Tag Archives: Pentagon

Revolving Door Picking Up Speed at the Pentagon and Homeland Security

Standard

Pentagon Revolving Door

“THE INTERCEPT”

“Defense firms have eagerly watched as Trump recently unveiled a budget calling for $54 billion in additional military spending next year.

President Trump has weaponized the revolving door by appointing defense contractors and their lobbyists to key government positions as he seeks to rapidly expand the military budget and homeland security programs.”


“The spending spree will provide a brand new opportunity for defense lobbyists to get business for their clients. And the most effective lobbying generally involves contacting former colleagues in positions of power.

Two Department of Homeland Security appointments Trump announced Tuesday morning are perfect examples.

Benjamin Cassidy, installed by Trump as assistant secretary for legislative affairs, previously worked as a senior executive at Boeing’s international business sector, marketing Boeing military products abroad. Jonathan Rath Hoffman, named assistant secretary for public affairs, previously worked as a consultant to the Chertoff Group, the sprawling homeland security consulting firm founded by former Secretary of Homeland Security Michael Chertoff. The firm has come under fire for advising a variety of firms seeking government contracts, including for full-body scanners deemed invasive by privacy activists. Hoffman also led a state chapter of a neoconservative military-contractor advocacy organization during the 2016 presidential campaign. Neither position requires Senate confirmation.

Personnel from major defense companies now occupy the highest ranks of the administration including cabinet members and political appointees charged with implementing the Trump agenda. At least 15 officials with financial ties to defense contractors have been either nominated or appointed so far, with potentially more industry names on the way as Trump has yet to nominate a variety of roles in the government, including Army and Navy secretaries.

Before their confirmations, Jim Mattis and John Kelly, the secretaries of the departments of Defense and Homeland Security, were primarily paid by defense firms.

Mattis was paid $242,000, along with up to $500,000 in vested stock options, as director of General Dynamics, a company that produces submarines, tanks, and a range of munitions for the military. Mattis also received speaking fees from several firms, including Northrop Grumman. Kelly previously served in a number of roles at defense contracting consulting and lobbying firms and worked directly as an adviser to Dyncorp, a company that contracts with the Immigrations and Customs Enforcement.

Major lobbying groups for the arms companies, including the National Defense Industrial Association and the Aerospace Industries Association, welcomed the selection of Secretary Mattis, who has already scheduled meetings with industry executives. Secretary Kelly has pledged to work more closely with the private sector, promising greater collaboration with private firms to accomplish his agency’s goals.

To carry out this private-sector friendly agenda, defense officials have taken major roles throughout Trump’s administration.

Pat Shanahan, nominated last week by Trump to serve as deputy secretary of defense, is a vice president at Boeing who formerly led the company’s missile defense subsidiary. Disclosures show that Elaine Duke, the nominee for deputy secretary of homeland security, previously consulted for Booz Allen Hamilton, General Dynamics, and the Columbia Group, a small contractor that builds unmanned naval drones.

The nominee to lead the Air Force, former New Mexico Congresswoman Heather Wilson, worked as a consultant to a Lockheed Martin subsidiary after retiring from public office. The company sought Wilson’s help to maintain a $2.4 billion a year contract to manage Sandia National Laboratories, the premiere nuclear weapons research facility, and to keep the contract closed to competition. “Lockheed Martin should aggressively lobby Congress, but keep a low profile,” Wilson urged the company in a memo revealed later by an inspector general report.

Trump’s pick for national security council chief of staff, retired Lt. Gen. Keith Kellogg, has worked at a variety of defense contracting companies. After serving in senior roles in Iraq’s provisional government after the 2003 invasion, Kellogg left the government for the private sector. He told the Washington Post in 2005 that he joined Oracle to “establish a homeland security business unit” at the firm, and later joined CACI International, a company with major contracts in the wars in Iraq and Afghanistan. Following CACI, Kellogg joined Cubic Defense in 2009 to develop the company’s combat training business.

A list of temporary political appointees recently published by ProPublica reveals a number of less-known influence peddlers who have taken senior roles in the administration.

Chad Wolf and Lora Ries, two recently appointed advisers at the Department of Homeland Security, are formerly registered defense lobbyists. Wolf lobbied for Harris Corp. and the United Launch Alliance, a partnership between Boeing and Lockheed Martin. Ries previously lobbied for a range of defense and homeland security contractors, including Altegrity, Boeing, Implant Sciences Corp., General Dynamics, L1 Identity Solutions, and TASC Inc.

In the White House, one of the newest members of the National Economic Council staff is Michael Catanzaro, formerly a registered lobbyist working for both Boeing and Halliburton.

Palanatir Technology’s Justin Mikolay, formerly a chief in-house lobbyist for the company who worked to win over billions of dollars in Army contracts, was quietly appointed to serve as a special assistant in the Office of the Secretary of Defense.

Several appointees are associated with SBD Advisors, a consulting that firm that advertises its ability to facilitate “engagements between the technology and defense sectors,” and is advised by a high profile team of former government leaders, including former Chairman of the Joint Chiefs of Staff retired Adm. Mike Mullen and former National Security Agency Director of Operations Ron Moultrie.

SBD Advisors’d Sally Donnelly and Tony DeMartino work as temporary political appointees at the Office of the Defense Secretary, according to the list assembled by ProPublica. Kristan King Nevins, recently appointed as chief of staff to Second Lady Karen Pence, also previously worked at SBD Advisors as the director of communications.

The Trump administration is the “military-industrial complex personified,” said William Hartung, director of the Arms & Security Project at the Center for International Policy. Hartung noted that while the administration is bringing arms industry officials into government, it is also demanding a massive increase in military spending and appears to be escalating conflicts in Syria and Yemen.

In short, the Trump proposals are an armsmaker’s dream come true,” he said. “

https://theintercept.com/2017/03/21/revolving-door-military/

 

 

What Mark Thompson Has Learned Covering the Military for 40 Years

Standard
550-billion-pentagon-budget-cartoon-600x396_orig

Image:  “Otherwords.org”

“Scant public interest yields ceaseless wars to nowhere”

 

“Straus Military Reform Project – Center for Defense Information at POGO”

“It turns out that my spending four years on an amusement-park midway trying to separate marks from their money was basic training for the nearly 40 years I spent reporting on the U.S. military.

Both involve suckers and suckees. One just costs a lot more money, and could risk the future of United States instead of a teddy bear.

But after 15 years of covering U.S. defense for daily newspapers in Washington, and 23 more for Time magazine until last December, it’s time to share what I’ve learned. I’m gratified that the good folks at the nonpartisan Project On Government Oversight, through their Straus Military Reform Project, are providing me this weekly soapbox to comment on what I’ve come to see as the military-industrial circus.

As ringmaster, I can only say: Boy, are we being taken to the cleaners. And it’s not so much about money as it is about value. Too much of today’s U.S. fighting forces look like it came from Tiffany’s, with Walmart accounting for much of the rest. There’s too little Costco, or Amazon Prime.

There was a chance, however slight, that President Trump would blaze a new trail on U.S. national security. Instead, he has simply doubled down.

We have let the Pentagon become the engine of its own status quo.

For too long, the two political parties have had Pavlovian responses when it comes to funding the U.S. military (and make no mistake about it: military funding has trumped military strategy for decades). Democrats have long favored shrinking military spending as a share of the federal budget, while Republicans yearn for the days when it accounted for a huge chunk of U.S. government spending. Neither is the right approach. Instead of seeing the Pentagon as the way to defend against all threats, there needs to be a fresh, long-overdue accounting of what the real threats are, and which of those are best addressed by military means.

The Defense Department’s Quadrennial Defense Review, which is supposed to do just that every four years, has become an engine of the status quo. The Pentagon today is little more than a self-licking ice cream cone, dedicated in large measure to its growth and preservation. Congress is a willing accomplice, refusing to shutter unneeded military bases due to the job losses they’d mean back home. The nuclear triad remains a persistent Cold War relic (even former defense secretary Bill Perry wants to scrap it), with backers of subs, bombers and ICBMs embracing one another against their real threat: a hard-nosed calculus on the continuing wisdom of maintaining thousands of nuclear weapons on hair-trigger alert.

Unfortunately, it’s getting worse as partisan enmity grows. It’s quaint to recall the early congressional hearings I covered (Where have you gone, Barry Goldwater?), when lawmakers would solemnly declare that “politics stops at the water’s edge.” The political opposition’s reactions to Jimmy Carter’s failed raid to rescue U.S. hostages held in Iran in 1980 that killed eight U.S. troops, and to the loss of 241 U.S. troops on Ronald Reagan’s peacekeeping mission in Beirut in 1983, was tempered.

But such grim events have been replaced Hillary Clinton’s Benghazi and Donald Trump’s Jan. 29 special-ops raid in Yemen. Rancid rancor by both sides cheapens the sacrifice of the five Americans who died. It only adds a confusing welter of new rules designed to ensure they aren’t repeated. Yet mistakes are a part of every military operation, and an unwillingness to acknowledge that fact, and act accordingly, leads to pol-mil paralysis. It’s amazing that the deaths of Glen Doherty, William “Ryan” Owens, Sean Smith, Chris Stevens and Tyrone Woods seem to have generated more acrimony and second-guessing than the wars in Afghanistan and Iraq, in which 6,908 U.S. troops have died.

There is today a fundamental disconnect between the nation and its wars. We saw it in President Obama’s persistent leeriness when it came to the use of military force, and his successor’s preoccupation with spending and symbolism instead of strategy. In his speech to Congress Feb. 28, Trump mentioned the heroism of Navy SEAL Owens, but didn’t say where he died (Yemen). Nor did he mention Afghanistan, Iraq or Syria, where nearly 15,000 U.S. troops are fighting what Trump boldly declared is “radical Islamic terrorism.”

But he did declare he is seeking “one of the largest increases in national defense spending in American history.” His $54 billion boost would represent a 10% hike, and push the Pentagon spending, already well beyond the Cold War average used to keep the now-defunct Soviet Union at bay—even higher.

“We are going to have very soon the finest equipment in the world,” Trump said from the deck of the yet-to-be-commissioned carrier Gerald R. Ford on Thursday in Hampton, Va. “We’re going to start winning again.” What’s surprising is Trump’s apparent ignorance that the U.S. military has had, pound-for-pound, the world’s finest weapons since World War II. What’s stunning is his apparent belief that better weapons lead inevitably to victory. There is a long list of foes that knows better.

It’s long past time for a tough look at what U.S. taxpayers are getting for the $2 billion they spend on their military and veterans every day. It would have been great if Trump had been willing to scrub the Pentagon budget and reshape it for the 21st Century. But the U.S. has been unwilling to do that ever since the Cold War ended more than 25 years ago. Instead, it simply shrunk its existing military, then turned on a cash gusher following 9/11.

I know many veterans who are angered that their sacrifice, and that of buddies no longer around, have been squandered in Afghanistan and Iraq.

I recall flying secretly into Baghdad in December 2003 with then-defense secretary Donald Rumsfeld. The bantam SecDef declared on that trip that the U.S. military had taken the “right approach” in training Iraqi troops, and that they were fighting “well and professionally.” Last month, Defense Secretary Jim Mattis, the fifth man to hold that job since Rumsfeld, declared in Baghdad that the U.S. training of the Iraqi military is “developing very well.” His visit, like Rumsfeld’s 14 years earlier, wasn’t announced in advance.

Even as Army Lieutenant General H.R. McMaster, Trump’s national security adviser, tries to chart a path forward in Iraq, it’s worth remembering that he earned his spurs 26 years ago as a captain in a tank battle with Iraqi forces.

If we’re going to spend—few would call it an investment—$5 trillion fighting in Iraq and Afghanistan (and Syria, and Yemen), don’t we, as Americans, deserve a better return?

The problem is that the disconnect between the nation and its wars (and war-fighters) also includes us:

  • Our representatives in Congress prefer not to get their hands bloodied in combat, so they avoid declaring war. They prefer to subcontract it out to the White House, and we let them get away with it.
  • Through the Pentagon, we have subcontracted combat out to an all-volunteer force. Only about 1% of the nation has fought in its wars since 9/11. We praise their courage even as we thank God we have no real skin in the game.
  • In turn, the uniformed military services have hired half their fighting forces from the ranks of private, for-profit contractors, who handle the critical support missions that used to be done by soldiers. The ruse conveniently lets the White House keep an artificially-low ceiling on the number of troops in harm’s way. We like those lower numbers.
  • Finally, we have contracted out paying for much of the wars’ costs to our children, and grandchildren. We are using their money to fight our wars. They’ll be thanking us in 2050, for sure.

Until and unless Americans take responsibility for the wars being waged in their name, and the weapons being bought to wage them, this slow bleeding of U.S. blood and treasure will continue. “We have met the enemy,” another Pogo once said, “and he is us.”

http://www.pogo.org/blog/2017/03/military-industrial-circus-national-security-column.html

mark-thompson-230

2By: Mark Thompson, National Security Analyst

Mark Thompson Profile

Mark Thompson writes for the Center for Defense Information at POGO.

 

Silicon Valley’s Pentagon Ties Stay Strong

Standard
pentagon-165964418-final

Image:  “Wired”

“WIRED”

“On the surface, left-leaning Silicon Valley and the more conservative US military seem worlds apart.

But the Pentagon’s Defense Innovation Advisory Board continues to bring the two together.

Former Secretary of Defense Ash Carter created the board in March 2016 so that the Pentagon could tap some of the best minds in science and technology. It counts among its members prominent Silicon Valley leaders such as Alphabet’s Eric Schmidt, Amazon’s Jeff Bezos, Instagram’s Marne Levine and LinkedIn’s Reid Hoffman.Despite uncertainty about its future under Trump’s administration, all the board members plan to remain until the end of their terms. They’ve also dodged the public controversy swirling around Silicon Valley leaders who maintain advisory ties to the Trump White House.

“There is a real contrast between the enthusiasm of tech leaders to serve on the Pentagon’s Innovation Board and the positive public atmosphere that surrounds it and the controversy that surrounds Trump’s CEO advisory group, which CEOs from companies such as Uber have bailed from,” says Peter Singer, a defense expert at the New America Foundation and coauthor of the 2014 book “Cybersecurity and Cyberwar: What Everyone Needs to Know.”

The fact that Silicon Valley’s current advisory role to the Pentagon has proven substantially less controversial than its White House parallel is not without irony. “It points to how the Defense Department is now viewed as the bastion of sanity and respect for law and science, versus the White House as a space of controversy,” Singer says.

Calling All Geeks

To date, the board’s “seemingly nonpartisan ideas” have been “well-received within the defense policy community,” Singer says. But he cautioned that ordinary bureaucratic resistance could slow adoption of its recommendations, unless Mattis and senior Pentagon leaders make them a priority.

Still, the Silicon Valley approach has some momentum within the military, particularly around open source initiatives. The Forge.mil program—founded by the Defense Information Systems Agency in 2009—has enabled collaborative work on open source and community source software across the Pentagon. Separately, the Military Open Source Software (Mil-OSS) community has connected developers in the military and civilian worlds since its creation in 2009. Such open source approaches could help the Pentagon move faster and innovate inexpensively, says Joshua Davis, senior research scientist at the Georgia Tech Research Institute and co-founder of the Mil-OSS community.

On Jan. 9, the Defense Innovation Advisory Board voted to approve 11 recommendations that covered issues such as boosting cybersecurity for advanced weapons, and funding new research in artificial intelligence. Outside experts such as Davis and Singer especially lauded the board’s recommendation to make computer science a “core competency,” by creating a specialized career track for military service members and recruiting fresh talent from both the military and civilian worlds. The Pentagon previously announced its commitment to this recommendation during an interim proposal period in Oct. 2016.

“That right there is a multi-decade kind of thing that’s not going to happen overnight,” Davis says. “But it’s probably one of the first things you can do to build a culture to accept innovation happening this way.”

Training a generation of troops on computer science would have outsized impact because many of the other board recommendations will not succeed without it, says David A. Wheeler, an expert on developing secure software, open source software, and software innovation. “The [Department of Defense] already has tracks for lawyers and doctors,” Wheeler says. “Sadly, software expertise is thin within government, even though modern systems are completely controlled by software.”

A Few Good Recs

Other recommendations clarify existing Pentagon practices. For example, the board suggested that the Pentagon “require all systems purpose-built for the military to have their source code available to the Department,” so that the government retains the rights to and can modify the code when needed. That helps ensure military software remains up-to-date and relatively secure. (Davis describes source code as the equivalent to the recipe that the computer “kitchen” relies upon to cook up the executable software.)

Standard contracting clauses for custom-developed military software already give the government such rights, Wheeler says. But he notes that officials sometimes waive those rights because they don’t realize the systems they’re purchasing have custom software, and fail to specify the software as a contract deliverable.

An interim recommendation calling for a new “global and secure” online system that would hold “all or most” of the Pentagon’s data has yet to be approved—and will likely prove very tricky to implement. Many companies in Silicon Valley and other industries already have their own internal systems to collect and share data in a way that boosts efficiency and productivity. But companies typically don’t worry about devastating national security consequences if they get hacked by foreign powers or malicious agents. “Security isn’t just part of the problem, it is the fundamental problem,” Wheeler says.

The best commercial security products can’t protect the Pentagon’s data from determined adversaries backed by foreign governments, Wheeler says. As a result, the Pentagon has intentionally kept its many systems and networks isolated, to limit the damage that can be caused by breaches of security. But the board has discussed using so-called “formal methods” that can mathematically prove a computer system is immune to entire classes of cyberattacks—a promising approach that still requires much more development.

It’s still unclear how Marine Gen. James Mattis, Trump’s Secretary of Defense, will handle the board’s recommendations. He has the final say on whether the Pentagon fully embraces the board’s ideas.

“At the staff level, we have had very productive conversations with the President’s transition team,” says Joshua Marcuse, Executive Director at Defense Innovation Board.

The US military’s mission will likely never be fully compatible with the Silicon Valley culture that Singer describes as “fast, flat in structure, and happy to fail and fail rapidly.” But it’s still refreshing to see a collaboration between government and tech that’s not fraught with controversy, and that may actually yield some positive results. After all, if the military’s going to meet the technological demands of 21st-century warfare, it’s going to need a few good geeks.”

https://www.wired.com/2017/02/despite-trump-silicon-valleys-pentagon-ties-stay-strong/

Budget Control Act and the Pentagon – The Elephant in the Room

Standard
Elephant in the Room.png

Image:  Vestedway.com

“NATIONAL DEFENSE MAGAZINE”`

“The Elephant in the room is the Budget Control Act [BCA] that imposes strict limits to federal discretionary spending.

Mattis’ budget guidance goes out the window if the BCA is not repealed.

Defense pundits and industry watchers were surprised this week when the Pentagon released extensive new “budget guidance” from Secretary James Mattis that spells out the process for how the Pentagon will justify its upcoming funding request to Congress. The proposed budgets will seek to plug immediate funding holes but also set in motion the military buildup that President Trump promised.

Photo: Defense Secretary Jim Mattis meets with the Joint Chiefs of Staff at the Pentagon (DEFENSE DEPARTMENT)

“It’s our hope and intent that we can operate in a budget environment outside of sequestration,” said Defense Department spokesman Navy Capt. Jeff Davis. “We’ll continue to work these budget submissions very closely with the Office of Management and Budget.”

Mattis has held private discussions with members of Congress on the issue but Davis would not comment on whether the secretary is confident that the BCA caps will be lifted any time soon.

The restrictions in the Budget Control Act are in effect until fiscal year 2021. “We have not seen any plan to lift or strike the BCA and foresee difficulty getting a major hike through fiscal conservatives and Senate Democrats,” noted industry analyst Roman Schweizer, of Cowen Washington Research Group. “OMB’s budget blueprint is expected this month and the reaction to it will be the first indicators of likelihood.”

It is noteworthy that the Pentagon is putting out documents on its budget “sausage-making” when there are no top-line targets yet from OMB, Schweizer observed.

Davis said Mattis intends to build the budget request from the ground up, based on legitimate needs rather than artificial targets. “We don’t just pick a number and fill it in with capabilities,” he said. “We’ll come up with very real capabilities we need to restore readiness and balance programs. Then we’ll work to get the appropriate price tag for it.”

This will not be a free-for-all, Davis said. “Secretary Mattis has said he wants to be a faithful steward and get maximum value for the taxpayer dollar. That’s what this process is designed to do.”

According to the three-phase plan, the Pentagon will request by March 1 an emergency budget amendment for fiscal year 2017 to fund immediate needs like precision-guided munitions and pilot flying hours. The fiscal year 2018 budget proposal due May 1 would seek longer-term investments to increase the size and capability of U.S. forces. The foundation for the 2019-2023 five-year budget would be a new National Defense Strategy that the Pentagon is now drafting. The Trump administration also has ordered a nuclear posture review and a missile defense review, both of which could add significant new expenditures.

The Pentagon’s budget not only faces huge political and fiscal pressures but also practical constraints such as a narrow window of time on the congressional calendar.

“There is lots to do, and not much time,” said Bloomberg Government analyst Rob Levinson. A deadline to increase the national debt limit looms March 16. Federal funding for fiscal year 2017 runs out April 28, when the current continuing resolution expires and action will be needed to prevent a government shutdown.

There are larger variables at play, too, Levinson said during a Bloomberg webinar. “Trade-off decisions could be affected by changes in relations with Russia,” he said. The Pentagon’s ambitious “third offset” strategy is predicated on the need to counter rising powers like China and Russia. “Trump appears to feel differently about Russia than many in Washington, but is concerned about China, which could steer more money to the Navy and Air Force at the expense of the Army.”

Trump, like every president, will be forced to make tradeoffs between spending plans, tax cuts and deficits, said Levinson. “A most likely outcome is increases — not necessarily equal — for defense and domestic spending with resulting deficit growth. No faction will get everything they want: not the fiscal hawks, defense hawks, Democrats or the president.”

http://www.nationaldefensemagazine.org/blog/Lists/Posts/Post.aspx?ID=2411

Pentagon Playing Key Role in Reshaping U.S. Industrial Future

Standard
pentagon-and-industrial-future

Photo: 3D Manufacturing – US Marine Corps

“NATIONAL DEFENSE MAGAZINE”

“Federal agencies led by the Defense Department have been quietly laying the foundation for a high-tech manufacturing surge.

The Pentagon, notably, has been assembling a large network of government, private-sector and academic players in a bid to secure access to critical technologies the military needs, while also trying to motivate corporations to invest in advanced manufacturing research.

The Defense Department last week announced it awarded a contract to American Robotics Inc., based in Pittsburgh, Pennsylvania, to manage the “Advanced Robotics Manufacturing,” or ARM Institute, the eighth DoD-led hub that becomes the 14th member of the “Manufacturing USA” network.

Defense officials and industry analysts have hailed this business model because it spreads the financial burdens across many players and puts both the government and the private sector in a position to win big, if projects end up developing successful products that can be commercialized.

American Robotics — a consortium of state and local governments, industry, universities, community colleges and non-profit organizations from across the country — contributed $173 million to the ARM Institute. That will be combined with $80 million in federal funding.

The Pentagon is showing growing interest in these public-private partnerships at a time when it fears the U.S. military is seeing its technological edge slipping, and worries that private-sector innovations are moving far too rapidly for the government procurement bureaucracy to keep pace.

The ARM Institute will “organize the current fragmented domestic capabilities in manufacturing robotics technology and better position the United States, relative to global competition,” said a Pentagon news release.

The goal is to promote a democratization of sorts in the industry so manufacturing robots becomes less expensive and more accessible even to small businesses. “The use of robotics is already present in manufacturing environments, but today’s robots are typically expensive, singularly purposed, challenging to reprogram, and require isolation from humans for safety.” Robotic systems are viewed as essential to “achieve the level of precision required for defense and other industrial manufacturing needs, but the capital cost and complexity of use often limits small to mid-size manufacturers from utilizing the technology.”

The Pentagon for years has made it known that low-cost, multifunctional autonomous systems are at the top of its wish list. The manufacturing hubs are one vehicle to make that vision a reality.

The ARM consortium is one of the largest, with 123 industry participants, 40 members from academia and 64 government and nonprofit partners. The group will be directed to “create and then deploy robotic technology by integrating the diverse collection of industry practices and institutional knowledge across many disciplines — sensor technologies, software and artificial intelligence, materials science, human and machine behavior modeling and quality assurance.”

The Manufacturing USA network started out three years ago, when Congress authorized it in the Revitalize American Manufacturing and Innovation Act of 2014. The program was previously known as the National Network for Manufacturing Innovation. The legislation was passed with bipartisan cooperation and has drawn praise from politicians for supporting small and mid-sized manufacturers, and for creating venues to train the next generation of manufacturing workers.

Each Manufacturing USA institute focuses on a technology area, such as additive manufacturing, integrated photonics or smart sensors. The federal government has committed over $1 billion, matched by more than $2 billion in non-federal investment. The Pentagon noted that the hub in Youngstown, Ohio, attracted over $90 million in new manufacturing investments and is poised to train 14,000 workers in the fundamentals of 3D printing.

In a move aimed at building awareness and shoring up support for manufacturing consortiums, the Pentagon funded an independent study that looked at the overall performance of Manufacturing USA.

The study, conducted by the consulting firm Deloitte and released last week, reported that the first eight advanced manufacturing institutes were able to bring together 1,200 companies, universities and government agencies. The value of these massive networks is that they can help to “accelerate innovation,” the Deloitte study said. Over time, these centers would be the launch pads for the future technically trained manufacturing workforce and for a “sustainable national manufacturing research infrastructure.”

The first eight Manufacturing USA institutes were established by the Department of Defense or Department of Energy. There are early signs that the organizations are reaching “tipping points” where the benefits for both the government and the private sector are self-evident, the study said.

The private-sector members include influential U.S. companies such as Boeing, GE, Johnson & Johnson, Lockheed Martin and Ford. The study found that the institutes have created “true public-private partnerships that are successfully uniting academia, industry and government across the country.”

Deloitte analysts noted that Manufacturing USA addresses the so-called “valley of death” between research and commercialization, a problem that has plagued defense technology for decades. “By breaking down market barriers in the right technological areas, the program facilitates the acceleration of U.S. manufacturing R&D.” The institutes also focus on ensuring that there are enough workers with the right skills to meet the needs of advanced manufacturers.

The study compliments the program too for helping entrepreneurs and small businesses by providing access to expensive equipment, pooling project costs, creating technology roadmaps and promoting knowledge exchange.

One project at the Digital Manufacturing and Design Innovation Institute, in Chicago, linked researchers from the Rochester Institute of Technology and several businesses that were seeking to commercialize wearable technologies. At the Power America advanced electronics institute in North Carolina, a member company called AgileSwitch applied a newly patented switching technique for use in high-power silicon carbide applications. The technology has applications in solar and wind turbine energy, and electric vehicles.

The Defense Department believes it has a huge stake in the success of these ventures as the Pentagon continues its pursuit of low-cost systems such as drones and surveillance sensors. One plan, for instance, is to deploy swarms of minidrones to overwhelm enemy forces and weapon systems. That will require systems that cost a fraction of current products, so they can be deployed in large numbers and used as disposable gear. Buzzwords like “distributed, persistent sensor networks” have been used to describe that vision.

Deloitte warns that Manufacturing USA should increase collaboration with the Pentagon’s own labs and avoid overlapping efforts. “Manufacturing USA was designed, in part, to complement the national labs and propel their work through the manufacturing innovation process,” the study said. “In practice, however, by focusing institute efforts on technology development, the program risks creating non-strategic overlap with these peer entities.”
http://www.nationaldefensemagazine.org/blog/Lists/Posts/Post.aspx?ID=2400

 

 

Outgoing Weapons Chief : “Acquisition Improvement Must Come From Within”

Standard

defense-industry-daily-frank-kendall

Frank Kendall, Under Secretary of Defense for Acquisition, Technology and Logistics

“DEFENSE NEWS”

“The Pentagon’s outgoing acquisition chief slammed Congress for recent efforts to improve the weapons buying process.

“What it does do, almost inevitably is create more bureaucracy. Because everything it gets put in statute, we have to implement to demonstrate compliance, and that adds and adds and adds to the body of regulation that is a burden to our acquisition system.”

Lawmakers on Capitol Hill have only “imperfect tools” to improve defense acquisition, said Frank Kendall, under secretary of defense for acquisition, technology and logistics, during a Tuesday speech at the Center for Strategic and International Studies. Congress can overhaul organizational structures and set very firm regulations on how the Defense Department operates, but ultimately those actions can be counterproductive.

In a wide ranging speech that drew from his new 228-page book, “ Getting Defense Acquisition Right,” Kendall shared anecdotes about his career in the Pentagon and made the case that incremental changes would serve the procurement process better than sweeping change.

“Acquisition improvement is going to have to come from within. It is not going to be engineered by Hill staffers writing laws for us. It’s going to be done by people in the trenches, everyday, dealing with industry, trying to get the incentives right, trying to get the performance right, trying to set up business deals and enforce them, set reasonable requirements in our contracts [and] do all the hundreds of things that are necessary to get good results,” he said.

The department’s procurement wing is on the right track, and “we should be reinforcing” good practices, he said. For instance, data shows that cost overruns have been coming down “significantly” over the last couple of years, in part because program managers feel empowered to do the “right thing” for the program instead of simply adhering to regulations.

That flexibility is important in many areas of contracting, Kendall said, pointing to his fight with Congress over fixed price contracts. Although many lawmakers favor fixed-price contracts that shift risk to industry, data gathered over the past few years shows that fixed-price and cost-plus contracts seem to generate the same amount of cost growth.

“The idea that fixed price is the solution to our problems. It was tried. It was tried and it failed. One of my frustrations having been in this business for so long is that we don’t seem to learn from the past,” he said. “I spent a few years in the Pentagon in the late ’80s, early ’90s cleaning up the messes that fixed price development caused across the department.”

Kendall offered a couple suggestions on how Congress could help the acquisition process. For one, it could make it easier for the department to recruit and retain skilled personnel and compensate them fairly.

The Pentagon also needs more money for research and development. Over the past few budgets, the department has invested in a number of demonstration programs that prove out innovative and cutting edge technologies, but it doesn’t have the budget to turn them into procurement programs.

“We have, I’m afraid, conveyed the impression, unintentionally, that lack of innovation is our problem, and that more innovation is the solution to our problems. I don’t believe that. We actually have quite a bit of innovation. What we haven’t had is the money to take that innovation and translate it into products,” he said.

There are signals that the Trump administration could funnel more money into the Defense Department, something that Kendall said “wouldn’t be a bad thing.” However, some of that money needs to flow into modernization programs.

Although much of Kendall’s comments focused on how congressional meddling negatively impacts defense acquisition, he offered some sharp criticisms of Pentagon policy as well.

So far, the department’s Third Offset effort has funded a series of demonstrations, with artificial intelligence and autonomy being seen as two of the key enabling technologies. However, officials do not have a clear vision of the capabilities needed or how they can be used to revolutionize warfare.

“We’re doing a lot of experimentation,” Kendall said. “But we do not yet have the clear design concept … for a new suite of capabilities that will be dramatically better on the battlefield.”

Requirements development could also be improved by doing more analysis to ensure that what is being asked for will actually make a difference to the warfighter, he said.”

http://www.defensenews.com/articles/outgoing-weapons-chief-pleads-his-case-for-incremental-change-to-acquisition-process

America’s Military Has a Big Problem: It’s Dead Broke

Standard

500-hammer

“THE NATIONAL INTEREST”

“The Pentagon has made big plans for which it lacks the money.

DoD has breathtaking liabilities—as much as $88 billion a year—that ought to be addressed before procuring a single additional plane, ship or tank.

“We’re broke.” In essence, that’s the message Deputy Secretary of Defense Bob Work delivered to Defense-Secretary-in-Waiting James Mattis at the December 5 Future Strategy Forum.

Military leaders have testified to the problems caused by five straight years of budget cuts and how these cuts, combined with an extraordinarily high operational tempo, have resulted in a smaller, less capable military force.

What has received less attention is the degree to which the Pentagon’s future plans bank on questionable assumptions and budgetary sleight-of-hand to balance the books for 2018 and beyond. These gimmicks include: relying on rosy future estimates for the cost of labor, fuel and currency exchange; pushing the costs of large modernization programs like the nuclear triad into the ill-defined “out years,” and using Overseas Contingency Operations funds to help cover normal DoD operating costs. Taken together, these liabilities, combined with the administration’s decision to submit budgets in excess of the Budget Control Act caps, constitute about $100 billion dollars per year of unbudgeted liabilities or risk—a staggering sum that will severely limit the new administration’s ability to quickly rebuild the U.S. military.

In October 2016 a Pentagon spokesman publicly acknowledged, and Secretary Work confirmed, what many have known for some time: that as much as half of the money requested in the DoD Overseas Contingency Operations (OCO) funding is planned to go to normal Pentagon operations such as training soldiers, steaming ships or flying planes—not the extraordinary wartime operations which OCO was designed to cover.

The President-elect’s nominee to head the Office of Management and Budget, Rep. Mick Mulvaney, (R-SC), has decried such misuse of OCO funds, calling it a “backdoor loophole” in the budget process. Considering that comment, if Congress and the country want DoD’s normal operating costs captured in the appropriations process versus the wartime funding mechanism, this $30 billion annual cost must be eventually covered in the base budget, further adding to DoD’s liabilities. And while it may be a worthy goal to move these enduring costs into the base appropriation it’s important to note that this shift by itself won’t do anything to restore military capabilities.

Here are some other liabilities Secretary Work didn’t mention:

Future Costs of Labor

Section 1009 of Title 37 United States Code requires military pay raises to equal the Economic Cost Index (ECI), a common measure of the cost of labor, unless the president invokes his authority to request an alternative pay raise. The Congressional Budget Office estimated in August that “the ECI will grow by more than 3 percent a year, on average over the next several years.” However, in its budget request, DoD has planned on much smaller raises than CBO forecasted. The 2017 DoD budget projects pay raises of only 1.6 percent for 2017-2019, and 1.8 percent and 2.1 percent for 2020 and 2021, respectively.

From 2014-2016 President Obama used his authority to lower the requested pay raises, and Congress complied. After three years of smaller than prescribed pay raises, this year Congress disregarded the president’s recommendation and set the pay raise at 2.1 percent in the 2017 NDAA, matching the growth in ECI.

Because the DoD has banked on being able to lowball military and civilian pay raises for the next five years, the liability incurred by Congress’ inconvenient compliance with law this year, and potentially in the future, will run to the tens of billions of dollars. Just next year’s change in pay will cost DoD about $800 million in 2017 than planned.

Hopeful Fuel Cost Assumptions

The DoD budget estimate projects that fuel costs for fiscal year 2017 will drop 8.2 percent from 2016. For future years, DoD used planning assumptions that reflected minor increases ranging from 4.8 percent in 2018 to only 1.8 percent in 2021.

However, the latest forecast from the U.S. Energy Information Administration predicts crude oil prices will gradually rise, not fall, next year. And future year energy estimates vary widely, with high end price per barrel of crude oil reaching $150 by 2020. If energy costs grow at even a modest rate of 5 percent annually, the Pentagon will be short billions of dollars compared to its plan.

Living Large In an “Out-year”

Former Secretary of the Army John McHugh famously commented that he always wanted to “live in an out-year.” In Pentagonese, “out-years” fall outside the rigid five-year planning window; they are, consequently, years in which unrealistic procurement plans magically come to fruition and normal budget rules don’t apply.

DoD is notorious for planning to acquire major systems such as planes, submarines and ships in quantities that are patently unaffordable in the next five years, but will be brought on-board when the money somehow materializes in an “out-year.”

This Pentagon has double-downed on that technique. In addition to the unpaid bills associated with the recapitalization of the nuclear triad mentioned by Secretary Work, the replacement for the Ohio class submarine and many other major systems are also all awaiting an out-year deus ex machina to save the day.

For example, the Navy’s current, approved 30-year shipbuilding program only gets them to 308 ships—even though they just announced they need 355, nearly matching the president-elect’s promise to get to 350 ships. Yet when the Congressional Budget Office analyzed the Navy’s 308-ship plan, they found it would cost $3-5 billion dollars more per year than what was budgeted.

In an excellent study of the out-year issue, CSIS’s Todd Harrison suggested that just to execute the DoD’s planned modernization programs would require approximately 7 percent more funding— around $40 billion per year—than was budgeted. This includes nothing of the re-building that President-elect Trump has promised.

Other problems lie ahead. DoD has made optimistic assumptions about foreign currency exchange rates, counting on them to remain near where they are today, which is very favorable for the United States. Another liability includes Pentagon requests for changes to military health care programs that the 2017 NDAA did not fully support.

At the Bottom of a Very Deep Hole

The liabilities described above will build to about $100 billion a year over time, seriously complicating matters for a president-elect who has pledged to rebuild our depleted military.

The Pentagon can save some money through efficiencies, base realignment and closure, restructuring and better business practices, and some of these efforts are already underway. But those savings won’t be nearly enough to close liabilities of this magnitude. It’s unfortunate this critical information hasn’t been part of a national discussion by our nation’s leaders, including the president, prior to the imminent transition.

In It’s a Wonderful Life, George Bailey’s financial problems were solved with a crowdfunding solution among the residents of Bedford Falls. General Mattis won’t be so fortunate. It’s among the many challenges that the new administration’s leaders will have to grapple with in their first hundred days to begin the necessary restoration of our military.”

http://nationalinterest.org/feature/americas-military-has-big-problem-its-dead-broke-18956?page=show

 

Can Defense Procurement Be Great Again?

Standard

small-business-rules

“NATIONAL DEFENSE MAGAZINE”  by Steven M. Speakes

“As the CEO of a small defense contractor, I see hope for a brighter future. We are excited not just at the prospect of a permanent end to sequestration and a return to more funding for defense but also at the prospect that the broader issues of the electorate discontent manifested in Trump’s win will be felt and heeded by our government.

We believe that government exists to serve citizens. In government contracting, for instance, bureaucracy and bureaucrats have become accustomed to ruling over their fellow Americans. The recent past has been characterized by process gone amuck.

As small business leaders, we feel victimized by a lack of redress to issues such as an acquisition system that takes forever, relies on arcane rules, involves lawyers at every opportunity and requires top-tier lobbyists to obscure accountability.

Following are some new rules that America’s small businesses would like to see in defense procurements:

Write requirements in plain English. Use modern commercial technology to take the “black art” out of the process. Instead of forcing contractors to employ expensive legal firms, use modern software like “Legal Zoom” to provide readily available contract language to small firms. Set a reasonable time limit for government proposals. Establish timelines for steps in processes and live by them by enforcing penalties on the government for non-performance. Cash flow is an issue for small firms that cannot risk months or years of bureaucratic processing to gain decisions.

End the DoD war on intellectual property rights. Firms that are inventive deserve the right to profit from their success. The federal government’s current approach to intellectual property would not be accepted in the music and publishing industries. In those sectors the sanctity of intellectual property is respected and serves as the engine that drives re-use of the most clever ideas.

Enforce transparency in decision-making. Under the guise of “protecting the process,” government is able to make decisions with minimal accountability, particularly with small contract awards that are so often the bread and butter for smaller firms.

Make civil servants and military officers accountable. While a heroic few work extremely hard and are deeply devoted to their professional responsibilities, too many are not. When you contact world-class commercial organizations with a problem, you expect to speak to a human being who understands that we expect accountability. Emails are responded to promptly. Satisfying the customer is key. The commercial world believes that relations with partners and customers are long term and mutually beneficial, not adversarial. Emails receive responses and communication is evaluated for results. None of this is true with the government, where the contractor is often viewed with disregard and occasionally with contempt.

Adopt modern commercial principles of innovation. It is the foundation of much that is going well in America. We started the country with innovators in charge. Early founders such as Benjamin Franklin and Thomas Jefferson popularized the view that the creative, questioning human spirit is the spark of greatness. Our foundations of government reflect this view. Unfortunately the reality of the DoD bureaucracy hinders innovation.

Initiatives by Secretary Ash Carter to “bolt on” innovation to DoD are of limited relevance. Innovation principles are by now well established in industry and can be applied to DoD, but only if senior leaders are committed to the task. Innovation needs to be undertaken in partnership with all contractors, including the small and midsize businesses that bend metal and make hardware.

Coach DoD leaders that lawyers provide “legal opinion” and not “the law.” Uniformed and civilian leaders hide behind their lawyers who dominate government decision-making with the power to delay, obfuscate and just say no. The responsibility of leadership is to act and to take responsibility for decisions. We all know that the opposite is true as too often inaction becomes the goal. While we all recognize that issues of senior leader misconduct are serious, we need better procedures to ensure swift and fair resolution of allegations to make the business of DoD work better.

Make American jobs count. Many small businesses that are defense contractors are struggling to survive. DoD’s focus on the industrial base centers all too often on the top 100 firms and not the small manufacturers that possess unique qualities of innovation, agility and enormous capability. Let’s establish a framework — if the president-elect gets involved to save 1,000 jobs, then when should a secretary of defense or general get involved? It will take that kind of focus to cause DoD to change its indifferent operating focus.

So where is the future of the U.S. government headed for small businesses? It must move in a new direction. We feel sure of that. As contractors, we must embrace a goal of creating a new DoD culture, peopled with agile, committed leaders and followers who understand partnership, embrace service and respect as core ethics and are prepared to multiply the value of the $600 billion our nation invests annually in this most noble cause.”

Stephen M Speakes, a retired U.S. Army lieutenant general, is president and CEO of Kalmar Rough Terrain Center LLC, in Cibolo, Texas.

http://www.nationaldefensemagazine.org/archive/2017/January/Pages/CanDefenseProcurementBeGreatAgain.aspx

 

Pentagon’s Suppressed Waste Report Only Tip of the Iceberg

Standard

penteagon-just-the-tip

“THE HILL”  By William D. Hartung

“The Pentagon now has the dubious distinction of being the only federal agency that cannot pass an audit.

As a result, the department often doesn’t know how much equipment it has, or how many contractors it employs. This makes the department extremely vulnerable to waste, fraud and abuse.

The revelation this week by “The Washington Post” that the Pentagon buried a report that exposed $125 billion in waste in the department’s administrative operations is just the latest indication that it is more interested in padding its budget than spending taxpayer dollars wisely.

Reducing this entrenched bureaucracy should be a top priority for the new administration and the new Congress that take office in January.

This is not the first time the issue of the billions in unnecessary bloat in the Pentagon’s budget has been raised.

A 2010 report by the Defense Business Board uncovered similar problems, citing an “explosion of overhead work because the Department has failed to establish adequate controls to keep it in line.”

And as Gordon Adams, former director of the Office and Management and Budget for defense issues, has noted, the cost of the Pentagon’s back office has “basically doubled per active duty troop since 2000.”

In short, a huge portion of the Pentagon’s buildup in the 2000s has paid for bureaucracy, not combat capability. The business board report made specific recommendations of how to fix the problem, but few were implemented.

In addition to the issue of bureaucracy, a few examples of the other ways the Pentagon wastes our money underscore the point of the need to keep a much closer eye on the Pentagon’s use of our tax dollars.

In February of this year, I issued a report that provided a small sampling of the most egregious examples of Pentagon waste that have occurred in the past few years, from small expenses like Pentagon personnel spending on casinos and strip clubs using their government-issued credit cards to spending $2.7 billion on a surveillance balloon that failed spectacularly when it came free from its moorings and crashed in Pennsylvania.

The new Defense Business Board 2015 report casts doubts on Pentagon claims that it is making progress towards being able to pass an audit, something it has failed to do since 1990, when it was first required by law.

2300-1-pentagon1113

The Pentagon now has the dubious distinction of being the only federal agency that cannot pass an audit. As a result, the department often doesn’t know how much equipment it has, or how many contractors it employs. This makes the department extremely vulnerable to waste, fraud and abuse.

The audit issue has gained greater visibility in recent years, including planks in both the Republican and Democratic platforms that promised to do something about the problem. And there were bipartisan bills in both the House and Senate this year that, if passed, would have imposed financial penalties on the Pentagon if it doesn’t get its books in order.

Supporters of the bills ranged across the political spectrum, including Rep. Barbara Lee (D-Calif.) and Rep. Michael Burgess (R-Texas) in the House, and Sen. Joe Manchin (D-W.Va.), Sen. Ron Wyden (D-Ore.), Sen. Ted Cruz (R-Texas), and Sen. Bernie Sanders (I-Vt.) in the Senate.

President-elect Donald Trump has also spoken out on the issue of Pentagon waste, promising to clean up the department and “conduct a full audit.” In fact, Trump puts so much stock in reducing Pentagon waste that he has cited it as a major way to offset the costs of the major increases in troops, ships, aircraft and missile defense systems he proposed during the campaign.

Given a price tag that could reach well over $900 billion in additional spending over the next three decades, there is no way President Trump can offset all of the costs of his proposed buildup by cutting waste. But he will certainly have an incentive to squeeze out all the savings he can find.

But even if the Pentagon were able to account for every penny it spends, there would still be a question of whether those funds are being spent on the right things.

There is a broader definition of waste that goes beyond the administrative costs cited by the business board.

This includes the refusal of Congress to support the closure of unnecessary military bases under a Base Realignment and Closure (BRAC) process; the decision to move full speed ahead on the F-35 fighter program despite its myriad cost and technical problems; and the plan to spend $1 trillion over the next decade on a new generation of nuclear-armed bombers, submarines, and missiles at a time when current systems already exceed what is needed to deter any country from attacking the United States with nuclear weapons.

The plan to spend funds on high-priced nukes makes even less sense when one considers that upgrades of current systems could last for decades without having to throw tens of billions of dollars at systems we don’t need at prices we can’t afford.

Even in times of intense partisan debate on a whole range of other issues, it should be possible for Congress and our next president to come together on the need to eliminate waste at the Pentagon, broadly defined.

Whether or not they do so will be a good test of whether they are willing and able to spend scarce tax dollars efficiently and effectively. This kind of accountability is the least we should ask for as we move into a new, uncertain period in Washington.”

http://thehill.com/blogs/pundits-blog/defense/309083-pentagons-suppressed-waste-report-only-tip-of-the-inefficient

Pentagon New Background Check System Won’t Be Ready for 2 More Years

Standard
background-check

US Army Photo by Staff Sgt. William Reinier

“DEFENSE ONE”

“System to securely store  information collected by the National Background Investigation Bureau.

The Obama administration launched NBIB in January in the wake of the Office of Personnel Management data breach, which compromised background information of 21.5 million current and former federal employees and their families.

It will be roughly 18 months to two years before the Defense Department completes building out a next-generation computer system to house federal background check data, the director of the new agency that manages the clearance process said Thursday.

Information shared by law enforcement could form the basis for programs to continuously evaluate cleared federal employees for red flags rather than conducting full re-investigations every five to 10 years, he said.

There are several continuous evaluation pilot programs in the military and intelligence community, but the practice isn’t yet widespread.

While NBIB waits on its updated system, the agency plans to update its public-facing, and notoriously onerous, Electronic Questionnaires for Investigations Processing, or e-QIP, system, Phalen told members of the National Industrial Security Program Policy Advisory Committee.

“This is our front face to our population that we’re clearing, and we’ve got to do a better job of how we’re presenting ourselves,” he said.

The Obama administration launched NBIB in January in the wake of the Office of Personnel Management data breach, which compromised background information of 21.5 million current and former federal employees and their families. The agency’s reputation was previously damaged by a data breach at background check contractor USIS, which OPM cut ties with in 2014.

The new agency effectively retains responsibility for conducting most background investigations inside OPM, but transfers responsibility for securing the networks that hold that information to DOD.

Long backlogs created by the end of the USIS contract and the OPM breach continue to plague the government, Phalen said, though the government is getting back on track.

Contracts with a quartet of background check contractors are set to kick off this year. That will bring the total number of contractor background investigators to roughly 6,000, Phalen said, plus 2,000 federal investigators, 400 of them hired in 2016. NBIB plans to hire an additional 200 federal investigators in 2017, Phalen said.

Average wait times for various background investigations range from 95 days to more than 200 days, according to the most recent quarterly report.”

http://www.defenseone.com/technology/2016/11/pentagons-new-background-check-system-wont-be-ready-nearly-two-more-years/133111/?oref=d-river