Thursday, April 30, 2015

Analysis: U.S. Navy's budget plan "doesn't hold water"

Ryan Alexander, U.S. News and World Report
29 April 2015

Last week, the House Armed Services Committee’s Subcommittee on Seapower and Projection Forces released a draft of its proposed program levels and policy language for fiscal year 2016. Of particular interest to fiscal conservatives should be language changes to the so-called “National Sea-Based Deterrence Fund.” This new fund was established in last year’s Pentagon policy bill. It gets pretty deep in the weeds of procurement and appropriations law by establishing a transfer fund in the “Defense-wide” portion of the budget to purchase
the replacement for the Ohio class of ballistic missile submarines, also known as “SSBN(X.)”
As I wrote in this column last fall, this effectively means the purchase of new submarines is being taken out of the Navy’s shipbuilding budget and placed in the budget of the Office of the Secretary of Defense. And as far as I can tell, that’s unprecedented. A recent comment by Rear Admiral Joseph Tofalo, director of undersea warfare, suggests otherwise, but an informed parsing of what the admiral is saying will make the difference clear: 
"The Navy is going to need top line relief in order to accomplish the ship building program.  When '41 for freedom,' and then the Ohio-Class, were built, the Navy received about $5 to $7 billion per year in additional funding for ship building. When you compare those years to all other post-Korean war years, you see that top line relief is historically consistent with what has happened over time. The issue is the additional resources and that is the conversation that is going on," Tofalo said.
The admiral is correct in stating that additional money was placed in the shipbuilding accounts in the so-called “Reagan build-up” of the 1980s. Additional funding in the Navy's shipbuilding account is the proper way to fund new ships. That is where funding for new ships should reside in the federal budget. Placing the money there allows for an honest and healthy debate over the proper size of the account and what the Navy, and the nation, can afford.  
Placing it, instead, in the defense-wide budget masks the huge cost of these submarines. A recent infographic shows how. It also means the Navy's shipbuilding account will likely stay at the $14-$15 billion level even without paying for the new submarines. And all that means is the Pentagon topline is going to go up. Way up. The Congressional Budget Office estimate is that the overall costs of the Ohio class replacement is almost $92 billion.
The idea that ballistic missile submarines are a “national asset” deserving of this special status in the defense-wide budget doesn’t hold much water, pardon the pun. All the elements of war-making are national assets. Tanks, missiles, aircraft carriers, even artillery pieces. After all, it wasn’t the U.S. Army who was at war in Iraq and Afghanistan – it was the U.S. government under a Congressional declaration of war, signed by President George W. Bush. These are all national assets. And all the other military services manage to purchase their weapons out of their own budgets.
But the subcommittee rubbed a little more sea salt into that wound. Among the amendments to the original language from the fiscal year 2015 bill is this new language: “a class of twelve national sea-based deterrence vessels, and cross-program coordinated procurement efforts with other nuclear powered vessels.” With the 12 sea-based deterrence vessels obviously being the Ohio class subs, the only other nuclear powered vessels would be the Virginia class of fast attack submarines and Fordclass aircraft carriers. This means that funding for all common procurement items in nuclear powered vessels could be funded out of this defense-wide account.
Camel’s nose, meet the edge of the tent.
So the Navy, and only the Navy, gets relief from its budgetary “woes” by being allowed to transfer major procurement programs over to the defense-wide budget. Watch for the Air Force to look for similar relief for the procurement of the Long Range Strike Bomber or the modernization of intercontinental ballistic missiles. And, given the recent actions of the House Armed Services Committee, I don’t see any likely candidates to stop this train as it races down the track of further fiscal irresponsibility.

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