The Pentagon in the coming year will be able to implement about one-third of the 300 classified policy recommendations in its recent report on the defense industrial base, according to Deputy Assistant Defense Secretary for Manufacturing and Industrial Base Policy Eric Chewning, who helped manage the study.
“Things we've identified as high-impact and easy to implement? That's going to happen first,” he said. “That's things where we've got a single source supplier that's got capacity issues, we've got to go in and help de-bottleneck something, or put investment in for additional capacity, or it could be a sourcing relationship that we're not comfortable with that we need to address.”
Chewning, who spoke today at the U.S. Chamber of Commerce in Washington, said DOD will have an implementation plan by mid-month and should be able to execute the first third of its classified actions mainly because of authorities granted by the Fiscal Year 2019 National Defense Authorization Act.
Among other provisions aimed at strengthening the defense industrial base, the NDAA reauthorized the 50-year-old Defense Production Act, which allows DOD to directly invest $50 million to $60 million annually in vulnerable sub-tier suppliers.
Chewning said DOD would first work to demonstrate the effectiveness of its current DPA program before it considers expanding available funding.
First, he said, DOD must accelerate the average two-year cycle time it takes to process a DPA action. Then, a good return on investment can be used to convince Congress to add money to the program, he said.
Though the 300 recommended actions remain classified, Chewning pointed to one that will involve the “forward buying” of munitions, an authority also granted by the NDAA.
“We did talk about a policy change to improve cross-program coordination and planning for something like material obsolescence in the munitions industrial base,” he said. “The munitions industrial base is one where traditionally we haven't thought about forward buying and we haven't provided a constant demand signal so we're always kind of catching up on the curve for how we're thinking about munitions.”
Chewning said DOD is internally circulating a new set of legislative proposals to be considered in the FY-20 defense authorization bill that are “of the ilk” of those passed for FY-19.
Chewning also noted the report's focus on a variety of workforce issues facing the defense industrial base.
“The challenge with shipbuilding right now is how do we actually build the ships? Whereas with a sector like ground combat vehicles, we haven’t had a new, fully developed combat vehicle in a generation,” he said. “Where is the engineering talent that does that design work? Our ability to appropriately program dollars is very important for maintaining stability within the industrial base so there's a constant steady flow, a constant demand signal to industry.”
Meanwhile, the Army has embarked on several new combat vehicle efforts and contractors debuted potential prototypes at a Washington conference last month.
Despite the report's concerns about domestic capacity and the dearth of scientists and engineers in the U.S. economy's pipeline, Chewning said no one should mistake the central thrust of the recommendations, which is to block China from stealing technologies that could help modernize its military and put American dominance at risk.
“I just wanted to make sure as we talk about industrial policies of competitor states, the one we're focused on is China,” he said.
For instance, the report states the U.S. defense industrial base is overly reliant on some rare materials provided by foreign sources, including China.
“There are going to be certain things that we're currently sourcing that we need to find a domestic source of supply for,” he said.
The Pentagon, Chewning said, plans to provide an unclassified summary of its efforts to implement the new policy changes in its annual defense industrial capabilities report, typically released in the spring.