House Passes Massive $611 Billion New Military Spending Bill — Including $14-Billion Lockheed Boondoggle

December 4th, 2016 - by admin

Jason Ditz / & Hope Hodge Seck / & Kimberly Amadeo / The Balance – 2016-12-04 22:06:35

House Passes Massive $611 Billion New Military Spending Bill

House Passes Massive $611 Billion
New Military Spending Bill

Jason Ditz /

(December 2, 2016) — In an overwhelming 375-34 vote, the House of Representatives today passed a massive $611 new military spending bill. Though presented as the National Defense Authorization Act for 2017, the bill is only a portion of what the US will ultimately spend on the military in fiscal 2017.

The bill includes bans on any closure of any military bases by the Pentagon, once again rejecting calls by the military leadership to get rid of costly, unwanted bases, and also forbids the closure of the detention center at Guantanamo Bay. It also forbids the Pentagon from going through with a plan to reduce the number of active duty soldiers,

Despite being far more money than the Pentagon and the administration sought, and despite being several times more than any other nation spends on their own military in a year, Rep. Mac Thornberry (R-TX), the Armed Services chair complained that the bill was much too small, and expressed hope that President-elect Donald Trump would push through another major spending bill in the early part of 2017.

Subsequent spending bills were expected at any rate, with the current spending caps theoretically limiting just how out of control the spending can get in an individual bill, and Congress having already decided to circumvent that cap by funding the wars only for a fraction of the year, necessitating an “emergency” supplement be passed to continue wars that no one in this administration or the next has any intention of ending.

The bill still has to pass the Senate, which it is expected to do early next week. With the removal of controversial riders authorizing military contractors to discriminate against gays and requiring women to register for the draft, the bill is expected to pass the Senate easily, as someone the unsustainable military spending itself is considered completely non-controversial.

Littoral Combat Ship (LCS) in Action 2015-2016

July 27, 2016. Lockheed-Martin writes: “The US Navy’s littoral combat ship is designed to defeat growing threats in the coastal water battlespace. The Freedom-variant LCS is lethal, survivable and affordable, and its design is recognized for stability and reliability on multiple overseas deployments.”

Officials: Littoral Combat Ship
Project ‘Broke the Navy’

Jason Ditz /

(December 2, 2016) — While headlines on government waste have tended to focus on larger projects like the F-35, the latest testimony to the Senate Armed Services Committee has once again revealed just how calamitous smaller, less ambitious programs like the Littoral Combat Ship (LCS) program can be.

Assistant Secretary of the Navy Sean Stackley described the program as having “broke the Navy,” saying the cost overruns have put the Navy’s program managers under a microscope to ensure they don’t ignore cost overruns in other projects as well.

The LCS project’s overruns are virtually unprecedented as a percentage, with per-unit costs just to buy the ships more than doubling from the estimates, and upkeep costs for the largely useless ships to set the taxpayers back another $14 billion, a figure which continues to grow.

The Navy came up with the LCS project as part of a quantity over quality push which aimed at having more boats in the water than they otherwise could, intending the LCS to be a low-cost, reliable ship for limited operations around coastlines.

In practice, the costs are far higher than anyone expected, the ships have been breaking down pretty much constantly, and even when they get them seaworthy, officials concede they’re so small and unarmored that they have no survivability in combat.

Adding insult to injury, the Navy is facing lawsuits over the LCS project on the claims that the design of one of the ships was stolen.

Acquisition Chief:
LCS Program ‘Broke’ the Navy

Hope Hodge Seck /

(December 2, 2016) — The Navy’s littoral combat ship is costing taxpayers billions more than budgeted, failing survivability assessments, and may never live up to the original vision for the program, a panel of Navy and government oversight officials told the Senate Armed Services Committee on Thursday.

The hearing, which focused on continued testing and acquisition of the small surface vessels, came at the close of a 12-month period in which five of the eight littoral combat ships in service have suffered major mechanical and engineering casualties. Navy officials have ordered dramatic program overhauls and reviews of ship employment and training in response to the breakdowns.

And despite the program’s underperformance, costs continue to skyrocket, testified Paul Francis, managing director of acquisition and sourcing management at the Government Accountability Office.

The ship’s unit cost has more than doubled from $220 million to $478 million apiece, and plans to conduct a “block buy” of 12 redesigned littoral combat ships, to be called frigates, will put taxpayers on the hook for nearly $14 billion, he wrote in a GAO report released Thursday. [Emphasis added.]

See the complete story online.

US Military Budget: Components, Challenges, Growth
There’s $250 Billion in Hidden Military Spending

Kimberly Amadeo / The Balance

(October 26, 2016) — The US military budget is $773.5 billion. That’s the budget for Fiscal Year 2017 (October 1, 2016 through September 30, 2017). There are four components. First is the Department of Defense (DoD) base budget ($523.9 billion). Second is the Overseas Contingency Operations (OCO) for DoD to fight ISIS ($58.8 billion).

But there’s more to military spending than the Department of Defense. Many other agencies are involved with protecting our nation.

These expenses total $175.9 billion. They include the Department of Veterans Affairs ($75.1 billion), the State Department ($37.8 billion), Homeland Security ($40.6 billion), FBI and Cybersecurity in the Department of Justice ($9.5 billion), and the National Nuclear Security Administration in the Department of Energy ($12.9 billion).

There is also $14.9 billion in OCO funds for the State Department and Homeland Security to fight ISIS. (Source: “Mid-Session Review Fiscal Year 2017, Table S-10.” “2017 Budget, Summary Tables, Table S-11,” Office of Management and Budget.)

Defense Department Base Budget
DoD requested $523.9 billion, slightly higher than last year’s $521.7 billion appropriation. It seeks to:

Continue retirement and healthare (TRICARE) reforms. If you include subsidized housing, free healthcare, and the other benefits military personnel receive, the average compensation works out to $59,000 for enlisted personnel and more than $108,000 for officers.

Focus on national and regional ballistic missile defense.

Train local security forces in Iraq, Syria, and Afghanistan to combat ISIS.

Strengthen maritime security in Asia.

Increase presence in NATO to respond to Russia’s aggression in Europe.

Beef up cyber security forces. That include strengthening space control and investing advanced munitions systems.

Reduce spending on headquarters by 25%. Improve audits, acquisition practices, and commissary spending. Eliminate excess infrastructure.

The Air Force is moving forward with the F-35 Joint Strike Fighter program. Lockheed Martin built 45 in 2015, costing $100 million each. That’s expected to rise to 53 in 2016, and 160 annually by 2025. By then the jet should cost $85 million, adjusted for inflation.

The Air Force cut five F-35s in the FY 2017 budget.(Source: “FY 2017 Budget Fact Sheet,” US Department of Defense. “F-35 Plan Stays on Track,” The Wall Street Journal, February 11, 2016.)

Overseas Contingency Operations
The DoD base budget does not include, ironically, the cost of wars. That’s separated out in Overseas Contingency Operations. That’s budgeted at $58.8 billion for DoD, and $14.9 billion for the State Department. For OCO spending back to 2001, see War on Terror Facts. (Source: “Mid-Session Review Fiscal Year 2017, Table S-10.” “2017 Budget, Summary Tables, Table S-11,” Office of Management and Budget.)

Factors Influencing Budget:
2003: Iraq War launched March 19.
2004: US torture at Abu Ghraib prison increased resistance, and costs.
2005: Afghanistan War costs rose to protect free elections.
2006: Costs rose in Iraq.
2007: Surge in Iraq to counter violence.
2008: Violence rose in Middle East due to recession.
2009: Surge in Afghanistan.
2010: Obama funds Iraq drawdown.
2011: Iraq War ended but costs reached all-time high.
2012: Troop withdrawal in Afghanistan War. Costs begin falling.
2013: Sequestration cut spending.
2014: Wind-down of Afghanistan War.
2015: Sequestration cut spending. Still higher than in 2007.
2016: Resurgence of ISIS drives spending higher.
2017: Increase in VA and FBI funding.

DoD Tries to Save Money,
But Congress Won’t Let It

The Defense Department knows it needs to become more efficient. It now spends a third of its budget on personnel and maintenance. That will rise to 100% by 2024, thanks to retirement and medical costs.

That leaves no funds for procurement, research and development, construction, or housing. These necessary support programs now take up more than a third of DoD’s budget. (Source: “Pay Will Swallow DoD Budget by 2024,” Center for Strategy and Budgetary Assessments, April 8, 2013.)

How could the DoD become more efficient? First, it needs to rationally reduce its civilian workforce, which grew by 100,000 in the last decade, instead of resorting to hiring freezes and unpaid furloughs. Second, it must reduce pay and benefits costs for each soldier. Instead, it plans to raise both.

Third, and most important, it should close unneeded military bases. By its own estimates, the DoD is operating with 21% excess capacity in all its facilities. However, Congress won’t allow it. The Bi-Partisan Budget Act of 2013 blocked future military base closings.

Few elected officials are willing to risk losing local jobs caused by base closures in their states. The Pentagon will be forced to reduce the number of actual soldiers so it can afford these benefits. (Source: “Pentagon Lays Out Way to Slash Spending,” The Wall Street Journal, August 1, 2013.)

Congress is also reluctant to allow DoD to cut other costs, like military health benefits and the growth of military pay. It recently gave service-members a 1% pay increase, but cut the cost-of-living-adjustment by 1% for veterans who retire before age 62.

However, disabled veterans and surviving families had the cut re-instated. (Source: “House Quickly OKs Bipartisan Budget Deal,” Stars and Stripes, December 12, 2013. “Disabled Veterans Get Back Pension Raises,” CNN, January 14, 2014.)

Sequestration would have cut defense spending by $487 billion in ten years if it had continued. However, many Congressmen said the cuts would jeopardize national security. They were particularly concerned about a cutback of about 100,000 troops, closure of domestic military bases, and termination of some weapons systems — all of which would have cost jobs and revenue in their districts.

That’s why defense spending is the only budget area that rarely gets focused on as an area to cut. (Source: “Lawmakers Skeptical of Cuts in 2013 Defense Budget,” Reuters, February 15, 2012.)

Military spending is the second largest Federal government expenditure, after Social Security ($967 billion). If all military spending were returned to 2003 levels ($437.4 billion), the budget deficit would only be $105 billion instead of $441 billion.

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