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: How the Pentagon and Pratt & Whitney porked taxpayers; why the Army ended up with $1.1 million desktop printers; DOD empties its acronym depot in the hunt for UFOs; The Bunker’s off the next two weeks.
A NEW WAY OF “BUYING IN”
Discounting F-35 performance instead of price
Low-balling a Pentagon contract used to be all the rage. That’s where a contractor — with a wink and a nod from its Defense Department allies — would submit a ridiculously low bid to land a lucrative contract. Then, of course, you could count on that rosy bottom line ballooning over time, forcing the Defense Department (i.e., taxpayers) to cough up extra cash.
But that was so 20th Century.
There’s a new way of buying in, and it surfaces in a July 19 government probe(PDF) into the F-35 fighter. Yes, The Bunker is well aware we’re planning to spend about $400 billion for 2,456 of these planes, for the Air Force, Navy, and Marines. And yes, we know that it’s going to cost an additional $1.3 trillion to keep those planes flying until 2070. So there’s plenty of money to go around.
But guess what? The F-35-buying Pentagon, the F-35-building Lockheed Martin, and the F-35 engine-maker Pratt & Whitney have agreed that these planes will be out of order due to engine problems more than five times as often as other planes. Unlike rising costs, this didn’t happen over time, but has been baked into the program. “DOD’s goal is to have no more than 6% of F-35s being non-mission capable due to engine issues,” the Government Accountability Office report said. “This means that DOD has decided it is acceptable for up to 6% of F-35 aircraft at any one time to be without an operating engine, waiting for a repair part, or undergoing engine-related maintenance.”
Lockheed is the Pentagon’s No. 1 contractor, and Pratt & Whitney is part of Raytheon, No. 3. Pratt issued a press release in the wake of the GAO report that echoed Johnny Mercer’s classic lyrics for Ac-Cent-Tchu-Ate the Positive with a touch of don’t-blame-us on top: Pratt’s engines, the company said, are “designed, funded, and contracted for a 6% Non-Mission Capable (NMC) rate.” Lord knows how many billable hours P&W lawyers accrued before approving that “contracted for” dig.
Only the Pentagon and its biggest suppliers can build the world’s most costly weapon and still come up short when it comes to money. “In developing a sustainment strategy for the F-35 engine,” the GAO said, “DOD aimed to balance the performance of the aircraft and the engine with the affordability of sustainment, according to DOD, military service, and Pratt & Whitney officials.” To try to accomplish that, they made it easier to replace non-working engine parts (instead of the entire $12 million engine), and by limiting repairs to two levels of depots, instead of the three used by other warplanes. But it hasn’t worked out, leading to more than 9% of the fleet being grounded in February. Shortages of both parts and labor have contributed to the snafu. By having complete spare engines on hand, F-16, F-18, and F-22 fighters have “1% or lower” of their fleets grounded for engine woes, the GAO said.
But as they say on TV: Wait — there’s more! In the right-hand, left-hand, department, Pentagon officials told GAO investigators “that a goal of no more than 6% for the non-mission capable due to engine rate — even if met — would not allow the military services to effectively support National Defense Strategy missions, such as those related to China and Russia.” The Pentagon folks overseeing the F-35 and Pratt & Whitney also conceded “that the F-35 engine sustainment strategy did not align with the desired outcomes of the military services,” the agency reported. But you don’t have to wait for World War III: the GAO says the powerplant shortfall has already “adversely affected deployed combat units.”
Last year, the F-35 program office at the Pentagon projected that continuing business-as-usual could ground 43% of F-35s by 2030. And that’s why the Air Force is getting $175 million extra this year to fix F-35 engines, with billions more sure to follow.
Think of it as stealthy “buying in.”
The sad state of Army bookkeeping
One reason the Pentagon costs so much is that it can’t keep track of the money it gets, leading it to spend more. That’s why it can’t be audited, and why it thinks it has printers — you know, like that humble box sitting on your desk — costing more than $1 million each. The golden printer surfaced among the gear the Army provided a contractor to support U.S. bases in Kuwait.
According to a recent report(PDF) by the Department of Defense inspector general, Army records showed it had provided the (unnamed) contractor with 12 Hewlett Packard printers worth…$1,131,181.00 each (The Bunker has always been fascinated by the Pentagon’s precision with such inane numbers, as if that makes them more accurate). “During our inventory of the printers,” the IG said, “we believed the cost of each was incorrect.” (Can’t sneak anything past these eagle-eyed government gumshoes!) Actually, the IG found each printer cost no more than $408 (at least one cost $314.77). “The Kuwait accountable property records showed the 12 printers at a cost 277,150% higher than both the contractor Government Furnished Property records and the (Defense Department’s) DD 1149s (records).”
The Bunker has been at this game a long time, but doesn’t believe he’s ever seen a 277,150% markup. Back in 1983, for example, we had tales of the Pentagon’s $400 hammer. That was a mere 9,900% increase, assuming said hammer cost $4. And the costly hammer represented real money spent, not a mere bookkeeping snafu. But you can take this to the Treasury: the Pentagon is never going to pay the right price if it can’t get its bookkeeping straight.
According to the IG, the Army simply didn’t follow the rules when it came to logging in supplies it gave the contractor. Just how the printers ended up with that $1.1 million price tag isn’t made clear, although another example involving refrigerators blamed the Army’s inflated price on a clerk who mistakenly logged the cost of 17 fridges as the price for one.
Alas, the princely printers weren’t an isolated case. All 61 items(PDF) the IG reviewed had “significant cost discrepancies” between what the item cost and what the Army said the item cost. The gear cost $10.2 million; the Army said it cost $74.9 million. Nor was Kuwait an isolated example — the Army had 83 $1.1 million printers logged into its books at locations around the world. “The 83 printers were listed in Army accountable property records at a cost of $1.1 million each, resulting in a total cost of $93,888,023 instead of $33,864,” the IG said.
When you can’t count, you can’t control. And that, in a nutshell, is why Pentagon spending is out of control.
LOST IN SPACE
Congress plays Star Warrior
The U.S. military, which hasn’t had much luck lately winning wars on the ground, has been told by Congress to begin scouring the heavens for Unidentified Flying Objects. It’s a perfect example of the “mission creep” that has been plaguing the Pentagon for decades:
In 2020, the Pentagon created the UAPTF (Unidentified Aerial Phenomena Task Force) “to detect, analyze and catalog UAPs that could potentially pose a threat to U.S. national security.” The military prefers the term UAP instead of UFO because the UFO label “comes with cultural stigma that might discourage pilots from reporting such incidents for fear of being labeled, well, kooky,” the Washington Posthas noted.
Unfortunately, that’s not the only acronym that has changed.
In 2021, the Pentagon decided the UAPTF wasn’t up to the task. So it created the AOIMSG (Airborne Object Identification and Management Synchronization Group) to “synchronize efforts across the Department and the broader U.S. government to detect, identify and attribute objects of interests in Special Use Airspace (SUA), and to assess and mitigate any associated threats to safety of flight and national security.” “The title does not convey confidence that the group will be nimble and sharply focused,” noted Chris Impey, an astronomer at the University of Arizona. At the same time, the Pentagon created(PDF) the AOIMEXEC (Airborne Object Identification Management Executive Council) to tell the AOIMSG what to do.
In 2022 — on July 15 — the Pentagon replaced the eight-month-old AOIMSG (which had replaced the 15-month-old UAPTF) with the AARO (All-domain Anomaly Resolution Office) “to detect, identify and attribute objects of interest in, on or near military installations, operating areas, training areas, special use airspace and other areas of interest, and, as necessary, to mitigate any associated threats to safety of operations and national security. This includes anomalous, unidentified space, airborne, submerged and transmedium objects.” It goes without saying that it also created the AAROEXEC (All-domain Anomaly Resolution Office Executive Council) to tell the AARO what to do.
To be fair, this latest change wasn’t the Defense Department’s doing. Congress ordered the Pentagon to widen its UFO hunt in five densely-packed pages(PDF) of this year’s defense authorization act. Lawmakers acted after a hearing earlier this year where Pentagon officials were unable to explain cockpit videos of objects, apparently unidentified, apparently flying near military aircraft.
Congress told the department to start “evaluating links between unidentified aerial phenomena and adversarial foreign governments, other foreign governments, or nonstate actors.” It also wants to know if they might be responsible for various “adverse physiological effects” some pilots have experienced. It orders the Pentagon to hunt for those “transmedium objects,” which the legislation says are “objects or devices that are observed to transition between space and the atmosphere, or between the atmosphere and bodies of water, that are not immediately identifiable.” (Unidentified Floating Objects, in other words.) And it wants to know of “any efforts underway on the ability to capture or exploit discovered unidentified aerial phenomena” as well as “any health-related effects for individuals that have encountered unidentified aerial phenomena.”
Then hardware geeks got involved. Assuming the Pentagon can capture, pin down, and dissect one of these UFOs, Congress wants to know what it possesses beyond “the known state of the art in science or technology, including in the areas of propulsion, aerodynamic control, signatures, structures, materials, sensors, countermeasures, weapons, electronics, and power generation.” And, of course, to “provide the foundation for potential future investments to replicate any such advanced characteristics and performance.”
The Pentagon is saluting, and ready for action. Deputy Defense Secretary Kathleen Hicks pledges the Pentagon is primed(PDF) to handle any UFO threats.
Just so long as they’re not flown by the Taliban.
WHAT WE'RE READING
Here’s what has caught The Bunker's eye recently
The Navy and its Pentagon overseers can’t decide whether the fleet needs 316, 327, 367, 373, or 500 ships, Lara Seligman, Lee Hudson, and Paul McLeary reported for Politico July 24. Congress isn’t happy.
Army General Mark Milley, chairman of the Joint Chiefs of Staff, warns that Beijing is becoming “significantly more and noticeably more aggressive” in the Pacific, Lolita C. Baldor of the Associated Press reported July 24.
Chinese Foreign Minister Wang Yi said the South China Sea is not a "safari park" for countries outside the region or a "fighting arena" for major powers, Reuters reported July 25. Its fate “should be handled by countries in the region themselves.”
Retired Marine Major Fred Galvin takes on Jim Mattis, the retired four-star Marine and defense secretary, for his “mendacity and mad dishonesty,” Galvin wrote in American Greatness July 15.
An Army solar-powered drone has been flying lazily over Arizona for more than a month, testing future spy capabilities, Andrew Eversden said July 22 in Breaking Defense. (Speaking of drones, here’s a nifty July 19 summary from the Congressional Research Service highlighting the Pentagon’s plethora of pilotless planes.)
Northrop has partnered with aerospace startup Boom Supersonic to develop a “supersonic special-mission aircraft” capable of zipping 80 troops to hotspots in a hurry, the companies said in a July 19 press release. This is what happens when the Pentagon is drowning in dollars.
Thanks for reading The Bunker. We’re launching our two-week August recess, so look for us to return to your inbox August 17. If you like what you're reading, consider forwarding this on to a friend so they can sign up here.