F-35’s ability to evade budget cuts illustrates challenge of paring defense spending
By Rajiv Chandrasekaran, Washington Post
click here for original article
At EGLIN AIR FORCE BASE, Fla. — With an ear-ringing roar, the matte-gray fighter jet streaked down Runway 12 and sliced into a cloudless afternoon sky over the Florida Panhandle. To those watching on the ground, the sleek, bat-winged fuselage soon shrank into a speck, and then nothing at all, as Marine Capt. Brendan Walsh arced northward in America’s newest warplane, the F-35 Lightning II.
The F-35 has features that make pilots drool. It is shaped to avoid detection by enemy radar. It can accelerate to supersonic speeds. One model can take off and land vertically. Onboard electronic sensors and computers provide a 360-degree view of the battlefield on flat-panel screens, allowing pilots to quickly identify targets and threats.
But its greatest strength has nothing to do with those attributes. The Defense Department and Lockheed Martin, the giant contractor hired to design and build the plane, also known as the Joint Strike Fighter, have constructed what amounts to a budgetary force field around the nearly $400 billion program.
Although it is the costliest weapons system in U.S. history and the single most expensive item in the 2013 Pentagon budget, it will face only a glancing blow from the sequester this year. And as the White House and Congress contemplate future budgets, those pushing for additional cuts may find it difficult to trim more than a fraction of the Pentagon’s proposed fleet, even though the program is years behind schedule and 70 percent over its initial price tag.
The reasons for the F-35’s relative immunity are a stark illustration of why it is so difficult to cut the country’s defense spending. Lockheed Martin has spread the work across 45 states — critics call it “political engineering” — which in turn has generated broad bipartisan support on Capitol Hill. Any reduction in the planned U.S. purchase risks antagonizing the eight other nations that have committed to buying the aircraft by increasing their per-plane costs. And senior military leaders warn that the stealthy, technologically sophisticated F-35 is essential to confront Iran, China and other potential adversaries that may employ advanced anti-aircraft defenses.
The biggest barrier to cutting the F-35 program, however, is rooted in the way in which it was developed: The fighter jet is being mass-produced and placed in the hands of military aviators such as Walsh, who are not test pilots, while the aircraft remains a work in progress. Millions more lines of software code have to be written, vital parts need to be redesigned, and the plane has yet to complete 80 percent of its required flight tests. By the time all that is finished — in 2017, by the Pentagon’s estimates — it will be too late to pull the plug. The military will own 365 of them.
By then, “we’re already pregnant,” said Air Force Lt. Gen. Christopher Bogdan, who oversees F-35 development for the Pentagon.
When the F-35 finishes testing, “there will be no yes-or-no, up-or-down decision point,” said Pierre Sprey, who was a chief architect of the Air Force’s F-16 Fighting Falcon. “That’s totally deliberate. It was all in the name of ensuring it couldn’t be canceled.”
The Pentagon has long permitted equipment to be produced while it is still being tested, with the intent of getting cutting-edge gear to warriors more quickly, but senior military officials said the F-35 takes the approach to new extremes. Doing so has served as more than a hedge against cuts — it has also driven up the overall price. The 65 aircraft that already have been built, and those that will be assembled over the next few years, will require substantial retrofits that could cost as much as $4 billion as problems are uncovered during testing, the officials said.
Initial tests already have yielded serious problems that are forcing significant engineering modifications. The entire fleet was grounded earlier this year because of a crack in the fan blade in one jet’s engine. The Marine Corps’ version has been prohibited from its signature maneuver — taking off and landing vertically — because of a design flaw. And the Navy model has not been able to land on an aircraft carrier because its tailhook, an essential feature to alight aboard a ship, needs to be redesigned. The Pentagon’s top weapons tester issued a scathing report on the F-35 this year that questioned the plane’s reliability and warned of a “lack of maturity” in performance.
When the F-35 program was first approved by the Pentagon, Lockheed Martin said it could develop and manufacture 2,852 planes for $233 billion. The Pentagon now estimates the total price tag at $397.1 billion. And that is for 409 fewer planes.
The overall program is almost four times more costly than any other weapons system under development. Taxpayers have already spent $84 billion on the plane’s design and initial production. By contrast, the production of 18,000 B-24 bombers during World War II cost less than $60 billion, in inflation-adjusted dollars.
To the plane’s backers, including senior leaders of the Air Force and Marine Corps, the benefit is worth the cost. Unlike the infantry, which still accepts battlefield casualties as part of war, military aviators have grown accustomed to a different risk calculus since the 1991 Persian Gulf War, when U.S. warplanes quickly established air superiority over Iraq with minimal losses: They want to ensure that, whatever the future conflict, their planes are packed with enough offensive and defensive measures to accomplish the mission and avoid getting shot down.
“This aircraft reinforces the way Americans go to war. . . .We don’t want to win 51-49. We want to win 99 to nothing,” said Lt. Gen. Frank Gornec, the assistant vice chief of staff of the Air Force. He said he is convinced the F-35 “will become a superstar in the arsenal of the United States.”
Many independent defense analysts do not share that conviction. To them, the plane’s political engineering and buy-before-you-fly procurement mask deep problems with performance and affordability.
“It was a bait-and-switch operation; we were overpromised benefits and under-promised costs,” said Chuck Spinney, a former Pentagon analyst who gained widespread attention in the 1980s for issuing pointed warnings about the military’s pursuit of unaffordable weapons. “But by the time you realize the numbers don’t add up, you can’t get out of the program.”
A turbulent takeoff
The F-35 program, which commenced 12 years ago, was intended to be a model of how to build a modern fighter. The same airframe would be used to produce planes for the Air Force, Navy and Marine Corps, with only modest modifications to address service-specific needs, hence the name Joint Strike Fighter. The commonality, proponents argued, would allow the three services to mount more coordinated wartime missions, and, perhaps more important, it would drive down development, assembly and maintenance costs.
That was essential because the Pentagon needs a lot of F-35s. It is supposed to replace thousands of legacy aircraft including the F-16, a workhorse of the Air Force fleet, and every fighter jet owned by the Marine Corps. The F-35 was pitched as the answer because it was supposed to be affordable — in the relative terms of fighter jets — and could be acquired in larger quantities than the F-22 Raptor, the Air Force’s new high-performance fighter.
Pentagon officials accepted Lockheed’s claim that computer simulations would be able to identify design problems, minimizing the need to make changes once the plane actually took to the sky. That, in turn, led to an aggressive plan to build and test the aircraft simultaneously.
Cautioning that all of those assumptions were flawed, Spinney and other defense analysts urged the Pentagon to see the plane in flight before committing to buy it. But senior Defense Department officials in the George W. Bush administration did not heed the warnings.
Within months, the program began veering off course.
The Air Force, Marines and Navy all sought additional modifications to meet their needs, reducing commonality among the three models. A bigger problem was the fundamental concept of building one plane, with stealth technology, that could fly as far and fast as the Air Force wanted while also being able to land on the Navy’s carriers and take off vertically from Marine amphibious assault ships.
Instead of meeting the original plan of being about 70 percent similar, the three versions now are 70 percent distinct, which has increased costs by tens of billions and led to years-long delays. “We have three airplane programs running in parallel,” Bogdan said. “They are very, very different airplanes.”
Even with three variants, the plane’s design has forced serious compromises. To remain stealthy, bombs and missiles must be placed inside a weapons bay, which limits the volume of munitions that can be carried. The use of a single engine, required for the Marine version, restricts speed.
With an even more complex engineering challenge than initially envisioned, Lockheed and the Pentagon took a hands-off approach to managing the program, according to several people involved in the process.
An electrical engineer who worked as a manager at Lockheed’s F-35 program headquarters in Fort Worth beginning in 2001 said the development effort was beset with “tremendous organizational inadequacies” and “schedule and cost expectations that never were achievable.” In his unit, he said, there were no firm development timetables and no budgets. “It was all on autopilot,” he said. “It was doomed from the beginning.”
In 2005, the engineer, who spoke on the condition of anonymity because of concerns he will risk job opportunities in the close-knit aviation industry, participated in a two-week-long assessment of the program.“There were reds and yellows across the board,” he recalled. But when he briefed his superiors, “nobody was interested,” he said. And when he gave a copy of the assessment to those at the Pentagon office responsible for the plane, he said, “they didn’t want to hear it.”
A senior Defense Department official acknowledged the office “didn’t have the capacity or the understanding to manage such a complicated program” at the time. Lockheed executives also make little excuse for those years. “It was a very different program from what we are executing today,” said Steve O’Bryan, Lockheed’s vice president of F-35 business development.
With wars raging in Iraq and Afghanistan, and military budgets growing year over year, Defense Secretary Donald H. Rumsfeld paid little attention to the program. His successor, Robert M. Gates, took the same approach during his first few years on the job. In 2007, the Defense Department permitted Lockheed to begin producing the fighter — before the first flight tests had even begun. Frank Kendall, who is now the Pentagon’s chief weapons buyer, has called that decision “acquisition malpractice.”
Early tests uncovered flaws unnoticed by the computer simulations. Key engineering tasks, including the vertical takeoff and landing system, were taking much longer to complete. All the while, costs were rising at supersonic speeds.
In 2009, Gates grasped the dysfunction. The following year, he withheld $614 million in fees from Lockheed, fired the two-star Marine general in charge of the program and brought in a Navy vice admiral, David Venlet, to clean house. In 2011, Gates placed the Marine plane on probation, warning that it would be killed if problems with its propulsion system were not fixed quickly.
Bogdan, who served as Venlet’s deputy until December, when he took charge of the development effort, was astounded by what he found when he delved into the program.
“It was an unimaginable mess,” he said.
Taking countermeasures
An imposing former test pilot who wears an olive flight suit to his office in Crystal City, Bogdan spent his first two years on the job analyzing virtually every aspect of how the plane is designed and built. He and Venlet adjusted schedules and assumptions, and they implemented changes that brought the Marine version off probation. New goals call for aggressive testing and modifications over the next five years, and the start of full-rate production by 2018.
Bogdan thinks the program cannot afford another do-over. “There is no more money and there is no more time,” he said.
To stay on track, he has adopted a get-tough approach with Lockheed and Pratt & Whitney, the contractor building the plane’s engine. Instead of allowing Lockheed to manage the development of millions of lines of software code for the plane — one of the most vexing technical challenges — his office, which has now grown to 2,000 people, is taking charge. “We have forced discipline on them,” he said of Lockheed.
Until recently, he said, Lockheed’s software developers worked at computers that were not connected to each other. “I couldn’t believe it,” he said. Changes imposed by his office have reduced software revision cycles from 27 days to three.
Although enormous technical hurdles remain — designing the tailhook on the Navy’s model, for instance, and writing software to instantaneously fuse reams of data from the plane’s electronic sensors — Bogdan said none of that keeps him up at night. His nightmares are all about the cost: what it costs to design and build the plane, but also what it will cost to operate it over the next 50 years.
He has pushed Lockheed to pay for all cost overruns — in the past, the government picked up the tab — and he has insisted that the company share in the expense of modifications to planes that are being built during the testing phase.
“What I see Lockheed Martin and Pratt & Whitney doing today is behaving as if they are getting ready to sell me the very last F-35 and the very last engine and are trying to squeeze every nickel of that last F-35 and that last engine,” Bogdan said earlier this month during a visit to Australia, which plans to buy 100 F-35s. “I want them both to start behaving like they want to be around for 40 years. I want them to take on some of the risk of this program. I want them to invest in cost reductions. I want them to do the things that will build a better relationship. I’m not getting all that love yet.”
Lockheed and Pratt executives insist they are trying to drive down expenses and increase reliability. “We’ve made enormous progress over the past few years,” said Lockheed’s O’Bryan. “When the professionals look at the facts and they talk to the pilots, they see a program that is accelerating with costs that are rapidly decreasing.”
O’Bryan said Lockheed and its suppliers are “committed to working in close partnership” with Bogdan’s office.
For Bogdan, an even bigger challenge involves the cost of flying and maintaining the F-35. The Pentagon estimates it could reach as much as $1.1 trillion over the life of the plane. Although unknown variables such as the cost of fuel could drive that figure down, Bogdan said the jet has serious sustainability problems. Chief among them are a greater need for maintenance and replacement parts than projected. “If we don’t do things now to change the game, this airplane will be unaffordable to fly,” he said.
He is pushing suppliers to make parts more reliable, and he has put Lockheed and Pratt & Whitney on notice that they should not assume they will be selected to fill the operations and maintenance contracts, which could be worth as much as $500 billion. He wants other firms to compete for parts of the work, reasoning that it will bring down costs.
To reinforce his seriousness, he has told Lockheed and Pratt not to wait him out. Unlike other senior officers, who change assignments ever few years, he intends to stay for 10 years. “The only way I’m leaving this program,” he said in the interview, “is if I’m fired.”
A dogfight no one wants
But Bogdan’s leverage is limited. Behind his feisty language lies an inescapable reality: The services don’t want to shrink their orders, and Congress doesn’t want to clip the F-35’s wings.
For many legislators, the F-35 is as much about employment as it is about air superiority. Lockheed has repeatedly emphasized to legislators, particularly those who sit on appropriations committees, that the plane supports 133,000 jobs, many of them at 1,300 subcontractors and parts suppliers spread across 45 states. When full-rate production begins, likely in 2018, the company says the employment figure will grow to 260,000.
A Web site established by Lockheed for the plane provides a sample letter for constituents to send to lawmakers. “The F-35 program is a win-win proposition for our national security and our nation’s declining manufacturing base,” the letter states.
Despite the lobbying, a few members have spoken out. One of them was Sen. John McCain (R-Ariz.), a former Navy pilot. In December 2011, he took to the floor of the Senate to lambaste the development effort. “In a nutshell, the JSF program has been both a scandal and a tragedy,” he said.
The following November, the Marines established their first F-35 squadron in Yuma, Ariz. They invited McCain to the inauguration ceremony.
“I am — after many years of frustration and setbacks — encouraged that the overall program is moving in the right direction,” McCain said at the event. He said the program was on track “to produce more achievable and predictable outcomes.”
For the generals who lead the Marines, the F-35 is a must-win fight. There is no alternative fighter readily available to replace the service’s current jets, which will soon become too obsolete to fly.
“It’s essential for us,” said Lt. Gen. Robert Schmidle, the Corps’ deputy commandant for aviation. “We don’t have another option.”
Thus far, there has been little discussion within the Pentagon or on Capitol Hill about whether the Marines, which are organized to travel by sea and fight small wars, require such a sophisticated aircraft. Compared with the Air Force and Navy versions, the Marine variant has the most engineering challenges and the largest price tag. But the Marines, the smallest service, have long wielded disproportionate influence on the Hill and in the Pentagon.
“Nobody wants to say no to the Marines,” a senior Army officer said on the condition of anonymity to speak candidly about the program. “Nobody around here is asking the fundamental question: Why does the Navy’s army need its own air force?”
Avoiding a death spiral
The Pentagon’s latest five-year budget plan, released last year, calls for a smaller volume of annual purchases to save money. Sequestration-related cuts this year also will defer a few more planes. But the overall purchase of 2,443 jets remains unchanged.
Though the F-35 is rarely mentioned by those seeking to rein in federal spending on Capitol Hill, sotto voce discussions are beginning within the walls of the Pentagon. Some senior officers, even those who are enamored of the plane, worry that footing the $400 billion tab in an era of declining defense budgets will require too many other sacrifices and trade-offs.
“This aircraft does everything better than anything ever flown,” a three-star general said on the condition of anonymity. “But how many can we afford? How many of them do we really need?”
Although Air Force and Marine leaders have held fast, an unofficial reexamination is occurring within the Navy, which is not as desperate for the F-35 because it possesses a relatively new fleet of F/A-18 Super Hornets. While toeing a public line of support for the F-35, some Navy experts are looking at whether it makes sense to reduce its planned order and plow some of the savings into high-speed drones that can operate off aircraft carriers, according to senior military officials.
Should that occur, or should Defense Secretary Chuck Hagel decide to shrink the overall purchase, it could prompt howls from key U.S. allies, including Britain, Italy and Norway, which all have contributed to the development of the aircraft. Their purchase price has been based on a U.S. order of about 2,500 jets. If that number drops, the per-plane cost will rise for the allies, possibly leading them to buy fewer then planned.
For some of them, cost increases and delays over the past decade have been significant enough to prompt a reexamination. Australia is deciding whether to halve its 100-plane order and Canada is reconsidering its plan to buy 65.
A smaller total purchase, of course, further increases unit costs for the United States, which likely would increase pressure to cut more. Procurement officers have a term for the phenomenon, borrowed from the world of aviation: a death spiral.
That’s what happened to the Air Force’s F-22. The original plan, set in 1991, was to buy 750 of them for $132 million apiece. Increased development costs and budget cuts in the 1990s sent that program into a tailspin. The Air Force eventually wound up with just 187 — at a cost of $422 million per plane.
That is why Bogdan is pressing Lockheed so aggressively to reduce costs. He knows the F-35 — despite the jobs it fuels, regardless of the needs of the Marines and Air Force — is a giant, unstealthy presence in the federal budget.
His best defense against cuts, he figures, involves showing that the long-troubled program can finally meet its targets — and that more reductions will just mean more-expensive aircraft.
“We have to understand there are trade-offs every time we cut spending on the F-35,” he said. “And none of them are very good.”
