Why Gates Chooses DDG-1000 Over DDG-51

The next administration is walking into a hornets nest with the US Navy. It always looks so simple, except the devil is in the details. The conventional wisdom is the Obama administration is going to walk into office, be told by the Navy the DDG-1000 program is available to be cut, and the Obama administration will jump at the chance. Sounds smart right? Governing has never been so easy. Lets set the stage, Geoff Fein of Defense Daily (subscription) helps us out with his October 31 article regarding the Bush administrations decision to punt the problem to the next administration:. This first quote is a classic.

Additional analysis needs to be done before the Navy makes a decision on whether to move away from DDG-1000 and restart the DDG-51 production line, according to a top Pentagon official.

"I think there's [a] substantial amount of additional analytical work to be done," John Young, the Pentagon's acquisition chief, told reporters during a briefing yesterday.

"We certainly have a requirement for future surface combatants," he said.

Did you catch that? Wow! In its official capacity, the Office of the Secretary of Defense is basically telling the Navy their analysis for canceling the DDG-1000 is unacceptable. When the Under Secretary of Defense for Acquisition tells the the Navy through the media that the Navy has a "substantial amount of additional analytical work" to do before canceling the DDG-1000, Young is basically telling the Navy, (through the public no less) that the Navy's reasons for canceling the DDG-1000 amounts to a big load of crap.

Think clearly about what we are seeing here. That is exactly the kind of comment the Navy can expect both Senator Kennedy and Rep. Sestek, if not every Senator and Congressman, to quote back to the Navy under oath next year.

John Young is speaking directly to the Navy through the press, and with a comment like that is eventually speaking to the Navy directly on Capitol Hill, and he would never say such a thing unless he was representing the official position of the Secretary of Defense himself. With a statement like that by John Young, the conclusion I draw is that Gates is a supporter of the DDG-1000, at least in comparison to the Navy's current idea of truncating that program in favor of more DDG-51s.

Why would that be? Gates doesn't come off as a battleship man to most observers, and yet in this debate his position appears to support the big battleship. Why? Because this issue isn't black and white, indeed its a symbol of the mess the Obama administration is inheriting when it comes to the US Navy.

The biggest challenge facing the next administration is the challenge the Democrats have been working on since taking power in 2006, specifically, stabilizing the shipbuilding industry. The United States has lost a lot of manufacturing jobs over the last eight years, indeed part of Obama's political platform is to rebuild the manufacturing industry in the United States and make it more competitive globally.

I think the Obama administration would like nothing more than to cut the DDG-1000, and I think the Navy is hoping that is exactly what happens, but I don't see how the Obama administration will do it based on the current plan put forth by the Navy, assuming the Obama administration is doing their homework. The Navy either has plans we have not seen, or the Navy leadership has very low expectations of the next administration, and is counting on a clumsy approach in defiance of all the Democratic Party leaders on Capitol Hill asking important questions.

Geoff Fein goes on to discuss ramifications of truncating the DDG-1000 later in the article.

The Navy does have a legitimate concern that if the DDG-1000s become significantly more expensive than the cost targets projected, it might be hard for the service to afford the ship, Young noted.

"But we have not done enough analysis, especially analysis looking forward as far as the time period when these ships will be a vital part of [the nation's security]," he added. "We ought to lay in some flexibility in the budget through that analytical work and make a decision. And there are some near-term decision to be made."

For example, Young said, if DDG-1000 is not the hull for the future, building three ships between two yards could be punitively expensive for the taxpayer.

"We are certainly talking internally, and we talk with industry, and industry are willing to talk to the Navy and Pentagon about these issues," Young said. "But those are just discussions at this time."

Young is making a great point outside of the industry concerns. The DDG-51 was conceptually designed in the 1970s, during the Carter administration. These new ships that would be built are expected to serve until the 2050s, 8 decades later! The last ship to be funded under the Navy's new plan is in FY15. It takes 5 years to build the ship, and the ship has a service life of 35-40 years. Assuming 35 years that mean it would retire in 2055! Is the ship going to be relavent come 2055? What about 2035, only half way through its service life? It is a huge investment of taxpayer money for a ship that could be outpaced by technology by 2035, much less 2055.

But the problem is bigger than that. There are companies in almost every state that are part of the DDG-1000 program, and we are on the eve of construction of this program. The shipyards have made extraordinary efforts to build the 7 ships, including each shipyard building 25% of each hull as part of a modular construction plan to insure workload distribution and workforce efficiency. Young is suggesting those plans could disappear if the DDG-1000 goes away.

I don't imagine that sounds very good to Gene Taylor (D-Miss), chairman of the Seapower subcommittee in the House and whose Ingalls yard would be hurt the most from that decision. I don't see a scenario where he will just sit around and let the manufacturing in his district take a major hit during a downward economic spiral.

This is why the analysis the Navy has provided to switch from DDG-1000 to DDG-51 needs a "substantial amount of additional analytical work" done. The decision, as currently laid out in plans disclosed to the public, will have the side effect of causing significant shipbuilding industry problems during a down turn in the economy (while also being more expensive). I fully expect that the Navy will offer up the DDG-1000 to be cut, but the question is whether the Obama administration is so clueless as to either ignore or be unaware of the ramifications of cutting the program.

The thing is, the Bush administration entered office in 2001 with a predetermined notion of what needed to be done, also known today as Rumsfeld's "transformation." Having a preset agenda regardless of consequences is a pattern that I suspect many expect from the Obama administration, as if repeating the mistakes of the last administration is the model for the new one. I just don't see it. I suspect the Obama administration is going to make the workforce concerns a priority, and if the Navy hasn't accounted for that being the priority, they are facing disappointment. The DDG-51 replacement program for the DDG-1000 doesn't represent a solution for the industry by itself, don't take my word for it, Ronald O'Rourke has laid it out the facts in detail for Congress.

There is a significant shipbuilding industry challenge facing the next administration, and I am yet to see evidence the Navy is accounting for the industry in its choice to truncate the DDG-1000. The Navy wants the decisions to be made quickly, meaning we will know early what the priorities are for the next administration. Questions that will be decided include:

1. Is stabilization of the shipbuilding industry a major priority of the next administration?
2. Can the next administration work with the Navy in developing a complete plan that maintains the shipbuilding workforce and stabilizes the shipyard industry?
3. Can the DDG-1000 be canceled, something clearly better aligned to long term strategy, without creating significant workforce disruptions during a down economic turn?

The shipbuilding industry is one of the most regulated manufacturing industries in the United States. That is nothing new, as far back as George Washington the President and Congress has determined the specific outline for Navy forces, and has exercised significant influence over the shipbuilding industry in general. If the Obama administration can't stabilize the shipbuilding industry, an industry it has the most control of today, how the heck will they influence any other manufacturing industry? Clearly dealing with the problems in the shipbuilding industry will be an early, important test for the Obama administration, and the decisions will have long term ramifications on the future US Navy.