By Emelie Rutherford
Aerospace backers in Congress and industry chided the Pentagon yesterday to follow through with dictates to help strengthen the defense-industrial base.
Deputy Defense Secretary William Lynn, in turn, highlighted how the Department of Defense (DoD) calls in the 2010 Quadrennial Defense Review (QDR) for bolstering the industrial base. He also said the Pentagon will heed legal requirements related to considering industrial-base impacts in acquisitions.
House Appropriations Defense subcommittee (HAC-D) Chairman Norm Dicks (D-Wash.), at an Aerospace Industries Association (AIA) luncheon on Capitol Hill, said that “for quite some time” he has “been concerned about how the DoD attends to our industrial base.”
He repeated his oft-cited concern that the Pentagon has not followed a defense-acquisition regulation–in section 2440 of Title 10 of U.S. Code–that he says requires it to examine industrial-base impacts when developing acquisition strategies for major weapon systems, including the KC-X Air Force tanker aircraft. Boeing [BA], a major employer in Dicks’ district, wants to build the tanker and may compete for the contract against European Aeronautic Defence and Space Co. (EADS); Boeing backers say if EADS wins the contract it would not support as many U.S. jobs as Boeing would.
“The point of the section (of U.S. Code) is that there’s supposed to be a study done, prior to going forward on a contract, about what the effect will be on the U.S. industrial base,” Dicks said to Lynn. “My impression of the previous administration was that they hadn’t really done very much in this (tanker) contest to look at what the impact would be on the U.S. industrial base.”
When the senior lawmaker told Lynn he’s is “sure you agree” that the provision is law and should be followed, Lynn simply replied: “We absolutely should follow the law.”
After the AIA event, Dicks told reporters he is “not satisfied with the previous administration’s approach to this, or this administration’s.”
“I think there needs to be a real study of the industrial base,” the HAC-D chairman said. “I think the fact that they mentioned it in the QDR is good, but I want to see real consideration, a real in-depth study….I don’t get the sense that there’s an in-depth analysis of what the difference would be on this.”
Dicks during his luncheon address said he is pleased the QDR report, which the Pentagon released in February, states the DoD has not given the industrial base as much attention as it warrants.
While he said he believes the QDR shows the Pentagon “has a grasp of both the importance and complexity of the industrial base as it relates to our national security,” Dicks said “what is not entirely clear from the QDR…is how DoD plans to move forward to engage on this truly important issue.”
Lynn called the industrial base “an important element in the QDR.”
“And we do believe maintaining the industrial base takes stewardship,” he told the lunch crowd. “As we said in the QDR, we’re focused on understanding the impact of the strategic shifts that we’ve made. We’ve embedded industrial base into all of the QDR decisions.”
Lynn pointed to two current Pentagon efforts: working with the White House to reform the export-control system so defense firms can sell to foreign buyers more easily, and conducting an “industry-by-industry, sector-by-sector review of our industrial base.”
“We’re making judgments there (during this review) as to do we need to maintain a design team here with some extra funding, do we need to think about how we establish a competition to ensure we have the appropriate level of competition to get the taxpayer the best product at the best price,” the No. 2 Pentagon official said. “So we’re trying to build this cross-sector analysis of industry and use that to inform all of our industrial base decisions.”
Regarding export-control reform, Lynn said Defense Secretary Robert Gates will announce more details later this month on the Obama administration’s plans.
“What we need is a new system, a system that focuses on unique technologies that are unique to the U.S. that provide us the kind of military advantages we need to retain, and we need to put higher walls around those many fewer systems; but we need to reduce te restraints around the many other systems,” he said.
James Albaugh, president and chief executive officer of Boeing Commercial Airplanes and AIA vice chairman, at the luncheon called for more discussion about the “strategic advantage” the industrial base gives the United States.
He said no other nation’s defense industry is as strong as the United States’, and warned against allowing it to further erode following post-Cold War declines. He noted the Pentagon now has fewer new-start programs, a smaller investment in research and development, and longer lifecycles for programs that result in fewer efforts being underway at one time.
For a company and industry to be healthy, Albaugh said, “they need to have the capability to take technology to design, to take design into production, and also to maintain an effective production base, and they need the ability to support the weapon systems that have been fielded.” If that chain is broken along the way, he said, a company won’t be viable for very long.
“If we don’t very quickly start addressing the issue of industrial base, we will wind up with an arsenal approach to how we support the Department of Defense,” the Boeing executive said. “So what do we need to do? I think very simply carry out what’s in the QDR, develop that policy, make sure that people understand that policy. I think we need to make sure we have a design team supported, even if only on a low level, in order to keep the design capabilities in place and sharp for future generations.”