just how big the Pentagon budget is—and why it's so hard to trim. (That GOP politician? Former Sen. Chuck Hagel, now the secretary of defense.)
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Our military is mind-bogglingly big.
One out of every five tax dollars is spent on defense.
The $3.7 trillion federal budget breaks down into mandatory spending—benefits guaranteed the American people, such as Social Security and Medicare—and discretionary spending—programs that, at least in theory, can be cut. In 2013, more than half of all discretionary spending (and one-fifth of total spending) went to defense, including the Pentagon, veterans' benefits, and the nuclear weapons arsenal.
We're still the world's 800-pound gorilla.
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</SECTION>
When it comes to defense spending, no country can compete directly with the United States, which spends more than the next 10 countries combined—including potential rivals Russia and China, as well as allies such as England, Japan, and France. Altogether, the Pentagon accounts for nearly 40 percent of global military spending. In 2012, 4.4 percent of our GDP went to defense. That's in line with how much Russia spends; China spends 2 percent of its GDP on its military.
Too big to audit
Where does the Pentagon's money go? The exact answer is a mystery. That's because the Pentagon's books are a complete mess. They're so bad that they can't even be officially inspected, despite a 1997 requirement that federal agencies submit to annual audits—just like every other business or organization.
The Defense Department is one of just two agencies (Homeland Security is the other) that are keeping the bean counters waiting: As the Government Accountability Office dryly notes, the Pentagon has "serious financial management problems" that make its financial statements "inauditable." Pentagon financial operations occupy one-fifth of the GAO's list of federal programs with a high risk of waste, fraud, or inefficiency.
Critics also contend that the Pentagon cooks its books by using unorthodox accounting methods that make its budgetary needs seem more urgent. The agency insists it will "achieve audit readiness" by 2017.
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</SECTION>
Anatomy of a budget buster
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</SECTION>
In the early 2000s, the Pentagon began developing a new generation of stealthy, high-tech fighter jets that were supposed to do everything from landing on aircraft carriers and taking off vertically to dogfighting and dropping bombs. The result is the F-35 Joint Strike Fighter, whose three models (one each for the Navy, Air Force, and Marines) are years behind schedule, hugely over budget, and plagued with problems that have earned them a reputation as the biggest defense boondoggle in history.
Ways to save a few billion
There are savings to be had within the Pentagon's massive budget—if politicians can weather the storm that kicks up whenever a pet project is targeted. Here are 10 ideas for major cuts from an array of defense wonks, from the libertarian Cato Institute and the liberal Center for American Progress to the conservative American Enterprise Institute.
<TABLE class=tableZebra><THEAD><TR><TH>Proposal</TH><TH>Estimated savings</TH></TR></THEAD><TBODY><TR class=oddRow><TD>Get rid of all ICMBs and nuclear bombers (but keep nuclear-armed subs).</TD><TD>$20 billion/year</TD></TR><TR class=evenRow><TD>Retire 2 of the Navy's 11 aircraft carrier groups.</TD><TD>$50 billion through 2020</TD></TR><TR class=oddRow><TD>Cut the size of the Army and Marines to pre-9/11 levels.</TD><TD>At least $80 billion over 10 years</TD></TR><TR class=evenRow><TD>Slow down or cancel the pricey F-35 fighter jet program.</TD><TD>At least $4 billion/year</TD></TR><TR class=oddRow><TD>Downsize military headquarters that grew after 9/11.</TD><TD>$8 billion/year</TD></TR><TR class=evenRow><TD>Cancel the troubled V-22 Osprey tiltrotor and use helicopters instead.</TD><TD>At least $1.2 billion</TD></TR><TR class=oddRow><TD>Modify supplemental Medicare benefits for veterans.</TD><TD>$40 billion over 10 years</TD></TR><TR class=evenRow><TD>Scale back purchases of littoral combat ships.</TD><TD>$2 billion in 2013</TD></TR><TR class=oddRow><TD>Cap spending on military contractors below 2012 levels.</TD><TD>$2.9 billion/year</TD></TR><TR class=evenRow><TD>Retire the Cold War-era B-1 bomber.</TD><TD>$3.7 billion over 5 years</TD></TR></TBODY></TABLE>
Why Congress spared the Pentagon
A few weeks ago, an agreement to end the cycle of budget crises and fiscal hostage-taking seemed distant. Sequestration had few friends on the Hill, but the parties could not agree on how to ditch the automatic budget cuts to defense and domestic spending. Republicans had proposed increasing defense spending while taking more money from Obamacare and other social programs, while Democrats said they'd scale back the defense cuts in exchange for additional tax revenue. Those ideas were nonstarters: Following the government shutdown in October, Senate Majority Leader Harry Reid (D-Nev.) called the idea of trading Social Security cuts for bigger defense budgets "stupid."
Which explains why Rep. Ryan and Sen. Murray's deal craftily dodged taxes and entitlements while focusing on the one thing most Republicans and Democrats could agree upon: saving the Pentagon budget. This chart shows why military spending is the glue holding the budget deal together.
Guns and butter
A closer look at the $361 billion handed to military contractors in 2012 reveals the enormous amount of stuff the modern military consumes. Some of the items on the shopping list:
Sources: Office of Management and Budget (historic Pentagon budget chart); Department of Defense (PDF), Congressional Research Service, OMB, House Budget Committee (PDF) (recent/proposed Pentagon budget chart); DoD (PDF), Government Accountability Office (size of Pentagon stats); OMB, Washington Post (federal budget chart); Stockholm International Peace Research Institute (international military spending chart); GAO (F-35 cost chart); GAO, Kara's Cupcakes (cupcake chart); USASpending.gov (contracts list). Research by AJ Vicens and Eric Wuestwald. Top illustration: Guyco; Top photograph: Gregg Segal; Cupcake image: Edward Boatman/ The Noun Project. Charts by Carolyn Perot. Support for this story was provided by a grant from the Puffin Foundation Investigative Journalism Project.
Until Sen. Patty Murray (D-Wash.) and Rep. Paul Ryan (R-Wis.) rode to the rescue this week, Pentagon brass and their allies had been issuing dire warnings about the nation's military readiness: The armed services were being decimated, they said, by sequestration—the automatic budget cuts that were set to trim $1 trillion from the Pentagon budget over the next decade. "It's one thing for the Pentagon to go on a diet. It's another for the Pentagon to wear a straitjacket while dieting," grumbled Rep. Jim Cooper (D-Tenn.). The message got through: The House overwhelmingly approved the Ryan-Murray plan just two days after it was introduced.
But now, the Pentagon has once more gotten a reprieve from the budget ax: Under Murray and Ryan's congressional budget deal, the Pentagon will get an additional $32 billion, or 4.4 percent, in 2014, leaving its base budget at a higher level than in 2005 and 2006. (The Department of Defense expects its total 2014 budget, including supplemental war funding, to be more than $600 billion.)
Before the budget deal, some critics of defense spending had been ready to accept sequestration as the blunt, imperfect tool that might force the military to shed some of the bulk it acquired while fighting two of the longest and most expensive wars in our history. Even with the sequester in place, the Pentagon's base budget was set to remain well above pre-9/11 levels for the next decade, and the military would have taken a far smaller haircut than it did after Vietnam and the Cold War wound down.
<SECTION class=full>
The wars in Iraq and Afghanistan cost $1.5 trillion, about twice the cost of the Vietnam War when adjusted for inflation. Those funds came entirely from borrowing, contributing nearly 20 percent to the national debt accrued between 2001 and 2012.
And that's just the "supplemental" military spending passed by Congress for the wars—the regular Pentagon budget also grew nearly 45 percent between 2001 and 2010.
No wonder, perhaps, that defense watchdogs found the Pentagon's wailing about the sequester less than convincing. "These 'terrible' cuts would return us to historically high levels of spending," snapped Winslow Wheeler of the Project on Government Oversight. According to Lawrence J. Korb, a senior fellow at the Center for American Progress, the Pentagon could reduce its budget by $100 billion a year without undermining its readiness. The sequestration cuts for 2013 amounted to $37 billion.
Not so long ago, a hawkish GOP politician called for the "bloated" defense establishment to "be pared down" and retooled for the 21st century. The new budget deal doesn't reissue the blank check the Pentagon received during the past decade, but it may have removed the incentive to pare down. Below, a field guide to just how big the Pentagon budget is—and why it's so hard to trim. (That GOP politician? Former Sen. Chuck Hagel, now the secretary of defense.)
<SECTION class=full>
- The Pentagon employs 3 million people, 800,000 more than Walmart.
- The Pentagon's 2012 budget was 47 percent bigger than Walmart's.
- Serving 9.6 million people, the Pentagon and Veterans Administration together constitute the nation's largest healthcare provider.
- 70 percent of the value of the federal government's $1.8 trillion in property, land, and equipment belongs to the Pentagon.
- Los Angeles could fit into the land managed by the Pentagon 93 times. The Army uses more than twice as much building space as all the offices in New York City.
- The Pentagon holds more than 80 percent of the federal government's inventories, including $6.8 billion of excess, obsolete, or unserviceable stuff.
- The Pentagon operates more than more than 170 golf courses worldwide.
The $3.7 trillion federal budget breaks down into mandatory spending—benefits guaranteed the American people, such as Social Security and Medicare—and discretionary spending—programs that, at least in theory, can be cut. In 2013, more than half of all discretionary spending (and one-fifth of total spending) went to defense, including the Pentagon, veterans' benefits, and the nuclear weapons arsenal.
<SECTION class=floatRight>
When it comes to defense spending, no country can compete directly with the United States, which spends more than the next 10 countries combined—including potential rivals Russia and China, as well as allies such as England, Japan, and France. Altogether, the Pentagon accounts for nearly 40 percent of global military spending. In 2012, 4.4 percent of our GDP went to defense. That's in line with how much Russia spends; China spends 2 percent of its GDP on its military.
Where does the Pentagon's money go? The exact answer is a mystery. That's because the Pentagon's books are a complete mess. They're so bad that they can't even be officially inspected, despite a 1997 requirement that federal agencies submit to annual audits—just like every other business or organization.
The Defense Department is one of just two agencies (Homeland Security is the other) that are keeping the bean counters waiting: As the Government Accountability Office dryly notes, the Pentagon has "serious financial management problems" that make its financial statements "inauditable." Pentagon financial operations occupy one-fifth of the GAO's list of federal programs with a high risk of waste, fraud, or inefficiency.
Critics also contend that the Pentagon cooks its books by using unorthodox accounting methods that make its budgetary needs seem more urgent. The agency insists it will "achieve audit readiness" by 2017.
<SECTION class=full>
Anatomy of a budget buster
<SECTION class=floatRight>
In the early 2000s, the Pentagon began developing a new generation of stealthy, high-tech fighter jets that were supposed to do everything from landing on aircraft carriers and taking off vertically to dogfighting and dropping bombs. The result is the F-35 Joint Strike Fighter, whose three models (one each for the Navy, Air Force, and Marines) are years behind schedule, hugely over budget, and plagued with problems that have earned them a reputation as the biggest defense boondoggle in history.
- Rolling out the F-35 originally was expected to cost $233 billion, but now it's expected to cost nearly $400 billion. The time needed to develop the plane has gone from 10 years to 18.
- Lockheed says the final cost per plane will be about $75 million. However, according to the Government Accountability Office, the actual cost has jumped to $137 million.
- It was initially estimated that it could cost another $1 trillion or more to keep the new F-35s flying for 30 years. Pentagon officials called this "unaffordable"—and now say it will cost only $857 million. "This is no longer the trillion-dollar [aircraft]," boasts a Lockheed Martin executive.
- Planes started rolling off the assembly line before development and testing were finished, which could result in $8 billion worth of retrofits.
- A 2013 report by the Pentagon inspector general identified 719 problems with the F-35 program. Some of the issues with the first batch of planes delivered to the Marines:
- Pilots are not allowed to fly these test planes at night, within 25 miles of lightning, faster than the speed of sound, or with real or simulated weapons.
- Pilots say cockpit visibility is worse than in existing fighters.
- Special high-tech helmets have "frequent problems" and are "badly performing."
- Takeoffs may be postponed when the temperature is below 60°F.
- The F-35 program has 1,400 suppliers in 46 states. Lockheed Martin gave money to 425 members of Congress in 2012 and has spent $159 million on lobbying since 2000.
There are savings to be had within the Pentagon's massive budget—if politicians can weather the storm that kicks up whenever a pet project is targeted. Here are 10 ideas for major cuts from an array of defense wonks, from the libertarian Cato Institute and the liberal Center for American Progress to the conservative American Enterprise Institute.
<TABLE class=tableZebra><THEAD><TR><TH>Proposal</TH><TH>Estimated savings</TH></TR></THEAD><TBODY><TR class=oddRow><TD>Get rid of all ICMBs and nuclear bombers (but keep nuclear-armed subs).</TD><TD>$20 billion/year</TD></TR><TR class=evenRow><TD>Retire 2 of the Navy's 11 aircraft carrier groups.</TD><TD>$50 billion through 2020</TD></TR><TR class=oddRow><TD>Cut the size of the Army and Marines to pre-9/11 levels.</TD><TD>At least $80 billion over 10 years</TD></TR><TR class=evenRow><TD>Slow down or cancel the pricey F-35 fighter jet program.</TD><TD>At least $4 billion/year</TD></TR><TR class=oddRow><TD>Downsize military headquarters that grew after 9/11.</TD><TD>$8 billion/year</TD></TR><TR class=evenRow><TD>Cancel the troubled V-22 Osprey tiltrotor and use helicopters instead.</TD><TD>At least $1.2 billion</TD></TR><TR class=oddRow><TD>Modify supplemental Medicare benefits for veterans.</TD><TD>$40 billion over 10 years</TD></TR><TR class=evenRow><TD>Scale back purchases of littoral combat ships.</TD><TD>$2 billion in 2013</TD></TR><TR class=oddRow><TD>Cap spending on military contractors below 2012 levels.</TD><TD>$2.9 billion/year</TD></TR><TR class=evenRow><TD>Retire the Cold War-era B-1 bomber.</TD><TD>$3.7 billion over 5 years</TD></TR></TBODY></TABLE>
A few weeks ago, an agreement to end the cycle of budget crises and fiscal hostage-taking seemed distant. Sequestration had few friends on the Hill, but the parties could not agree on how to ditch the automatic budget cuts to defense and domestic spending. Republicans had proposed increasing defense spending while taking more money from Obamacare and other social programs, while Democrats said they'd scale back the defense cuts in exchange for additional tax revenue. Those ideas were nonstarters: Following the government shutdown in October, Senate Majority Leader Harry Reid (D-Nev.) called the idea of trading Social Security cuts for bigger defense budgets "stupid."
Which explains why Rep. Ryan and Sen. Murray's deal craftily dodged taxes and entitlements while focusing on the one thing most Republicans and Democrats could agree upon: saving the Pentagon budget. This chart shows why military spending is the glue holding the budget deal together.
A closer look at the $361 billion handed to military contractors in 2012 reveals the enormous amount of stuff the modern military consumes. Some of the items on the shopping list:
Sources: Office of Management and Budget (historic Pentagon budget chart); Department of Defense (PDF), Congressional Research Service, OMB, House Budget Committee (PDF) (recent/proposed Pentagon budget chart); DoD (PDF), Government Accountability Office (size of Pentagon stats); OMB, Washington Post (federal budget chart); Stockholm International Peace Research Institute (international military spending chart); GAO (F-35 cost chart); GAO, Kara's Cupcakes (cupcake chart); USASpending.gov (contracts list). Research by AJ Vicens and Eric Wuestwald. Top illustration: Guyco; Top photograph: Gregg Segal; Cupcake image: Edward Boatman/ The Noun Project. Charts by Carolyn Perot. Support for this story was provided by a grant from the Puffin Foundation Investigative Journalism Project.
Re: Taxpayers Turn U.S. Farmers Into Fat Cats With Subsidies
source: Los Angeles Times
Farm bill: Still millions for fat cats in Congress, cuts for the poor
Rep. Doug LaMalfa, R-Richvale (in hat), still thinks food stamp recipients are living too high. (J. Scott Applewhite/AP
Backers of the new farm bill, approved by the House today and destined for consideration by the Senate next week, are patting themselves on the back for saving billions by eliminating a huge wasteful farm subsidy program.
Don't believe the hype. The conservative American Enterprise Institute says the measure could cost taxpayers $15 billion more per year than do existing crop programs, much of it going to the wealthiest farmers and the crop insurance industry. The AEI calls the farm bill a "bait and switch" scheme and the product of "beggar thy neighbor cronyism." And that's from a pro-business organization.
But the AEI doesn't even address what may be the worst aspect of the farm bill, which is its cuts to food stamps. The Supplemental Nutrition Assistance Program (that's the formal name for food stamps) will be cut by $8 billion over 10 years by the bill agreed upon in conference between representatives and senators.
That's twice what the Senate originally proposed, but a fraction of the nearly $40 billion the GOP House voted to cut last year. Those cuts didn't go into effect, but a cut of $5 billion in the current fiscal year was implemented via Congressional inaction last November. That meant the loss of 21 meals a month for a family of four, and affected 47 million needy Americans.
That should provide some perspective to the terms of the new farm bill. As we've reported in the past, the farm bill often has given rise to some of the most coldhearted and hypocritical debate in Congress.
Our favorite poster boy among members of Congress who belly up to the crop-subsidy bar while crabbing about feeding the needy through SNAP has been California's own Rep. Doug LaMalfa (R-Richvale), whose farming family collected a sweet $5.1 million in federal crop subsidies between 1995 and 2012. By then he had come to the realization that food stamp recipients needed to tighten their belts in the name of governmental economizing.
LaMalfa is still ticked off that food stamp recipients aren't been squeezed more. "While I would have preferred a bill that generated more savings and included larger reforms in the food stamp system, I believe that we’ve achieved as much as the Democrat-led Senate will allow," he said after Wednesday's House vote. Then he asked for sympathy for the pain and destitution California farmers are experiencing because of the drought.
But LaMalfa's not the only farm bill hypocrite. Among the Republicans inveighing against the latest proposal is Rep. Marlin Stutzman (R-Ind.), who grouses that combining farm subsidies and SNAP in the same bill contributes to "logrolling." He prefers that the programs be debated separately, presumably so that food stamps can be slashed without farm aid being held for ransom. Stutzman has collected $200,000, and possibly more, in farm aid since 1995.
The AEI's analysis of the new bill says its one clear cutback in farm aid is the elimination of direct payments to farmers. Some 75% of those payments went to the richest 10% of farm owners.
But the $5 billion in annual savings there, AEI says, could be swamped by the higher costs of three new programs created by the farm bill. Among them are programs that would "essentially guarantee that farmers’ revenues never fall below 86% of what they earned in previous years, when crop prices were at historical highs." Another program would be "much more lucrative for farmers" than the version it replaces by guaranteeing farmers "much higher prices for covered crops."
AEI supports a proposal by Sens. Tom Coburn (R, Okla.) and Dick Durbin (D-Ill.) that would cap taxpayer subsidies for crop insurance for the richest farmers, cutting them as much as 15%. That's a step in the right direction, the organization says, but it's pretty meager--and it's not part of the farm bill.
The bottom line: Rep. LaMalfa and his fellow congressional farmers aren't in danger of needing food stamps themselves any time soon.
source: Los Angeles Times
Farm bill: Still millions for fat cats in Congress, cuts for the poor
Rep. Doug LaMalfa, R-Richvale (in hat), still thinks food stamp recipients are living too high. (J. Scott Applewhite/AP
Backers of the new farm bill, approved by the House today and destined for consideration by the Senate next week, are patting themselves on the back for saving billions by eliminating a huge wasteful farm subsidy program.
Don't believe the hype. The conservative American Enterprise Institute says the measure could cost taxpayers $15 billion more per year than do existing crop programs, much of it going to the wealthiest farmers and the crop insurance industry. The AEI calls the farm bill a "bait and switch" scheme and the product of "beggar thy neighbor cronyism." And that's from a pro-business organization.
But the AEI doesn't even address what may be the worst aspect of the farm bill, which is its cuts to food stamps. The Supplemental Nutrition Assistance Program (that's the formal name for food stamps) will be cut by $8 billion over 10 years by the bill agreed upon in conference between representatives and senators.
That's twice what the Senate originally proposed, but a fraction of the nearly $40 billion the GOP House voted to cut last year. Those cuts didn't go into effect, but a cut of $5 billion in the current fiscal year was implemented via Congressional inaction last November. That meant the loss of 21 meals a month for a family of four, and affected 47 million needy Americans.
That should provide some perspective to the terms of the new farm bill. As we've reported in the past, the farm bill often has given rise to some of the most coldhearted and hypocritical debate in Congress.
Our favorite poster boy among members of Congress who belly up to the crop-subsidy bar while crabbing about feeding the needy through SNAP has been California's own Rep. Doug LaMalfa (R-Richvale), whose farming family collected a sweet $5.1 million in federal crop subsidies between 1995 and 2012. By then he had come to the realization that food stamp recipients needed to tighten their belts in the name of governmental economizing.
LaMalfa is still ticked off that food stamp recipients aren't been squeezed more. "While I would have preferred a bill that generated more savings and included larger reforms in the food stamp system, I believe that we’ve achieved as much as the Democrat-led Senate will allow," he said after Wednesday's House vote. Then he asked for sympathy for the pain and destitution California farmers are experiencing because of the drought.
But LaMalfa's not the only farm bill hypocrite. Among the Republicans inveighing against the latest proposal is Rep. Marlin Stutzman (R-Ind.), who grouses that combining farm subsidies and SNAP in the same bill contributes to "logrolling." He prefers that the programs be debated separately, presumably so that food stamps can be slashed without farm aid being held for ransom. Stutzman has collected $200,000, and possibly more, in farm aid since 1995.
The AEI's analysis of the new bill says its one clear cutback in farm aid is the elimination of direct payments to farmers. Some 75% of those payments went to the richest 10% of farm owners.
But the $5 billion in annual savings there, AEI says, could be swamped by the higher costs of three new programs created by the farm bill. Among them are programs that would "essentially guarantee that farmers’ revenues never fall below 86% of what they earned in previous years, when crop prices were at historical highs." Another program would be "much more lucrative for farmers" than the version it replaces by guaranteeing farmers "much higher prices for covered crops."
AEI supports a proposal by Sens. Tom Coburn (R, Okla.) and Dick Durbin (D-Ill.) that would cap taxpayer subsidies for crop insurance for the richest farmers, cutting them as much as 15%. That's a step in the right direction, the organization says, but it's pretty meager--and it's not part of the farm bill.
The bottom line: Rep. LaMalfa and his fellow congressional farmers aren't in danger of needing food stamps themselves any time soon.
source: Huffington Post
Cost Of Military Jet Could House Every Homeless Person In U.S. With $600,000 Home
It's no news that a large portion of our federal tax dollars goes towards defense spending. But your jaw might drop at the cost of the newest jet manufactured by the U.S. military, and just how much good could have been achieved domestically with the same price tag.
The $400 billion program to create a fleet of F-35 Joint Strike Fighter jets, which, as The Hill points out, is seven years behind schedule and chronically plagued with misfortunes and incompetencies, could have housed every homeless person in the U.S. with a $600,000 home.
The staggering fact, configured by Think Progress, is just one of several figures the news source put into perspective for taxpayers. For example, the amount spent per year to build the F-35 jets could easily fulfill a $16.7 billion request by the United Nations Office of Coordination for Humanitarian Affairs to save countless lives from preventable causes around the world — and then have enough left over to fund UNICEF's budget request, too. The full cost of the jets program could also fund the National School Lunch Program, which feeds about 31 million students annually, for the next 24 years.
The mind-boggling cost for a fleet of F-35 jets exemplifies what Steven Conn would consider a military budget that doesn't have much of a positive impact on everyday Americans.
"Spending our taxes on the military doesn't yield much to make our lives or our communities better," Conn, a professor and Director of the Public History Program at Ohio State University, wrote on a HuffPost blog in April. "Big weapons systems and overseas military installations, to say nothing of feckless military adventures in Vietnam or Iraq, have done very little to fix our roads, improve our kids' education, or push the boundaries of medical research."
According to data provided by the Office of Management and Budget, the federal government spent roughly 19 times more on defense and international security assistance than it did on education in 2013. A graph created by the Peter G. Peterson Foundation illustrates that the U.S. spends more on defense than China, Russia, Saudi Arabia, France, the U.K., Germany, Japan and India combined.
Cost Of Military Jet Could House Every Homeless Person In U.S. With $600,000 Home
It's no news that a large portion of our federal tax dollars goes towards defense spending. But your jaw might drop at the cost of the newest jet manufactured by the U.S. military, and just how much good could have been achieved domestically with the same price tag.
The $400 billion program to create a fleet of F-35 Joint Strike Fighter jets, which, as The Hill points out, is seven years behind schedule and chronically plagued with misfortunes and incompetencies, could have housed every homeless person in the U.S. with a $600,000 home.
The staggering fact, configured by Think Progress, is just one of several figures the news source put into perspective for taxpayers. For example, the amount spent per year to build the F-35 jets could easily fulfill a $16.7 billion request by the United Nations Office of Coordination for Humanitarian Affairs to save countless lives from preventable causes around the world — and then have enough left over to fund UNICEF's budget request, too. The full cost of the jets program could also fund the National School Lunch Program, which feeds about 31 million students annually, for the next 24 years.
The mind-boggling cost for a fleet of F-35 jets exemplifies what Steven Conn would consider a military budget that doesn't have much of a positive impact on everyday Americans.
"Spending our taxes on the military doesn't yield much to make our lives or our communities better," Conn, a professor and Director of the Public History Program at Ohio State University, wrote on a HuffPost blog in April. "Big weapons systems and overseas military installations, to say nothing of feckless military adventures in Vietnam or Iraq, have done very little to fix our roads, improve our kids' education, or push the boundaries of medical research."
According to data provided by the Office of Management and Budget, the federal government spent roughly 19 times more on defense and international security assistance than it did on education in 2013. A graph created by the Peter G. Peterson Foundation illustrates that the U.S. spends more on defense than China, Russia, Saudi Arabia, France, the U.K., Germany, Japan and India combined.
source: Think Progress
Americans Have Spent Enough Money On A Broken Plane To Buy Every Homeless Person A Mansion
An F-35 Joint Strike Fighter in its natural habitat: the ground
Just days before its international debut at an airshow in the United Kingdom, the entire fleet of the Pentagon’s next generation fighter plane — known as the F-35 II Lightning, or the Joint Strike Fighter — has been grounded, highlighting just what a boondoggle the project has been. With the vast amounts spent so far on the aircraft, the United States could have worked wonders, including providing every homeless person in the U.S. a $600,000 home.
It’s hard to argue against the need to modernize aircraft used to defend the country and counter enemies overseas, especially if you’re a politician. But the Joint Strike Fighter program has been a mess almost since its inception, with massive cost overruns leading to its current acquisition price-tag of $398.6 billion — an increase of $7.4 billion since last year. That breaks down to costing about $49 billion per year since work began in 2006 and the project is seven years behind schedule. Over its life-cycle, estimated at about 55 years, operating and maintaining the F-35 fleet will cost the U.S. a little over $1 trillion. By contrast, the entirety of the Manhattan Project — which created the nuclear bomb from scratch — cost about $55 billion in today’s dollars.
“The political armor of the F-35 is as thick as the heads of the people who designed the airplane and its acquisition plan,” Winslow Wheeler, a former congressional staffer and outspoken critic of the F-35, recently told Foreign Policy about the longevity of the plane, despite the many setbacks it has endured. The support for the F-35 is so great in Congress that there’s actual a bipartisan Joint Strike Fighter Caucus dedicated to promoting it and keeping it alive. With that in mind, here are just a few of the other things that the insane amount spent on the troubled fighter could have gone towards instead, both at home and abroad:
Buying Every Homeless Person In The U.S. A Mansion
On any given night in 2013, the Department of Housing and Urban Development concluded, there were an estimated 600,000 homeless Americans living on the streets. Numerous studies, however, have showed that rather than putting money into temporary shelters or incarceration, communities have saved millions of dollars by investing in permanent homes for the homeless. A recent report showed that in one Florida community, it cost taxpayers an estimated $30,000 to take the homeless off the streets through traditional methods, but only around $10,000 per person to give them permanent housing and provide job training and other support. Expanding that concept to the Federal level, even taking into account things like varying real estate prices around the country, it’s possible that $7.4 billion would be more than enough to start a program nationwide. With the full amount spent on the F-35 at its disposal, the U.S. could afford to purchase every person on the streets a $664,000 home.
Unilaterally Funding Every Humanitarian Crisis
Overall, the United States less than one percent of its federal budget to foreign assistance. The State Department and USAID in Fiscal Year 2014 set aside about $31.1 billion in foreign aid funding, according to ForeignAssistance.gov. This includes $4.5 billion devoted towards funding the U.S. response to humanitarian crises around the world, including those in Syria, Iraq, South Sudan, and others. Millions of refugees and internally displaced people in these conflicts are struggling to survive, as the United Nations reports that each of these emergencies remain chronically underfunded. This year alone, the U.N. Office of Coordination for Humanitarian Affairs (UNOCHA) has raised only 35 percent of the funds it needs. In contrast, the $49 billion per year spent on the F-35 would singlehandedly fund not just UNOCHA’s $16.7 billion request, but also those of UNICEF and other emergency disaster relief bodies, saving countless lives.
In addition, U.N. officials want the situation at the U.S.’ southern border to be classified as a refugee crisis as well, as most of the thousands of children currently being detained fled their homes to escape a myriad number of life-threatening conditions. The Obama administration has requested $3.7 billion from Congress in emergency spending to help staunch the flow and provide for those who have already made it to the United States, but Republicans already appear to be lining up against the proposal. The F-35’s increased cost from last year alone would have easily covered that amount and then some.
Feeding Every Schoolchild In The Country
Earlier this year, President Obama signed into law an compromise version of the Farm Bill after months of deadlock saw the expiration of the former version. As part of the deal, House Republicans demanded huge cuts to the Supplemental Nutrition Assistance Program (SNAP), former known as food stamps, backing down only after a veto threat from the White House. The final bill, however, still included $8.7 billion worth of cuts, equaling about a $90 per month cut for recipients. The F-35’s excess costs for the last year by themselves could have nearly covered all of the losses, prevent state governors from having to scramble to provide families with the assistance they need.
As a backup when food subsidies are cut, low-income families often find themselves turning towards schools to provide meals during the day for their children. The National School Lunch Program feeds approximately 31 million students every year, at the cost of about $16.3 billion in both cash and commodity payments. The full cost of the plane so far would have funded this program as it stands for 24 years. If the amount being dispersed to schools was doubled, allowing the program to reach all 55 million students enrolled in K-12, the F-35 still would be able to cover that for the next decade.
Providing Security Around The World
Under the weighted system used to determine dues, the U.S. pays the lion’s share of funding to the United Nations’ 16 peacekeeping missions around the world. For the coming fiscal year, that works out to about $2.4 billion. That’s quite a bargain, as then-U.S. ambassador to the U.N. Susan Rice argued in 2009, telling PBS: “If the US was to act on its own – unilaterally – and deploy its own forces in many of these countries; for every dollar that the US would spend, the UN can accomplish the Mission for twelve cents.” Given how cost effective blue helmets are at providing security in areas where conflict has just ended, it would behoove the U.S. to grant even more support to the system. Additional funds would provide better arms and equipment, as well as better training, as the number of peacekeepers required around the world increases. The amount the U.S. has spent on the F-35 could have funded this year’s level of peacekeeping — a record-high $8.6 billion — for the next 46 years.
Boosting Funding Needed To Rebuild America
The United States is falling apart. A lack of funding for bridges, roads, and other infrastructure has led to collapses across the country and the more than 63,000 bridges that have been labeled as “structurally deficient.” The Department of Transportation’s total budget request for next year is $90.1 billion, part of a four-year budget of $302.1 billion with $199 billion set aside to rebuild America’s roads and bridges. Obama has for the last two years called for a $50 billion lump sum to be added to the on top of DOT’s budget to help address the growing need, and twice Congress has rejected this proposal. If the U.S. were to have channeled the $298 billion is has spent so far on the F-35 — and continued spending at that level for the next six years — the U.S. would be halfway towards closing the $1.1 trillion gap in investment needed in infrastructure, according to the American Society of Civil Engineers. In addition, a report from the Center for American Progress, citing Moody’s Analytic’s chief economist, estimates infrastructure investment generates $1.44 of economic activity for each $1 spent. That sort of claim can’t be duplicated in the spending on the F-35.
<center>***</center> Along with the United States, seven other countries have committed to purchasing F-35 fighters from Lockheed Martin once they’re completed, which is helping diffuse the costs for the American taxpayer. But these partners are growing increasingly wary of the aircraft’s ballooning price. Australia recently announced that it was scaling back its purchase, as has the Netherlands. Those concerns will likely only be compounded by the current grounding of the fleet. And so, though the British Air Force intended to have the fighter in service a full two years ago, the only place you’ll be able to see the F-35 in action for now remains on the big screen — where its successes have been about equal to those in real life.
Americans Have Spent Enough Money On A Broken Plane To Buy Every Homeless Person A Mansion
An F-35 Joint Strike Fighter in its natural habitat: the ground
Just days before its international debut at an airshow in the United Kingdom, the entire fleet of the Pentagon’s next generation fighter plane — known as the F-35 II Lightning, or the Joint Strike Fighter — has been grounded, highlighting just what a boondoggle the project has been. With the vast amounts spent so far on the aircraft, the United States could have worked wonders, including providing every homeless person in the U.S. a $600,000 home.
It’s hard to argue against the need to modernize aircraft used to defend the country and counter enemies overseas, especially if you’re a politician. But the Joint Strike Fighter program has been a mess almost since its inception, with massive cost overruns leading to its current acquisition price-tag of $398.6 billion — an increase of $7.4 billion since last year. That breaks down to costing about $49 billion per year since work began in 2006 and the project is seven years behind schedule. Over its life-cycle, estimated at about 55 years, operating and maintaining the F-35 fleet will cost the U.S. a little over $1 trillion. By contrast, the entirety of the Manhattan Project — which created the nuclear bomb from scratch — cost about $55 billion in today’s dollars.
“The political armor of the F-35 is as thick as the heads of the people who designed the airplane and its acquisition plan,” Winslow Wheeler, a former congressional staffer and outspoken critic of the F-35, recently told Foreign Policy about the longevity of the plane, despite the many setbacks it has endured. The support for the F-35 is so great in Congress that there’s actual a bipartisan Joint Strike Fighter Caucus dedicated to promoting it and keeping it alive. With that in mind, here are just a few of the other things that the insane amount spent on the troubled fighter could have gone towards instead, both at home and abroad:
Buying Every Homeless Person In The U.S. A Mansion
On any given night in 2013, the Department of Housing and Urban Development concluded, there were an estimated 600,000 homeless Americans living on the streets. Numerous studies, however, have showed that rather than putting money into temporary shelters or incarceration, communities have saved millions of dollars by investing in permanent homes for the homeless. A recent report showed that in one Florida community, it cost taxpayers an estimated $30,000 to take the homeless off the streets through traditional methods, but only around $10,000 per person to give them permanent housing and provide job training and other support. Expanding that concept to the Federal level, even taking into account things like varying real estate prices around the country, it’s possible that $7.4 billion would be more than enough to start a program nationwide. With the full amount spent on the F-35 at its disposal, the U.S. could afford to purchase every person on the streets a $664,000 home.
Unilaterally Funding Every Humanitarian Crisis
Overall, the United States less than one percent of its federal budget to foreign assistance. The State Department and USAID in Fiscal Year 2014 set aside about $31.1 billion in foreign aid funding, according to ForeignAssistance.gov. This includes $4.5 billion devoted towards funding the U.S. response to humanitarian crises around the world, including those in Syria, Iraq, South Sudan, and others. Millions of refugees and internally displaced people in these conflicts are struggling to survive, as the United Nations reports that each of these emergencies remain chronically underfunded. This year alone, the U.N. Office of Coordination for Humanitarian Affairs (UNOCHA) has raised only 35 percent of the funds it needs. In contrast, the $49 billion per year spent on the F-35 would singlehandedly fund not just UNOCHA’s $16.7 billion request, but also those of UNICEF and other emergency disaster relief bodies, saving countless lives.
In addition, U.N. officials want the situation at the U.S.’ southern border to be classified as a refugee crisis as well, as most of the thousands of children currently being detained fled their homes to escape a myriad number of life-threatening conditions. The Obama administration has requested $3.7 billion from Congress in emergency spending to help staunch the flow and provide for those who have already made it to the United States, but Republicans already appear to be lining up against the proposal. The F-35’s increased cost from last year alone would have easily covered that amount and then some.
Feeding Every Schoolchild In The Country
Earlier this year, President Obama signed into law an compromise version of the Farm Bill after months of deadlock saw the expiration of the former version. As part of the deal, House Republicans demanded huge cuts to the Supplemental Nutrition Assistance Program (SNAP), former known as food stamps, backing down only after a veto threat from the White House. The final bill, however, still included $8.7 billion worth of cuts, equaling about a $90 per month cut for recipients. The F-35’s excess costs for the last year by themselves could have nearly covered all of the losses, prevent state governors from having to scramble to provide families with the assistance they need.
As a backup when food subsidies are cut, low-income families often find themselves turning towards schools to provide meals during the day for their children. The National School Lunch Program feeds approximately 31 million students every year, at the cost of about $16.3 billion in both cash and commodity payments. The full cost of the plane so far would have funded this program as it stands for 24 years. If the amount being dispersed to schools was doubled, allowing the program to reach all 55 million students enrolled in K-12, the F-35 still would be able to cover that for the next decade.
Providing Security Around The World
Under the weighted system used to determine dues, the U.S. pays the lion’s share of funding to the United Nations’ 16 peacekeeping missions around the world. For the coming fiscal year, that works out to about $2.4 billion. That’s quite a bargain, as then-U.S. ambassador to the U.N. Susan Rice argued in 2009, telling PBS: “If the US was to act on its own – unilaterally – and deploy its own forces in many of these countries; for every dollar that the US would spend, the UN can accomplish the Mission for twelve cents.” Given how cost effective blue helmets are at providing security in areas where conflict has just ended, it would behoove the U.S. to grant even more support to the system. Additional funds would provide better arms and equipment, as well as better training, as the number of peacekeepers required around the world increases. The amount the U.S. has spent on the F-35 could have funded this year’s level of peacekeeping — a record-high $8.6 billion — for the next 46 years.
Boosting Funding Needed To Rebuild America
The United States is falling apart. A lack of funding for bridges, roads, and other infrastructure has led to collapses across the country and the more than 63,000 bridges that have been labeled as “structurally deficient.” The Department of Transportation’s total budget request for next year is $90.1 billion, part of a four-year budget of $302.1 billion with $199 billion set aside to rebuild America’s roads and bridges. Obama has for the last two years called for a $50 billion lump sum to be added to the on top of DOT’s budget to help address the growing need, and twice Congress has rejected this proposal. If the U.S. were to have channeled the $298 billion is has spent so far on the F-35 — and continued spending at that level for the next six years — the U.S. would be halfway towards closing the $1.1 trillion gap in investment needed in infrastructure, according to the American Society of Civil Engineers. In addition, a report from the Center for American Progress, citing Moody’s Analytic’s chief economist, estimates infrastructure investment generates $1.44 of economic activity for each $1 spent. That sort of claim can’t be duplicated in the spending on the F-35.
<center>***</center> Along with the United States, seven other countries have committed to purchasing F-35 fighters from Lockheed Martin once they’re completed, which is helping diffuse the costs for the American taxpayer. But these partners are growing increasingly wary of the aircraft’s ballooning price. Australia recently announced that it was scaling back its purchase, as has the Netherlands. Those concerns will likely only be compounded by the current grounding of the fleet. And so, though the British Air Force intended to have the fighter in service a full two years ago, the only place you’ll be able to see the F-35 in action for now remains on the big screen — where its successes have been about equal to those in real life.
source: Daily Press
$1.1 trillion federal spending bill advances over opposition
The $1.1 trillion spending bill that survived a nail-biting vote in the House on Thursday night has several important provisions for the Hampton Roads defense community.
But that vote was close for a reason: Both Republicans and Democrats object to provisions in the spending legislation, and it showed in the views of local congressmen.
The bill would fund the government through September 2015. It cleared the House of Representatives 219-206 just hours before a midnight deadline to avoid a government shutdown. Before the vote, the White House mounted a furious lobbying blitz to help advance the measure.
A Senate vote could have happened late Friday or Saturday.
The bill contains $848 million to overhaul the aircraft carrier USS George Washington, a critical job for Newport News Shipbuilding and hundreds of defense subcontractors in Virginia and around the country. It authorizes funding for two Virginia-class submarines, which are built in a teaming arrangement between Newport News, a division of Huntington Ingalls Industries, and General Dynamics Electric Boat of Groton, Conn.
Another item of keen interest to Huntington Ingalls is $1 billion toward constructing a final San Antonio-class amphibious warship. The company's Ingalls Shipbuilding division in Pascagoula, Miss., was angling for that job to extend its San Antonio-class production line before the Navy changes to a new class of ship.
The bill authorizes a 1 percent pay increase for most service members, rejects another military base-closing round and authorizes $53.3 million toward military suicide prevention efforts. It adds $190 million to maintain operations at popular on-base commissaries.
Provisions of the bill that proved controversial had nothing to do with the military or local issues.
Rep. Rob Wittman, R-Westmoreland, railed against the process itself — another 11th-hour showdown that ended in a last-minute vote when Congress could have decided the matter earlier.
"While I am pleased that the critical functions of government are not shutting down, and that programs serving our military and veterans are still being properly resourced, I am frustrated at the process by which we have reached this point," he said in a statement.
He said the bill "did not go far enough to reign in the President's unilateral action on immigration." He also opposed changes to campaign laws that vastly increased contributions a single donor can give through various campaign committees.
Wittman is a conservative Republican. Joining him in dissent was a progressive Democrat, Rep. Robert C. "Bobby" Scott of Newport News. Scott also opposed the campaign finance law change, and he took issue with a banking provision in the bill.
"I could not in good conscience vote for a bill that includes a provision that will allow banks to speculate with taxpayer insured funds — some of the very same activity that contributed to the 2008 financial crisis and that Congress voted in 2010 to limit when we passed the Dodd-Frank Wall Street Reform Act," Scott said in a statement.
That provision, combined with the campaign finance law change, "is just too much of an insult to the legislative process," he said.
The bill has been dubbed the "CRomnibus," because it combines an overall omnibus approach with a "continuing resolution" that funds the Department of Homeland Security only through Feb. 27.
Rep. Scott Rigell, R-Virginia Beach, supported the bill. He said it will allow the Republican-controlled Congress to take a second look at funding Homeland Security in 2015 and reopen the debate over Obama's immigration policy. Meanwhile, the rest of the bill funds yearlong military needs.
"The goals of defunding his immigration executive order and maintaining a strong national defense are best advanced by voting FOR [his emphasis] full appropriations for the federal government with exception of the Department of Homeland Security," he said in a statement.
$1.1 trillion federal spending bill advances over opposition
The $1.1 trillion spending bill that survived a nail-biting vote in the House on Thursday night has several important provisions for the Hampton Roads defense community.
But that vote was close for a reason: Both Republicans and Democrats object to provisions in the spending legislation, and it showed in the views of local congressmen.
The bill would fund the government through September 2015. It cleared the House of Representatives 219-206 just hours before a midnight deadline to avoid a government shutdown. Before the vote, the White House mounted a furious lobbying blitz to help advance the measure.
A Senate vote could have happened late Friday or Saturday.
The bill contains $848 million to overhaul the aircraft carrier USS George Washington, a critical job for Newport News Shipbuilding and hundreds of defense subcontractors in Virginia and around the country. It authorizes funding for two Virginia-class submarines, which are built in a teaming arrangement between Newport News, a division of Huntington Ingalls Industries, and General Dynamics Electric Boat of Groton, Conn.
Another item of keen interest to Huntington Ingalls is $1 billion toward constructing a final San Antonio-class amphibious warship. The company's Ingalls Shipbuilding division in Pascagoula, Miss., was angling for that job to extend its San Antonio-class production line before the Navy changes to a new class of ship.
The bill authorizes a 1 percent pay increase for most service members, rejects another military base-closing round and authorizes $53.3 million toward military suicide prevention efforts. It adds $190 million to maintain operations at popular on-base commissaries.
Provisions of the bill that proved controversial had nothing to do with the military or local issues.
Rep. Rob Wittman, R-Westmoreland, railed against the process itself — another 11th-hour showdown that ended in a last-minute vote when Congress could have decided the matter earlier.
"While I am pleased that the critical functions of government are not shutting down, and that programs serving our military and veterans are still being properly resourced, I am frustrated at the process by which we have reached this point," he said in a statement.
He said the bill "did not go far enough to reign in the President's unilateral action on immigration." He also opposed changes to campaign laws that vastly increased contributions a single donor can give through various campaign committees.
Wittman is a conservative Republican. Joining him in dissent was a progressive Democrat, Rep. Robert C. "Bobby" Scott of Newport News. Scott also opposed the campaign finance law change, and he took issue with a banking provision in the bill.
"I could not in good conscience vote for a bill that includes a provision that will allow banks to speculate with taxpayer insured funds — some of the very same activity that contributed to the 2008 financial crisis and that Congress voted in 2010 to limit when we passed the Dodd-Frank Wall Street Reform Act," Scott said in a statement.
That provision, combined with the campaign finance law change, "is just too much of an insult to the legislative process," he said.
The bill has been dubbed the "CRomnibus," because it combines an overall omnibus approach with a "continuing resolution" that funds the Department of Homeland Security only through Feb. 27.
Rep. Scott Rigell, R-Virginia Beach, supported the bill. He said it will allow the Republican-controlled Congress to take a second look at funding Homeland Security in 2015 and reopen the debate over Obama's immigration policy. Meanwhile, the rest of the bill funds yearlong military needs.
"The goals of defunding his immigration executive order and maintaining a strong national defense are best advanced by voting FOR [his emphasis] full appropriations for the federal government with exception of the Department of Homeland Security," he said in a statement.
Last edited:
Can the U.S. Government Go Moneyball?
Can the U.S. Government Go Moneyball?
Written byPeter Orszag Jim Nussle
12.23.14
In an excerpt from their new book, two former Office of Management and Budget directors ask whether or not a focus on numbers and hard evidence—not emotion—could transform American governance.
Between August 13 and September 4, 2002, the Oakland Athletics baseball team didn’t lose a single time. For twenty consecutive games—an American League record—a team of misfits and overlooked talent dominated Major League Baseball like never before. And they did so, incredibly, on a budget of just $40 million—less than a third that of the league’s richest teams.
Oakland’s success came about not in spite of their measly resources but because of them. Recognizing that his team could never compete in a system where only the wealthiest could be winners, Billy Beane, the team’s general manager, began identifying and exploiting inefficiencies in the game that other teams hadmissed. He embraced his team’s scarce resources and let statistics, not unscientific scouting reports, drive his draft picks. The rest of the league could play baseball; Billy Beane and the Oakland A’s were playing “Moneyball.”
It’s a compelling story, especially in the hands of a writer like Michael Lewis, who coined the term and penned the 2003 bestselling book of that name. At its heart, Moneyball is about crunching numbers and relying on hard evidence—not emotion or tradition—to drive decisions about how to allocate scarce resources. It’s also about determining what data matter and what don’t (in the case of baseball, concluding that on-base percentage matters a lot more than total home runs). When it comes down to it, it’s a way to get more with less.
Which raises important questions: Can data, evidence, and evaluation similarly revolutionize America’s government? Can we provide better services to millions more Americans while actually saving billions of dollars? Can we make this country a better place for children and families by investing in what works, by testing it and retesting it, and by holding ourselves to a higher standard?
In short, can government play Moneyball?
The answer, we believe, is a resounding yes.
It might seem obvious that the government, which collects more than $2.4 trillion in taxes each year (and spends more than $3 trillion), would want to know whether it is spending that money effectively. But too often we lack the answer to that very important question. In fact, astonishingly, based on our estimate, less than one dollar out of every hundred dollars the federal government spends is backed by even the most basic evidence. We might know a program is popular. We might even see data that suggest the program is performing efficiently. But it is the relatively rare case when we actually have the evidence to tell us a program is working as intended and it’s the most effective way to achieve the outcome we desire.
Federal programs might be working; but in too many cases, we just don’t know. With the mounting challenges our nation is facing, it is not enough to base government spending on intuition, instinct, or—the overwhelming rationale for most programs—what has been funded in the past. That is especially important given that, very often, when we do investigate the efficacy of federal programs, the results are not encouraging. Since 1990, the federal government has rigorously tested ten large social programs through randomized controlled trials (RCTs), the gold standard of evaluation. Of the ten programs—which collectively cost taxpayers over $10 billion annually—nine showed “weak or no positive effects” on their participants.
This would be a problem under any circumstance—after all, as former Senate minority leader Everett Dirksen is famously said to have remarked, “A billion here, a billion there, and pretty soon you’re talking real money.” But in the wake of the 2008 recession and recent budget agreements—with jobs and GDP growing modestly, discretionary spending under tight caps, and cash-strapped governments struggling to do more with less—it’s even more critical that we maximize the impact of every taxpayer dollar we invest.
Ultimately, this is a debate about genuinely improving the lives of children and their parents by making sure we are spending our resources in the right way. And while these debates tend to play out in the abstract language of dollars and cents, the impact is not merely seen in columns in an Excel spreadsheet or line items in an omnibus budget bill. Our failure to assess the effectiveness of government spending carries more than a financial cost—it has a massive human cost as well. When a program designed to boost employment fails to perform, parents are unable to put food on their families’ tables. When an education initiative doesn’t live up to its promise, neither can the young children enrolled in it.
Fortunately, it doesn’t have to be this way. Thanks to decades of social-science research, we know more about how to help struggling Americans than ever before. And in this era of impact-blind, across-the-board budget cuts, we see an opportunity. Like Billy Beane and the A’s, these lean times offer us a chance to reevaluate how we measure success and to shift our focus to what works.
First, we need to change the debate—to focus at least as much on the quality of resources as the quantity. Our goal is to get policy makers to adopt three principles that we believe can improve outcomes for young people, their families, and their communities:
1. Build evidence about the practices, policies, and programs that will achieve the most effective and efficient results.
2. Invest limited taxpayer dollars in practices, policies, and programs that use evidence and evaluation to demonstrate that they work.
3. Direct funds away from practices, policies, and programs that consistently fail to achieve measurable outcomes.
The good news is, the government has already begun to play Moneyball in some areas. During the administration of President George W. Bush—America’s first MBA president as well as a former Major League Baseball–team owner—the Office of Management and Budget (OMB) developed a Program Assessment Rating Tool (PART) to evaluate social programs and adjust funding according to their success. The Obama administration took up the baton in 2009 and has since become the most evidence-based administration in history.
Take, for example, the popular Head Start program, which spends $8 billion annually providing early-childhood education, health, and nutrition assistance to nearly a million disadvantaged children. Ever since it was created in 1965, politicians and researchers have studied and debated its effectiveness. Supporters pointed to math and literacy gains, while critics noted that those improvements disappeared in elementary school.
In 2007, President Bush signed a law that required all Head Start grantees to be evaluated using an evidence-based system. President Obama has since initiated a series of targeted reforms to weed out underperforming providers and has refused to automatically fund about one-third of programs. In order to re-qualify, they would have to improve.
To be sure, the evidence-based agenda we are proposing isn’t just about identifying programs that aren’t working; it’s about scaling up those that are, and improving those that show promise. Consider Nurse-Family Partnership, one of the best examples of evidence in action. Early in his career, David Olds worked at a day-care center in inner-city Baltimore, where he hoped to change the lives of low-income children. But to his frustration, he found that, even by preschool age, many of the children he worked with were already at an enormous developmental and educational disadvantage. Rather than give up, David changed his approach, deciding to focus his efforts even earlier—in some cases, before the child is even born.
He created an organization called Nurse-Family Partnership, which sends nurses to the homes of first-time, low-income mothers and their children. There they would help women prepare for everything from the birth itself to raising a baby, planning future pregnancies, staying in school, and preparing for the workforce.
“When a woman becomes pregnant, whether she’s fourteen or forty, there’s a window of opportunity,” explained Valerie Carberry, a nurse for the program. “They want to do what’s right. They want to change bad behaviors—tobacco, alcohol, using a seat belt, anything. As nurses, we’re able to come in and become part of their lives; it’s a golden moment.”
But Olds did more than build Nurse-Family Partnership; he did the rigorous evaluation to prove it would work. Over the next thirty years, he tested the program in randomized trials in three different communities. His results showed that the program was a remarkable success—improving pregnancy outcomes, bolstering the health and development of children, and helping parents create a positive life course for themselves. He took that evidence and the support of modest private funding to scale his program, from just a few locations to more than forty states by 2013. And in proving the effectiveness of the program, the organization was able to help secure a $1.5 billion federal investment in similar programs around the country. That funding was set to expire in 2014, but Congress has extended the program once already on a bipartisan basis and is likely to do so again in the future. Home visitation is a great example of building political support the right way—by doing what works.
The move toward more analytical policy making is encouraging.
From the Obama administration’s Social Innovation Fund to New York City’s Center for Economic Opportunity, we are seeing more and more examples of policy making based on data and evidence that makes a meaningful impact.
We’re not naïve: we know from personal experience that overhauling how the federal government does business isn’t easy.
While local, state, and federal governments have made positive strides, scaling up a handful of promising pilot programs into a completely reimagined framework for governance presents some real challenges.
For one thing, policy makers’ incentives aren’t always aligned with the imperative to squeeze the most impact out of every dollar. Sometimes politicians oppose reform for nefarious reasons—to protect a special interest or a major donor, for example. Sometimes they protect a program because of who started it, whose pet project it was, rather than whether it’s working. For too many members of Congress, when it comes to evidence, it’s just easier not to know.
All of that is before you consider our current political environment, which is, to put it charitably, not particularly conducive to making major changes. In truth, it’s downright dysfunctional—so polarized and toxic that Democrats and Republicans can hardly stand to be in the same room together, let alone overhaul our approach to governance. And in the rare instances when our elected officials manage to forge bipartisan consensus, legislation is still often blocked for petty political reasons. To anyone watching thecurrent mess in Washington, it’s not surprising that from 2011 to 2013, Congress passed fewer bills than any Congress in more than half a century.
But while the obstacles to evidence-based governance are formidable, they are not insurmountable. In fact, there are a number of good reasons to be optimistic.
First, there is a political opportunity for both parties. Republicans will have the chance not only to identify and eliminate real waste in the system but also to prove that a smaller government can be a more effective government. Democrats, on the other hand, will be able to fine-tune government until it is smarter and works better, and leverage it to better deliver services to vulnerable populations. There is nothing ideological about this approach, which is why we’ve already seen broad bipartisan support for these ideas.
Second, there is an economic opportunity. Researchers have projected, for example, that closing the achievement gap would boost GDP by 3 to 5 percent. By collecting—and then leveraging—evidence to improve the way we approach this challenging problem, we can dramatically improve our economic footing.
Already, we’ve witnessed policy makers seizing these opportunities. In Texas and many other states, where the prison systems are straining budgets, die-hard conservative Republicans have joined with Democrats to reform the state’s criminal-justice system. This has saved money (a Republican priority) while simultaneously creating humane alternatives to incarceration (a longtime goal for Democrats).
Finally, there is a moral opportunity. Regardless of party, those who work in government do so because they care about helping their fellow citizens. And right now, we’re not doing all that we could be. Half of low-income fourth graders aren’t even reading at a basic level—yet we know there are proven ways to change that. One out of every fifteen African American men is in jail—yet we know that good evidence can change that, too.11 So let’s build that evidence, analyze it, and use it as a tool to do a better job ofrunning this country.
That, in a nutshell, is the case for Moneyball. It might sound like a basic idea, but it’s also a big idea. As Billy Beane explained to Peter Brand, his prized statistician, “If we win, on our budget, with this team ... we’ll have changed the game. And that’s what I want.” That’s what we want as well: to change the game, to get government working better, and to brighten the opportunity of and possibilities for everyone who calls America home.
So, ladies and gentlemen, let’s play Moneyball.
Excerpted from Moneyball for Government, published by Disruption Books, and reprinted with permission. Copyright © 2014.
http://www.thedailybeast.com/articles/2014/12/23/can-the-u-s-government-go-moneyball.html
Can the U.S. Government Go Moneyball?
Written byPeter Orszag Jim Nussle
12.23.14
In an excerpt from their new book, two former Office of Management and Budget directors ask whether or not a focus on numbers and hard evidence—not emotion—could transform American governance.
Between August 13 and September 4, 2002, the Oakland Athletics baseball team didn’t lose a single time. For twenty consecutive games—an American League record—a team of misfits and overlooked talent dominated Major League Baseball like never before. And they did so, incredibly, on a budget of just $40 million—less than a third that of the league’s richest teams.
Oakland’s success came about not in spite of their measly resources but because of them. Recognizing that his team could never compete in a system where only the wealthiest could be winners, Billy Beane, the team’s general manager, began identifying and exploiting inefficiencies in the game that other teams hadmissed. He embraced his team’s scarce resources and let statistics, not unscientific scouting reports, drive his draft picks. The rest of the league could play baseball; Billy Beane and the Oakland A’s were playing “Moneyball.”
It’s a compelling story, especially in the hands of a writer like Michael Lewis, who coined the term and penned the 2003 bestselling book of that name. At its heart, Moneyball is about crunching numbers and relying on hard evidence—not emotion or tradition—to drive decisions about how to allocate scarce resources. It’s also about determining what data matter and what don’t (in the case of baseball, concluding that on-base percentage matters a lot more than total home runs). When it comes down to it, it’s a way to get more with less.
Which raises important questions: Can data, evidence, and evaluation similarly revolutionize America’s government? Can we provide better services to millions more Americans while actually saving billions of dollars? Can we make this country a better place for children and families by investing in what works, by testing it and retesting it, and by holding ourselves to a higher standard?
In short, can government play Moneyball?
The answer, we believe, is a resounding yes.
It might seem obvious that the government, which collects more than $2.4 trillion in taxes each year (and spends more than $3 trillion), would want to know whether it is spending that money effectively. But too often we lack the answer to that very important question. In fact, astonishingly, based on our estimate, less than one dollar out of every hundred dollars the federal government spends is backed by even the most basic evidence. We might know a program is popular. We might even see data that suggest the program is performing efficiently. But it is the relatively rare case when we actually have the evidence to tell us a program is working as intended and it’s the most effective way to achieve the outcome we desire.
Federal programs might be working; but in too many cases, we just don’t know. With the mounting challenges our nation is facing, it is not enough to base government spending on intuition, instinct, or—the overwhelming rationale for most programs—what has been funded in the past. That is especially important given that, very often, when we do investigate the efficacy of federal programs, the results are not encouraging. Since 1990, the federal government has rigorously tested ten large social programs through randomized controlled trials (RCTs), the gold standard of evaluation. Of the ten programs—which collectively cost taxpayers over $10 billion annually—nine showed “weak or no positive effects” on their participants.
This would be a problem under any circumstance—after all, as former Senate minority leader Everett Dirksen is famously said to have remarked, “A billion here, a billion there, and pretty soon you’re talking real money.” But in the wake of the 2008 recession and recent budget agreements—with jobs and GDP growing modestly, discretionary spending under tight caps, and cash-strapped governments struggling to do more with less—it’s even more critical that we maximize the impact of every taxpayer dollar we invest.
Ultimately, this is a debate about genuinely improving the lives of children and their parents by making sure we are spending our resources in the right way. And while these debates tend to play out in the abstract language of dollars and cents, the impact is not merely seen in columns in an Excel spreadsheet or line items in an omnibus budget bill. Our failure to assess the effectiveness of government spending carries more than a financial cost—it has a massive human cost as well. When a program designed to boost employment fails to perform, parents are unable to put food on their families’ tables. When an education initiative doesn’t live up to its promise, neither can the young children enrolled in it.
Fortunately, it doesn’t have to be this way. Thanks to decades of social-science research, we know more about how to help struggling Americans than ever before. And in this era of impact-blind, across-the-board budget cuts, we see an opportunity. Like Billy Beane and the A’s, these lean times offer us a chance to reevaluate how we measure success and to shift our focus to what works.
First, we need to change the debate—to focus at least as much on the quality of resources as the quantity. Our goal is to get policy makers to adopt three principles that we believe can improve outcomes for young people, their families, and their communities:
1. Build evidence about the practices, policies, and programs that will achieve the most effective and efficient results.
2. Invest limited taxpayer dollars in practices, policies, and programs that use evidence and evaluation to demonstrate that they work.
3. Direct funds away from practices, policies, and programs that consistently fail to achieve measurable outcomes.
The good news is, the government has already begun to play Moneyball in some areas. During the administration of President George W. Bush—America’s first MBA president as well as a former Major League Baseball–team owner—the Office of Management and Budget (OMB) developed a Program Assessment Rating Tool (PART) to evaluate social programs and adjust funding according to their success. The Obama administration took up the baton in 2009 and has since become the most evidence-based administration in history.
Take, for example, the popular Head Start program, which spends $8 billion annually providing early-childhood education, health, and nutrition assistance to nearly a million disadvantaged children. Ever since it was created in 1965, politicians and researchers have studied and debated its effectiveness. Supporters pointed to math and literacy gains, while critics noted that those improvements disappeared in elementary school.
In 2007, President Bush signed a law that required all Head Start grantees to be evaluated using an evidence-based system. President Obama has since initiated a series of targeted reforms to weed out underperforming providers and has refused to automatically fund about one-third of programs. In order to re-qualify, they would have to improve.
To be sure, the evidence-based agenda we are proposing isn’t just about identifying programs that aren’t working; it’s about scaling up those that are, and improving those that show promise. Consider Nurse-Family Partnership, one of the best examples of evidence in action. Early in his career, David Olds worked at a day-care center in inner-city Baltimore, where he hoped to change the lives of low-income children. But to his frustration, he found that, even by preschool age, many of the children he worked with were already at an enormous developmental and educational disadvantage. Rather than give up, David changed his approach, deciding to focus his efforts even earlier—in some cases, before the child is even born.
He created an organization called Nurse-Family Partnership, which sends nurses to the homes of first-time, low-income mothers and their children. There they would help women prepare for everything from the birth itself to raising a baby, planning future pregnancies, staying in school, and preparing for the workforce.
“When a woman becomes pregnant, whether she’s fourteen or forty, there’s a window of opportunity,” explained Valerie Carberry, a nurse for the program. “They want to do what’s right. They want to change bad behaviors—tobacco, alcohol, using a seat belt, anything. As nurses, we’re able to come in and become part of their lives; it’s a golden moment.”
But Olds did more than build Nurse-Family Partnership; he did the rigorous evaluation to prove it would work. Over the next thirty years, he tested the program in randomized trials in three different communities. His results showed that the program was a remarkable success—improving pregnancy outcomes, bolstering the health and development of children, and helping parents create a positive life course for themselves. He took that evidence and the support of modest private funding to scale his program, from just a few locations to more than forty states by 2013. And in proving the effectiveness of the program, the organization was able to help secure a $1.5 billion federal investment in similar programs around the country. That funding was set to expire in 2014, but Congress has extended the program once already on a bipartisan basis and is likely to do so again in the future. Home visitation is a great example of building political support the right way—by doing what works.
The move toward more analytical policy making is encouraging.
From the Obama administration’s Social Innovation Fund to New York City’s Center for Economic Opportunity, we are seeing more and more examples of policy making based on data and evidence that makes a meaningful impact.
We’re not naïve: we know from personal experience that overhauling how the federal government does business isn’t easy.
While local, state, and federal governments have made positive strides, scaling up a handful of promising pilot programs into a completely reimagined framework for governance presents some real challenges.
For one thing, policy makers’ incentives aren’t always aligned with the imperative to squeeze the most impact out of every dollar. Sometimes politicians oppose reform for nefarious reasons—to protect a special interest or a major donor, for example. Sometimes they protect a program because of who started it, whose pet project it was, rather than whether it’s working. For too many members of Congress, when it comes to evidence, it’s just easier not to know.
All of that is before you consider our current political environment, which is, to put it charitably, not particularly conducive to making major changes. In truth, it’s downright dysfunctional—so polarized and toxic that Democrats and Republicans can hardly stand to be in the same room together, let alone overhaul our approach to governance. And in the rare instances when our elected officials manage to forge bipartisan consensus, legislation is still often blocked for petty political reasons. To anyone watching thecurrent mess in Washington, it’s not surprising that from 2011 to 2013, Congress passed fewer bills than any Congress in more than half a century.
But while the obstacles to evidence-based governance are formidable, they are not insurmountable. In fact, there are a number of good reasons to be optimistic.
First, there is a political opportunity for both parties. Republicans will have the chance not only to identify and eliminate real waste in the system but also to prove that a smaller government can be a more effective government. Democrats, on the other hand, will be able to fine-tune government until it is smarter and works better, and leverage it to better deliver services to vulnerable populations. There is nothing ideological about this approach, which is why we’ve already seen broad bipartisan support for these ideas.
Second, there is an economic opportunity. Researchers have projected, for example, that closing the achievement gap would boost GDP by 3 to 5 percent. By collecting—and then leveraging—evidence to improve the way we approach this challenging problem, we can dramatically improve our economic footing.
Already, we’ve witnessed policy makers seizing these opportunities. In Texas and many other states, where the prison systems are straining budgets, die-hard conservative Republicans have joined with Democrats to reform the state’s criminal-justice system. This has saved money (a Republican priority) while simultaneously creating humane alternatives to incarceration (a longtime goal for Democrats).
Finally, there is a moral opportunity. Regardless of party, those who work in government do so because they care about helping their fellow citizens. And right now, we’re not doing all that we could be. Half of low-income fourth graders aren’t even reading at a basic level—yet we know there are proven ways to change that. One out of every fifteen African American men is in jail—yet we know that good evidence can change that, too.11 So let’s build that evidence, analyze it, and use it as a tool to do a better job ofrunning this country.
That, in a nutshell, is the case for Moneyball. It might sound like a basic idea, but it’s also a big idea. As Billy Beane explained to Peter Brand, his prized statistician, “If we win, on our budget, with this team ... we’ll have changed the game. And that’s what I want.” That’s what we want as well: to change the game, to get government working better, and to brighten the opportunity of and possibilities for everyone who calls America home.
So, ladies and gentlemen, let’s play Moneyball.
Excerpted from Moneyball for Government, published by Disruption Books, and reprinted with permission. Copyright © 2014.
http://www.thedailybeast.com/articles/2014/12/23/can-the-u-s-government-go-moneyball.html
source: Military.com
Pentagon Tells Congress to Stop Buying Equipment it Doesn't Need
The chairman of the Senate Armed Services Committee said Wednesday he wants the U.S. Military's service chiefs to have more power to prevent the Pentagon from buying weapons it doesn't need.
Sen. John McCain, SASC's new chairman in the new Republican-run Senate, said one his top priorities for this session is to ensure that the service chiefs have more input into the acquisition and procurement process.
Wednesday's hearing's focus was to hear testimony on the next round of mandatory defense spending cuts under sequestration scheduled to occur in fiscal 2016.
The Army, Navy, Air Force and Marine Corps have already suffered massive cuts to end-strength, modernization and readiness under sequestration that began in 2012. And just like in past hearings, the heads of each service predicted a grim outlook if more sequestration cuts come in 2016.
All the services agreed that they would not be able to continue to meet mandatory missions under the National Defense Strategy – win a major war, deter the threats of a second, major enemy and protect the homeland at the same time.
Lawmakers asked many questions, but no one offered a plan to prevent sequestration cuts from happening as it has in past years minus last year when the military received a reprieve from the across-the-board cuts.
Some Senators focused on finding ways to help the Pentagon run more efficiently.
Sen. Joe Manchin, D-W. Va., told the chiefs he wanted to know how to prevent the Defense Department's acquisition and procurement system from wasting money on equipment the services don't need.
"There has got to be a more effective and efficient method of procurement," he said. "When [President] Eisenhower said 'beware of the military industrial complex,' man he knew what he was talking about ... We force stuff on you all that we know you don't want."
Army Chief of Staff General Raymond Odierno agreed with Manchin.
"We are still having to procure systems we don't need," Odierno said, adding that the Army spends "hundreds of millions of dollars on tanks that we simply don't have the structure for anymore."
For three years, the Army in numerous Congressional hearings has pushed a plan that essentially would have suspended tank building and upgrades in the U.S. for the first time since World War II. The Army suggested that production lines could be kept open through foreign sales.
Each time, Congress has pushed back. In December, Congress won again in the National Defense Authorization Act for Fiscal Year 2015 that funded $120 million for Abrams tank upgrades.
The Army and the Marine Corps currently have about 9,000 Abrams tanks in their inventories. The tank debate between the Army and Congress goes back to 2012 when Odierno testified that the Army doesn't need more tanks.
Odierno lost then too. Congress voted for another $183 million for tanks despite Odierno's argument that the Army was seeking to become a lighter force.
"When we are talking about tight budgets a couple of hundred million dollars is a lot of money," Odierno said.
"There are lots of people that have looked at procurement reform. And the one thing that has been frustrating to me is as the chief of staff of the Army is how little authority and responsibility that I have in the procurement process. I have a say in requirements, to some extent, but I have very little say."
Adm. Jonathan Greenert, Chief of Naval Operations, said that there needs to be clarity on the chain of command when it comes to procurement.
"There are too many people involved in the process," Greenert said. "If I say 'I need a thing' ... there are a whole lot of people telling us 'no, this is what you really need.'"
In many cases, the technology is not mature and even essential programs become delayed and end up costing more than they should, Greenert said. If it won't be ready on time, it becomes too expensive.
"Cost and schedule need to become a much bigger factor in this process than it is today," Greenert said.
Manchin told the chiefs he is "really interested in finding out how many ideas come from you all and what you need vs. from those on the outside and what they think you need."
Pentagon Tells Congress to Stop Buying Equipment it Doesn't Need
The chairman of the Senate Armed Services Committee said Wednesday he wants the U.S. Military's service chiefs to have more power to prevent the Pentagon from buying weapons it doesn't need.
Sen. John McCain, SASC's new chairman in the new Republican-run Senate, said one his top priorities for this session is to ensure that the service chiefs have more input into the acquisition and procurement process.
Wednesday's hearing's focus was to hear testimony on the next round of mandatory defense spending cuts under sequestration scheduled to occur in fiscal 2016.
The Army, Navy, Air Force and Marine Corps have already suffered massive cuts to end-strength, modernization and readiness under sequestration that began in 2012. And just like in past hearings, the heads of each service predicted a grim outlook if more sequestration cuts come in 2016.
All the services agreed that they would not be able to continue to meet mandatory missions under the National Defense Strategy – win a major war, deter the threats of a second, major enemy and protect the homeland at the same time.
Lawmakers asked many questions, but no one offered a plan to prevent sequestration cuts from happening as it has in past years minus last year when the military received a reprieve from the across-the-board cuts.
Some Senators focused on finding ways to help the Pentagon run more efficiently.
Sen. Joe Manchin, D-W. Va., told the chiefs he wanted to know how to prevent the Defense Department's acquisition and procurement system from wasting money on equipment the services don't need.
"There has got to be a more effective and efficient method of procurement," he said. "When [President] Eisenhower said 'beware of the military industrial complex,' man he knew what he was talking about ... We force stuff on you all that we know you don't want."
Army Chief of Staff General Raymond Odierno agreed with Manchin.
"We are still having to procure systems we don't need," Odierno said, adding that the Army spends "hundreds of millions of dollars on tanks that we simply don't have the structure for anymore."
For three years, the Army in numerous Congressional hearings has pushed a plan that essentially would have suspended tank building and upgrades in the U.S. for the first time since World War II. The Army suggested that production lines could be kept open through foreign sales.
Each time, Congress has pushed back. In December, Congress won again in the National Defense Authorization Act for Fiscal Year 2015 that funded $120 million for Abrams tank upgrades.
The Army and the Marine Corps currently have about 9,000 Abrams tanks in their inventories. The tank debate between the Army and Congress goes back to 2012 when Odierno testified that the Army doesn't need more tanks.
Odierno lost then too. Congress voted for another $183 million for tanks despite Odierno's argument that the Army was seeking to become a lighter force.
"When we are talking about tight budgets a couple of hundred million dollars is a lot of money," Odierno said.
"There are lots of people that have looked at procurement reform. And the one thing that has been frustrating to me is as the chief of staff of the Army is how little authority and responsibility that I have in the procurement process. I have a say in requirements, to some extent, but I have very little say."
Adm. Jonathan Greenert, Chief of Naval Operations, said that there needs to be clarity on the chain of command when it comes to procurement.
"There are too many people involved in the process," Greenert said. "If I say 'I need a thing' ... there are a whole lot of people telling us 'no, this is what you really need.'"
In many cases, the technology is not mature and even essential programs become delayed and end up costing more than they should, Greenert said. If it won't be ready on time, it becomes too expensive.
"Cost and schedule need to become a much bigger factor in this process than it is today," Greenert said.
Manchin told the chiefs he is "really interested in finding out how many ideas come from you all and what you need vs. from those on the outside and what they think you need."
