Peter Stinson at the Unofficial Coast Guard Blog said something the other day that I've been thinking about over the last few weeks.
Many of us here in the blogosphere (and I count myself among the many) have been critical in the past of the Coast Guard's handling of acquisitions. I think it is safe to say that the Coast Guard got in over their collective heads.
I also think it is safe to say, although my fellow blogosphere brethran may disagree, that the Coast Guard has, indeed, turned a corner.
Actually Peter, I think you are on the money. I have not been very kind to Coast Guard acquisition, at least I wasn't when I first started blogging. I do however recognize that the National Security Cutter has been the primary source of criticism, but I am not sure the criticism has always been fair in context. In looking through
this CRS report (PDF) I noted the following table included from a GAO report, I thought this was an interesting breakdown that explains the cost increases to Berthoff and other National Security Cutters. Click for better resolution.

Requirements changes to address post-9/11 needs are one of the main reasons for the cost increases. The new requirements include
- expanded interoperability with the Department of Defense, DHS, and local first responders;
- increased self-defense and survivability, including chemical, biological, and radiological measures;
- increased flight capability via longer and enhanced flight deck;
- upgraded weapon systems; and
- improved classified communication capabilities.
Another contributing factor was Hurricane Katrina, which not only caused considerable damage to the shipyard, including tooling, equipment, shops, and other facilities, but also caused an exodus of the experienced workforce. The overall number of shipworkers declined significantly, causing the contractor to use more overtime hours. The loss of workers, in turn, considerably disrupted the ship’s learning curve, which normally results in greater efficiencies in production of subsequent ships.
However, some of the increase can be attributed to Coast Guard actions. For example, the contractor used the Coast Guard’s failure to precisely execute the contract according to the implementation plan as basis for requesting an equitable adjustment. Furthermore, even though the Coast Guard’s own technical staff raised fatigue life concerns — later confirmed by a U.S. Navy study — during the design phase, the decision was made to proceed with production of the first two NSCs and enhance the structure later.
I think it is interesting e GAO graphic above is saying about 70% of the cost increases are directly attributed to either 9/11 mandated requirements, Hurricane Katrina, or the economic issues the nation is facing. Consider for a moment that in the case of Berthoff, the design problems have only contributed 20% of the total cost increases. For perspective, if the LCS was only suffering a 20% cost increase, the hull would cost only $264 million instead of around $650 million.
Are there still problems with Deepwater? Yes, but the GAO has about as much praise as it does criticism in is June 2008 report according to that CRS report, and given recent events it would appear some of those criticisms will not be evident in their next report.
Would you rather have C4ISR problems you can overcome with a bit of yard work, or
problems like this (PDF)? In context, the Berthoff issues aren't as big a deal as the claims make them out to be, at least under the reforms implimented by Admiral Allen.
Problem solved? Nope. Peter is saying the Coast Guard has turned the corner, and I agree. What makes me even more optimistic is that it isn't just about turns, from where I'm watching it also appears the Coast Guard turned onto the right road.
That All Hands email reflects only a small part of what is going on, and has a history well explained in
this CRS report for those interested. What also has me encouraged was a discussion between
David Axe and Rear Admiral Gary T. Blore (PDF), Assistant Commandant for Acquisition & Chief Acquisition Officer during a recent bloggers roundtable.
Now that is an interesting conversation on Coast Guard acquisition, and explains in detail why Peter is on to something.