Trump Budget To Cap Next Raise, Hike Retiree TRICARE Fees, Slam ‘IU’ Vets
(MILITARY ADVANTAGE BLOG 25 MAY 17) … Tom Philpott
President Trump’s first budget request embraces many Obama administration ideas to dampen military compensation growth. It would cap the next military pay raise; hike healthcare fees “modestly” for working-age military retirees, and increase co-payments on pharmacy drugs for TRICARE beneficiaries, including retirees of any age, though prescriptions filled on base would still be free.
But the new administration has fresh cost-cutting plans. Many target federal civilian employees but one that would hit 208,000 seriously disabled older veterans particularly hard. These “IU” veterans have disability ratings from the Department of Veterans Affairs of 60 to 90 percent, but because they aren’t able to work they receive VA compensation as if 100-percent disabled.
Individual Unemployability or IU status provides, on average, an additional $1300 a month in VA disability pay. The administration wants Congress to end IU eligibility next year for any veteran 62 and older who qualifies for at least minimum Social Security payments. Their VA compensation would be rolled back to amounts payable based on their actual disability ratings of 60 to 90 percent.
The “IU modernization” plan would save $3.2 billion annually, which VA would use to expand the Choice program, making private sector healthcare more available when veterans can’t get timely or appropriate care at VA medical facilities.
Rollback of IU payments hasn’t gotten a serious look from Congress for more than a decade ago. The Government Accountability Office in 2006 released a report criticizing VA for lax oversight of the program. One criticism by auditors was that VA compensation for being “unemployable” continued into old age. (Read more about the proposed VA budget on Military.com)
Veteran service groups can be expected to resist the rollback vigorously. At the Pentagon, meanwhile, Defense officials presented familiar plans for modifying compensation programs starting in fiscal 2018 to save a total of $7.1 billion over the next five years. Here are details:
Military Pay Raise Cap – By law, active duty and reserve component personnel are due a 2.4 percent raise Jan. 1, 2018, to match recent wage growth in the private sector. The budget proposed would cap that raise at 2.1 percent, matching the 2017 raise but staying higher than the 1.9 percent projected for 2018 by Obama budgets. Shaving the raise by .3 percent would free up $200 million next year, and $1.4 billion through 2022, to spend on other readiness-related priorities.
Working-Age Retiree TRICARE Fees – Last year, Congress embraced the Defense plan to raise TRICARE fees, deductibles and co-payments on working-age retirees (those younger than 65). But lawmakers disappointed TRICARE officials by applying the fees only to future force members. This will delay any serious tamp down in healthcare costs through higher beneficiary cost shares for 20 years and create inequities in benefits between generations of future retirees.
The Trump administration wants that “grandfather” protection shelved and current working-age retirees exposed to higher TRICARE fees starting in 2018, to save the department $3.6 billion in just the next five years.
In an interview, Jon Rychalski, acting principal deputy assistant secretary of defense for health affairs, said the more important reason to repeal the grandfather protection is “make things equitable” across year groups of working-age retirees.
Without repeal, he said, “you’re going to have a situation where you have two people potentially working side by side with very different benefits. One grandfathered and one who is not. So, our overarching interest this year is to have one equitable benefit for everybody.”
If Congress agrees, many retirees are likely to view higher TRICARE fees as a broken promise and not restored equality. Only the elderly, those who qualify for TRICARE for Life (TFL) and Medicare, would be spared higher fees. This budget drops the idea of imposing a new enrollment fee on newly-eligible TFL retirees.
It does propose for TRICARE Prime, the military’s managed care option, that the enrollment fee be renamed a “participation” fee and be raised from $282.60 to $350 for single coverage and from $565.20 to $700 for family coverage.
A participation fee would be set too for TRICARE Standard and Extra, which are to be merged and renamed TRICARE Select on Jan. 1. Retirees using Select would have to pay $450 a year for single coverage and $900 for family coverage.
Though new to TRICARE Standard users, Rychalski said, a participation fee is a “best practice” of industry to ensure a healthcare system knows year to year “who it’s treating. It is our belief that having people buy into the system, to know what our population is, we can better serve that population through disease management service or things like that. And frankly maybe keep costs lower.”
Annual deductibles also would climb. For family coverage under TRICARE Select, deductibles would be reset at $300 to access network providers and $600 to be able to use non-network providers. The deductible for single coverage would be $150 for network coverage and $300 for out-of-network providers.
Co-pays for primary and specialty care also would rise. Catastrophic caps on total out-of-pocket health costs would increase to $3500 from $3000 per family, with annual participation fees not counted against the cap. TRICARE fees, deductibles and co-pays would be adjusted yearly to keep pace with inflation.
Overall, officials estimate, out-of-pocket costs for a non-Medicare-eligible retiree family of three would climb from an average of $1517 a year to $1986, assuming a weighted mixed use of network and non-network providers. The proportion of health costs borne by working-age retirees would climb from 8.6 percent to 11.3 percent. Officials argue that retirees had paid an average of 27 percent out-of-pocket in 1996, the year of TRICARE was fully implemented.
Higher costs will be accompanied by improved services, Rychalski said.
“We want to have a sustainable benefit, for the beneficiary and for the government,” he said. While older retirees will still cite recruiter promises of free lifetime healthcare, generations of younger retirees should weigh TRICARE coverage and “realize this is actually really a great benefit. And not only is it a great benefit, [they] get great service, great access,” said the interim healthcare chief.
TRICARE Pharmacy Co-Pays – Congress last year rejected the department’s call to raise beneficiary co-pays for prescription drugs filled at retail outlets or through TRICARE Mail Order. The new administration seeks higher co-pays again, projecting savings of $400 million in 2018 and $2.1 billion through 2022 if adopted.
Prescriptions on the military formulary would continue to be filled for free on base. Co-pays for prescriptions filled off base would rise gradually for generic, brand names and non-formulary drugs. The slope the increases planned over the next five years would be more gradual than under last year’s proposal.
For example, the co-pay for a 30-day supply of a brand drugs at retail would increase from $24 to $31 by 2022. The co-pay for a 90-day supply of a brand drug by mail order would rise from $20 to $31. The co-pay for generic drugs at retail would stay at $10 until rising to $11 in 2022.
Last year The Military Coalition, comprised of 32 organizations representing members of the uniformed services and their families, opposed any TRICARE fee increases until access and quality of care improved. The coalition called the higher fees, then targeted only at new entrants, “disproportionately high” and rejected the notion of a participation fee for TRICARE Select (Standard) users.
Rychalski said quality of care remains high, and TRICARE users should be seeing improved access to care, the results of multiple reform initiatives.
“We have had about a 43 percent increase in access to primary care appointments” and “a 29 percent increase in access to specialty care,” he said.
“While it’s not 100 percent free, our hope is that [beneficiaries] still think this is really a great value,” he said, compared to private sector health insurance plans.
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Naval Officer Takes Over F-35 Program As Bogdan Retires
(DEFENSE NEWS 25 MAY 17) … Valerie Insinna
WASHINGTON – Leadership of the F-35 program passed from the Air Force to the Navy on Thursday, as the joint program office looks toward wrapping up the F-35 development program and the Navy’s initial operational capability declaration in 2018.
Vice Adm. Mat Winter, a naval officer who had served as deputy program executive office for six months, took the reins from current PEO Lt. Gen. Christopher Bogdan during a ceremony in Fort Meyer, Virginia, the JPO announced.
“The F-35 program is more than a program; it is truly a global enterprise built upon a broad spectrum of stakeholders joined together by a common goal – to support the warfighter,” Winter said, according to a news release.
“Our warfighters, stakeholders and JPO teammates have my commitment to provide timely continuous communications, make prudent transparent decisions, and deliver on our commitments through crisp, accountable execution,” he continued. “These core tenets of my commander’s intent will focus our thinking as we transition to the follow on development phase, ramp up to full rate production and expand global sustainment operations for the growing F-35 fleets and forces.”
Winter joined the JPO after serving as chief of naval operations. Before that, he spent years managing weapons programs acquisition, including as commander of the Naval Air Warfare Center Weapons Division, assistant commander for test and evaluation at Naval Air Systems Command, and PEO for the Navy’s unmanned aviation and strike weapons portfolio.
After graduating from the University of Notre Dame in 1984 with a degree in mechanical engineering, Winter was commissioned as a naval flight officer in 1985. He conducted several tours as an A-6E Intruder Bombardier/Navigator with Attack Squadrons 42, 85 and 34 before moving onto the acquisition world.
Bogdan will retire from the Air Force in June after more than four years of directing the F-35 program, which was in in danger of cancellation in 2012 when he took over. In his first public comments as F-35 JPO, Bogdan said the relationship between joint strike fighter manufacturer Lockheed Martin and the Pentagon was “the worst I’ve ever seen.”
Bogdan’s tone eventually softened as Lockheed’s performance improved and costs decreased, but he acknowledged that the JPO’s interests and the company’s were not always in line. The program hit several key milestones under his watch, including the Marine Corps and Air Force IOCs, but he also hit Lockheed with a unilateral contract in 2016 after the firm refused to bend.
“It’s been an honor to serve alongside so many great leaders and support our nation and allies,” said Bogdan.
“The F-35 weapon system is now operational and forward deployed. The size of the fleet continues to grow and we are rapidly expanding its capability. The F-35 will form the backbone of United States air combat superiority for decades to come and I know the program is in good hands as we transition leadership today to Vice Admiral Winter.”
Winter commended Bogdan during the ceremony, saying the latter’s leadership set the program on a course for success.
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Navy, Marine Aviation See Funding Boost For Spares, Depots, Logistics Contracts
(USNI NEWS 30 MAY 17) … Megan Eckstein
After more than a year of talk from Navy and Marine Corps aviation leaders about needing to fund “aviation enablers” to boost readiness, the Fiscal Year 2018 budget request shows exactly the investments that are needed to get more planes ready to fly.
A number of conditions have led to naval aviators having a shortfall of ready-to-fly aircraft – everything from a backlog at maintenance depots, to not enough contractor support, to a lack of spare parts – and no amount of investment in flying hours accounts will help the aviation readiness issue unless these enabler accounts are properly funded as well, leaders have said. Some of these enablers are seeing historic levels of funding in the 2018 request, a sign of the seriousness of the Navy and Marine Corps’ effort to dig out of this readiness hole.
Deputy Commandant of the Marine Corps for Aviation Lt. Gen. Jon Davis has said many times that the service couldn’t reduce its “not mission capable- supply” rates – when aircraft cannot be fixed due to lack of spare parts, which at times has reached a quarter of the fleet for older airplanes like the AV-8B Harrier – if it didn’t increase spending on spares. This spring he told lawmakers that the lack of spares was “the number-one readiness degrader” aside from the sheer age of some of the aircraft.
In the 2018 request, “the Marine Corps has increased funding for spares to $606 million – 93 percent of the total Marine Corps requirement,” Marine Corps spokeswoman Capt. Sarah Burns told USNI News this week.
“Increased funding for spare parts will not impact readiness for 18 to 24 months,” she added, but without this investment the readiness trajectory would never change.
For the Department of the Navy as a whole, spares are funded at 91 percent of the requirement, which is a 14-year high.
For comparison, in March Davis testified to lawmakers and said that the 2017 budget request only funded spares at two-thirds of the service’s need, though the supplemental spending request that the administration released earlier that month would have boosted spares funding.
“We’re funded at about 67 percent of our spares requirements in ’17. Some of that additional money in ’17 (in the supplemental request) would go to get us up to the max executable amount of spare parts, certainly for the Marine Corps, 88 percent – as much money as I can spend in ’17 – to go get those spare parts,” he said. At the time he wouldn’t talk about the upcoming 2018 request, but he said “I think you’ll see a very different profile from the United States Marine Corps as far as what we’re doing for our enabler accounts.”
Outside of the day-in, day-out maintenance that takes place at the squadrons, some types of aircraft make use of performance-based logistics contracts with industry and others’ readiness is the responsibility of the military.
Both strategies are addressed through increased funding in the 2018 request.
For aircraft types with PBL contracts with industry – the F-35 Joint Strike Fighter, KC-130J Hercules and MV-22 Osprey among them – the Navy and Marine Corps made a historic investment: $826.6 million for the aviation logistics account, compared to about $661 million in 2017.
“The aviation logistics support has increased six percent to a high of 87 percent of the requirement. These logistics contracts for the F-35, KC-130, MV-22 and E-6B are funded at an all-time high, and we anticipate future growth as more F-35s enter the fleet,” Deputy Assistant Secretary of the Navy for Budget Rear Adm. Brian Luther told reporters during a May 23 budget briefing.
Other types of aircraft are kept ready through Navy- and Marine Corps-led maintenance efforts at Fleet Readiness Centers, with the services responsible for their own engineering, logistics and supplies associated with repairs and overhauls. For those aircraft, more money is on the way too.
“Aircraft depot maintenance is funded to capacity, which is 89 percent of the requirement. This is an increase from last year where we funded the air depot maintenance to 85 percent,” Luther said in his briefing.
“Capacity is limited for different reasons at our fleet readiness centers. Some are limited by the hiring of civilian personnel, others by physical space and aging tools and materials. In all cases, we are investing to correct these limitations.
“Aviation support, primarily program-related engineering and logistics, is funded higher than ’17, but not to a hundred percent,” Luther added.
“This account also funds critical chain initiatives to improve depot throughput and increase hiring of planning, engineering and maintenance support manpower to align the workforce to the projected workload.”
As a result of the additional aviation enabler spending, the services should be able to fly more.
“The FY ’18 budget calls for $8.6 billion for flying hour operations for Navy and Marine Corps aircraft, compared with $7.5 billion in FY ’17. This increase equates to more than 100,000 flight hours across all models,” Burns told USNI News.
Overall, the Navy and Marine Corps requested $11.1 billion for air operations, compared to $9.9 billion in 2017.
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Chief Of Naval Research Issues Challenge For Innovation And The Future Force
(SEAPOWER MAGAZINE 31 MAY 17)
ARLINGTON, Va. – The Chief of Naval Research (CNR) has issued a historic call for innovative ideas to support the Navy and Marine Corps of the future, the Office of Naval Research (ONR) said in a May 31 release.
Leap-ahead technologies and cutting-edge concepts are the focus of the new CNR Concept Challenge, with finalists to be announced at the Naval Future Force S&T Expo at the Walter E. Washington Convention Center in Washington July 20-21. The Expo is co-sponsored by the American Society of Naval Engineers.
“I am looking for visionary ideas that really get out in front of the rapid, ever-accelerating technology development and deployment cycle,” said CNR Rear Adm. David J. Hahn. “With new advances taking place at breakneck speeds, across multiple domains, the truth is that the ‘Navy and Marine Corps After Next’ is being created right now.
“I need people to think big, and then imagine even more,” he said.
The concepts in the CNR Challenge need to keep naval ships, aircraft and personnel always at an advantage and help Sailors and Marines either deter conflict or win decisively and return safely.
“We want our men and women on the front lines to have such a dominant technological edge that potential adversaries don’t even try to challenge us,” Hahn said.
All idea submissions will be reviewed by a team of subject matter experts within the ONR. Finalists must be registered for the Expo to be selected and will be announced at the event by the CNR during his opening remarks.
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Trump breaks with Pentagon on climate change
(CNN 31 MAY 17) . Barbara Starr
(CNN) – As President Donald Trump contemplates withdrawing the US from the landmark Paris climate accord, he may be turning his back on some crucial national security views, starting with the opinion of his own Defense Secretary, James Mattis.
During his confirmation process in January, Mattis responded to a question from the Senate Armed Services Committee about whether climate change is a security threat, writing: “Climate change can be a driver of instability and the Department of Defense must pay attention to potential adverse impacts generated by this phenomenon.”
Mattis went on to say, “climate change is a challenge that requires a broader, whole-of-government response,” adding that he would “ensure that the Department of Defense plays its appropriate role within such a response by addressing national security aspects.”
For those who follow Mattis’ views on environmental challenges, it wasn’t a surprise. In 2010, while still on active duty, his command issued a report on future trends facing the military. That report noted: “The impact of climate change, specifically global warming and its potential to cause natural disasters and other harmful phenomena such as rising sea levels, has become a concern.”
A CNN military analyst, retired Lt. Gen. Mark Hertling, said climate change is a vital national security issue.
“You have seen war games where there have been indicators that in the future there could be fights, wars, over water supplies,” he said. “You have seen the potential for cities along the shore to be submerged and cause multiple problems.”
Those concerns have also been stated by the intelligence community, at least during the Obama administration.
A September 2016 report on the national security implications of climate change noted: “Many countries will encounter climate-induced disruptions — such as weather-related disasters, drought, famine, or damage to infrastructure — that stress their capacity to respond, cope with, or adapt. Climate-related impacts will also contribute to increased migration, which can be particularly disruptive if, for example, demand for food and shelter outstrips the resources available to assist those in need.”
The report includes a stark warning: “When climate-related effects overwhelm a state’s capacity to respond or recover, its authority can be so undermined as to lead to large-scale political instability. Countries with weak political institutions, poor economic conditions or where other risk factors for political strife are already present will be the most vulnerable to climate-linked instability. In the most dramatic cases, state authority may collapse partially or entirely. ”
For the US, there are challenges ahead. The US Navy has analyzed the impact of rising sea levels on its coastal naval bases. And there are strategic concerns that melting Arctic ice could give Russia new navigable waterways to expand their naval and commercial maritime operations.
“It just gives them a wider berth in terms of naval forces. I mean, there’s all sorts of things, some of which are classified, in terms of what the Russians might do in the North Sea,” Hertling said.
New warm water ports and wider sea lanes mean Russian submarines and warships have great freedom to operate year-round.
The intelligence community’s stance on climate change has been criticized by Republicans in Congress who question whether it should be part of their portfolio. In fact former Congressman Mike Pompeo, during his confirmation hearing to become CIA director largely demurred on answering any questions about it. In a recent hearing on Capitol Hill on worldwide threats, the Director of National Intelligence Daniel Coats showed a little more public flexibility.
When asked if climate change risks should be part of national security strategy, Coats said: “We should be assessing what the consequences of changes that are relevant to security issues — that should be part of the assessment, and it is.”
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Pratt & Whitney pitches souped up version of the F-35 engine
(DEFENSE NEWS 31 MAY 17) .Valerie Insinna
WEST PALM BEACH, Fla. – Pratt & Whitney is pitching a souped up version of the F-35’s engine that would add thrust and cut down fuel consumption, company officials disclosed on Wednesday.
The upgrade, which the company is calling the F135 Growth Option 1.0, could be cut into the existing production line by the early 2020s, said Matthew Bromberg, president of Pratt & Whitney military engines. Pratt manufactures the F135 for all three F-35 models as well as aircraft purchased by international customers.
“It’s very attractive to the JSF [joint strike fighter] program for several reasons,” Bromberg told journalists during a media day in West Palm Beach, Florida. “It’s very common, so we could drop this upgrade into any one of the three variants. It would be compliant with the partner requirements and go to foreign partner countries. It would be cost neutral, so the upgraded JSF motor with Growth Option 1.0 would be the same price as the existing motor.”
Pratt & Whitney recently completed performance tests of an early version of the system, called the fuel burn reduction demonstrator engine, which proved that the upgrade could improve thrust by up to 10 percent and reduce fuel consumption by up to 6 percent, he said. Reporters got to see the prototype in action during a May 30 demonstration at the company’s test rigs.
Afterwards, Steve Burd, the company’s chief engineer for advanced programs and technology, explained that the company funneled capabilities from two technology development programs – the Navy’s fuel burn reduction effort and the Air Force’s Component and Engine Structural Assessment Research (CAESAR) program – into the Growth Option 1.0 configuration.
To upgrade the F135, only the power module would need to be swapped out for a new one with a more efficient compressor and improved turbine, including changes to the system’s cooling, he said.
The new configuration is not funded through current joint strike fighter program of record, but if the F-35 joint program office approves it, the engine could be ready for the second round of upgrades under the Block 4 modernization effort, Bromberg said. The cost of the enhanced engine would be roughly the same as the current F135, but the Pentagon would have to pay for further development and validation of the technology.
“The technologies that we’re developing on the rig you saw yesterday, those are some of the critical technologies that prove that we can actually execute the program,” he said. “If we’re given the green light to go, we would launch a relatively short engineering and manufacturing development program. We have to go through all of that validation. But we view that as low risk.”
The Pentagon could opt to skip the growth option and wait for the results of the Adaptive Engine Transition Program, an ongoing Air Force effort to advance engine technology by adding a third stream of air, which helps optimize the propulsion system’s fuel consumption and performance. Last year, the service awarded Pratt and General Electric Aviation a $1 billion contract each for further work on their engines.
Pratt’s entry for AETP, the XA1010, has been hitting its developmental milestones on time, said Bromberg, noting the company might be able to move faster on the program if directed by the Air Force.
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Fear Of DoD Struggles Grow, Amid Vacancy Levels Not Seen For 50 Years
(DEFENSE NEWS 27 MAY 17) … Joe Gould
WASHINGTON – Pro-defense lawmakers have grown frustrated at how slowly the White House is moving to fill dozens of top-tier posts at the Pentagon, warning that vacancies are hamstringing efforts to advance the president’s national security agenda.
The administration has advanced 13 of U.S. President Donald Trump’s picks for the Pentagon’s civilian leadership to the Senate, which has 53 key jobs requiring Senate confirmation. The Senate has confirmed five – Defense Secretary Jim Mattis, Air Force Secretary Heather Wilson had been confirmed by the Senate and three mid-tier nominees – had been confirmed by the Senate as of May 25.
Trump’s total for civilian DoD nominees sent to the Senate is just over half the number President Barack Obama had sent by this point in his first term, according to data compiled by Defense News. By this time in their first terms, President George W. Bush had sent 17, President Bill Clinton had sent 16, President George H.W. Bush had sent 10 and President Ronald Reagan had sent 15.
This mirrors a larger trend for Trump. Of more than 500 key executive branch positions, Trump has only formally nominated 98 candidates, of which 36 were confirmed, according to data compiled by the Partnership for Public Policy. By this time, Obama had nominated 225, W. had 202, Clinton 205 and H.W. had 144.
“It’s hard to start a game when your whole team isn’t on the field, and each of the positions in these agencies have different roles,” said Mallory Barg Bulman, vice president of research and evaluation at the partnership.
“DoD has announced a deputy secretary, and a lot of agencies don’t have somebody in that role. That’s somebody who’s going to serve as the chief operating officer for the agency. These people are managing very large and complex agencies.”
The White House Transition Project has also dinged Trump for the fewest nominations and fewest confirmations in a president’s first 100 days in 50 years. Of 72 critical national security positions, Trump had 14 filled, whereas Obama had 24 in the same period.
Arnold Punaro, a retired U.S. Marine general and former staff director on the Senate Armed Services Committee, said the Trump administration is not to be faulted. Growing scrutiny and red tape for key nominees has fueled growth in the time to confirmation – from three and a half months under President John F. Kennedy to nine months under Obama.
“I don’t buy that what we’re seeing with this administration is much different from the past two administrations,” Punaro said. “The overall trend is it takes longer.”
Behind the scenes, Punaro argues, the White House is much, much further along in its vetting than it can publicly acknowledge. “There’s a substantial, larger number in the pipeline, moving through at a normal pace, and that to me is encouraging,” he said.
It’s unclear when Trump will have his service secretaries confirmed. Clinton in 1993 saw his Navy secretary clear the Senate on July 1, his Air Force secretary July 22 and his Army secretary on Nov. 22.
The more senior Bush moved slowly at first, but he brought in a Pentagon staffer to expedite nomination paperwork full-time, worked closely with the SASC and used judge advocates to assist the White House counsel’s office – a natural chokepoint given the breadth of issues it encounters.
“Administrations who will take the extra help, it tends to move faster, while administrations that don’t, it goes at the same glacial pace,” Punaro said. “[The SASC] set a hearing day every Wednesday morning, so if they could get a guy done, he’s got a hearing date.”
Fast-forward to the present day, where SASC Chairman John McCain, R-Ariz., and House Armed Services Committee Chairman Mac Thornberry, R-Texas, have both lamented that Mattis cannot steer the gargantuan Department of Defense appropriately without a full crew of Trump picks approved by the Senate.
McCain, who joined the Senate in 1987, affirmed Trump “has been more slow” than past administrations in offering nominees to the committee. The problem is not only having the people in the Pentagon for SASC staffers and lawmakers to talk to, but without Senate confirmation, acting officials simply lack authority to do their jobs.
“We’re not getting people to implement the new administration’s policies and strategies,” McCain told Defense News on May 17. “That’s the problem. You hire a team who is with you philosophically and to actively pursue the agenda. If someone is in an acting position, no matter how great their integrity, they just don’t have the same kind of influence the way a regularly appointed member of the team does.”
Thornberry months ago made the case that holdovers from the Obama administration, which underfunded military readiness, cannot be relied upon to bring new urgency. But as the process has dragged out, he suggested at a press conference earlier this month that the nation’s security is at risk.
“We need to have good nominees and we need to have them in place because, just to emphasize, the world is not waiting on us to get our act together, and the Pentagon is the most complex, the largest government agency, it needs leadership,” Thornberry said.
There are some signs of a thaw. On May 25, several of Trump’s nominees received Senate confirmation by unanimous consent: David Norquist to be comptroller; Kari Bingen to be principal deputy undersecretary of defense for intelligence; and Robert Karem to be assistant secretary of defense for international security affairs.
There has been a notable delay for Boeing executive Patrick Shanahan, Trump’s pick for deputy secretary of defense, the No. 2 spot in the Pentagon. Two months after Trump announced Shanahan, his name has not formally advanced to the SASC. McCain, earlier this month, suggested Shanahan’s industry ties may be slowing the process. “We’d certainly like to move forward with him, he’s got an excellent reputation,” McCain said.
Ethics rules meant to safeguard against self-dealing are particularly relevant at the DoD, which stewards billions of taxpayer dollars. DoD and the SASC have strict rules that bar presidential picks from owning stocks and bonds in companies that have Defense Department contracts.
Army secretary nominee Vincent Viola and Navy secretary nominee Philip Bilden, both financiers, withdrew their names from consideration over business entanglements. The second Army secretary nominee Mark Green withdrew amid accusations he’d made anti-gay and anti-Muslim remarks.
To Punaro’s reckoning, the bar set by the Office of Government Ethics is too high, and should be updated to reflect modern compensation patterns, like deferred income and restricted stocks. The SASC and Pentagon should be more flexible about letting officials recuse themselves from potential conflicts – instead of letting them disqualify candidates.
“A lot of the standards were put in, in the 1970s,” Punaro said. “It makes no sense.”
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Trump’s Defense Spending Boom That Wasn’t
(THE HILL 29 MAY 17) … Ellen Mitchell
President Trump’s long touted promises for more robust military spending fell short in his first government-wide budget, which disappointed Democrats and Republicans alike, according to defense analysts and consultants.
The fiscal 2018 budget, released Tuesday, calls for $603 billion in the base budget for defense and national security issues, about $54 billion above a ceiling set by the 2011 Budget Control Act, but only $18 billion more than was planned for this year by President Obama.
Vice President Mike Pence touted the plan at the U.S. Naval Academy commencement ceremony on Friday, boasting that Trump “laid out one of the largest increases in defense spending since the days of President Ronald Reagan.”
“President Donald Trump and I will not rest, we will not relent until we rebuild our military, restore the arsenal of democracy, and ensure that our soldiers, sailors, airmen, Marines, and Coast Guard have all the resources that you need to accomplish your mission and come home safe,” Pence said. “That is our pledge to each of you.”
Not everyone views the defense spending plan so positively. Experts say the $18 billion extra will do little to help bolster Trump’s campaign trail promises to “avoid and prevent conflict through our unquestioned military strength.”
Among his pledges, Trump included a 350-ship Navy, a 540,000 active duty Army force, and dozens of new fighter aircraft for the Air Force. Such new military spending requires roughly $80 billion to $90 billion a year, according to experts.
In comparison, Trump’s budget only promises funds to keep the Army at 476,000 active duty soldiers, plans for eight new ships – the same number Obama forecast – and also falls short on extra equipment.
“It was mildly surprising that the Defense Department didn’t buy any new equipment. They chose to put it all in operations and personnel and maintenance,” said retired Army Lt. Gen. Thomas Spoehr of the conservative Heritage Foundation. “I thought there would be more of a mix, honestly.”
Senate Armed Services Committee Chairman John McCain (R-Ariz.) slammed the budget as inadequate and “dead on arrival” after its release.
McCain, along with his House counterpart Rep. Mac Thornberry (R-Texas), has vocalized the need for $640 billion in spending for fiscal year 2018.
And House Armed Services Ranking Member Adam Smith (D-Wash.) said that “despite having extra time to prepare because he delivered the budget some three months later than legally required, the president has not given us a solid document on which one can plan for the national defense.”
Defense industry insiders have said Trump’s “historic” increase looks just like another Obama defense budget request. If passed, the budget would only represent the ninth largest increase for the Pentagon in the past 40 years, according to Todd Harrison, a defense expert at the Center for Strategic and International Studies.
There is also wide speculation the defense plan is the work of White House Budget Director Mick Mulvaney, who defended the budget to reporters Monday as one that would help meet Trump’s vision.
Mackenzie Eaglen, a defense analyst with the conservative American Enterprise Institute, said it’s unlikely Trump even knows the details of his defense request or the ways it does not follow through on his promises.
“To be fair, $54 billion is a lot of money relatively speaking. But in defense today, the priorities are readiness, people and facilities. And that money goes fast. It does not yield the kind of kick-the-tire results as investments in equipment,” Eaglen said.
One industry consultant echoed that sentiment.
“Trump isn’t doing what he said he would because he doesn’t know any better,” the consultant told The Hill.
“He thinks he’s providing a big defense increase when he’s not. The people in his inner circle don’t understand the mechanics and the numbers, and Mick Mulvaney is totally pulling the wool over his eyes.”
A good or bad perspective on the budget, another defense consultant said, lies in where the defense spending baseline is set. When viewed as an increase over 2011 Budget Control Act (BCA) spending caps, the numbers seem significant. But when compared with previous administration plans, the numbers add up to only three percent more, which is not nearly as impressive.
“I truly believe Mulvaney sold this to Trump as a huge increase,” he said. “Fifty-four billion over the BCA numbers would in itself be a big increase, but it’s all where you start your baseline.”
The consultant added that the defense industry is “very disappointed,” while fiscal conservatives and the anti-defense crowd “are looking at this as a very big increase.”
Spoehr added that it’s likely people near Trump “probably were persuasive that they thought it was maybe at least as important to balance the budget [as] it was to build up defense.”
“My guess is – and speculation is he didn’t get much influence on setting the $603 billion number – given that he’s only going to get $18 billion more than President Obama had planned for, he probably chose within that $18 billion to focus on immediate readiness which includes paying the personnel, the spare parts the training, etc.,” Spoehr said.
Eaglen added that Secretary of Defense James Mattis told Congress behind closed doors that the $54 billion over BCA caps doesn’t buy a rebuild of the military, only a repair.
“Why $54 billion and not $100 billion, then – closer to the McCain/Thornberry levels? That is all Mulvaney,” she told The Hill. “He told President Trump, essentially, that was all the nation could afford. Secretary Mattis will have to personally go to the mat in fiscal year 2019 debates if he wants to reverse this trend.”
Pentagon officials, meanwhile, defended the budget as “not inconsequential.” More money would show up in the fiscal year 2019 request, according to John Roth, acting undersecretary of Defense comptroller and CFO.
“We’re not going to solve the readiness problem in one year. We’re not going to modernize in one night,” Roth said. “All of this is a multi-year commitment to defense spending, more than anything else.”
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Navy: Ford Clears Acceptance Trials. Delivery ‘Close At Hand’
(NEWPORT NEWS DAILY PRESS 26 MAY 17) … Hugh Lessig
The future USS Gerald R. Ford has successfully completed its final round of sea trials and the delivery to the Navy is up next, according to Naval Sea Systems Command.
The ship was at sea from Wednesday through Friday on acceptance trials, during which the crew demonstrates its ability to operate at sea and show that the ship was built according to contract specifications, NAVSEA said in a news release Friday.
The first-in-class nuclear-powered carrier was built at Newport News Shipbuilding, a division of Huntington Ingalls Industries.
Rear Adm. Brian Antonio, the Navy’s program executive officer for aircraft carriers, congratulated the crew and shipbuilders and said delivery is “close at hand.”
A commissioning ceremony will be held sometime this summer.
Acceptance trials were conducted by the Navy’s Board of Inspection and Survey. Prior to getting underway, INSURV conducted a set of pierside trials. The at-sea period included more than 500 demonstrations of the ship’s hull, mechanical and electrical systems, NAVSEA said.
When it joins the fleet, the Ford will replace the former USS Enterprise, the world’s first nuclear-powered aircraft carrier. It will bring the carrier fleet from 10 ships to the required 11.