Wednesday, April 13, 2011

What Would You Do With an Extra $70 Billion?

Published: April 2, 2011

NY Times


Defense Secretary Robert Gates has vowed that the days of profligacy are over and that the Pentagon will reform its bloated and often corrupt acquisition process.
Mr. Gates has already canceled several expensive and unneeded systems — pushing back against defense contractors and their Congressional enablers. In 2009, President Obama signed a law to improve contracting, which created a new office to handle cost estimates and put increased focus on testing weapons before they enter production. Mr. Gates’s point man, Ashton Carter, issued new guidelines to the 147,000 Pentagon employees handling acquisitions, stressing affordability and controlling cost growth.
Still, a new study by the Government Accountability Office found that the projected costs of the Pentagon’s largest weapons programs have risen $135 billion, or 9 percent, to $1.68 trillion in the last two years. Some $65 billion resulted from decisions to buy more of some systems, like mine-resistant vehicles for Afghanistan. But more than half of the total — $70 billion — was caused by management failures.
That means Pentagon cost overruns amount to one and half times the State Department’s entire $47 billion annual budget. The worst offender (with a $34 billion overrun) is the F-35 Joint Strike Fighter by Lockheed Martin, intended as the workhorse jet for the foreseeable future.
The G.A.O. said many of the problems resulted because the Pentagon began building weapons before designs were fully tested and is still not “fully adhering” to best practices. In some cases, cost estimates have been revised upward because initial projections were overly optimistic and flawed — a longstanding Pentagon failing.
It is unrealistic to expect the Pentagon to reverse years of unchecked spending and inefficiency overnight. But clearly much more must be done to change the way the bureaucracy, defense contractors and Congress act.



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