There Is Plenty To Cut At the Pentagon

Hugh Pickens writes "William D. Hartung, director of the Arms and Security Project at the Center for International Policy, writes that although we have been bombarded with tales of woe about the potentially devastating impacts of cutting the Pentagon budget 8% under the sequester, examples of egregious waste and misplaced spending priorities at the Pentagon abound. One need look no further than the department's largest weapons program, the F-35 combat aircraft, which has just been grounded again after a routine inspection revealed a crack on a turbine blade in the jet engine of an F-35 test aircraft in California. Even before it has moved into full-scale production, the plane has already increased in price by 75%, and it has so far failed to meet basic performance standards. By the Pentagon's own admission, building and operating three versions of the F-35 — one for the Air Force, one for the Navy and one for the Marines — will cost more than $1.4 trillion over its lifetime, making it the most expensive weapons program ever undertaken. And in an era in which aerial combat is of diminishing importance and upgraded versions of current generation U.S. aircraft can more than do the job, it is not at all clear that we need to purchase more than 2,400 of these planes. Cutting the two most expensive versions of the F-35 will save over $60 billion in the next decade."

Comments

I say cut the F-35

[jonwil]

As an Aussie who saw the Howard government jump on board with Bush on this overpriced boondoggle (without even considering if other aircraft, American, European or otherwise were suitable for our needs at a cheaper price), cutting it completly and forcing Australia to evaluate ALL the options for aircraft suitable for our defense needs would be a good thing.

Re:I say cut the F-35

[nbauman]

Social Security isn't bankrupt.

To quote Paul Krugman:

http://www.nytimes.com/2010/08/16/opinion/16krugman.html

But neither of these potential problems is a clear and present danger. Social Security has been running surpluses for the last quarter-century, banking those surpluses in a special account, the so-called trust fund. The program won’t have to turn to Congress for help or cut benefits until or unless the trust fund is exhausted, which the program’s actuaries don’t expect to happen until 2037 — and there’s a significant chance, according to their estimates, that that day will never come. ...

What’s really going on here? Conservatives hate Social Security for ideological reasons: its success undermines their claim that government is always the problem, never the solution. But they receive crucial support from Washington insiders, for whom a declared willingness to cut Social Security has long served as a badge of fiscal seriousness, never mind the arithmetic.

Re:I say cut the F-35

[geoskd]

SS has never been a 'paid for' plan. It was always predicated on more and more current workers paying for the retiree benefits. Sometimes a surplus to be sure, but never 'fully funded' for an individual by that individual's contributions.

For 50 years, far more has been collected than was needed to pay current obligations. This was done so that the coming of the baby boomers wouldn't cause a financial crisis. Since the 80's, That process has been undercut by congress "loaning" then money to itself in the form of special bonds, and then using the proceeds to offset spending (such as excessive defense spending, welfare, and reducing taxes on the wealthiest 1% of Americans). As a result, we have effectively given the money to the defense contractors, the extremely poor, and the 1% (same as the defense contractors). We borrowed against the future social security income to do it. The end result is that we have exactly the social security funding crisis that was envisioned, but the solution that was put in place has been systematically destroyed and we have the crisis anyway. The only good way to fix it now is to cut defense spending down to the core, put taxes on the 1% back to 75%+ where it belongs, or go and get our money back at the point of a gun. The choice is yours.

-=Geoskd

Re:I say cut the F-35

[Solandri]

For 50 years, far more has been collected than was needed to pay current obligations.

The catch is that "current obligations" is simply what's paid out today, not money needed to pay those who paid into it. The money you pay into Social Security isn't put into some savings account where it grows with interest waiting for you to retire. It's paid out almost immediately to current retirees (solvency varies from 1 year to about 15 years depending on program changes). That's why the baby boomers retiring is such a shock to the system - it drastically altered the ratio of SS payers to payees. If it had been structured like a real pension, the baby boomers would just be getting back money they paid in and there would be no shock to the system from the payer/payee ratio changing. But that's not how it works.

Medicare works the same way - current workers paying current retirees. This is why it's very dangerous to think of these programs as getting back money you paid in, or as "solvent and paid for" just because they've been running in the black on the accounting books thus far . They're not run like a regular retirement or pension fund. To compare their health like you would a pension fund, you have to project out about 30-40 years ahead to take into account the current batch of payers turning into payees. And the CBO has been warning for over a decade that these (primarily Medicare) are the biggest threats to the budget when you project out that far.

While I'm sure there's lots of waste in Defense spending which could be cut, it is not growing. It's more or less been holding steady. Even with the uptick from the two wars in Iraq and Afghanistan, Defense spending is still below 1980s levels. The bottom line is that you cannot balance a budget by cutting things which aren't growing, and ignoring the things which are growing. Eventually you're going to run out of things to cut, while the things you're ignoring will continue to grow (which btw is projected to happen around 2070, when SS + Medicare/Medicaid spending are projected to exceed all tax receipts). You have to look at the costs that are growing and do something to get their growth under control. The longer you wait, the harder it will be to implement those cost controls.

Re:I say cut the F-35

[CrimsonAvenger]

It is the same with Social Security. Why is this such a difficult concept for people to understand about Social Security? The major difference is that it is run by the government, it is required to invest in government securities, and when it needs cash (to pay retirees) it cashes in those government securities.

Read the fine print sometime. Those government securities they're required to "invest" in are ZERO-INTEREST intragovernmental T-Bills (essentially, IOU's).

Note that even if they were interest-bearing, effectively the government is taking money out of it's left hip-pocket, spending it, then replacing it with an IOU to itself.

Consider how well YOUR finances would work if you did that - would it actually give you more money to take money out of your wallet, spend it, and replace it with an IOU which you will redeem from yourself as soon as you need money again?

Re:I say cut the F-35

[chill]

Saying govt contacts must go to the lowest bidder is a myth. Every one I have dealt with has been "best value" and we have a certain amount of discretion.

Evaluating bids is a two part process. The technical evaluation and the cost evaluation. The technical eval is more than just "does it meet the minimum specs". I've sat on Technical Evaluation Boards that awarded contracts to huge bidders because the quality was superior. The awards withstood protest.

Re:I say cut the F-35

[khallow]

The greatest falsehood of our political debate is that the government can't do things more efficiently than private enterprise.

It'd help your argument, if the falsehood was actually false.

I've compared industries where the government was working side by side with private enterprises, and it was straightforward to compare the results. For example, in the electric industry, there are private, federal, state and locally-owned power generation plants. Everybody in the industry agrees on the standards to judge them -- basically the percentage of downtime and cost per kilowatt-hour. The federally-run power plants, like the Tennessee Valley Authority, were consistently at the top of the list. Some of the private plants were at the top, some of them were at the bottom. The government did a good job.

And if the TVA were playing on an even field, it'd be at the bottom of those lists. If I didn't have to follow a bunch of costly federal laws and had some large, cozy monopoly markets, I bet I'd be at the top of that list as well.

If you don't believe the government can do anything efficiently, then go out and look at the data, and see if it supports your hypothesis. When I look at the data, it doesn't.

One merely needs to look at your example to see that you aren't looking.

Re:I say cut the F-35

[Anonymous Coward]

Those government securities they're required to "invest" in are ZERO-INTEREST intragovernmental T-Bills (essentially, IOU's). Note that even if they were interest-bearing,

Errr, in the last reporting period the SSTF received over $120 BILLION in interest payments on those "ZERO-INTEREST T-bills". Since interest+payroll-tax was higher than payments, about half the interest payment went straight back into the investment fund, which stands at around $3 TRILLION and still growing. This is in spite of high unemployment reducing the number of people paying payroll tax, payroll tax reduction/holiday/stimulus, and the increase in payments due to retirees dropping under the income threshold, all due to the Great Recession. Anyone could almost think the fuckers knew what they were doing.

Re:Stay the hell away from the F35

[Anonymous Coward]

Afghanistan? Why not from everywhere around the world?

Pentagon Accounting Standards

[nickmalthus]

On September 10th, 2001 Secretary of Defense Donald Rumsfeld announced the pentagon could not track 2.3 trillion dollars. To this day, the Pentagon cannot be accurately audited For an institution with organization and discipline as its creed this is laughable. If Congress mandated that they would not receive one penny in funding until they got their house in order this problem would be solved overnight. Unfortunately the power of fear, obstinate Militarism, and the federal reserve corporations ability to manufacture unlimited debt provides no impetus for Congress to take the necessary corrective action.

Re:No bias at all...

[ducomputergeek]

Bullshit. My father was a VP at McDonnell Douglas. I spent more than half my life around the defense industry and it's all a political game. Little of it has to do with actually what we need to defend the country. The F-22 and F-35 are not about defense, they are about keeping the engineers and union factory workers at locheed busy.

Read the after action reports of conflicts for the past 20 years. They all said pretty much the same thing: Need more A-10's and B-52's. Today the A-10's role is increasingly being done by Drones like the Reaper. The B-52s are still flying. While you typically need a few fighters for air superiority and defense, you need a few. Not a lot, a few. The last credible air threat was in 1991. And that threat lasted how many hours before any birds in the air were shot down and every airbase the enemy had destroyed?

It's true the Air-Force needs new airframes. The F-15's and F-16's are getting too many hours on them. The question is why spend these huge amounts of money on the F-22 and F-35 when the era of the manned fighter is coming to an end. Sure there will need to be some manned fighters, but not as many. If we had been serious we would have launched a modernization program for the F-15 and purchased replacement airframes for those aging out. Sad thing is, Boeing did this anyway for the export market with the F-15S. And those planes are still cheaper than the F-22's and without the billions in overhead that the R&D cost.