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HASC Members, Air Force Trying ‘End Run’ on Air Guard Budget Talks — Press Release

WASHINGTON, Dec. 13, 2012 /PRNewswire-USNewswire/ — The National Guard Association of the United States today released the following statement by retired Maj. Gen. Gus L. Hargett Jr., the NGAUS president:

“Fueled by misinformation from some Air Force officers, it appears a handful of House Armed Services Committee members are willing to circumvent the legislative process to force a budget on the Air National Guard that the governors, the adjutants general and most in Congress oppose.

“This is the kind of mischief that can occur during conference, when a handful from the House and Senate can go behind closed doors and literally change legislation in the name of forging compromise between the two chambers.

“The House and Senate both rejected the Air Force’s fiscal 2013 budget request, which would take disproportionate cuts from the Air National Guard. Both chambers told Air Force officials to go back and work with the governors and the adjutants general on a new proposal that addressed state concerns.

“Unfortunately, Air Force officials have since ignored the governors and the adjutants general. Neither group has been able to provide meaningful input to a new budget plan. Nevertheless, Air Force officers have told members of Congress that they have a compromise plan in hand.

“For the record, the nation’s governors and adjutants general favor a freeze on Air Guard manpower and force structure and the establishment of a National Commission on the Structure of the Air Force. Neither organization has agreed to any Air Force proposal. Both remain concerned that the cuts to the Air Guard would adversely affect domestic response.

“In addition, to our knowledge, the chief of the National Guard Bureau has not endorsed any compromise plan for the Air National Guard in the fiscal 2013 Air Force budget.

“Commissions are certainly not the ideal way to craft budget decisions. They are a last resort. But at this point, a commission independent from the Air Force is our only remaining hope for a transparent process that includes real input from the governors and Guard leaders.”

About NGAUS: The association includes nearly 45,000 current or former Guard officers. It was created in 1878 to provide unified National Guard representation in Washington. In their first productive meeting after Reconstruction, militia officers from the North and South formed the association with the goal of obtaining better equipment and training by petitioning Congress for more resources. Today, 134 years later, NGAUS has the same mission.

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NGAUS Statement on Thursday’s Senate Hearing on Guard Empowerment — Press Release

November 8, 2011 by · Comment
Filed under: Events, Press Releases 

NGAUS Statement on Thursday’s Senate Hearing on Guard Empowerment

WASHINGTON, Nov. 7, 2011 /PRNewswire-USNewswire/ — NGAUS released the following statement by retired Maj. Gen. Gus L. Hargett Jr., the association president:

“We welcome a Senate hearing on legislation that would add the chief of the National Guard Bureau to the Joint Chiefs of Staff. The proposal would be the first change in the composition of the panel since 1986 and it deserves careful consideration, including input from a representative cross section of all the agencies and institutions impacted.

“Unfortunately, today’s announced list of those scheduled to testify at the Senate Armed Services Committee hearing on the matter Thursday morning looks more like a Defense Department show of force than an objective legislative hearing. Of course, Army and Air Force officials will oppose the proposal. They have historically fought― in some cases fairly, in others not so fairly― every attempt to give the National Guard and the states a greater voice at the Pentagon.

“Today the American homeland is part of a global battle space and the governors, state Guard leaders and homeland security officials down to the local level are in the fight. Yet they will have no representation at a hearing to determine if they need a statutory channel of communications to the nation’s senior panel of defense advisors.

“The House of Representatives and 68 members of the Senate, including a majority of those on the Armed Services Committee, support a Guard seat at the table. Thursday’s hearing, as now planned, is at best a last ditch, desperate attempt by the opposition to bully just enough votes to blunt on procedure the will of Congress and so many others.”

About NGAUS: The association includes nearly 45,000 current or former Guard officers. It was created in 1878 to provide unified National Guard representation in Washington. In their first productive meeting after Reconstruction, militia officers from the North and South formed the association with the goal of obtaining better equipment and training by petitioning Congress for more resources. Today, 133 years later, NGAUS has the same mission.

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International Fighter — Conference

International Fighter

8th-10th November 2011
Royal Air Force Museum, London, UK

International Fighter is the premier global forum for the fighter community bringing together for the last 10 years, senior Air Force Officials, Naval Aviators, Programme Managers and leading industry teams to engage in unbiased debate and discussion around future fighter requirements, upgrades and operational performance.

This November at Royal Air Forces Museum, you can expect the customary high-level insights and latest updates from across the globe on major programmes such as F-35 Joint Strike Fighter, Gripen, Rafale, Typhoon and Super Hornet, alongside analysis of PAK/T-50 and J-20 developments in Russia and China.

Plus, brand new specialised briefings on weapon payloads, CAS missions, cost-effective life cycle management and non-traditional ISR, a dedicated focus day on Electronic Warfare and, fresh from theatre, performance analysis of fighters in Libyan operations.

This year’s senior-level speakers include:

Air Vice-Marshal Stuart Atha, Air Officer Commander Number One Group, Royal Air Force
Major General Michael R. Boera, Director of Requirements, Headquarters Air Combat Command, US DoD

The full programme is available to download at www.international-fighter.com. Visit the International Fighter Resource Library for your FREE ACCESS to regularly updated podcasts, articles, speaker interviews and presentations at www.international-fighter.com.

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Crisis of Confidence as Questions Arise About U.S. Aircraft Program Costs

As the debt limit discussion plays out in the background two major U.S. defense aircraft programs being led by two of the biggest defense contractors faced scrutiny these past few weeks as the extent of their cost growth becomes clear. In the past depending where the program was in its cycle the Government would absorb most of these costs protecting the contractor’s earnings and profits. In today’s budget environment that may not be the case which will have an affect on Boeing (BA) and Lockheed Martin (LMT) near term performance.

First was the new aerial tanker, the KC-46A, being developed and then produced by Boeing. The company won a hard fought contest with European rival EADS (EADS:P) last year for the first 179 new tankers to replace the aging KC-135 fleet. This was the third attempt by the U.S. Air Force to award this contract since 2001. First Boeing received a sole source lease that was overturned after investigations showed issues between the company and high ranking Air Force officials. Then in 2008 Northrop Grumman (NOC) and EADS won the contract but this was overturned by Boeing’s protest. Finally the third contest was won as Boeing bid a modified 767 airliner at rock bottom prices.

Now it looks like those prices were too good to be true. Boeing actually bid $300 million below the Air Force’s estimated cost for the initial development contract that includes the first 18 aircraft. In the last month the company and Defense Department have begun to inform Congress that not only will Boeing need the $300 million but that they may go over that to at least $4.3 billion. The first billion dollar increase over the $3.9 billion figure will be shared by the Government and the contractor and then Boeing will have to eat everything beyond that. While right now there is no guarantee that the costs will go up that much it does mean the U.S. could be on the hook for another $600 million in costs beyond what was budgeted. Needless to say Congress, especially Ranking Member of the Senate Armed Services Committee and budget “hawk”, John McCain (R-AZ), did not react positively to the announcement.

The situation with the premier aircraft acquisition program, Lockheed Martin’s F-35 Joint Strike Fighter, is even worse. This past week the Defense Department submitted a routine reprogramming request to Congress in order to move money around in their budget to fund priorities. Part of this was to move $264 million to cover cost overruns in the production of the JSF. On top of that a further $450 is needed to be found in the JSF budget as well as costs on the first three production batches have increased over $700 million. McCain almost immediately tweeted that fact and called it “Disgraceful”. He and the Democratic Chairman of the SASC followed this up with a letter to the Defense Department asking among other questions what the bill would be if the JSF program was terminated.

That is an extreme reaction to the situation although the JSF program has a history of schedule delays and increased funding requirements that have seen the total cost balloon to hundreds of billion of dollars and the entry into service delayed by years. Lockheed, if the program really was cancelled, would lose one of their major contracts with a significant affect on earnings and revenues. At a minimum they are facing the possibility of paying themselves for much of the cost increases, especially on future orders, which would have a negative effect on their near term performance.

Programs in their early development and production such as the KC-46A and F-35 often have cost sharing built in to cover these kinds of issues. The problem these two program face is that Congress is not willing to keep sharing. They feel at a time when the defense budget will be reduced that these types of increases are difficult and will put pressure on the rest of the budget. They also put more blame on the contractors then the Government who may have caused requirement or testing changes that increase schedule and cost.

In the KC-46A situation there are already concerns that Boeing deliberately bid it low to win with the goal of making up the costs through the cost sharing process and in production. That is a cynical path to go down and the Air Force needs the KC-46A as the U.S. needs the F-35 now as there are no other potential replacements without the increased cost of starting over.

No matter what the two important aerospace programs will face greater scrutiny and more pressure to keep costs down. Congress will also look at transferring risk and increases to the contractors rather then the Government as has been proposed with the next buy of F-35 production where Lockheed would be responsible for 100% of all cost growth beyond the initial contract price if the Senate gets there way.

Will Congress cancel either of these programs due to the budget difficulties? That is very doubtful but five years ago if you asked the Army if Future Combat Systems (FCS) would be gone they would have said no as would the Navy with the DDG-1000 program. The military has spent billions on programs that never reached fruition for a variety of reasons and cost growth certainly has been one down through the years.

Article first published as Boeing and Lockheed Face Crisis of Confidence: Cost Growth Questioned by Congress on Technorati.

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Alabama Keeps Pushing The Air Force

Supposedly in a meeting between DoD and Air Force officials with members of the Alabama Congressional delegation it came out that the U.S.A.F. will adjust the KC-X RFP to keep Northrop Grumman (NOC) and EADS (EADS.P) in the competition. This of course is a report by Senator Sessions (R-AL) from the meeting. There is no official response as to how the U.S. officials will react to Northrop’s threatened non-participation.

It is in the best interest of the U.S. Government to have two bidders for this program and this may be a necessary step to assure that.

Arrests in Afghanistan contracting scandal

Two Air Force personnel and three Afghan nationals were arrested over charges that bribes were paid to win contracts for military construction in Afghanistan. Two of the Afghans also resided in the United States. Supposedly a bribe of $30,000 was paid to the US Air Force officials to win a $1 M construction contract in 2004. Another bribe was paid later to win a road contract. Several US military and civilian personnel have been arrested and charged with contract related corruption in Kuwait, Iraq and the United States. With the amount of money going to the efforts in Afghanistan and Iraq there is always a chance for such crime.

There is more at The Wall Street Journal’s MarketWatch.com site.

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