Drone builder foils Air Force frugality fling
Northrop Grumman goes over the brass’s heads to preserve an order for three $223 million crafts.
by Richard H.P. Sia and Alexander Cohen, Center for Public Integrity, Portland Press Herald
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With billions of dollars in spending reductions looming, Air Force officials looked around last year for a program they could cut that was underperforming, had busted its budget and wasn’t vital to immediate combat needs.
“The Block 30 (version of Global Hawk) is not operationally effective,” the Pentagon’s top testing official had declared in a blunt 2011 report about the drones being assembled by Northrop Grumman in Palmdale, Calif. Canceling its production and putting recently built models into long-term storage would save $2.5 billion over five years, the service projected. Its missions could be picked up by an Air Force stalwart, the U-2 spy plane, which had room for more sensors and could fly higher.
What happened next was an object lesson in the power of a defense contractor to trump the Pentagon’s own attempts to set the nation’s military spending priorities amid a tough fiscal climate. A team of Northrop lobbyists, packed with former congressional staff and bolstered by hundreds of thousands of dollars in campaign contributions, persuaded Congress to demand the drone’s continued production and operation.
DEFYING THE BIG GUNS
In so doing, the contractor defied not only the leadership of the Air Force but also the chairman of the Joint Chiefs of Staff, Army Gen. Martin Dempsey. Dempsey told the House Armed Services Committee in February 2012 that the Global Hawk “has fundamentally priced itself out of our ability to afford it.” The White House, in two messages to Congress last year, said it “strongly objects” to the lawmakers’ demands for additional Global Hawks.
But its protests were to no avail.
Northrop’s successful campaign to thwart the government culminated in a letter this May from two influential House of Representatives lawmakers to newly installed Secretary of Defense Chuck Hagel, reminding him of the requirement to buy three more of the drone aircraft at an estimated cost of at least $300 million.
The letter, whose authors – Rep. Howard “Buck” McKeon, R-Calif., and Rep. James Moran, D-Va. – have received a total of $135,100 from Northrop Grumman’s political action committee and employees for their election campaigns and leadership PACs since the beginning of 2009, is emblematic of the political forces now inhibiting a major drawdown in military spending.
Northrop Grumman’s political strategy “is entirely predictable: Hire the right people, target the right people, contribute to the right people, then link them together with subcontractors and go for the gold,” said Gordon Adams, who served as the senior White House budget official for national security from 1993 to 1997 and has studied defense spending and procurement for more than 30 years.
A spokesman for McKeon, Claude Chafin, said the lawmakers were responding to the absence of a credible Pentagon analysis supporting “the additional shedding of” assets such as the Global Hawk in the midst of “the war fighter’s growing need.”
Northrop Grumman has hailed the Block 30 — the largest drone in the U.S. arsenal — as an “unblinking eye” platform that does a better job of tracking objects on the ground for a longer period.
But Global Hawks ran into trouble partly because they were pressed quickly into service over Iraq, Afghanistan, Libya and other countries while still technically under development. Only after the new Global Hawks were in the field “did the services find out how commanders would actually use them,” said a congressional analyst who’s familiar with the program but wasn’t authorized to be quoted speaking about it.
The concurrent testing and production “put it at increased risk of cost growth,” the Government Accountability Office said last year. In all, the cost of a single Global Hawk jumped by more than 150 percent, from about $88 million in 2001 to $223 million in 2012, the GAO reported in March.
JOBS TRUMP COST, UNRELIABILITY
That record led a special Pentagon report June 28, examining why the defense-wide acquisition system routinely produces large cost overruns, to depict the Global Hawk in particular as an egregious outlier. “Analyzing just aircraft development contracts” such as Global Hawk, the report said, Northrop Grumman’s work had “significantly higher cost growth” than rival behemoths Lockheed Martin and Boeing.
Rigorous testing from October 2010 through January 2011 led the Pentagon’s chief weapons tester to conclude, moreover, that the Block 30 was unreliable.
Given the Block 30 troubles, Air Force officials concluded in late 2011 that they couldn’t fly both that aircraft and the U-2 under provisions in the Budget Control Act.
But cost and reliability concerns took a back seat to the risk of losing jobs, said former Rep. Roscoe Bartlett, R-Md., who played a key role last year in blocking the proposed retirement of Block 30s as the chairman of the House Armed Services Subcommittee on Tactical Air and Land Forces.
Bartlett, who lost his bid for re-election last fall, spoke openly about how his colleagues on the full committee “see the military as a jobs program,” something he said wasn’t necessarily in the national interest. “How is that consistent with national security? And budget frugality?” he asked rhetorically.
PUSHING THEIR PRODUCT
After rumors of the program’s cancellation surfaced in late 2011, Northrop Grumman activated a “Support Global Hawk” website that described the drones as “high-flying, combat-proven aircraft (that) are so robust and reliable that they’re in high demand by war fighters who fly them.” The advocacy site listed all the suppliers, their congressional districts and the lawmakers who represented them. It also offered a “Take Action” form visitors could fill in that would be emailed to their elected officials.
Northrop Grumman also circulated fliers on Capitol Hill with a map of the country showing the locations of major Global Hawk manufacturing sites, military bases and major subcontractors.
Among the 26 in-house and outside lobbyists who identified Global Hawk or surveillance issues on their lobbying reports were three well-connected former Republican aides to the House Appropriations Committee.
The company also reached out to lawmakers in another familiar way — with well-timed campaign contributions. Its political action committee gave $10,000 to the re-election campaign and leadership PAC of House Armed Services Chairman McKeon in February and March 2012, when his committee was grilling senior Pentagon and Air Force officials about the Block 30 issue in public hearings, according to campaign finance records.
Barely six weeks later, McKeon’s committee approved the fiscal year 2013 defense authorization bill with the provision ordering the Air Force to keep flying Block 30s.
McKeon, whose district is home to Northrop Grumman’s Palmdale facility, where final assembly of Global Hawks is done, has received at least $113,000 from the company’s employees and PAC since he became the House Armed Services Committee chairman in January 2009, the Center for Public Integrity analysis shows.
In the end, the Air Force didn’t get what it said it wanted in 2011 or 2012: Congress ordered it to keep both the U-2 and the Global Hawk Block 30s in operation.
“There’s no free lunch here,” then-Defense Secretary Leon Panetta complained at a news conference after McKeon’s committee acted. “Every dollar that is added will have to be offset by cuts in national security. And if for some reason they do not want to comply with the Budget Control Act, then they would certainly be adding to the deficit, which only puts our national security further at risk.”
But after Moran and McKeon sent their letter to Hagel, the service folded its cards.
“The Air Force considers the three additional Block 30 aircraft excess to need; however, to comply with congressional direction, the Air Force is taking action to execute unobligated funding and acquire these last three Block 30 aircraft,” said Ed Gulick, an Air Force spokesman.
The Center for Public Integrity is a non-profit, independent investigative news outlet.
