A Tiny Light at the End of the Tunnel?

The comments by Navy League president Daniel Branch that the Navy is heading for a fleet of 240 ships have been getting some attention this week. It was this specific comment that I found noteworthy.

“To maintain a Navy of at least 300 ships, the U.S. must fund and build at least 11 or 12 ships per year,” requiring as much as $27 billion per year, Branch wrote. “However, the administration submitted a budget of only $14.7 billion for ship construction in fiscal 2010. For this administration, there is a question as to budget priorities.”

A $27 billion shipbuilding budget? I love the Navy too brother, but no way in hell do I believe a budget of $27 billion would represent responsible spending of taxpayer money. $27 billion in FY11 is just stupid. Based on the reporting by Tony Capaccio of Bloomberg, either Secretary Gates didn't get Daniel Branch's memo, or Daniel Branch didn't get Secretary Gates memo. Either way, Tony Capaccio did get a hold of the memo. This first bit discusses a potential change to the latest LCS plans.

Gates, in a Dec. 23 directive to the military services, told the Navy to buy 17, adding $1.21 billion to its proposed five-year budget. Lockheed and General Dynamics each already have contracts to build two and would compete for contracts for the next 17 -- the first 10 in fiscal 2011.

Gates, in his directive, also told the Navy to add money to its budget for three new ships that would store equipment near a potential conflict zone; buy one more Virginia-class submarine than planned in 2015; and, delay by one year buying a new amphibious, tracked vehicle to carry Marines ashore.

Gates told the service to add $1.38 billion to buy the three new ships, one each in 2011, 2013 and 2015. The vessels would store craft, vehicles and equipment for the Marines before they move ashore as well as provide a landing strip for helicopters and V-22 Ospreys.

Gates told the Navy to add $2.38 billion for the second Virginia-class submarine in 2015, one more than the Navy planned.

What does this mean? Well, if you look at Table 2 on page 32 of this CRS report you will find the 5 year shipbuilding plan for FY11-FY15 leaked to Inside the Navy in early December. Adding this new information into that plan would suggest the Navy will be building a total 52 ships over the next 5 years and instead of averaging ~$13.5 billion annually, the shipbuilding budget will average $14.5 billion annually.

My only question is whether $460 million a piece can purchase three of these previously discussed Joint Logistics Vessels (MLP)?

Now all of these changes to the always changing FY2011 5 year plan (which may not even be accurate) comes before Gene Taylor starts asking tough questions on Ballistic Missile Defense. As usual, Emilie Rutherford at Defense Daily (subscription only) has the scoop from Capitol Hill.

The House Armed Services Seapower subcommittee, which Taylor chairs, plans to hold a hearing on missile-defense shipbuilding needs on Jan. 20. Defense experts including Congressional Research Service analyst Ronald O'Rourke, Congressional Budget Office analyst Eric Labs, and Lexington Institute Chief Operating Officer Loren Thompson are slated to address the panel. It was not clear yesterday if Navy officials will testify, but if any do Navy acquisition czar Sean Stackley is among those expected.

Any hearing with Eric Labs and Ronald O'Rourke is good in my book, and Loren Thompson is always insightful - even sometimes entertaining, but the hearing doesn't carry clear purpose without Sean Stackley. Everyone has an opinion on the needs for ballistic missile defense, and as you might expect Emilie outlines the confusion over requirements.

Taylor said yesterday that to have one ship on station would actually require three or four vessels per station; that would translate to a need for nine to 12 Navy ships.

The CBO has estimated a total of nine ships will be needed for the three stations, and Matthew Goldberg, its acting assistant director for national security, has said the ship- related costs are a major unknown variable (Defense Daily, Oct. 15, 2009).

The Navy has said its plan to covert an increasing number of existing Aegis warships for the Ballistic Missile Defense mission. The recently passed Pentagon budget for fiscal year 2010 budget funds the conversion of six ships.

Gene Taylor = 12
CBO = 9
Navy = 6

The Navy will tell anyone who asks off the record that the shipbuilding budget number they need to reach 313 ships is $17 billion annually. I don't know if they have the liberty to tell that to Congress under oath, but it would be a good question. I note that with the additions by Secretary Gates, the Navy is now $2.5 billion annually from that $17 billion number. One might ask where that money might come from, and Gene Taylor has an interesting response to the question of money.

Taylor noted that in recent years the missile-defense budget has been approximately $12 billion to $13 billion, and the shipbuilding funding has ranged from $14 billion to $15 billion.

"So wouldn't the missile-defense budget be a likely place to go for some of this (shipbuilding) money?" he said. "That's the platform that's going to carry the missiles."

If the Navy was somehow, by some miracle, able to add one extra DDG-51 every year for the next 5 years with funds previously spent on ballistic missile defense, under current plans the Navy would end up with 57 ships over the next 5 years. I think Daniel Branch would be very pleased to hear we would be building "at least 11 or 12 ships per year" for the next five years.

The question is whether 15% of the $12-$13 billion previously spent annually on ballistic missile defense can be used to build new Burkes for their BMD role? If so, the Navy could potentially build one fewer DDG-51 in FY2014 thereby meeting Gene Taylor's discussed target of 12 and use those SCN funds to build that one more LPD-17 the Marines want really bad, and for the first time in the 21st century the Navy would have a five year shipbuilding plan with 57 ships that everyone could actually believe in containing 1 CVN, 12 DDG-51s, 10 SSNs, 1 LHA(R), 2 LPDs, 3 MLPs, 1 JLV, 1 T-ATF(X), 9 JHSVs, and 17 LCS.

If ballistic missile defense becomes the priority and capability that pushes the Navy back to 300 ships and stabilizes the shipbuilding industry at the same time; that really would be something remarkable.