
Rep. Jim Langevin (D-RI)Clear as mud. There is a lot of confusion over this statement because the DDG modernization of record wasn't thought to include "ballistic missile defense capability," which implies maybe something has changed with the DDG modernization program? We will discuss the Navy's communication strategy later this week, but this is one example where explaining what the hell is going on is just not what the Navy does well.
You've stated that the new DDG 51s could incorporate additional technologies, but we haven't heard a clear explanation as to what those would be.
Do your cost estimates for the future DDG 51s reflect current design and capability? Or do they incorporate additional technologies, each of which could lead to insertion or new design costs?
And finally, do your life cycle comparisons between DDG 51 and the 1000s incorporate the increased personnel required for the 51s? And have you developed estimates -- termination costs for DDG 1000s?
Vice Admiral Barry McCullough
Sir, the capability set I described for a DDG 51 that would restart as DDG 113 is based on the modernization program that we currently have funded in the DDG modernization program.
And that includes the COTS-based computer hardware, the open- architected computer program, the multimission signal processor with inherent ballistic missile defense capability, and the extended range antiair warfare capability with SM-6.
That combat system, because of the way it's been developed, costs less than the current combat system that's in DDG 112. That will be available to drop into DDG 113 if it is an '09 restart. So I'm confident in the cost numbers that -- that we provided in letters, what the restart cost for a DDG 51 is.
Life cycle costs -- because the DDG 1000s are projected to come on service or in service inside this POM '10 developed F.Y. '10 future year defense plan, we used the N4's models on how we project costs for ops and maintenance and manpower on DDG 51s and the DDG 1000s.
And we look at -- when we look at manpower and fuel costs and spare parts, a DDG 51 over the life cycle is about $4 million more expensive to operate than a DDG 1000. I'll get you the exact number, but I think it's $4 million.
That's different than what's in the selected acquisition report because the SAR reflects different requirements for life cycle costs than we do when we do budget development for ops and maintenance and manpower on ships.
Clearly there are a number of ways to interpret this statement, and after consulting my crystal ball, I came up short and decided to ask around instead. We "think" the Navy is saying there will be ballistic missile defense included in the new Arleigh Burke class destroyers, although we admit that is a guess, because on Sunday we did not think so. Basically, there is a lot of hardware/software issues that could be ready by FY15, meaning BMD is in play. As things stand today, what Vice Admiral Barry McCullough is saying does not automatically imply BMD will be included in the new Burke's. Either way, bottom line is, with or without ballistic missile defense the Navy wants new DDG-51 Flight IIA models with all the modernizations expected throughout the Flight IIAs. Those are good ships.
It is noteworthy the Navy has decided not to do any changes to the Arleigh Burke class destroyers beyond the modernization already planned. There are a number of potential reasons why, but most likely it is to try to recapture some credibility on costing for ships and build credibility for the Navy in shipbuilding. A run of eight destroyers on time and budget right now would be a very welcome sight in Navy shipbuilding, and perception means a lot in Washington. It could also be to avoid making changes to the design knowing Congress has passed a law that requires nuclear power for warships, a point brought up in the hearing on Thursday. After all, if you make changes A, B, and C why not also make it nuclear? Requirement creep should be a concern, the reason for the Burke's in the first place is because requirement creep has turned the SC-21 shipbuilding plan into an enormous disaster. At the end of the day we think the reason is much simpler to explain, the Navy is led by people who think all solutions start and end with large surface combatants, and they are making a grab at more large surface combatants.
However, there are also several compelling arguments why the Navy should make changes. Ronald O'Rourke makes a number of interesting cases (PDF) regarding hull design possibilities for the DDG-51 Flight IIA. In his testimony before Congress last Thursday he listed a number of options in his submitted statement, but among the more interesting options to us were a few operating and support cost saving initiatives.
adding automated equipment and making other changes to reduce crew size;
adding some electric-drive equipment for interconnecting parts of the ship’s mechanical-drive propulsion system so as to permit the system to operate more like an integrated electric drive system; and
installing a near-surface bow bulb above the existing sonar dome to improve hydrodynamic efficiency.

However, we also started thinking about a Flight III. Why would the Navy want to look at a Flight III, or more specifically, why would Congress? Considering the rationale of ballistic missile defense for surface combatants, we began thinking perhaps the best reason for doing modifications to a new purchase of Arleigh Burke class would be to invest towards the CG(X) program, which was what the DDG-1000 was supposed to do. One way to do that might be to go ahead and meet part of the Cruiser requirement early, save costs, and build some consistency regarding the combat system into the fleet.
In our research on the modernization program, trying to figure out why McCullough's statements are so confusing, we found ourselves reading Bob Work's report on the surface combatant modernization programs, and we came across this:
The seven “Baseline 2” cruisers are the oldest surviving “Ticos,” the five earlier “Baseline 0” and “Baseline 1” cruisers having been retired as a cost-saving measure. For the purposes of this report, these seven ships will be referred to as the CG-52 class. Each of the CG-52s is equipped with the earliest version of the SPY-1 radar, the SPY-1A; the oldest and least capable Navy-proprietary computers, known as UYK-7s and UYK-20s; and four fire control illuminators. Their main battery consists of 122 Mk-41 VLS cells. Their secondary battery consists of eight Harpoons or SLAMs, two 5-inch/54 naval guns, and two Phalanx CIWSs. They can hangar and support two MH-60R (or MH-60S) helicopters...If you recall, before Gene Taylor revealed his source was Admiral Roughead in the hearing Thursday, we revealed it while also discussing how current events were being played out much how Bob Work recommended as an alternative path to the DDG-1000. In that discussion we cited the modernization report. In the same report, one of Bob Work's suggestion for the Navy was to replace the seven DDG-1000s with seven modified Arleigh Burke class ships as a stopgap between generations as the Navy looks forward. What he calls the LBNC stands for Large Battle-Network Combatant.
because their systems are so old, the first seven “Baseline 2” CGs cannot be easily upgraded to the SPY-1D(V) standard. Recall that these seven ships will not receive the SQQ-89(V) for similar reasons. As a result, the near-term TFBN battle line will consist of two different classes of Interim Large Battle Network Combatants with much different anti-air warfare capabilities.
Fourth, starting in FY 2008, build a minimum of seven modified Burke DDGs to help sustain the industrial base until the new LBNC is ready for production... all seven ships would serve as active test beds for DDG improvements identified as possible candidates for further BNRAM back fits, or to test next-generation LBNC technologies. As such, the ships would serve much the same purpose as both the Forrest Sherman-class destroyers, which helped to bridge the shipbuilding gap between World War II and Cold War combatants, and modified legacy combatants like the USS Gyatt, DDG-1, which helped to illuminate the way forward toward a new generation of warships. Provided all went as planned, Congress would authorize two of the next generation LBNCs in FY 2015, split funded as in the current arrangement for the DDG-1000, giving each of the two construction yards one ship. The general fleet-wide transition from Aegis/VLS I-LBNCs to the new design would then begin in FY 2017, with three ships authorized after a bidding competition. Of course, if the design was not ready, additional Burkes could be built until it was.It is actually brilliant advice, indeed one might suggest Admiral Roughead was reading Bob Work when he came up with his plan. The Navy, or Congress, could go two different ways. If the decision was simply to buy Burke's instead of DDG-1000s, and increase the total destroyer force, the Navy could continue with the current plan sent before Congress.
However another option is to replace the "baseline 2" CGs with 7 new "plugged" DDG-51s, essentially a Flight III version of the Arleigh Burke with more missiles, or perhaps the Advanced Gun System (although now the Navy says surface fires requirements are already met). In Ronald O'Rourkes statement on Thursday this is covered as one of a couple alternatives.
Additional vertical-launch tubes could be installed by lengthening the ship’s hull forward of the deckhouse. A 1994 CRS report discussed, on the basis of Navy information, how a 12-foot extension could permit the installation of 32 additional VLS cells.19 In 1997, to support research that CRS was conducting into possible alternatives to the Navy’s proposed Arsenal Ship, the Navy provided CRS with information on how lengthening the DDG-51 hull so as to install additional VLS tubes might change the ship’s procurement cost. The information is summarized in Table 2 below. The estimated changes in procurement cost were parametric, rough order of magnitude (ROM) estimates only, subject to further engineering evaluation, and did not include detail design or nonrecurring engineering costs. Although the table shows variants equipped with Mk 41 VLS tubes (the kind currently used on Navy surface ships), adding vertical launch tubes of a newer design may also be possible.Instead of building 8-9 new Burkes, Congress could instruct the Navy to use the money towards building seven "plugged" Flight III versions of the DDG-51 that, according to CRS testimony, potentially carry up to 256 VLS cells. That would clearly make this new ship the most powerful weapon system ever built, but what is also interesting is that as an evolutionary "plug" that has already undergone some study, based on a proven design it would certainly be cost affordable for that much firepower. Why do we like this idea? Because evolutionary has a proven track record, one look at the Ohio SSGNs and one can see the value of an evolutionary approach that carries a lower cost but high rate of return on investment.
The key here is that by replacing the seven "baseline 2" CGs with a plugged version, the Navy sets itself up well with the challenges they face with the CG(X) program, what we have consistently called the most important surface combatant program for the future of the US Navy.
The CG(X) is already under a number of constraints, in particular the Congressional requirement for nuclear power, but also the necessity to scale well in a constantly evolving world driven by the pace of technology, a much faster pace than warships with a service life of 30-40 years. It has been suggested that the CG(X) would not use the DDG-1000 hull, indeed this was brought up in the hearing. If you recall last year, the Navy had discussed two types of CG(X) replacements, one was an escort cruiser of the DDG-1000 hull, or in this case the evolved DDG-51 hull, while the other was a large CGN(X) built to support ballistic missile defense, which at the time we speculated on the reported size as potentially using the LPD-17 hull.
It really isn't as bad an idea as one might think, particularly if you care about the CG(X). The CBO estimates the CG(X) may cost as much as $4 billion per ship for 19 ships, but those 19 ships are based on the use of the DDG-1000 hull at 14,500 tons. CBO does its cost estimates on millions per 1000 tons, which is noteworthy because 19 ships at 14,500 tons is more total tons than 12 ships at 20,000 tons. Essentially, while the CBO would estimate the 12 ships more than what the Navy currently budgets for the entire CG(X) line, the number would be less than the $4 billion the CBO currently estimates for the CG(X) line based on the DDG-1000 hull. Adding 12 nuclear reactors would probably make up the difference, but at least the Navy would then be within the current estimates and be conforming to the law regarding nuclear power, something a CG(X) program based on the DDG-1000 hull cannot do.
As for the seven "baseline 2" ships, we wouldn't retire them early. Just allow them as modernized first rate battleships to serve out their time in areas like Africa and South America where the ballistic missile threat is not as critical as it is in the Middle East or Pacific. These cruisers make excellent flagships for those regions, and as we have pointed out in the past, the local economy never complains when a ship with 400+ sailors makes port. These ships send the right signal when conducting exercises with major allies in Europe, and even without BMD they still outmatch everything competitors can put to sea. Another option might be to replace the FFGs currently in reserve with these seven cruisers, and keep them maintained as the new contingency platform. They would certainly make a much smarter reserve force than the old FFG-7s currently holding that position.
There are a number of options regarding the Arleigh Burke battleships the Navy wants for the stopgap. Congress should seriously consider all the available options, from the operation and support cost saving measures to the large plug advanced ballistic missile defense cruiser option. With BMD now the primary driver of the large surface combatant fleet, the "Baseline 2" CGs offer the Navy additional ways to save money by putting these ships into reserve and replacing them with more capable Burke's. In our opinion, the Navy should make adjustments to the ships, that way when these ships reach 20-25 years old, they won't be retired early like other older ships have in the past because they are made obsolete due to the emerging technologies of competitors.