Washington Watch: Fifteen in a Row

April 1, 1999

Last fall, Undersecretary of Defense Jacques S. Gansler warned that US forces were caught in a modernization “death spiral,” whipsawed by escalating costs and shrinking budgets. Force readiness was in a similar fix. All signs are that President Clinton’s new defense plan will do little to arrest that downward spin, at least in the Air Force.

As the White House tells it, the Pentagon will get a boost in the Fiscal 2000 budget, the first step in what’s touted as a “sustained, long-term increase in defense.”

In reality, the Administration merely “boosts” defense from a very low planning level. The budget, unveiled on Feb. 1, does nothing to raise today’s low spending level. In fact, it actually proposes yet another year-to-year cut.

Military spending–$268.6 billion in 1999–would fall to $267.2 billion in 2000, constituting a drop of $1.4 billion. This would mark the 15th straight “down” year for the Pentagon, whose most recent budget increase came in 1985.

Within that overall budget, the Air Force would get $79.1 billion, slightly more than this year’s amount, when effects of inflation are eliminated, and roughly the same relative share. This poses several problems.

Gen. Michael E. Ryan, Air Force Chief of Staff, noted in September that USAF faced unfunded requirements totaling $5 billion in readiness and modernization accounts alone. The new budget was supposed to remedy that problem. When the budget drill ended, however, USAF had managed to cover only half of that amount.

The Air Force still confronts $2.6 billion in unfunded needs, reported Gen. Ralph E. Eberhart, USAF’s vice chief of staff. This includes shortages of $926 million in infrastructure, $788 million in modernization, and $900 million in readiness.

Over the Future Years Defense Program, covering the period 2000-05, the gap grows to nearly $10 billion, Eberhart said.

A prominent critic of the Administration plan is Rep. Floyd D. Spence, the South Carolina Republican who serves as chairman of the House Armed Services Committee. In his view, the Administration is using smoke and mirrors to create the illusion that it is strong on defense, but in fact is playing “high stakes poker” with US military forces and with the nation’s ability to protect its national interests.

Spence argues that the White House’s budgeting sleight of hand is transparent, a point on which Spence lectured the members of the Joint Chiefs of Staff at a Feb. 24 hearing of the committee he chairs.

“This budget may be viewed as clever politics in the minds of some people downtown [at the White House],” Spence told the chiefs, “but it sends a terrible message to the troops who are defending this country. And it certainly does not represent a serious commitment to addressing … critical unfunded requirements.”

Little for Tomorrow

Ryan, in recent testimony to the Senate Armed Services Committee, calculated the effect of inadequate funds. “It [USAF’s new budget] will fix immediate readiness problems,” the Chief said. “It will not fix tomorrow’s readiness problems at all. We need the full $5 billion.”

Even the immediate problems may not be all that easy to fix, given their scope and magnitude.

Materiel readiness is in trouble. Ryan said that the mission capable rate for major Air Force systems stands at 74 percent, a 10 percent drop since 1991. One-third of that decline occurred in the past year. The Air Force aircraft cannibalization rate shot up by 78 percent in the past three years.

On the personnel front, USAF is deeply concerned about low pilot and navigator retention. The “take rate” for the pilot bonus at the eight-year mark has fallen from 81 percent in 1994 to 27 percent in 1998, the last full year for which figures are available. This is well below the Air Force goal of 50 percent and the lowest of any year in recent memory. Only four years ago, the Air Force was losing 7 percent of pilots with more than 14 years of service. Last year, it lost 25 percent. USAF is now short about 800 pilots.

Even though the Air Force has launched a number of get-well programs, Ryan said it is not certain that pilot retention has yet turned around.

Enlisted ranks are a source of concern as well. The year 1998 saw enlisted retention of those completing their second term drop for the fifth year in a row; the new figure was 69 percent, well below the Air Force goal of 75 percent. The year 1998 was the first since 1981 in which USAF failed to meet re-enlistment goals in all three re-enlistment categories-first-termers, second-termers, and career.

In the first quarter of Fiscal 1999, USAF missed recruiting goals in two of three months. “That,” said Ryan, “has not happened to the Air Force in a very long time.”

If nothing else, the new budget attempts to address the worsening military personnel problem. It proposes a 4.4 percent raise in military pay to help close a 14 percent gap between military and private sector compensation. Congress seems certain to boost the pay hike even higher.

In addition, the budget would also restore the traditional military retirement program, providing a military member with 50 percent of base pay after 20 years of active duty. Today’s so-called Redux system offers the retiree only 40 percent of the average of his or her high three years.

In time, these measures may produce a turnaround, but the effect of the Air Force’s materiel and personnel woes already has been severe. Overall readiness of major combat units has fallen 18 percent in three years, and that’s not the worst of it. The combat unit readiness rate of stateside outfits in Air Combat Command has dropped a startling 56 percent.

The Air Force has diverted funds and supplies from ACC so its frontline units could be funded at something close to war-ready levels.

When Ryan talks about “tomorrow’s readiness problems,” he refers to weapon modernization. The new budget does not address a number of major and urgent Air Force requirements.

The most critical of these concerns military use of space. The Air Force has multibillion-dollar requirements for space-based capabilities, but little additional funding was devoted to them. Ryan told the House Armed Services Committee that USAF faces “a continual demand for more capability in space.”

USAF now is grappling with mounting deficiencies in the aircraft fleets, because a decade of slack procurement has caused the average aircraft age to rise to uncomfortably high levels, with no assurance of relief any time soon.

“With a progressively aging fleet of aircraft and underfunding in readiness accounts, our people are working harder and harder to cope with their vital missions,” Ryan told the House Armed Services Committee.

As if echoing Gansler’s warning of some months ago, the USAF Chief added, “We must end that downward spiral of readiness.”

In More Detail

The following focuses on the budget year 2000, with longer-range projections provided as needed. Figures refer to new budget authority. To facilitate year-to-year comparisons, all amounts are given in constant Fiscal 2000 dollars. The term “this year” refers to Fiscal 1999 and “next year” to Fiscal 2000.

Next year’s budget breaks down into five categories:

  • Procurement, $19.2 billion.
  • Research and development, $13.1 billion.
  • Operations and maintenance, $25.6 billion.
  • Military personnel, $20.3 billion.
  • Construction and housing, $1.5 billion.

Offsetting receipts total $410 million.

Today’s active duty component is by far the smallest in the history of the Air Force. When the Air Force was formed in 1947, it had 386,000 active duty people. In the late stages of the Cold War, end strength topped 600,000. Force size at the start of this year was down to 367,500–nearly 5 percent less than in 1947. The force continues to shrink.

Pentagon plans call for the service to cut another 1,600 members this year and another 5,000 next year, dropping the total to 360,900. In the outyears, 2001-05, the Air Force will lose another 10,000 active duty members, according to budget papers.

Within the Air National Guard and Air Force Reserve Command, one finds essentially no change in end strengths. USAF’s next-year budget provides for a combined military force of 180,300-106,600 Guardsmen and 73,700 Reservists.

In more than a decade of reductions, the US military has suffered a net reduction of 767,200 active duty troops. The armed forces, which numbered 2,174,000 troops at the end of 1987, had shrunk to 1,406,800 on Sept. 30, 1998. By the end of this September, the force will be down to 1,390,400 troops, or only 64 percent of its Cold War size.

In the next year’s budget, force structure remains stable. The Total Air Force will maintain about 20 Fighter Wing Equivalents, 13 of which will be in the active duty force. The number of Guard and Reserve wings will expand slightly, from 7.2 FWEs this year to 7.6 FWEs next year.

The Air Force plans to maintain a fleet of 190 heavy bombers–76 B-52s, 93 B-1Bs, and 21 B-2s. Of that number, 44 B-52s, 54 B-1s, and 21 B-2s will be fully funded in terms of parts, maintenance, and load crews and are ready for immediate deployment in major theater war. Twelve more B-52 bombers are held in reserve for nuclear missions.

The USAF airlift fleet of 2000 will consist of 46 C-17s, 104 C-141s, 104 C-5s, and 405 C-130s (all assigned for performance of wartime missions). The long-range tanker force consists of 472 KC-135 and 54 KC-10 Air Force primary mission aircraft.

ANG will operate 1,028 aircraft and pull 357,800 flying hours in interceptor, tactical airlift, air refueling, general-purpose fighter, and electronic warfare missions. AFRC will have 60 flying units containing 389 aircraft.

O&M funding will support the day-to-day activity of 86 major bases, 4,987 primary authorized aircraft, and 550 ICBMs. It funds 1.8 million flying hours.

Flying time in the next year for active Air Force fighter and attack aircrews has been set at 17.2 hours per month, down slightly from 17.7 this year but up a bit from 17.0 in 1998. Bomber crews, which flew about 19.3 hours per month in 1998 and 17.9 hours this year, will get only 15.8 hours per month next year, but this is not viewed as a worrisome problem because the Air Force will be doing more training on advanced simulators.

Combat Aircraft

The new spending plan pushes the Air Force’s fighter of the future, the F-22 Raptor, into low-rate initial production.

The Pentagon budgeted $3.1 billion for the F-22 program next year, enough to continue development efforts and pay for six more production aircraft. Officials envision a steady increase in the procurement funding for the F-22 over the next several years, rising to annual production of 36 aircraft.

The Air Force also supports the Joint Strike Fighter program, which is expected to produce new fighters for the Air Force, Navy, Marine Corps, and Britain’s Royal Navy. USAF plans next year to commit $235.4 million of a Pentagon­wide total of $476.9 million to continue development of the JSF. The Navy provides the rest.

William J. Lynn III, the Pentagon comptroller, said the F-22’s program “is paid for” over the life of the Future Years Defense Plan, meaning the Air Force does not have to find bill payers in other accounts down the line.

In a surprise move, the Air Force included money in the latest budget to buy 10 new F-16 multirole fighters, due to shortages in attrition reserve aircraft. Service officials said they would spend $440.8 million for F-16 procurement and research. All would be of the latest, Block 50 type.

Two more F-16 buys are planned in the outyears–10 fighters in 2002 and 10 more in 2003.

USAF budgeted $308.6 million next year for yet another type of theater combat aircraft–the YAL-1 Attack Laser, also known as the Airborne Laser. A jumbo jet fitted with a high-energy laser, the YAL-1 would attack threatening ballistic missiles in their boost phase and perhaps be capable of shooting down aircraft.

(In other tactical aircraft developments, the Navy put up another $3.1 billion to develop and procure 36 F/A-18 Super Hornet fighters, and the Defense Department committed $1.2 billion to procure 10 MV-22 Osprey aircraft for the Marine Corps and provided small amounts aimed at future Osprey buys for the Air Force.)

USAF’s procurement budget was virtually devoid of long-range airpower aircraft and systems.

The Air Force provides $374.6 million to continue work associated with the B-2 stealth bomber and its systems, but USAF is prohibited from spending any of that money on new bombers. The Administration has turned thumbs-down on acquisition of stealth bombers beyond the 21 previously ordered.

The new budget contains some $130.4 million to continue to modify the fleet of B-1 bombers for conventional theater war.

Money also flowed to precision guided munitions. Another $505.7 million is earmarked for next year’s development and procurement of five types of precision weapons-the Joint Air to Surface Standoff Missile, Joint Standoff Weapon, Joint Direct Attack Munition, Sensor Fuzed Weapon, and Wind-Corrected Munitions Dispenser.

The money will buy 8,332 of these ground-attack systems.

For aerial combat, the Air Force and Navy will spend a combined $207.3 million to buy 310 copies of the AIM-120 Advanced Medium Range Air-to-Air Missile and $142.3 million for 155 AIM-9X Sidewinder air-to-air missiles.

Airlift and Tankers

Airlift modernization again consumes a large chunk of USAF’s procurement funds.

The new budget allots $3.6 billion to procure 15 new C-17 airlifters and to fund their spare parts, R&D, and basing support construction. DoD has an official requirement for 135 C-17s. All but one of those is funded through the FYDP.

The Air Force has programmed extensive C-5 engine and avionics upgrades but allotted only $42.9 million to work on the new C-130J tactical airlifter, without buying any new ones.

Aerial refuelers get attention. The budget provides $347.1 million to modify aging KC-135 aircraft in the active force, Air National Guard, and Air Force Reserve. Next year’s investment in the Pacer CRAG program provides glass cockpit systems for 175 KC-135 aerial refuelers.

Eyes in Sky and Space

The Air Force continues to allot significant amounts of money to fund programs offering timely information about battles in the air and on land.

For example, the service will spend $483.0 million next year for one more E-8C Joint Surveillance Target Attack Radar System aircraft, the 14th of a required fleet of 19 aircraft. The fleet also contains one test aircraft. Defense Secretary William S. Cohen in 1997 cut the Joint STARS buy from 19 to 13, but he had second thoughts and shifted course. Air Force officials said they do not know whether the service will be permitted to buy any more. “We still have a requirement for 19,” said Eberhart, “but the 15th through the 19th [aircraft] is not in the President’s program at this time for fiscal reasons.”

In another major investment, the Air Force committed $557.7 million for continued development of the Space Based Infrared System, successor to the Defense Support Program warning satellite. However, in order to save money to divert to other programs, USAF slipped both phases of the program by two years. The so-called SBIRS High goes from 2002 to 2004, and the SBIRS Low from 2004 to 2006, a development that outraged some key members of Congress.

“This is a high priority with the Space Command-probably the No. 1 priority,” complained Sen. Bob Smith (R-N.H.) of the Senate Armed Services Committee. “It was on schedule, no technical problems, and the Air Force takes $325 million.”

F. Whitten Peters, the acting Secretary of the Air Force, explained the officials concluded they could delay the program in light of the fact that existing DSP satellites have sufficient life to perform the early warning mission and that USAF has five additional DSP spacecraft in reserve.

Elsewhere, the budget contains $361.3 million for the Milstar satellite follow-on system and $269.8 million for Global Positioning System satellite work.

The Outyears

Administration spokesmen, in their public explanations of the new defense program, have tended to put heavy emphasis on the “outyears,” the last five years of the six-year defense program, rather than on the initial year, Fiscal 2000.

They note that the plan calls for the Defense Department budget to go up significantly from 2000 to 2001 and then stay up, with the services, over the full multiyear plan, getting a combined boost of $112 billion over the original very low planning levels.

The Air Force, for its part, is scheduled to receive budgets, in the five “outyears,” of $84.8 billion, $86.7 billion, $89.2 billion, $92.3 billion, and $95.1 billion, in current dollars. That appears to mark a considerable increase over today’s funding.

However, critics note that, once the effects of inflation are removed and Pentagon budgeting “gimmicks” are eliminated, an increase that looked like $112 billion actually turns out to be a $44.5 billion. The same holds true of the Air Force budget. For example, the big USAF budget in the last “outyear” actually loses nearly $12 billion of its value when the inflation is squeezed out.

The same critics point out that most of the spending would not take place until after the Clinton Administration leaves office and so would have to be proposed and defended by a new President.

US Defense Spending

Fiscal Year Constant Billions
1985 $424.5
1986 $406.9
1987 $392.9
1988 $384.8
1989 $379.4
1990 $371.3
1991 $334.9
1992 $322.3
1993 $309.2
1994 $284.2
1995 $283.5
1996 $276.3
1997 $274.6
1998 $269.7
1999 $268.6
2000 $267.2
Fiscal 1991­92 budget authority figures exclude the cost of the Gulf War.