Monday, May 1, 2017

Creating 355-Ship U.S. Navy Will Take At Least 18 Years: CBO  

Sydney J. Freedberg Jr., Breaking Defense
25 April 2017 

President Trump and the US Navy want a 355-ship fleet, but even if you double shipbuilding budgets compared to historic levels, it can’t be done until 2032, at least 12 years after the end of Trump’s current term of office. That’s the estimate offered today by the Congressional Budget Office. At a more sustainable but still expensive pace, CBO calculates, you don’t reach 355 ships until 2047, thirty years from now, when today’s five-year-olds will be old enough to run for president.
We’ve seen a lot of interesting analysis of the Navy’s 355-ship Force Structure Assessment, including an estimate from the Congressional Research Service’s Ron O’Rourke that it would cost $5 billion a year over the Navy’s former plan for a 308-ship fleet, widely derided as an unaffordable “fantasy,” Now O’Rourke’s counterpart and colleague at CBO, Eric Labs, has taken an intriguing new approach: He’s made different estimates depending on how fast you want to reach the 355-ship goal.
“Fast” is a relative term, since 2032 is the earliest date Labs sees for a 355-ship fleet, and even then it’s not the 355 ships the Navy says it wants. The Force Structure Assessment calls for a 38 percent increase in nuclear-powered attack submarines (SSNs) above earlier plans, from 48 to 66, but Labs says there’s no way to build that many subs that fast. Construction of other vessels — even aircraft carriers — is less complex and less of a bottleneck, Labs says. So while the shipbuilding industry overall will need to increase its workforce 40 percent over the next decade, the sub builders need to grow even more.
There are just two shipyards that build attack boats, Electric Boat and Newport News, together producing two Virginia-class SSNs a year, but they’re also starting work on the much larger Columbia-class ballistic missile submarine (SSBN). That will dramatically increase their workload, and all the money in the world can’t create a sufficiently qualified welder (for example) overnight. Even if the yards double their attack boat output to four Virginias a year by 2025, Labs writes, “the Navy would not meet its goal of 66 attack submarines until 2035.” So put an asterisk by CBO’s “15-year plan,” because it’s really 18 years.
Interestingly, Labs finds that the cost to get started on any of the four plans is at least $23 billion a year. That’s 19 percent to 24 percent above the Navy’s previous plan for 308 ships and 42 percent to 48 percent above historical spending levels. Likewise, Labs estimates, if you look at the total cost to build a 355-ship fleet over 30 years, you pay about the same amount whether you buy as many ships as possible early or spread them out: an average of $26.6 billion a year. That’s about 25 percent above the old 308-ship plan, 40 percent above what was actually appropriated in 2016, and 60 percent above historical spending levels.
But Congress doesn’t vote to fund any program for 30 years, and most politicians — heck, most people — don’t plan that far out. In the relatively near term, the next 10 years, there’s a huge cost premium to getting 355 faster:
To get to 355 ships by 2032 (and 66 submarines by 2035), annual shipbuilding budgets would need to spike to $33 billion by 2023-2027. That’s more than 100 percent above historical spending levels and almost 50 percent above the Navy’s old 308-ship plan.
To get to 355 by 2037, spending would peak at $30 billion, also in 2023-2027, 86 percent above historical levels.
To get there by 2042, spending would rise to the $27-$28 billion range — 60-70 percent above historical levels — and stay there for most of the next 20 years, 2023-2037.
To get there by 2047, spending would rise slightly less, into the $26-28 billion range, on a slightly slower schedule and then stay there longer.
But to rise to even this easiest version of the challenge, CBO calculates a 42 percent increase in shipbuilding budgets above historical levels over the next five years. That’s a decision that this President and Congress actually have to face.

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