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: increasing leeriness about helping Ukraine highlights a widening fissure among the U.S. body politic; a pair of planes illustrates the contrasting phases of military procurement; defense contractors grumble that Pentagon negotiators are too stingy; and more.
THE FORK IN THE ROAD
What kind of country are we?
The chill wind of isolationism is blowing across the United States. That’s not necessarily a bad thing, but the country needs to do a better job of weighing the pros and cons of such a move. Congressional Republicans have thwarted the Biden administration’s efforts to send additional military aid to Ukraine two years into Russia’s invasion. The GOP wants the White House to deal with illegal immigration at the southern border as part of a package deal including more Ukrainian aid. It’s getting a push from the party’s presumptive nominee, who is eager to deny Biden, his likely opponent, a legislative win.
Yes, the border is a mess, but it has been nearly 40 years since the U.S. passed substantial immigration reform. Russia invaded Ukraine less than two years ago and, without additional help quickly from Washington, there’s a good chance Ukraine won’t exist two years from now.
It is striking to The Bunker how the Republican party is shrugging its shoulders as Vladimir Putin and his army seek to liquidate Ukraine. It’s wrong morally (we shouldn’t let invading bad guys win), militarily (might shouldn’t eclipse sovereignty), and monetarily (the U.S. has contributed only about 5% of its defense budget to battling Moscow, a real bargain).
This is all part of an expanding GOP pattern rooted in look-out-for-meism, preferring to shirk sharing for selfishness. It includes a growing willingness by the party’s apparent nominee to abandon NATO (incredibly, Congress was so spooked by the possibility that last month it barred a U.S. president from unilaterally quitting the alliance). At home, it’s evident in the party’s refusal to adequately fund the IRS to catch more tax cheats, who are costing honest taxpayers $600 billion annually. And it’s happening in 15 states whose GOP governors have spurned a federally funded program to feed needy children this summer.
Just as no person is an island, a nation standing apart becomes brittle and subject to shattering. It’s worth recalling how the world (even Iran and Russia) came to the U.S.’s aid in the wake of 9/11, and how NATO has largely kept the peace in Europe — until two years ago. It’s a sad state of affairs when one political party is so willing to sacrifice the commonweal for its own gain.
A TALE OF TWO PLANES
Fast start, flubbed finish
It was the best of times (for Northrop); it was the worst of times (for Lockheed), Colonel Charles Dickens might have written last week. The good news for Northrop was the Pentagon announcement that it has green-lighted production of the company’s B-21 bomber. Lockheed’s bad news was the company’s concession that continuing complications with the software on its F-35 fighter are going to further delay deliveries of the airplane.
Mil-ind-comp lingo surrounding a new weapon tends to the glowing. “As the world’s first six[th]-generation aircraft, B-21 forms the backbone of the future for U.S. air power, delivering a new era of capability and flexibility through advanced integration of data, sensors and weapons, and is rapidly upgradable to outpace evolving threats,” Northrop said after landing the Low Rate Initial Production contract.
But not so with the beleaguered F-35. Its vexatious software has led the Pentagon to refuse delivery of the $168 million warplanes after more than a decade in production. While the Pentagon won’t say where they’re being stored (citing national security, natch) or how many are on ice (more than 60, according to “industry sources”), the grim news is hard to hide. Lockheed and Pentagon officials used foggy phrases like “production cadence” (fewer planes built than expected) and “truncation plan” (allowing F-35s to be delivered before its new software has been shown to work) to try to stealthify its troubles.
The programs portray a peculiar Pentagon procurement paradox: Things tend to go swimmingly in the early stages, but predictably bog down later on. “There are only two phases to a program,” late Pentagon whistleblower Ernie Fitzgerald, would say. “The first is, ‘It’s too early to tell.’ The second: ‘It's too late to stop.’”
TOO-TOUGH PENTAGON BARGAINING?
Defense-industry bosses sound off
You’d never know it from last week’s summing-up-2023 press releases, but the nation’s defense contractors say they are hurting. Lockheed chief Jim Taiclet boasted of his company’s (the Pentagon #1 contractor, and builder of the F-35) “record $160.6 billion” backlog of orders, and $9 billion it returned to shareholders. Northrop, the Defense Department’s #6 supplier, including the B-21 bomber) posted a record backlog of $84.2 billion. CEO Kathy Warden said (PDF) her company is primed “for robust cash generation and our plans to return a significant amount of capital to shareholders.” Raytheon, now known as RTX (it’s the defense industry equivalent of the Twitter-to-X switcheroo), had “solid full-year results,” CEO Greg Hayes reported (PDF), and ended 2023 “with a record backlog of $196 billion.” RTX is the Pentagon’s #2 contractor, supplying it with jet engines and missiles.
Yet all three companies complained about how the U.S. military has been wielding its purchasing clout as pretty much the only buyer when it comes to procuring new hardware. “They’ve been taking advantage of that monopsony power, if you will, over the industry,” Taiclet said, forcing contractors into bad deals that generate “tremendous risk on costs and pricing, and tremendous cost on the ability to technically deliver these capabilities.” Warden said Northrop has “passed on some high-profile programs as a result of the risk balance that the customer put forward … not meeting our standards.” RTX Chief Operating Officer Chris Calio said his company is experiencing “profitability challenges” because of fixed-price contracts “that we took on that maybe weren’t in our core capability suite, and we signed up for requirements, and other specifications, that were really, really difficult.”
Lockheed’s Taiclet said he doesn’t “know what other companies are doing or how they’re making their decisions” about this issue. That’s a surprising thing for a CEO paid nearly $25 million in 2022 to say. Regardless, one thing’s for sure: these defense contractors are harmonizing like the Mormon Tabernacle Choir.
WHAT WE’RE READING
Here’s what has caught The Bunker’s eye recently
An Air Force major general charged with sexual assault has asked to retire instead of facing a court martial over the charge, David Roza reported January 25 in Air & Space Forces Magazine.
Venture capitalists seeking to invest in Pentagon startups are finding the U.S. military to be a tough sell, the Wall Street Journal’s Heather Somerville reported January 25.
More than half of Pentagon procurement using government charge cards to battle COVID-19 lacked required documentation for the purchases, the Pentagon inspector general said in a report issued January 17.
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