The Insider

Tanks For Egypt
By John Liang
July 5, 2011 at 6:45 PM

The Pentagon wants Congress to approve a foreign military sale of 125 M1A1 Abrams tank kits and related equipment to Egypt that would cost nearly $1.33 billion, according to a recently released Defense Security Cooperation Agency statement. Further:

The Government of Egypt has requested a possible sale that includes 125 M1A1 Abrams tank kits for co-production, 125 M256 Armament Systems, 125 M2 .50 caliber machine guns, 250 M240 7.62mm machine guns, 125 AGT-1500 M1A1 series tank engines and transmissions, 120mm test cartridges, spare and repair parts, maintenance, support equipment, special tool and test equipment, personnel training and equipment, publications and technical documentation, U.S. Government and contractor engineering and logistics support services, and other related elements of logistics and program support. Articles may be provided in furtherance of a co-production agreement. The estimated cost is $1.329 billion.

This proposed sale will contribute to the foreign policy and national security of the United States by helping to improve the security of a friendly country that has been and continues to be an important force for political stability and economic progress in the Middle East.

The additional M1A1 tanks will provide Egypt with a modern tank fleet, enhancing its capability to meet current and future threats. This will contribute to Egypt’s goal to update its military capability while further enhancing interoperability between Egypt, the U.S., and other allies. Egypt, which has co-produced the M1A1 Abrams tank, will have no difficulty absorbing the additional tanks.

The proposed sale of this equipment and support will not alter the basic military balance in the region.

The prime contractors will be General Dynamics in Sterling Heights, Michigan, Honeywell International Incorporated in Phoenix, Arizona, and Allison Transmission Motors in Indianapolis, Indiana. There are no known offset agreements proposed in connection with this potential sale. . . .

There will be no adverse impact on U.S. defense readiness as a result of this proposed sale.

However, Inside the Army reported in April that the recent unrest in the Middle East could put a damper on such a sale.

Over the past year, lawmakers have become agitated over a Pentagon proposal to shut down the Abrams production line. The issue has drawn the attention of the speaker of the House, who intends to ask the Army secretary to review the decision, according to government officials. As ITA reported in April:

The Abrams is produced by General Dynamics Land Systems and hundreds of subcontractors working out of a government-owned plant in Lima, OH. But, for fiscal reasons, the Army wants to stop production of the Abrams M1A2 in 2013 and begin work again in 2016 with an upgrade effort. GDLS and its host of subcontractors have been lobbying Congress to change the Army's mind.

The companies' claim that Abrams manufacturing impacts the economies of 48 states has garnered support from many lawmakers, including House Speaker John Boehner (R-OH), whose congressional district is adjacent to where the Abrams plant is located.

"Congressman Boehner intends to ask Secretary [John] McHugh to review the Army's current plan to cut tank production and ask that the excessive costs of shutting down the Lima plant are considered," according to Brittany Bramell, the speaker's spokeswoman.

An Army study from 2008 estimates the cost of a three-to-four-year Abrams shutdown and restart would not exceed $800 million, whereas producing 70 tanks annually between fiscal year 2012 and FY-15 would cost roughly $2.1 billion, according to an April 14 statement from the Army.

For more combat vehicle news, click here.

Gates Memo On NII
By John Liang
July 5, 2011 at 5:11 PM

Last week, Inside the Pentagon reported that Defense Secretary Robert Gates had quietly agreed late last year to transfer responsibility for the Defense Department's information network to U.S. Cyber Command, but reversed that decision in the twilight of his tenure, according to a memo he wrote. Further:

Gates' memo on the disestablishment of the Pentagon's Networks and Information Integration (NII) office, issued earlier this week, describes DOD's plans for shuttering the office following months of uncertainty about how the department would proceed.

Inside the Pentagon reviewed a copy of the memo, which is addressed to DOD acquisition executive Ashton Carter, NII boss and Chief Information Officer Teri Takai and Christine Fox, the director of the cost assessment and program evaluation shop.

Gates -- who retires today and will be succeeded by Leon Panetta -- first announced plans for NII's closure last August. Gates' chief of staff, Robert Rangel, set a March 30 deadline for the task. When DOD failed to meet the deadline, Pentagon officials admitted the task was harder than expected, but they declined to comment on the details of internal deliberations.

But the new memo reveals Gates "tentatively agreed" last December to "a conceptual approach that involves transferring significant responsibility for the operation of the DOD information network" from NII and the Defense Information Systems Agency to CYBERCOM.

The website for Takai's office states she is responsible for setting policy and providing oversight of information processes, systems and technologies. DISA provides information technology and communications support to the White House, the armed services and the combatant commands. CYBERCOM chief Gen. Keith Alexander has said his command coordinates, integrates and synchronizes activities to direct the operations and defense of DOD networks.

Gates writes that issues raised by Fox's office in February led him to "recognize there are a number of significant policy, operational and practical concerns with shifting DISA to CYBERCOM that no longer make it a viable approach."

The department will abandon plans for such a shift and refocus on disestablishing NII, the memo states.

"To this end, I believe the best course for the Department is to return to the original goal of disestablishing NII into a smaller and more focused and strengthened Chief Information Officer (CIO) office that has a strong relationship between DISA and CYBERCOM and achieves savings from eliminating functions that are duplicative or no longer necessary," Gates writes.

We now have a copy of the memo. Click here to view it.

Small Biz Set-Aside
By John Liang
July 5, 2011 at 3:25 PM

The Missile Defense Agency has sent out a feeler to gauge small businesses' interest in working on a set-aside contract for MDA's Upgraded Early Warning Radar effort. According to a June 30 Federal Business Opportunities notice:

The purpose of this Request for Information (RFI)/Sources Sought is to aid the government in determining if there is sufficient small business industrial expertise and interest to proceed with a small business set-aside, competitive procurement for the desired capability described below. Only small businesses should reply to this announcement.

This RFI/Sources Sought defines the tasks and scope for the UEWR & CD BIT which shall be acquired through a developmental Indefinite Delivery/Indefinite Quantity (IDIQ) contract to plan, execute, and analyze UEWR & CD BMDS flight tests, UEWR & CD BMDS ground tests (including MDA integration testing with the Single Stimulation Framework and at each participating radar site as necessary), and element stand-alone ground tests.

This RFI/Sources Sought includes developmental efforts for test provisioning, operation and non-COTS maintenance for the hardware-in-loop (HWIL) representations for each UEWR & CD sensor along with laboratory facilities that shall be required to execute Pre-Mission Testing/System Pre-Mission Testing (PMT/SPMT) for flight tests, BMDS ground testing, and element ground testing.

Building Ships
By John Liang
July 1, 2011 at 3:10 PM

Analysts from Wall Street firm Credit Suisse met with shipbuilder Huntington Ingalls Industries execs this week and noted "a cautiously optimistic tone." In a research note, Credit Suisse analysts write: "While HII sees upside in earnings and cash flow over the long-term, it is now focused on the heavy lifting required in the short and mid-term to build a cultural and operational foundation to achieve that end." Further:

■      No Guidance Yet: HII has yet to offer EPS guidance, citing visibility around Avondale as a key factor, and instead suggested investors track ship progress & milestones over financial targets.

■      Gulf Coast Margin Remains Key Driver & Watch Item: Mgmt reiterated its 9%+ L/T margin target by year-end 2014 (currently at 5-6% overall, and near 2% in the Gulf Coast).  Poorly priced contracts on LPDs 22-25 and LHA-6 (now at or near zero margin as prior mgmt’s plan for serial efficiencies were never realized) will begin to roll off later this year.  As new ships (DDG-113, LHA-7, LPD-26) move from planning to construction, margin should ramp, albeit slowly. HII noted that normally, lead ship contracts should earn ~8% while serial production ships represent a ~10% margin opportunity.

■      Mgmt Frames Report of Higher Potential Cost on Aircraft Carrier:  A June 2011 CBO report estimates that CVN-78 (Ford) may exceed its $12B budget target by $600M or more.  HII cautioned that its portion of the work is far below the $12B total cost, and the excess cited may not be attributable to HII.  Under this cost-plus contract, higher costs are recoverable, but fee could be impacted, depending on the responsible party & the share line.

■      No Near-Term Catalysts; Reiterate N with $35TP: While we see eventual EPS growth as bad contracts roll off, the linearity of improvement is unclear, especially since new work (with presumably better pricing) will be booked conservatively at first. Thus, visibility on margin improvement (the key catalyst) is still a year or more distant in our view. Reiterate N with a $35 TP.

Inside the Pentagon reported in April that HII, according to DOD, was not moving fast enough to fix its management deficiencies:

Huntington Ingalls Industries' shipyards stumbled last year in Defense Department reviews concerning earned value management, the Pentagon's top tool for ensuring industry delivers weapons on time and on budget. Since then, the shipbuilder has not made enough progress addressing the problems, said Capt. Cate Mueller, spokeswoman for Navy procurement chief Sean Stackley.

"The Navy participated in the recent EVM reviews with the Defense Contract Management Agency at the shipyards and, while noting progress, is not satisfied with the rate of progress," said Mueller. "We will continue to provide oversight while working with the shipyards to ensure appropriate priority is placed on correcting these deficiencies."

The Navy's comments came in response to remarks by Mike Petters, the shipbuilder's president and CEO, who recently said his company has "more work to do" on earned value management but also questioned whether all the rules should apply (Inside the Pentagon, April 7, p1).

DOD uses the EVM tool to flag problems, forecast cost and schedule performance, and get troubled Pentagon procurement programs back on track. Asked whether the company should apply all 32 of the Pentagon's management rules to each of its contracts, Petters said no.

"I wish it was that simple, but it's not," he said. "We get certified by our customer to invoice and report. And we do that, we go through all those certifications and we don't have any issues. Then we have another agency monitor and inspect and they come up with areas that we need to go work on. And then we take a look at those and say, 'Is that something that really makes sense for this business or not?' And then we have a discussion with our customer about that."

'No Hollow Force'
By Jason Sherman
July 1, 2011 at 1:36 PM

Leon Panetta, sworn in as the 23rd defense secretary at 8:45 this morning, pledged in a statement that he will protect the readiness and superiority of U.S. armed forces even as the Pentagon's budget is pared back.

“Even as the United States addresses fiscal challenges at home, there will be no hollow force on my watch,” Panetta said in a message to the Defense Department published soon after he took the helm.

As Secretary of Defense, I will do whatever is necessary to protect America and to meet the needs of the men and women who serve in harm's way, and the families who support them.  Even as the United States addresses fiscal challenges at home, there will be no hollow force on my watch.  That will require us all to be disciplined in how we manage taxpayer resources.  Throughout my career in public service -- as a member of Congress, Director of the Office of Management and Budget, White House Chief of Staff, and, until yesterday, Director of the Central Intelligence Agency -- I have focused on achieving that balance.  I will continue that approach at the Pentagon.  We must preserve the excellence and superiority of our military while looking for ways to identify savings.  While tough budget choices will need to be made, I do not believe in the false choice between fiscal discipline and a strong national defense.  We will all work together to achieve both.

Among Panetta's near-term challenges is continuing the Comprehensive Defense Review launched this spring by his predecessor, Robert Gates, to identify options for how to cut nearly $400 billion from planned national security spending over the next dozen years.

The new defense secretary, who until yesterday was the director of the CIA, plans to travel around the world to meet with troops and commanders.

As your leader, I will ensure that our nation continues to have the best-trained, best-equipped, and strongest military in the world – a force prepared to confront the challenges that face us.  As CIA Director, I saw first-hand the tremendous capabilities of our military, and I was always impressed by the professionalism and patriotism of the men and women of the Armed Forces.

Our nation is at war.  We must prevail against our enemies.  We will persist in our efforts to disrupt, dismantle, and ultimately defeat Al Qaeda.  The successful operation that killed Osama Bin Laden -- a mission that showcased American military strength and precision -- is a major step toward that goal.  As we begin the transition in Afghanistan, we must remain committed to working closely with our Afghan and international partners to ensure that it never again becomes a safe haven for Al Qaeda and its militant allies.  As we continue our transition out of Iraq, we must cement a strategic relationship with the Iraqi government, one based not solely on our military footprint there but on a real and lasting partnership.  It is in America's interests to help Iraq realize its potential to become a stable democracy in a vitally important region in the world, and to reinforce that responsibility for the future security of Iraq must belong to the Iraqis themselves.

JFCOM's Dissolution Continues
By John Liang
June 30, 2011 at 8:27 PM

Two organizations that were under U.S. Joint Forces Command's umbrella have found new homes, according to the soon-to-be-defunct command.

The Joint Enabling Capabilities Command was reassigned from JFCOM to U.S. Transportation Command. According to JFCOM:

The JECC will retain the Joint Communications Support Element (JCSE), the Joint Public Affairs Support Element (JPASE) and the Joint Deployable Team (JDT) as subordinate organizations.

"The JECC is pleased to be a part of the USTRANSCOM team and we will continue our mission of providing joint enabling capabilities on short-notice to joint force commanders worldwide," said U.S. Navy Rear. Adm. Walter E. Carter, Jr., JECC commander.  "The support we currently supply to the joint warfighter will continue without interruption as we are reassigned to USTRANSCOM."

The JECC provides immediate, short-duration support to establish, organize and operate joint force headquarters across the globe and combines capabilities from the six unique functional areas of plans, operations, logistics, information superiority/knowledge management, communications and public affairs.

The JECC will be a subordinate joint command of USTRANSCOM.  The JECC headquarters, JDT and JPASE will remain in Hampton Roads, Va., and JCSE will remain at MacDill Air Force Base in Tampa, Fla.

Additionally, the Joint Warfare Analysis Center has been moved from JFCOM to U.S. Strategic Command. In a separate statement, the command announces:

The JWAC provides comprehensive technical analyses on a wide array of national security challenges and issues to inform and support decision makers engaged in both combat operations and in policy-making sessions at the highest levels of our government.

“Our military and civilian professionals will continue to support the joint force by providing innovative solutions to our nation’s most pressing war fighting problems,” said Marine Corps Col. Michael R. Orr, commander, Joint Warfare Analysis Center.

After transition to USSTRATCOM, JWAC will continue work from its current location in Dahlgren, Va.

More Lockheed Layoffs
By John Liang
June 30, 2011 at 7:48 PM

Lockheed Martin just announced plans to lay off around 1,500 workers from its aeronautics business unit.

According to the statement:

Lockheed Martin currently has about 28,000 employees at its principal Aeronautics sites in Texas, Georgia and California and at six smaller locations in as many states. Reductions may occur across the enterprise, with the greatest impacts occurring at the larger sites. An organizational assessment will determine how to trim the organization with a target reduction of approximately 1,500 employees.

Ralph D. Heath, executive vice president, Lockheed Martin Aeronautics, said, "Bold and responsible action is necessary to meet customer expectations and reduce our costs. We are realigning the organization to be more efficient and agile, and a reduction in force will enable us to meet the requirements of our changing business environment."

Lockheed Martin will offer eligible salaried employees an opportunity for a voluntary layoff to minimize the number of involuntary layoffs. We will use a disciplined process to review every organization and position, considering all factors rather than making arbitrary reductions. We expect the greatest impact to be on employees in higher-level labor grades. Employees eligible for voluntary layoffs will be notified in August. An involuntary reduction in force begins in mid-September.

Today's layoffs announcement comes on the heels of the company declaring two weeks ago that it would lay off 1,200 workers from its space systems unit.

FYDP Figures
By John Liang
June 30, 2011 at 7:37 PM

The Congressional Budget Office today released an assessment of the Pentagon's five-year future years defense program. Among its conclusions:

-- To execute its base-budget plans for the period covered by the 2012 FYDP, DoD would need appropriations totaling about $206 billion (or 8 percent) more over those five years than if funding was held at the 2011 level of $536 billion. Over the 10 years from 2012 to 2021, DoD would need a total of $597 billion (or 11 percent) more than if funding was held at the 2011 level.

-- DoD's base budget would grow at a real (inflation-adjusted) average annual rate of 1.8 percent from 2012 to 2016 and by 0.5 percent from 2016 to 2030. At those rates, DoD's base budget would rise from $554 billion in 2012 to $594 billion in 2016 and to $642 billion in 2030.

-- The primary cause of long-term growth in DoD's budget from 2012 to 2030 would be rising costs for operation and support (O&S), which would account for nearly all of the increase. In particular, CBO projects significant increases in the costs for military and civilian compensation, military health care, and various operation and maintenance activities. O&S costs would grow steadily throughout the projection period, from $350 billion in 2012 to $459 billion in 2030, a growth rate of 1.5 percent per year.

-- That large contribution of operation and support costs to long-term budget growth is a change from the years before the wars in Afghanistan and Iraq, when sharp growth in anticipated requirements to replace and modernize weapon systems (the so-called bow wave) was the primary factor underlying projected budget growth beyond the years covered by the FYDP. In CBO's current projections, acquisition costs (the costs of developing and procuring weapon systems) would grow steadily from $189 billion in 2012 to a peak of $217 billion in 2019 (an increase of about 14 percent) before decreasing and leveling off -- albeit with year-to-year variations -- at an average of about $197 billion per year through 2030.

Guarded Optimism
By Dan Dupont
June 30, 2011 at 2:00 PM

The National Guard Association of the United States is touting unprecedented levels of support in the Senate for its long-running goal of a seat for the Guard director on the Joint Chiefs of Staff. In a statement issued this morning, NGAUS says thirty senators "now sponsor legislation that would give the National Guard a voice in final resource decisions at the Pentagon."

Sen. Patrick Leahy, D-Vt., and Sen. Lindsey Graham, R-S.C., introduced the National Guard Empowerment and State-National Defense Integration Act of 2011, S. 1025, in late May. Twenty-eight senators have since signed on as co-sponsors.

The bill includes a provision to give the Guard’s senior officer a seat on the Joint Chiefs of Staff.

The House approved a similar provision last month, meaning it now only needs Senate approval to be sent to the president, who committed to a Guard “seat at the table” in his 2008 campaign booklet, The Blueprint for America: Barack Obama’s Plan for America.

“Thirty and counting,” said retired Maj. Gen. Gus L. Hargett Jr., the president of the National Guard Association of the United States (NGAUS). “This legislation has real momentum because a growing number of lawmakers recognize that the Guard will be increasingly important to the nation’s defense and security, yet still goes largely unrepresented atop the Pentagon.”

A formal role in final resource decisions is part of an ongoing effort by many on Capitol Hill and NGAUS that three years ago elevated the chief of the National Guard Bureau at the Pentagon from a three- to a four-star general.

The NGB chief is now invited to participate in some discussions with the Joint Chiefs. However, he does not have a vote in final decisions. Nor does he have the ability to nominate Guard officers for positions that require Senate confirmation.

S. 1025 would enable the NGB chief to sit with the heads of the Army, Navy, Air Force and Marines — none of whom have ever served in the Guard — and give the Guard, for the first time, representation in final deliberations on staffing and resources.

All of the living former NGB chiefs, who were not allowed to support a Guard seat at the table while they served at the Pentagon, have endorsed the legislation.

Counterterrorism Strategy Released
By John Liang
June 29, 2011 at 6:41 PM

The White House released its national counterterrorism strategy this morning, a document that "formalizes the approach that President Obama and his administration have been pursuing and adapting for the past two and half years to prevent terrorist attacks and to deliver devastating blows against al Qaeda, including the successful mission to kill Osama bin Laden," according to an administration fact sheet. Further:

Rather than defining our entire national security policy, this counterterrorism strategy is one part of President Obama's larger National Security Strategy, which seeks to advance our enduring national security interests, including our security, prosperity, respect for universal values and global cooperation to meet global challenges.

This Strategy builds upon the progress we have made in the decade since 9/11, in partnership with Congress, to build our counterterrorism and homeland security capacity as a nation.  It neither represents a wholesale overhaul -- nor a wholesale retention -- of previous policies and strategies.

Quorum Call
By John Liang
June 29, 2011 at 4:08 PM

The Senate Armed Services Committee this morning was able to establish a quorum and voted to approve 1,603 pending military nominations in the Army, Navy, Air Force, and Marine Corps. According to a committee statement, those approved include:

General James D. Thurman, USA for reappointment to the grade of general and to be Commander, United Nations Command/Combined Forces Command/United States Forces Korea;

Vice Admiral William H. McRaven, USN to be admiral and Commander, United States Special Operations Command; and

Lieutenant General John R. Allen, USMC to be general and Commander, International Security Assistance Force/Commander, United States Forces, Afghanistan.

The votes were voice votes, with all nominees en bloc.  All nominations were immediately reported to the floor following the Committee's action.

Nomination Thumbs-Up
By John Liang
June 28, 2011 at 8:18 PM

The Senate Intelligence Committee today unanimously approved President Obama's nomination of Army Gen. David Petraeus to succeed Leon Panetta as head of the Central Intelligence Agency.

According to a joint statement from committee Chairwoman Dianne Feinstein (D-CA) and Vice Chairman Saxby Chambliss (R-GA):

Gen. Petraeus is an outstanding public servant and one of our country’s finest officers. The committee voted unanimously today to report his nomination to the full Senate. We look forward to a speedy confirmation this week so Gen. Petraeus can take the reins of the CIA at this critical time for our country.

China Syndrome
By John Liang
June 28, 2011 at 6:36 PM

The Senate last night passed a resolution co-sponsored by Sens. Jim Inhofe (R-OK) and Jim Webb (D-VA) deploring China's harassment of ships in the South China Sea and calling for a peaceful, multilateral resolution to maritime territorial disputes in Southeast Asia. According to a statement from Inhofe's office:

On June 9, three Chinese maritime security vessels ran into and disabled the cables of a Vietnamese exploration ship, the Viking 2, in an area within 200 miles of Vietnam’s continental shelf and recognized under international law to be within Vietnam's Exclusive Economic Zone. This followed similar incidents on May 26 near Vietnam and in March near the Philippines, as well as incidents at sea last year in the Senkaku Islands, which are under the legal administration of Japan.  Following international condemnation of the June 9 incident, China deployed its largest maritime security ship to the South China Sea. Several other countries in the region have also deployed military vessels to the area.

"Over the past twelve months, China has been carrying out calculated acts of naval harassment in the South China Sea," Inhofe said. "Seeing this negative trend which threatens the freedom of navigation as well as the national security interests of the United States and its allies in the region, we introduced this Senate resolution.  China needs a clear message that their continued harassment will no longer be tolerated. I am pleased that the U.S. Senate sent that clear message in a unified manner. It lets Communist China know they must halt their aggressive behavior and return to the pledge made in 2002 to resolve this dispute peacefully."

"A growing number of nations around the South China Sea are now voicing serious concerns about China's pattern of intimidation. These nations include Vietnam and the Philippines, as well as countries such as Singapore that do not have a stake in the territorial disputes," said Webb. "This is a significant development toward fostering a multilateral approach to resolve these territorial disputes in a peaceful manner, respecting the sovereignty of all claimants."

"The United States has a clear strategic interest in facilitating such a multilateral approach, ensuring open access to international waters and air space, and promoting adherence to international law," said Webb.

The resolution passed by the Senate:

(1) reaffirms the strong support of the United States for the peaceful resolution of maritime territorial disputes in the South China Sea, and pledges continued efforts to facilitate a multilateral, peaceful process to resolve these disputes;

(2) deplores the use of force by naval and maritime security vessels from China in the South China Sea;

(3) calls on all parties to the territorial dispute to refrain from threatening force or using force to assert territorial claims; and

(4) supports the continuation of operations by the United States Armed Forces in support of freedom of navigation rights in international waters and air space in the South China Sea.

Inside the Pentagon reported earlier this month of the Defense Department's growing interest in China's military capabilities, despite growing economic ties:

While defense officials publicly insist that the military's new AirSea Battle concept, a study meant to reshape the way the U.S. military fights future wars, is not focused on China, one Navy team is quietly contradicting their claims. The group, called the China Integration Team, is hard at work applying the lessons of the study to a potential conflict with China, say sources familiar with the effort.

Portions of the AirSea Battle concept are classified, and high levels of sensitivity surround the study's connection with China. For both reasons, those who were willing to discuss the study asked to remain anonymous.

According to one source familiar with the effort, the China Integration Team is undertaking exactly what its name suggests -- applying the lessons of the concept specifically "at the China threat."

When asked to confirm the team's existence and mission, the Navy had little to say.

"With respect to an office being stood up to support AirSea Battle or China, I have nothing for you at this time," said Navy spokesman Lt. Cmdr. Justin Cole.

But an internal bulletin from the Navy's strategy and policy shop confirms the China Integration Team's existence and its connection with AirSea Battle.

"With the completion of ASB Spiral One development," the bulletin states, referring to the first draft of the study, "ASB responsibilities are shifting from N513," the strategy office that handled the first stage of the study, "to N3/N5 China Integration Team (CIT)."

Wargaming
By John Liang
June 27, 2011 at 4:19 PM

The week before the U.S. and Mexican men's soccer teams clashed in the final of a regional tournament in Pasadena, CA, officials from the Naval War College held a wargaming workshop in Mexico City. According to a college statement:

The U.S. Naval War College's (NWC) War Gaming Department presented a three-day professional development workshop at the Centro de Estudios Superiores Navales (CESNAV) in Mexico City, to share war gaming techniques and expertise. Attendees at the 21-23 June workshop included Mexico Navy, Army, and Air Force officers. The 30 conference attendees watched presentations from NWC War Gaming Department faculty on game uses, design considerations, and post-game analysis.

NWC war gamers Cmdr. Walter Topp, Cmdr. Dustin Martin, and Professor Shawn Burns used a blend of lectures, experiential, and team game development activities. Workshop attendees considered, discussed, and briefed team deliberation results in a plenary forum. Participants were guided through development of two war games to facilitate the experiential learning portion of the workshop. Fictional game scenarios included a Gulf of Mexico oil spill within Mexican territorial waters, and a game focused on an interagency and multinational response to illicit trafficking in the Gulf of Mexico.

Speedy Design, Big Savings
By Jason Sherman
June 27, 2011 at 3:45 PM

During a visit to the National Robotics Engineering Center at Carnegie Mellon University on Friday, President Obama touted the promise of big savings to the national pocketbook from designing defense systems faster and for less money. Exhibit A, he said: Local Motors, a small Arizona company that under a DAPRA contract procured the Experimental Crowd-derived Combat Support Vehicle (XC2V), the first ever crowd-sourced, militarily relevant vehicle design. After checking out the vehicle prototype, which was in Pittsburgh, the president said:

We just took a look at it.  Not only could this change the way the government uses your tax dollars -- because think about it, instead of having a 10-year lead time to develop a piece of equipment with all kinds of changing specs and a moving target, if we were able to collapse the pace at which that manufacturing takes place, that could save taxpayers billions of dollars.  But it also could get products out to theater faster, which could save lives more quickly, and could then be used to transfer into the private sector more rapidly, which means we could get better products and services that we can sell and export around the world.  So it’s good for American companies.  It’s good for American jobs.  It’s good for taxpayers.  And it may save some lives in places like Afghanistan for our soldiers.

Through this program, DARPA looked beyond the traditional domestic defense industry for “innovative ideas for a vehicle body designed to accomplish the critical mission tasks of combat resupply and medical evacuation,” according to the agency. Local Motors was one of more than 150 bidders with designs deemed credible, and delivered its concept vehicle -- which includes a vehicle body and shell -- in less than 14 weeks.

Deputy Defense Secretary William Lynn, in remarks earlier in the day at the same event, said the design approach of the DARPA program could break the prevailing -- and unsustainable -- paradigm of military acquisition efforts, which have considerably less nimble development phases.

Before Eli Whitney had success in with the Cotton Gin, he went to Congress with a proposal to build muskets with interchangeable parts. It was 1801.  He was fairly dramatic in his presentation. Congress, then as now, is pretty skeptical of new ideas.  But Eli had a fairly dramatic way of demonstrating his. He took 10 muskets to Congress.  He disassembled them.  He threw all the parts in a pile.  And then he reassembled them, with different parts constituting each new musket-something that had never before been done. Congress was impressed.  Eventually, the Department of the Army issued a contract for 10,000 new muskets to be built using this method.  It was one of the first widespread uses standardized parts, and it contributed enormously to the advance of in manufacturing in the United States.

Fast-forward a couple hundred years to Norm Augustine, the former CEO of Lockheed Martin.  Norm wrote a book that is well known in defense circles called "Augustine's Laws." One of his laws was that he charted the increase in cost in high-performance jets and tactical aircraft against the increase in the defense budget.  When he plotted these two lines -- and it would not be that different now -- they crossed in 2054.  And what that meant was that in 2054 we would have to spend the entire defense budget to buy one airplane. He observed that that we could work this out.  The Navy would get it for three days a week, the Air Force for three says, and the Marines would have it on Sundays.

Obviously, this kind of rise in manufacturing costs is not sustainable.  But costs have continued to rise at roughly the rate Augustine predicted.  The cost increase in high-performance jets and other advanced equipment has been going up in a linear faction.  And part of the reason, a strong part of it, is the length of time it takes to design and approve them.  The time horizon of design and development is increasing at a similar pace. . . .

DARPA has focused on an advanced manufacturing effort that uses integrated circuits manufacturing as a model for open design and configurable foundries.  And that will lead you to the ability to crowd-source your design, greatly diversifying the sources of your design and the east with which it can be manufactured.  Altogether, we think this can significantly speed up the manufacturing timeline-on the order of dividing it by a factor of five.  That is to say we could do it five times as fast, which could yield enormous cost savings. . . .

This pilot [the XC2V] has the ability to undo Augustine's law and yield advances in manufacturing equivalent to what Eli Whitney ushered in during the early 19th century.  This is indeed the prize for us, for warfighters, and for taxpayers.