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The Bunker: Just for Fun(ding)

The Bunker: Just for Fun(ding)

The Bunker, delivered to our subscribers Wednesdays at 7 a.m., is a newsletter from the desk of National Security Analyst Mark Thompson. Sign up here to receive it first thing, or check back Wednesday afternoon for the online version.


This week in The Bunker: Sifting through new reports for amazing defense-spending facts; the Navy’s latest maneuvering, but not on the high seas; President Biden stumbles in the China shop; and more.

REPORTEDLY…

Two annual reports worth checking out

Every year, there is a pair of reports issued that clash. First, there’s the Heritage Foundation’s Index of U.S. Military Strength, which makes clear how much trouble the U.S. military is in because it’s not spending enough money. “As currently postured, the U.S. military continues to be only marginally able to meet the demands of defending America’s vital national interests,” the October 20 assessment concludes.

Two days later, the Pentagon released its own annual accounting of how much of its money goes to each state to support that supposedly threadbare military force. Well, here’s a secret from The Bunker: if the nation’s defenses are rickety, it’s not for lack of money.

While Heritage’s report has been published for only eight years (“The only non-governmental and only annual assessment of U.S. Military Strength,” it notes), the Pentagon’s state-by-state spending list has been around pretty much forever. A much-younger Bunker remembers poring over it while working for the Fort Worth Star-Telegram’s Washington bureau, in between the Vietnam and first Gulf wars. Hometown readers were always eager to learn how much tax money was flowing back into their pockets as the U.S. military bought their locally-produced General Dynamics F-16s fighters (before General Dynamics sold the line to Lockheed), Bell helicopters, Texas Instruments HARM missiles, and Vought A-7 attack planes (told you it was a long time ago), among other hardware.

Just for fun(ding), let’s pit the Pentagon’s biggest state winners alongside its most fearsome foes. Turns out that in 2020, Texas, all by its Lone Star lonesomeness, collected $83 billion in Pentagon contracts and salaries. That made it #1 among the 50 states. That’s more than the $61.7 billion Russia spent the same year, according to the Stockholm International Peace Research Institute (There are as many ways to measure defense spending as there are excuses for the F-35 program, but The Bunker finds SIPRI’s data[PDF] pretty solid). In other words, one of the biggest foes of the U.S. spends about as much on their military as one U.S. state pockets from the Pentagon.

Virginia, mainlining Navy funds, ranked second among the states, at $64.3 billion. Iran spent $15.8 billion. Tossing North Korea into the mix—SIPRI says “data unavailable” for the fanatically secret nation, but the State Department estimated it spent an average of $3.6 billion annually between 2007 and 2017. Bottom line: Virginia, all by its itself, collects three times more from the Pentagon than the two surviving members of President George W. Bush’s “axis of evil.”

California came in third, with $61 billion. That was enough to eclipse Australia ($27.5 billion), Britain ($59.2 billion), Canada ($22.8 billion), France ($52.7 billion), Germany ($52.8 billion), Israel ($21.7 billion), Italy ($28.9 billion), Japan ($49.1 billion), Saudi Arabia ($57.6 billion), and South Korea ($45.7 billion). Granted, California outspends each when counted individually, and not added together, but…They…Are…Our…Allies.

The Pentagon says it spent $593.9 billion on contracts and payroll in 2020 in the 50 states and D.C., an 8% hike over 2019. That’s more than twice what China spends on its entire military. “If the total spending were divided across every U.S. resident," the Defense Department added, "it would amount to $1,803 per U.S. citizen.”

Skeptics will maintain that such comparisons are apples-to-oranges, if not closer to fruit cocktail. But the logic is clear: when the U.S. military can’t defeat an insurgency in Afghanistan despite 20 years of trying—at a cost of more than 2,000 U.S. lives and $2 trillion—money ain’t the issue.

CONTRACTING UP

And speaking of spending…

Pentagon reports like that state-by-state spending analysis often contain interesting data…if you’re willing to spend the time to dig for it. Take the share of Pentagon contracting dollars awarded to Lockheed Martin, the Pentagon’s biggest contractor, over the past five years. As we like to say here at The Bunker, a numerator (how much Lockheed got) without a denominator (how much everyone else got) is worthless.

So let’s do the math. All you’ve got to do is review the state-by-state spending reports (PDFs) dating back to 2016, subtract the Defense Department payroll paid in each state, from the spending on private contracting and services, and contrast what’s left with Lockheed’s share. Here’s what it looks like:

2016: 11.5% (Lockheed received $29.8 billion out of a total of $258.2 billion awarded).

2017: 11.2% ($30.5 billion of $271.7 billion).

2018: 10.5% ($37.8 billion of $358.9 billion).

2019: 11.3% $45.6 billion of $403.9 billion.

2020: 16.6% ($72.9 billion of $439.4 billion).

Lockheed’s slice of the Pentagon pie has grown by nearly 60% over the past three years. In fact, its 2020 piece was bigger than the combined slices of the Defense Department’s next three biggest contractors: General Dynamics ($22.8 billion), Boeing ($22.4 billion), and Raytheon ($20.2 billion). Lockheed shares took a hit October 26 after it lowered its sales outlook for this year and next, blaming the pandemic. But CEO Jim Taiclet predicted sales “would go up again in 2023 and increase steadily through 2026,” Reuters reported.

This reminds The Bunker of defense executive Norm Augustine’s laws of Pentagon procurement. He drafted them after serving as the Army’s No. 2 civilian official during the Carter administration and before joining the Martin Marietta Corp. in 1977. Law No. 16 reads (PDF):

“In the year 2054, the entire defense budget will buy just one tactical aircraft…which will have to be shared by the Navy and the Air Force 6 months each year, with the Marine Corps borrowing it on the extra day during leap years.”

Augustine capped his career in the defense business as Lockheed’s top executive, after Martin Marietta merged with Lockheed in 1995. Lockheed builds the F-35 fighter, the most costly weapon system in the history of the world. And it also happens to be flown, per Augustine’s nearly 40-year-old law, by the Air Force, Navy, and Marines.

The Bunker remembers when everyone thought Augustine’s Laws were a joke.

SEASICK

Navy woes continue

That Heritage report cited above says today’s 296-ship U.S. Navy is “‘Marginal,’ Trending Toward ‘Weak.’” The sea service “desperately needs a larger fleet of 400 ships, but current and forecasted levels of funding will prevent this from occurring for the foreseeable future.” That puts it smack dab in the middle of Heritage’s assessments: the Marines are “strong,” the Army’s “marginal,” and the Air Force is “weak.”

The Bunker has made clear over the years that the Navy has been sailing amid rough seas. Instead of standing up to its civilian masters and declaring they don’t have the resources to do what they’re told to do, they meekly salute and carry on, killing sailors in the process. The Navy has boomeranged from one scandal—a sailor set fire to the billion-dollar USS Bonhomme Richard last summer that the Navy couldn’t put out, forcing it to be scrapped—to another: a Navy engineer and his wife seeking to sell nuclear secrets to a foreign country. “If the Navy is not prepared to fight a fire in a major warship,” Navy veteran Harlan Ullman asks, “is it fit to fight a major war?”

Procurement is just as bad. Even Congress has had enough. “Senate Appropriators Call for GAO Probe into Navy’s Budget Tactic to ‘Deliberately Underfund Programs,’” read the headline over an October 20 piece on the U.S. Naval Institute website. The gimmick, according to the committee’s defense panel, involves the Navy breaking multi-year-procurement deals in its budget submissions, betting that Congress will find enough money elsewhere in the Pentagon budget to keep them afloat. “The Committee expects the Navy to honor the commitments it has made to our domestic shipbuilding industrial base,” it added(PDF), “and avoid paying unnecessary penalties that increase the cost of shipbuilding programs.” In each of the past two years, the Navy also has scrapped a planned ship from its official budget request. Instead, it has moved it into the top spot on its so-called “unfunded requirements list,” known to taxpayers as a “wish list.”

In recent decades, the Navy has had great difficulty buying aircraft carriers, destroyers, drones, and other weapons on time and budget. “This is particularly concerning given the Navy’s plans to initiate and ramp up several major acquisition programs in the near-term, including the COLUMBIA Class submarine, the Next Generation Air Dominance Family of Systems, the DDG(X) Destroyer, FFG, and SSN(X),” the panel’s October 18 report, accompanying its proposed 2022 defense-spending bill, said(PDF). “At the same time, the Navy is struggling to manage cost on several major acquisition programs, including the COLUMBIA Class submarine, certain subsea and seabed warfare programs, and the TAO fleet oiler, revealing significant cost increases for each of these programs in the fiscal year 2022 budget submission.”

The panel criticized what it called “these repeated budgetary maneuvers.” Perhaps so, but after Iran captured U.S. sailors for stumbling into its territorial waters, and two at-sea collisions where Navy officers were to blame, it’s good to know there are some kinds of maneuvers it can still perform.

UNDIPLOMATIC LANGUAGE

Biden in a China shop

The Taiwan Relations Act(PDF) became the law of the land in 1979, the same month The Bunker arrived in the nation’s capital. But it never was a law in the usual sense. It never made clear—and still hasn’t—whether or not the U.S. military would come to Taiwan’s aid if mainland China tried to retake the island it deems a renegade province. Diplomats call it “strategic ambiguity,” a will-they-or-won’t-they construct familiar to anyone who ever went on a drive-in movie date.

It was a studied approach, designed to tamp down warmongers in both Beijing and Taipei. Its goal is to preserve an uneasy peace, as The Bunkerdetailed in his latest Military-Industrial Circus. Plainly, President Biden hadn’t read it by October 21. “Are you saying that the United States would come to Taiwan’s defense if China attacked?” CNN host Anderson Cooper asked Biden after the president, responding to an audience question, suggested it would. “Yes,” Biden quickly answered. “We have a commitment.”

Actually, no, we don’t. The U.S. used to have a commitment to Taiwan’s defense against Chinese attack, but President Carter scrapped it when the U.S. established diplomatic relations with mainland China in 1979. Biden had been in the Senate for six years when that happened. His response alarmed old China hands, who noted it wasn’t his first Formosa flub. The White House was forced to correct the boss the next day. “Our policy has not changed,” White House press secretary Jen Psaki said. “He was not intending to convey a change in policy, nor has he made a decision to change our policy.” Unfortunately, he spoke like he did. That’s not something one wants a president doing in “The most dangerous place on Earth,” as the cover of a recent issue of The Economist declared.

WHAT WE'RE READING

Here’s what has caught The Bunker's eye recently

Hunger games

Food insecurity—that’s hunger, to you and The Bunker—is an increasing problem for U.S. military families, John Donnelly reported October 22 in Roll Call. “Studies have found that one in eight military families were food insecure prior to the COVID-19 pandemic and this number has now grown to one in five,” a recent Senate report said. Confounding to realize this is a problem in the world’s most costly military.

Air sickness

Air Force personnel who fly have a markedly higher chance of developing some kinds of cancer, a comprehensive service investigation has found. “The study is the first confirmation of a connection long suspected by fighter aviators who saw their peers contracting some cancers at concerning rates,” Tara Copp at Defense One reported October 24. Copp won plaudits in her prior job at McClatchy News for her series on rising cancers among veterans who fought in Afghanistan and Iraq.

Technomania

Anthony Zinni may have retired as a four-star Marine general in 2000, but his views on what ails the U.S. military remain as current as ever. In an October 18 interview with CIMSEC, he expounded on two critical problems facing the U.S. military today:

“Every time I get into a discussion with someone about facing a peer-level military threat, it always comes down to the same thing: Well, they’ve got missiles that are going to crush us. The answer is always that we must go after those missiles, we must find them, and shoot them down…Instead of wasting all this effort and resources on new technology to kill the missiles, could we blind their missiles?...To address the threat through better tactics, using what we already have. No one ever talks about that. Everybody just pushes the technology to kill the missile…”

“One of the problems the military has is that capabilities are not centrally determined. Every service, every service secretary, and every service chief fights for something, and we don’t have a good way of looking at tradeoffs and risks…This was Eisenhower’s complaint when he talked about the military industrial complex—the military wants everything.”

Competitively speaking…

The Air Force has awarded a preliminary contract to Boeing, which suggests it may not hold a competition to build a follow-on to its venerable E-3 AWACS radar-warning airplane (that’s the one with that cool rotating radar dome atop its fuselage). It’s paying Boeing to explore if the company’s already-flying E-7A Wedgetail (named after an eagle in Australia, the first nation to buy the modified 737) can do the job. “The sole-source award to Boeing for the study may signal that the Air Force will not pursue a competitive effort to replace the E-3, a decision that could raise the ire of lawmakers and companies like Saab that have created their own airborne early warning aircraft,” Valerie Insinna reported October 21 at Breaking Defense. The Bunker well remembers when competition was all the rage inside the Pentagon (raise your hand if you recall the services’ “competition advocates general”). Of course, it’s worth remembering that Boeing beat Airbus to build the Air Force’s troubled KC-46 tanker—something that suggests competition doesn’t solve all problems.

And with Halloween coming…

…what could be better than a scary tale about an Air Force officer who witnessed a flying saucer shooting laser beams at a dummy nuclear warhead while in flight? The purported 1964 event is one of several cited in this October 21 piece from the New York Post showing “how aliens tampered with weapons systems during tests.” Well, that certainly would explain a lot.

Thanks for tampering with The Bunker this week. Please forward it on to those who like scary stories about national security…