Friday, February 29, 2008

The Most Important Naval Discussion in a Decade

I'm not sure but it is entirely possible that CDR Salamander and I are not as far apart as the titles of our observations may indicate. I don't disagree with his comments warning of legislative solutions, but we note change will only come from the legislature as long as Mullen, the architect of the 313-ship plan, is CJCS. I also observe, one cannot bring a strong bias against Murtha if one is to measure these comments in good faith.

In observing an article by Geoff Fein, I observed the beginning of what might be the most important naval discussion in the last decade. On Wednesday, John Murtha discussed the 313-ship plan, and in the process asked several good questions. We quote the 5 noteworthy comments from the article:

"A couple of suggestions staff has made is to take one of the DDG-1000s out and put in two more T-AKEs because they are stabilized platforms. I don't know if that is the right answer," he [Murtha] said. "Our industrial base is so small now, there is so little competition, and we obviously need competition. But on the other hand, we need to build as many ships as we can, so we need to look at all the options."

In its FY '09 budget, the Navy has requested $14.2 billion to build seven ships. Of that amount, $2.55 billion is for full funding of a third DDG-1000 and advanced procurement for the fourth ship of the class.

"If we took the ships the administration sent over, we would never get to what the Navy says it needs," he added. "So we are going to try...Bill and I are going to try...and convince the committee that we need three or four more ships. [We need to] find a way to get to take us to 313 ships in much less years."

"There are three (DDG-1000s) now in '09. If you take one out what does that do to the shipbuilding distribution," Murtha said. "If you take one out and go to two T-AKEs, what does that do to...capability of the force?"

If you take one of the other DDG-1000s out, it would fund a 10th LPD-17 and two T-AKEs, Murtha said. "We are looking how we can shift this and not affect you," he said. "What happens to the shipbuilding industry, how will it affect them?"

Lets break this down. Murtha is looking to do what must be done for the future fleet to have more than 313-ships, he is looking to cancel the DDG-1000. His idea is to replace the DDG-1000 in FY09 with 3 ships, the 10th LPD-17 and 2 additional T-AKEs, all of which the Navy has listed in its unfunded priorities listings.

This article is so damn good, if Geoff Fein could get an award for writing about the Navy, this would be the winner. The article gives us 5 very insightful comments from the Navy's point of view on the subjects Murtha discusses.

"NASSCO likely could not execute four in one year," Allison Stiller, deputy Assistant Secretary of the Navy (Research, Development & Acquisition), told lawmakers. "They would have to spread them out. We felt they could go to two year; that's why we put two in '09," she added.

Stiller said any reduction in DDG-1000s would be an issue for the surface combatant force as well as Bath, which is one of the Navy's surface combatant providers, she said.

After the hearing, McCullough told reporters the cost to do a Service Life Extension Program on the four amphibious ships was less than buying a new LPD-17. "It's around $1 billion to get 27 years of ship life out of those [ships], and that includes operations and maintenance...it might be $1.2 billion, but it's a billion dollars," McCullough said "Currently one LPD-17, on our unfunded list, is $1.7 billion. So for me to get 27 years of ship life is about a billion...by extending the estimated service life of those four ships. To buy a new one is $700 million more, and that's not counting the operations and maintenance."

While the CNO supports Marine Commandant Gen. James Conway's requirement for 11 aviation capable amphibious ships, 11 LSD-class and 11 LPD-class ships, the Navy has to balance that in its budget, McCullough added.

LPD-25 doesn't deliver until 2012, so there is a backlog of ships, she added.
The Navy wouldn't be shutting down the LPD-17 production line once the final ship is built, Stiller noted.

Lets break this down. According to Allison Stiller, NASSCO cannot build more than 2 T-AKEs in one year, and there are already 2 T-AKEs in the FY09 budget. While the Navy claims to support the 10th LPD-17 (and supposedly the 11th too) requirement of the Marine Corps, they would prefer to extend the lives of 4 older ships an average of only 6.75 years per hull, even though they will still be retired within the next decade (basically a plan to stall the problem), than to get a new ship that would last for the next 40 years. The Navy does not intend to shut down the LPD-17 production line in the future, meaning the Navy intends to use the LPD-17 for other purposes in the future (BMDCGN? Hospital ship? Command Ship?).

Additionally, the Navy can't stop production of the DDG-1000 because it will hurt Bath Iron Works, which we agree is an important consideration. Is it just me, or is the solution plainly apparent to everyone, just waiting for someone to shout it out loud?

We believe any major changes to the 313-ship plan will require solutions that benefit the Navy, the Industry, and Congress. If it cannot do all three, it will never happen. In this case, assuming it is even possible, we see a solution that might do exactly that.

Congress needs options. Lets face it, for the last decade Congress failed to give itself low mix alternatives by not forcing the Navy to produce designs for frigate sized warships. This is a lesson that needs to be learned, retained, and never repeated, and if necessary forced upon the Navy starting this fiscal year. Congress must always have options in regards to building ships, because it can never be assumed that all programs will work out.

The Industry needs work. The idea that $2.5+ billion dollars annually for the next five years tied up in only 5 warships will help the industry, helping competition, and sustaining the workforce is dead wrong. The only way to boost shipbuilding is to build more ships, it is the only factor that is universal, while all other factors can only contribute to industry stability as long as that factor exists. The DDG-1000 must be canceled, and the Navy must build any ships above and beyond 313 before 2020 as afterwards all money must go directly to replacements.

The Navy 313-ship plan doesn't even meet the requirements of the Navy's own maritime strategy, so the Navy really can't even defend it intellectually. I'll debate any Admiral all day long on the merits of building more battleships for an already battleship centric fleet within the context of the new maritime strategy, and I'd win that debate even though Admirals are a hell of a lot smarter than me. The sole reason I'd win is because the position really can't be defended due to strategy. The Navy may defend specific metrics of specific programs, but all they do in those discussions is raise even more compelling questions whether the current approach matches strategy.

Seems to me the answer is obvious. Cancel the DDG-1000 after two ships. Take the $2.55 billion this year, spend $1.7 billion on LPD-26 to recover the $1 billion that would be used on the 4 old amphibious ships. Take the recovered $1 billion and leftover $855 million and build 1 General Dynamics LCS MMC and 1 Lockheed Martin LCS MMC. Build the General Dynamics ship at Bath to insure they have some work, and equally important, let Lockheed Martin decide where to build its ship based on where export orders for Israel and India may come from.

Seems to me building two more first in class now would be a good idea, to at minimum offer an alternative to the low mix to the LCS concept, but also very important, set the industry up for potential exports of MMC versions. It would be hard for the industry to complain, as it begins the process of spreading the work around, and most importantly, gives the Navy a fifth-rate to evaluate as part of its future fleet constitution, something we believe is very important in the context of strategy. We see this as a winning approach from all sides, if it can be done. We also note that if it is to be done this year, it would only happen if John Murtha pushed for it.

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