The future of the Air Force
Andrew F. Krepinevich, Jr. has compiled a long record of thoughtful, informed analysis of defense issues. He justifies his reputation once again in “The Air Force at a Crossroads” (Issues, Winter 1996-97). As Krepinevich points out, the U.S. military is facing enormous uncertainties as we build the forces this nation will need in the next century. Although he focuses on the Air Force, I think he would agree that the huge changes and uncertainties he identifies are issues with which every element of our joint team must wrestle. The revolution in military affairs, geopolitical developments across the international landscape, and the growing importance of space-based capabilities will have profound effects on the entire U.S. military.
About 18 months ago, General Ronald Fogleman and I established a long-range planning effort to address those issues and to construct a plan to guide the Air Force into the next century. We focused on creating an effort that would draw on the expertise of the entire Air Force in building an actionable pathway toward the future. Over that year and a half, our long-range planning group spearheaded a study that covered the entire scope of Air Force activity.
Krepinevich mentions the first result of that effort: Global Engagement: A Vision for the 21st Century Air Force. It captures the outcome of our planning effort, capped by the deliberations of a week-long conference of our senior leadership, both military and civilian. It outlines our vision for the Air Force of the next century: how we will fight, how we will acquire and support our forces, how we will ensure that our people have the right training and values.
In defining this vision, our senior leadership looked at all of our activities. This is clearly too much to outline in a brief summary, but four major themes emerged. As we move into the next century, the Air Force will: fully integrate air and space into all its operations as it evolves from an air force, to an air and space force, to a space and air force; create personnel who understand the doctrine, core values, and core competencies of the Air Force as a whole, in addition to mastering their own specialties; regenerate our heritage of innovation by conducting a vigorous program of experimenting, testing, exercising, and evaluating new operational concepts, and by creating a series of battle labs; and reduce infrastructure costs through the use of best-value practices across the range of our acquisition and infrastructure programs. Together-and these must be viewed as a package-these goals provide an actionable, comprehensive vision for the future Air Force.
However, we realized right from the start of this process that it is much easier to define a vision than to execute it. The shelves of libraries all across this city are stacked high with vision statements, many of them profound, some of them right, very few of them acted upon. So we have begun the process of transforming this vision into a plan, subject to rigorous testing and review, that will carry the Air Force along the path we have laid out. And we are beginning to define the programmatic actions necessary to execute our vision.
Certainly we will disagree with Krepinevich on some particulars. That is inevitable, given the complexities we face and the uncertainty of the future. But we are in general agreement on the larger issues: We must move away from traditional approaches and patterns of thought if we are to execute our responsibilities in the future. We are well aware that our plan will change over time. But we are also confident that we have a mechanism and the force-wide involvement necessary to make those adjustments. We will give this nation the air and space force it needs.
Andrew F. Krepinevich, Jr.’s well-reasoned discussion is quite timely as the nation’s military establishment undergoes a major effort in introspection: The Quadrennial Defense Review. I agree that the Air Force and the other services are at a crossroads of sorts as we approach the new millennium. Accordingly, the Air Force has been engaged over the past year and a half in a far-reaching, long-range planning effort. The initial output of this effort is the white paper Global Engagement: A Vision for the 21st Century Air Force.
I observe with some pleasure the extent to which many of Krepinevich’s observations and suggestions are addressed in Global Engagement. Those who developed our long-term vision resisted the temptation to seize on any one design or discipline for all their answers. The focus is on crafting institutional structures to ensure that the U.S. Air Force remains on the leading edge of the revolution in military affairs. Where Krepinevich urges the Air Force to engage in vigorous experimentation, testing, and evaluation, Global Engagement directs the establishment of six battle laboratories to shepherd developments in key areas such as space operations, information, and uninhabited aircraft. At the same time as it sharpens its focus in specific technical fields, the Air Force will broaden professional understanding by creating a basic course of instruction in air and space operations. Improving both of these areas and their purposeful integration will maintain our leading-edge advantage in capabilities useful to the nation.
The efforts described in Global Engagement were developed to move the Air Force forward responsibly and effectively. Those two concerns-responsibility and effectiveness-will always tend to distance an institutional vision document from even the most expertly drawn thinkpiece. However, such institutional vision documents are less likely to contemplate the truly revolutionary but more risky notions that thinkpieces can embrace. Therefore, the best path forward is often illuminated by lamps both within and without the institution.
Krepinevich proposes that “the Air Force should reduce its current reliance on theater-based, manned tactical air systems . . . this issue is crucial to a successful transformation . . . because success in this area would mean that the Air Force’s dominant culture-its tactical air force-accepts the need for major change.” Krepinevich would have us reduce our emphasis on controlling the air, yet the demand for these capabilities persuades us that this mission is of greater importance than ever. The growing sophistication, availability, and proliferation of defensive and offensive systems on the world arms market provide a diverse set of problems for our field commanders to confront today and in the battlespace of the future. Our forces must be ready to meet and defeat those capabilities.
Joint Vision 2010 has given all the services a focus for achieving success. All the elements of this vision cited by Krepinevich depend on friendly control of the air. Such control is absolutely necessary to the effectiveness of all our forces and to the security of host nations, and the challenges in this area continue to grow. Moreover, tactical air capabilities have great leverage in defense against missiles. Indeed, the most promising way to prevent attack from cruise and ballistic missiles is to destroy them before they launch.
On the issue of manned aircraft, our most flexible, responsive, and effective solutions to many military challenges are currently provided by manned aircraft. Air power is the most liquid of combat assets, offering a unique combination of man, machine, speed, range, and perspective. But even we do not see this as an immutable truth; it’s the best we have been able to do in an imperfect world. Our current theater-based manned aircraft are a result of sound tradeoffs among range, payload, performance, and cost. The rich range of new aircraft possibilities is probably the most valuable harvest of the revolution in military affairs, but each new possibility will have to prove its advantages in the real world of limited dollars, unlimited liability, and a nation that holds its Air Force accountable for success in peace and war.
In spite of the many congruencies between Krepinevich’s article and Global Engagement, there remain some significant differences. Considering Global Engagement on its own merits, I believe readers will agree that it is a solidly reasoned document based on a thorough understanding of the aerospace technology horizon that projects improved ways to apply science and technology to serve the nation. It rests on 18 months of dedicated effort involving the force at large; experts from the scientific, academic, and policy communities; and a winnowing and prioritization process conducted by the accountable senior leadership of every part of our nation’s Air Force. However, no body of thought ever attained its full potential without being burnished by competing views. I look forward to the thoughtful responses of your readers and to more articles like “The Air Force at a Crossroads.” I am certain they will help the Air Force see farther and better.
As the Air Force adopts new technologies to meet future challenges, it will be transformed. Force structure, organization, and operational concepts will change. One of our challenges is to manage these changes as we recapitalize our fighter force. In “The Air Force at a Crossroads,” Andrew F. Krepinevich, Jr. states that the F-22 and Joint Strike Fighter (JSF) that are the heart of this recapitalization effort will be of only marginal operational utility in the future. His prediction is based on the premise that tactical ballistic missiles (TBMs) and cruise missiles (CMs) will become so effective that they will deny us the use of airbases within theater. Without bases in theater, we will be unable to employ our tactical aircraft.
This is not a new problem. Airbases have always been vulnerable. It is much easier to destroy aircraft on the ground than when they are airborne, and thus the quickest way to attain air superiority over an opponent is to destroy his aircraft on the ground. This has been accomplished in the past with relatively unsophisticated systems; in 1967, the Israelis devastated the Egyptian Air Force during the opening hours of the Six Day War. The lesson we have drawn from that campaign and others like it is that we must control the airspace over our airbases. Air Force doctrine in this matter is clear: Air superiority is a prerequisite to any successful military operation.
Our response to the emerging TBM and CM threat is consistent with our doctrine; we will acquire the necessary systems and develop the operational concepts to control the airspace over our bases. The air superiority mission has expanded to include TBMs and CMs. We will field an architecture of new systems that will significantly reduce the effectiveness of TBM and CM attacks. This architecture will put the missiles at risk throughout their operational life. We will conduct attack operations against the command and control, garrison, and launch sites. Missiles that are launched will be engaged in their boost phase by airborne lasers. Our next line of defense will be the Army’s Theater High-Altitude Defense System (THAAD) and the Navy’s Theater-Wide System. A similar layered approach will be used against CMs.
The Air Force has consistently applied new tactics and technology to solve difficult operational problems. The long-range escort fighter in World War II and the employment of stealth to neutralize surface-to-air missiles during the Gulf War are just two examples. TBMs and CMs are no more than another operational challenge.
The F-22 and JSF will not be marginalized by these threats. The F-22 and JSF share stealth and an integrated sensor suite to which the F-22 adds supercruise. These capabilities are important enablers that will allow them to dominate an adversary’s airspace. We will deploy into theater, using our bomber force to conduct initial attack operations and, if necessary, our defensive systems as a shield. Then we will take the battle to the enemy. The tempo, accuracy, and flexibility of our operations, directed at his center of gravity, will paralyze him. His systems will be destroyed or neutralized. Instead of being marginally useful, the F-22 and JSF will be the prime offensive element of any future campaign. They will simultaneously attain air superiority, support the ground forces, and conduct strategic attack. Because of their critical importance, the Air Force is committed to acquiring these systems in numbers consistent with our national strategy.
Science and democracy
In “The Dilemma of Environmental Democracy” (Issues, Fall 1996), Sheila Jasanoff provides a vivid portrait of how democracies struggle to resolve environmental controversies through more science and public participation. I concur with her diagnosis that these two ingredients alone are not a sufficient recipe for success and will often be a prescription for policy stalemate and confusion. Jasanoff sees “trust and community” as ingredients that must accompany science and participation and offers glimpses of examples in which institutions have earned trust, fostered community, and sustained policies.
In order for Jasanoff’s vision to be realized, it may be necessary to address the dysfunctional aspects of U.S. culture that serve to undermine trust and community. First, the potent role of television in our society promotes distrust of precisely those institutions that we need to strengthen: administrative government and science. These institutions are not served well by sound-bite approaches to public communication. Second, the lack of a common liberal arts education in our citizenry breeds ignorance of civic responsibility and a lack of appreciation of the values and traditions that distinguish our culture from others. Third, our adversarial litigation system undermines truth in science.
I’m not exactly sure how to moderate the perverse influences of television and litigation, but we certainly can take steps in educational institutions at all levels to promote liberal arts education. It is intriguing that many European cultures are generally doing better than we on each of these matters, through perhaps that is only coincidence.
Sheila Jasanoff has written a profound and provocative article on the relationship between science and public participation. Her essay is a bracing antidote to much of the shallow rhetoric about “more participation” that has become so popular in the risk literature.
The basic issues with which Jasanoff deals are at least as old as Plato and Aristotle: To what extent should public decisions be left in the hands of “experts” or representatives, and to what extent should others-whether interest groups, lay citizens, or street mobs-be involved? However, as Jasanoff discusses, the current setting for these dilemmas is different in important ways than it has ever been before. I think there are at least three critical differences.
First, the complexity of decisions has increased. Today’s decisions often must be considered in a global context, involve large numbers of diverse groups and individuals, and are embedded in rapidly changing and very complicated technologies.
Second, the technology of participation has changed and is continuing to evolve rapidly. We seem to be asymptotically approaching a state where everyone can communicate instantaneously with everyone else about everything. Television, the Internet, the fax, and the cellular phone have profoundly changed the ability of people to find information and to communicate views to each other and to the government. We are only beginning to understand the implications of these technologies, and new technologies will appear before we understand the implications of the old.
Third, the sheer number of people on the planet is a major factor in its own right. Participation in so many diverse issues becomes possible in part because of the size and affluence of the citizenry, as well as an unguided division of labor. It is not so much that individuals have more time to participate in decisions or that they are smarter (although in historical perspective both these things are true); it is that there are more of them. In the United States, there are people who spend a large portion of their waking hours worrying about the treatment of fur-bearing animals or the threat of pesticide residues on food. This allows other people to concentrate on education or homeopathic medicine. Every conceivable issue has its devotees.
I agree with Jasanoff on the central importance of trust and community in the modern context of participation. As she says, the task is to design institutions that will promote trust. At least in the United States, we have barely begun to explore how we can do this. We need to start by developing a better understanding of how trust relates to various forms and conditions of participation. It is questionable, for example, whether the standard government public hearing does much to promote trust on anyone’s part. But what are the alternatives, and what are their advantages and disadvantages? We need less rhetoric and more research and thought about these kinds of questions. We should be grateful to Jasanoff for having raised them.
Restructuring the military
David Ochmanek, a distinguished scholar and public servant, has written a sound article laying out ways in which the United States might selectively cut military force structure without significantly degrading its combat capabilities. My only quibble is with his heavy reliance on yet-untested military technologies as a basis for his recommendations. Although I think his policy prescriptions are sound, they pass muster only because of a much broader set of arguments.
To see why heavy dependence on high-tech weapons is an imprudent way to plan on winning future wars similar to the Gulf War, consider all the (now unavailable) capabilities Ochmanek says we need to realize his vision. He insists that we must be able to shoot down ballistic missiles reliably (preferably in their boost phase) and be able to find mobile missile launchers, even though we recently failed almost completely at both these tasks against Saddam’s unsophisticated Scud missiles. He appears to assume that we will be able to discriminate enemy tanks, artillery, and armored fighting vehicles from those of our allies, not to mention from trucks and cars. He also assumes that adversaries will not be able to develop simple countermeasures, such as multitudes of small independently propelled decoys that could mimic the radar or heat signatures of armor, or that if they do, U.S. sensors will improve even more quickly and overcome the countermeasures.
Rather than hinge all on science and technology, we should reexamine current defense strategy. For one thing, today’s two-Desert Storm strategy is too pessimistic about our ability to deter potential adversaries. Contrary to the thinking behind the Bottom-Up Review, neither Saddam nor the North Korean leadership would be likely to attack if most of our forces were engaged elsewhere. As long as the United States keeps a permanent military presence on the ground in Kuwait and South Korea and retains the ability to reinforce substantially in a crisis, Baghdad and Pyongyang will know it would be suicide to undertake hostilities. Second, just as our deterrent is improved by having forces deployed forward, so is our warfighting capability-not so much for high-tech reasons as because we have prepared. The United States now has troops, aircraft, and many supplies in the two regions of the world where we most fear war. Third, should war occur, not only will our capabilities be greater than before, our opponents’ will be worse. North Korea’s forces are atrophying with time. Iraq’s are only two-thirds their 1990 size. No other plausible adversary is as strong.
Instead of keeping the two-major-war requirement, the United States should modernize as Ochmanek suggests while also moving to a “Desert Storm plus Desert Shield plus Bosnia” strategy. That approach would solve the Pentagon’s current funding shortfall and do a little more to help balance the federal budget at the same time.
David Ochmanek argues from the assumption that future defense budgets must either decrease or stay the same. This is hardly inevitable. No one really knows what future circumstances will shape the defense budget. One thing is certain, however: Ochmanek’s contention that the Pentagon can maintain a two-war capability by relying on heavy investment in aerospace modernization at the expense of force structure is highly questionable.
There is merit to Ochmanek’s belief that advances in technology will allow for reduced force structure without the loss of combat capabilities. However, it is too risky to reduce forces now with the expectation that technology will bail us out in the long run. Technology must first prove itself in training operations and then be applied against force structure requirements. Approving Ochmanek’s approach means accepting that, for an unspecified time period, the United States will be making commitments it cannot fulfill.
Ochmanek overstates the case for increased reliance on high-tech firepower, dangerously devaluing maneuver despite numerous examples in which the use of smart weapons alone proved insufficient. He disregards the failure of five weeks of unimpeded air campaign to dislodge Saddam Hussein from Kuwait in 1991 and the noneffect of the cruise missile raids against Iraq in 1993 and 1996. The powerful deterrent effect that thousands of U.S. troops sent to Kuwait had in those episodes should not be overlooked. Similarly, remote, long-range, high-tech capabilities such as satellites and cruise missiles do not reassure U.S. allies and ensure U.S. influence in peace and war in the way that visible ground and naval forces do. Ochmanek anticipates future combat in which the United States will see everything, and everything that can be seen can be destroyed or manipulated at long range. Nowhere does he discuss the effects of counter-technology or missions in which a wide and robust array of forces may be needed.
However, in describing the need for much better capabilities to defend against weapons of mass destruction, Ochmanek is right on target, although he places too little emphasis on the need to defend U.S. territory from missile attack. Moreover, his assessment of the potential threats posed by improved conventional weapons in the hands of U.S. adversaries accurately reflects the current situation and the dangers of underestimating these threats. Furthermore, his proposed cut in combat formations of the Army National Guard is both reasonable and practical.
Ochmanek is also correct in asserting that the nature of U.S. international responsibilities requires U.S. military superiority. However, by assuming that static or decreased defense budgets are inevitable, he compels the United States to accept a force structure that is too imbalanced and inflexible to ensure its superiority. Although technological advances offer great promise and potential savings, the military needs to maintain a broad and diverse range of air, land, and sea capabilities in order to be persuasive in peace and decisive in war. This will require a defense budget that Ochmanek seems unwilling to support.
I agree with David Ochmanek (“Time to Restructure U.S. Defense Forces” (Issues, Winter 1996-97) that with a smaller force structure, the United States could still carry out its strategy of fighting and winning two major wars. I would like to add two additional points to consider.
First, the military forces and capabilities of our allies for fighting two major wars could be taken into account more seriously than has previously been the case. For example, the Iraq scenario in the Report on the Bottom-Up Review shows U.S. allies limited to Kuwait, Saudi Arabia, and the Gulf Cooperation Council countries-a far cry from the Gulf War coalition of over 30 nations, including NATO allies with very capable forces.
Second, from a deterrence standpoint, the perception of U.S. leadership resolve is more important than definitive proof that U.S. defense resources are adequate to fight and win two major wars. There will always be domestic critics who contend that defense resources are inadequate to execute the national strategy. But our enemies-those who actually decide whether deterrence is effective-focus more on whether the U.S. leadership is willing to commit substantial forces than on whether those forces can actually defeat them. The leader of any aggressor state will still hesitate to attack our allies if force structure is reduced and the United States can attack with “only” four army divisions, nine air force fighter wings, four navy aircraft carrier battle groups, and one marine expeditionary force.
The reality of the situation is that there is no way to prove that the United States has the resources to execute its two-war strategy without actually fighting two wars. Even within the Department of Defense (DOD), detailed analytic support for the two-war requirement came years after the strategy was announced in October 1993. Analysis of airlift and sealift requirements was not complete until March 1995. War gaming by the Joint Staff and commands was not completed until July 1995. Analysis of supporting force requirements was not completed until January 1996. Finally, analysis of two-war intelligence requirements was not completed until June 1996. And although DOD touted these as proof of our two-war capability, they failed to quell concerns held by many, particularly some in the military services.
Energy policy for a warming planet
In “Climate Science and National Interests” (Issues, Fall 1996), Robert M. White sets forth the problem of climate-change policy in all its stark reality. We are moving from substantially stable climatic systems to instability that will continue into the indefinite future unless we take firm steps to reduce the accumulation of heat-trapping gases in the atmosphere.
There are, to all practical purposes, two alternatives to fossil fuels: solar and nuclear energy. Nuclear energy is the most expensive form of energy at present and carries with it all the burdens of nuclear weapons and the persistent challenge of finding a place to store long-lived radioactive wastes. The United States does not at the moment have such a depository.
Although the less-developed world sees possible limits on the use of fossil fuels as an impediment to their technological development, fossil fuels may in fact not be essential. There is every reason to consider jumping over the fossil fuel stage directly into renewable sources of energy. Solar energy is immediately available, and the combination of improved efficiency in the use of energy and the possibility of capturing solar energy in electrical panels may be able to displace much of the fossil fuel demand.
The development of oil has been heavily subsidized by the federal government throughout the history of its use. Now there is every reason for the federal government to subsidize a shift to solar energy. We can afford to develop that technology and then to give it away through a massive foreign aid program 2 to 10 times larger than the current minuscule effort. It will come back to us in goodwill, in markets, and most of all in a global reduction in the use of fossil fuels, and will give us a real possibility of meeting the terms of the Framework Convention on Climate Change.
Streamlining the defense industry
In “Eliminating Excess Defense Production” (Issues, Winter 1996-97), Harvey M. Sapolsky and Eugene Gholz suggest that the Department of Defense (DOD) should help pay industry restructuring costs to buy out excess production capacity, and they propose to fund a greater level of investment in R&D through further reductions in procurement accounts. The first recommendation is not new and is, in fact, being implemented today. The second recommendation would slow the modernization of our forces and is counter to our planned program to increase modernization funding.
The authors state that “defense policy is back to the Bush administration’s practice of verbally encouraging mergers but letting the market decide the ultimate configuration of the industry.” It is true that DOD is not directing the restructuring of the defense industry. Our role has been to provide U.S. industry with honest and detailed information about the size of the market so industry can plan intelligently and then do what is necessary to become more efficient.
DOD has always permitted contractors to include the costs associated with restructuring within a single company in the price of defense goods. In 1993, the Clinton administration extended that policy to include the costs associated with restructuring after a merger or acquisition, when it can be shown that the savings generated in the first five years exceed the costs. In 1994, a law was enacted requiring certification by an assistant secretary of defense that projected savings are based on audited cost data and should result in overall reduced costs for DOD. In 1996, another law was enacted requiring that the audited savings be at least twice the costs allowed.
During the past three years, DOD has agreed to permit $720 million in restructuring costs to be included in the price of defense goods in order to generate an estimated $3.95 billion in savings through more efficient operations. This policy is more than “verbal encouragement.” U.S. defense companies are now more efficient and are saving taxpayers billions of dollars, and the productivity of the average defense industry employee has risen about 10 percent over the same period of time.
Total employment-active duty military, DOD civilians, defense industry employees-is down from a 1987 Cold War peak of slightly more than seven million to about 4.7 million, or about 100,000 less than the 1976 Cold War era valley of 4.8 million. Defense industry employment has come down the most-38 percent compared with 31 percent for active duty military personnel and 27 percent for DOD civilians.
The authors are correct that there were roughly 570,000 more defense industry employees in 1996 than in 1976. But in 1997, that number will drop to about 390,000, and over the coming years employment will continue to shift to the private sector as DOD becomes more efficient by outsourcing noncore support functions in areas such as inventory management, accounting and finance, facility management, and benefits administration.
I am particularly shocked and dismayed with the authors’ assertion that “acquisition reform will only make matters worse” and “neither the military nor the contractors will be long-term advocates for these reforms” because the savings will lead to budget cuts. This argument does not make sense for at least three reasons. First, the budgets have already been cut-procurement is down two-thirds since the mid-1980s. Second, budget levels-past and future-are driven by fiscal forces that are quite independent of savings projected from acquisition reforms. In this environment, the services have supported and continue to strongly support acquisition reform as a way to make ends meet. Finally, acquisition reforms make our defense industry more efficient and competitive; it’s the reason why industry strongly supports these reforms.
Sapolsky and Gholz’s second major recommendation is to fund increased investment in R&D through further reductions in procurement accounts. This is not a prudent course to follow in 1997. Since 1985, the DOD budget is down by one-third; force structure is down by one-third; and procurement is down by two-thirds. Further, the average age and remaining life of major systems have not increased significantly. This was accomplished by retiring older equipment as the force was drawn down, but it is not a state of affairs that can be sustained over the long term; either force structure must come down further or the equipment will wear out with continuing use.
The historical norm for the ratio of expenditures on procurement to those on R&D has been about 2.3 during the past 35 years. Today, the procurement-to-R&D ratio is 1.1-an all-time low. To invest for long-term readiness and capability, we must begin spending more money on procuring new systems. Consistent with that goal, procurement spending is projected to increase to $60 billion by 2001. Although this goal is being re-examined in the current Quadrennial Defense Review, I very much doubt the review will recommend reducing procurement budgets from their current level.
Harvey M. Sapolsky and Eugene Gholz get it half right. Their diagnosis of the problem hits the mark but their solutions won’t fix it. Mergers seem to occur on a weekly basis in today’s defense industry. Yet, as Sapolsky and Gholz note, the excess capacity “overhang” remains. Much of this excess results from a delay in consolidation among merged firms as well as the need to complete work on previously awarded contracts. As the consolidation process proceeds, we should expect additional painful defense downsizing. However, the market alone will not rationalize defense capacity. The authors’ support for restructuring subsidies and for expanded support for affected communities and workers makes sense. Long-term defense savings are impossible unless we act now to rationalize production capacity.
In terms of solutions, Sapolsky and Gholz do not go far enough. Whether we like it or not, the defense industry of the 21st century will look something like the “private arsenal” the authors describe. Unfortunately, a private arsenal cannot run on R&D alone. Experimentation should be encouraged and heavily funded, but such a system will not sustain the defense industrial base or effectively support military requirements.
Dual-use items can be supplied by existing civilian firms, and the Pentagon’s support for dual use should continue. These initiatives can help maintain competition on both price and technology grounds at the subtier or supplier levels of the industrial base. But systems integration and defense-unique items will most likely continue to be produced by a handful of firms with a predominant focus on defense.
Sustaining the private arsenal will require that we treat it like an arsenal, through significant public subsidy and, when necessary, tight regulation to ensure competitive prices. Such a solution is far from ideal and actually runs counter to the Pentagon’s current emphasis on acquisition reform. Unfortunately, the economics of defense production may leave us no other choice, barring an even more undesirable (and more expensive) return to global tensions that requires Cold War levels of defense production.
In “The Dual-Use Dilemma” (Issues, Winter 1996-97), Jay Stowsky does a thoughtful job of laying out the conflicting political, economic, and national security objectives of the Technology Reinvestment Project (TRP). What he says about TRP in microcosm is also true for the Department of Defense (DOD) as a whole. In my opinion, the following are the most significant dual-use challenges that face DOD today.
Despite ongoing efforts to achieve a common definition, dual use continues to be interpreted in very different ways according to constituency, context, and agenda. The creation of a DOD-wide dual-use investment portfolio with clearly stated rate-of-return criteria seems to be an elusive goal. How to maximize benefits from dual use has not been adequately addressed.
DOD continues to be unprepared to deal directly with the critical business and economic issues encountered when engaging commercial industry. Most government employees outside of the senior leadership have little or no experience with the commercial world. To be successful, DOD must become market-savvy. However, evaluating commercial potential is difficult enough for private entrepreneurs; evaluating dual-use potential will be even more so for bureaucrats.
Successful acquisition reform is critical to success, as Stowsky points out. To achieve it, DOD needs to find better ways to select and educate program managers. It is not enough to teach the formalities; those chosen must be prepared to be creative and exercise the new flexibilities built into the recently reformed DOD acquisition regulations. Program managers will need to understand how to evaluate a broad range of risks and be capable of prudently weighing them against anticipated benefits.
Despite its attractiveness, dual use must not be seen as a panacea. Although it is an important component of any future defense investment strategy and can considerably improve the affordability and technological capabilities of our military systems, the differences between commercial and military operating environments remain significant. National defense is expensive, and overly optimistic notions that some day everything will be cheap and bought off the shelf are unrealistic.
The future of dual use must be bright, for as we are reminded by our leaders, we cannot afford to continue the Cold War legacy of maintaining a separate defense industrial base. TRP was a learning experience and must be taken as such. The difficulties it encountered can be overcome through vigorous, intelligent leadership. We really have no other choice.
Although Jay Stowsky is sympathetic to the objectives of TRP, his article makes it clear that the Pentagon’s dual-use efforts are not an effective way of promoting civilian technology. It is not a matter of fine-tuning the mechanism; rather, we must abandon the basic notion that government is good at helping industry develop commercially useful technology.
Of course there is a key role for government in this important area of public policy. It is to carefully reexamine the many obstacles that the public sector, usually unwittingly, has imposed on the innovation process. These range from a tax structure that discourages saving and investment to a regulatory system that places special burdens on new undertakings and new products. Surely, a simpler and more effective patent system would encourage the creation and diffusion of new technology.
Contrary to the hopes of the conversion enthusiasts, in adjusting to defense cutbacks after the end of the Cold War the typical defense contract reduced its work force substantially rather than diversify into new commercial markets. However, the aggregate results have been quite positive. Employment in major defense centers (southern California and St. Louis are good examples) is now higher than at the Cold War peak. A growing macroeconomy has encouraged and made possible the formation and expansion of civilian-oriented companies that have more than offset the reductions in defense employment.
There is little in the history of federal support for technology to justify the notion that government is good at choosing which areas of civilian technology to support and which organizations to do the work. The results are far superior when private enterprises risk their own capital in selecting the ventures they undertake.
Improving U.S. ports
Charles Bookman’s “U.S. Seaports: At the Crossroads of the Global Economy” (Issues, Fall 1996) recognizes the importance of ports and articulates the enormity of the challenges facing them and the entire U.S. freight transportation system in the next decade. He puts ports into the context of the global economy and outlines the need for investment so that ports can meet the demands of future trade.
In fact, U.S. public ports have invested hundreds of millions of dollars in new facilities over the past five years and will continue to invest about $1 billion each year through the turn of the century. Much of this investment has gone into modernizing facilities for more efficient intermodal transportation. It is commonly assumed that intermodalism is something new and that intermodalism equals containerization. The fact is that all cargo is intermodal (that is, involving the exchange of goods between two or more types of transportation). The majority of the cargo handled by U.S. ports is bulk and breakbulk; 10 percent or less of total trade tonnage is containerized.
The view that many “inefficient” ports may disappear in favor of huge megaports does not take into full account local interest and investment in deep-draft ports. Within the national transportation system there is room for a diverse array of ports to serve niche cargo and economic development needs in local communities.
Bookman correctly identifies future challenges for ports as those dealing with environmental regulation, particularly the need to resolve dredging and disposal issues. In recent years, ports have made significant progress in expediting project approvals and in working with the U.S. Army Corps of Engineers to streamline the process. We continue to work for further improvements that will encourage consensus-building among stakeholders on dredging issues and to implement technological advances to help resolve some of the problems.
Bookman also encourages coordinated efforts in port planning and suggests several approaches, including a federal-state partnership in the funding of projects. We agree that a barrier to “such regional planning . . . is that state and local government officials have tended to be more interested in highway and mass transit improvements than in port access.” Ports hope that reauthorization of the Intermodal Surface Transportation Efficiency Act will give greater recognition to intermodal access and freight projects as an integral part of the transportation system.
The American Association of Port Authorities endorses the idea of a National Trade and Transportation Policy that would direct the federal government to match its commitment to growth in world trade with a commitment to help improve the nation’s infrastructure and build on the transportation system now in place.
Bookman’s article gives thought-provoking attention to a system in need of continued investment and planning. We look forward to the challenge of developing better partnerships with local, state, and federal stakeholders to further enhance U.S. public ports.
Rethinking the car of the future
Daniel Sperling’s critique of the industry-government Partnership for a New Generation of Vehicles (PNGV) highlights a troubling divergence between national goals and federal research priorities (“Rethinking the Car of the Future,” Issues, Winter 1996-97). A well-designed PNGV could be a valuable component of a broader strategy to lower the social costs of our transportation system. In its current form, however, PNGV amounts to little more than an inefficient use of public funds.
From its objectives to its execution, PNGV is inadequately designed to meet the transportation challenges of the 21st century. The next generation of automotive technology must make substantial inroads in dealing with the problems of climate change, air quality, and dependence on foreign energy. In an era of shrinking public funds, policymakers must maximize investments by pursuing technologies that can simultaneously address these problems.
The leading technology on the PNGV drawing board today-a diesel-powered hybrid vehicle-offers only moderate technological progress at best and a step backward in air pollution control at worst. Diesel combustion generates high levels of ozone-forming pollutants and harmful particulate matter, two categories of pollutants that the Environmental Protection Agency has recently determined must be further reduced to protect human health. Several states are also considering classifying diesel exhaust as a toxic air contaminant because of its potential carcinogenic effects. There are other, more advanced technological options (such as fuel cells) that would deliver substantial air quality benefits along with larger gains in energy security and mitigation of global warming.
As Sperling suggests, now is the time to reform PNGV. In particular, the clean-air goals of the program must be redefined to drive down emissions of key air pollutants. The PNGV process also deserves more public scrutiny to ensure that it continues to meet public interest goals and delivers adequate returns on public investment. Finally, even a well-designed PNGV is no silver bullet; policies that pull improved technologies into the market will continue to be a necessary complement to the technology push of PNGV.