MCCAIN: I think that we have to return -- particularly in defense spending, which is the largest part of our appropriations -- we have to do away with cost-plus contracts. We now have defense systems that the costs are completely out of control.
We tried to build a little ship called the Littoral Combat Ship that was supposed to cost $140 million, ended up costing $400 million, and we still haven't done it.So we need to have fixed-cost contracts. We need very badly to understand that defense spending is very important and vital, particularly in the new challenges we face in the world, but we have to get a lot of the cost overruns under control.
I know how to do that.(Incidentally, Inside the Navy this week runs a good piece quoting Chief of Naval Operations Adm. Gary Roughead extensively on LCS and other shipbuilding programs -- and the Navy's need to "regain our credibility when it comes to talking about shipbuilding and costs associated with shipbuilding.")Back to the debate: McCain then highlighted the flawed Boeing Tanker deal as an example of his record of reining in defense spending.MCCAIN: I saved the taxpayers $6.8 billion by fighting a contract that was negotiated between Boeing and DOD that was completely wrong. And we fixed it and we killed it and the people ended up in federal prison so I know how to do this because I've been involved these issues for many, many years. But I think that we have to examine every agency of government and find out those that are doing their job and keep them and find out those that aren't and eliminate them and we'll have to scrub every agency of government.However, later in the debate, McCain made the case that he would protect the defense budget from spending cuts that may be necessary due to the $700 billion financial rescue plan.LEHRER: What I'm trying to get at this is this. Excuse me if I may, senator. Trying to get at that you all -- one of you is going to be the president of the United States come January. At the -- in the middle of a huge financial crisis that is yet to be resolved. And what I'm trying to get at is how this is going to affect you not in very specific -- small ways but in major ways and the approach to take as to the presidency.MCCAIN: How about a spending freeze on everything but defense, veteran affairs and entitlement programs.LEHRER: Spending freeze?MCCAIN: I think we ought to seriously consider with the exceptions the caring of veterans national defense and several other vital issues.To which Sen. Barack Obama (D-IL) responded, "The problem with a spending freeze is you're using a hatchet where you need a scalpel."-- Kate Brannen