Is the F-35 a Trillion-Dollar Mistake?

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[Interesting piece, not just on the many technical flaws of the F35, but also on both the huge sunk cost effect of the project and the extent to which the production and maintenance of the plane is mired in pork barrel politics. *RON*]

Paul Barrett, Bloomberg, 4 April 2017

Illustration: 731; Photograph: Courtesy U.S. Air Force
Trump criticized the cost of America’s warplane of the future, but what he’s not saying is that it might be hackable and leave soldiers vulnerable.

A pointy-beaked F-35B Lightning II idles noisily on a runway at Naval Air Station Patuxent River in southern Maryland. Suddenly the plane roars to life and sprints a mere 300 feet before abruptly lifting off and soaring into a cloudless, late-winter sky over Chesapeake Bay. A while later it zooms back into view, slows to a hover over the runway like a helicopter, then drops straight down to the concrete, where it lands with a gentle bounce.

A U.S. Marine Corps test pilot is manning the controls. If he were Air Force or Navy, his version of the military’s highly anticipated new fighter jet wouldn’t have this capacity to take off and land on a dime—though it would come with other custom features. This is why Air Force Lieutenant General Christopher Bogdan, who’s in charge of overseeing the acquisition of the F-35, brought three plastic models of the fighter jet to a December 2016 meeting with Donald Trump at his Florida residence.

Bogdan, a tall former test pilot who speaks in a raspy, authoritative voice, has been working with Lockheed Martin Corp., the plane’s manufacturer and the country’s largest defense contractor, since 2012. Nine days before their meeting, Trump had called Bogdan’s program “out of control” in a tweet, so the three-star general knew that at Mar-a-Lago, the president-elect would put him on the spot. But what he didn’t anticipate was Trump’s eagerness to demonstrate his own knowledge of aviation. Trump talked with pride about his personal Boeing 757, Bogdan says. “Anything about airplanes, he’s excited about, and he told me that the first time we met.”

Amid the gold-inlaid, high-ceilinged splendor of the Jazz Age château in Palm Beach, Bogdan explained the F-35’s advanced sensor system and stealth capability. Trump listened respectfully, but the next day he was back on Twitter, complaining about the plane’s “tremendous cost and cost overruns.” To Bogdan’s continued surprise, in the days before the inauguration, Trump twice telephoned the general at his office in an austere Pentagon annex in Arlington, Va. He wanted to discuss the allegations he’d heard that the F-35’s performance fell short of existing fighters. Bogdan hastened to reassure Trump that those claims were “myths,” “misinformation,” or “old information”—none of them worth believing.

On Jan. 30, his 10th day as president, Trump markedly changed his tone. He took credit for knocking $600 million off the price of the latest batch of 90 fighters and told reporters the F-35 was “a great plane.” Since then, he’s made the F-35 an emblem of his dealmaking prowess. During his Feb. 28 address to a joint session of Congress, the president boasted he’d “saved taxpayers hundreds of millions of dollars by bringing down the price of the fantastic new F-35 jet fighter.”

In truth, thanks to Bogdan’s negotiations with Lockheed, prices were going to fall with or without Trump’s intervention. And the plane, discounts notwithstanding, is still on its way to becoming the priciest military procurement in U.S. history. Trump’s self-congratulation serves as a distraction from the larger issue troubling the fighter jet: its performance. While the Pentagon’s official line is that, after years of difficulties, the F-35 is meeting high expectations, skeptics both outside and within the military say it’s turning out to be a two-decades-in-the-making, trillion-dollar mistake.

The ambition to create the version of the F-35 that I watched on the tarmac at Patuxent River—one that can make short takeoffs and vertical landings—was what got the fighter jet’s development under way in the 1980s. The Defense Advanced Research Projects Agency (Darpa), the Pentagon’s tech arm, began working at the Marine Corps’ behest on an improved version of the Harrier, a crash-prone vertical-landing jet of British design. According to a Pentagon history of the F-35, Darpa quietly sought assistance from a research and development arm of Lockheed Martin known as the Skunk Works. By the early 1990s, the Darpa-Skunk Works collaboration had produced preliminary concepts, and the Marine Corps began pressing Congress for funding. The Air Force and Navy insisted that they, too, needed stealthy, supersonic fighters to replace aging Cold War-era models. Out of this clamoring grew a consensus that the only way to afford thousands of cutting-edge fighters was to build a basic model that could be customized for each service. “In terms of future tactical aircraft, this was the program,” says Frank Kendall, a senior Pentagon acquisition official during the Clinton and Obama administrations. “There was no other program.”

In 2001 the Pentagon declared Lockheed the winner of a five-year competition against Boeing Co. for the opportunity to build the F-35. At the time, the contract was estimated to be worth $200 billion over three decades. Lockheed, which is based in suburban Bethesda, Md., not far from the Capitol and Pentagon, would assemble the plane in Fort Worth, in a mile-long facility that’s produced military aircraft since 1942. In addition to the Marine Corps F-35B vertical-landing jet, Lockheed agreed to manufacture the Air Force F-35A, which would take off and land conventionally, and the Navy F-35C, designed for aircraft carriers, with larger, foldable wings, more durable landing gear, and a tailhook.

Not only was the F-35 going to offer a 3-in-1 cost savings for the U.S. military, the plane was supposed to help knit together the air forces of 11 American allies—including Britain, Israel, Japan, and South Korea—that have lined up to buy it.

But this one-size-fits-all promise quickly led to problems. For the F-35B, the Marine Corps variant, Lockheed incorporated a novel propulsion system with a 50-inch-diameter “lift fan” positioned horizontally just behind the cockpit. When the plane goes into vertical mode, doors on the fuselage open, allowing the fan to draw in air from above and blow it toward the ground. Simultaneously, the plane’s main engine in the rear swivels 90 degrees to expel its exhaust downward. The combined force of fan and engine allows the plane to hover.

The lift fan made the common fuselage bulkier than it otherwise would have been. That, in turn, increased drag and decreased fuel efficiency and range. Lockheed engineers also discovered they had to slim the F-35B by thousands of pounds to make it light enough to hover. The degree of commonality among the three versions of the F-35—the shared features—turned out to be not the anticipated 70 percent but a mere 25 percent, meaning that hoped-for economies of scale never materialized. A pattern of continual reengineering resulted in billions of dollars in cost overruns and yearslong delays.

Beginning in 2007, the Pentagon accepted delivery of scores of planes, even as Lockheed continued to make design changes and address myriad deficiencies. The military “didn’t follow the old rule of ‘fly before you buy,’ ” says Michael Sullivan, director of defense acquisition oversight for the Government Accountability Office, the auditing arm of Congress. Once new weapons are in the hands of the military services, says Kendall, the former Pentagon acquisition official, “there’s a lot of inertia to continue, no matter what.” Michael Rein, a Lockheed spokesman, declines to comment on what he calls the “ancient history” of this period.

The arrival of the Obama administration in 2009 brought new scrutiny to the F-35 program. Ashton Carter, a physicist and former Harvard professor of science and international affairs, took over as the Pentagon’s chief weapons buyer, known formally as undersecretary of defense for acquisition, technology, and logistics. (He went on to serve as secretary of defense in 2015 and 2016.) The dysfunction startled Carter. What was supposed to have been an economical plane at $50 million apiece had doubled in price, he recalled in a talk at Harvard in 2014.

Part of the problem stemmed from a policy instituted in the mid-1990s aimed at reducing red tape. “This was a notion of trying to skinny down the acquisition bureaucracy,” says retired General Norton Schwartz, who served as Air Force chief of staff from 2008 to 2012. “In doing so, we regrettably lost much of the systems engineering ability that existed in-house.”

The “cost plus” contracts the Pentagon signed with Lockheed only exacerbated the situation. The company received all its costs and was eligible for a performance-based bonus on top of that. Despite the program’s disarray, the military consistently awarded Lockheed 85 percent of its potential fee. In his Harvard talk, Carter described confronting the Pentagon program manager, a Marine Corps major general named David Heinz: “He looked me in the eye—I’ll never forget it—and he said, ‘I like the program manager on the Lockheed Martin side that I work with, and he tells me if he gets less than 85 percent, he’s going to get fired.’ ”

Instead, it was Heinz who was fired, in 2010. Carter switched the Lockheed contract to a fixed-price arrangement under which the government and contractor split the cost of overruns. Carter declines to comment for this article, but confirms his earlier account. (Heinz, now chief executive officer of IBC Advanced Alloys Corp., an Indiana-based company that supplies Lockheed with the housing for one of the F-35’s targeting systems, also declines to comment, as does Rein, the Lockheed spokesman.)

With the program about seven years behind schedule, the Pentagon estimates it will spend $379 billion over 40 years to develop and acquire more than 2,440 of the warplanes. Adjusting for inflation, that’s a 38 percent increase from the initial 2001 estimate. Add more than $600 billion for upkeep, and the total price tag approaches $1 trillion. But the aircraft has already paid off for Lockheed. Having delivered 210 F-35s so far—mostly to the Pentagon, but also to Israel and other privileged U.S. friends—the company is expected to derive more than 20 percent of its revenue in 2017 from the jet.

For all its stumbles, the plane’s geographic and political heft make it too big to fail. The three versions of the plane require a total of some 300,000 parts, and Lockheed has parceled out the subcontracting to all but five unlucky states—Alaska, Hawaii, Louisiana, North Dakota, and Wyoming. Lockheed says the F-35 directly or indirectly supports 146,000 jobs across the U.S., ranging from minimum-wage broom-pushers to engineers paid well into six figures.

Consider Arizona. In December 2011, Republican John McCain, the state’s senior U.S. senator and chairman of the Armed Services Committee, went to the Senate floor to declare that the F-35 program “has been both a scandal and a tragedy.” But less than a year later, the lawmaker, himself a former Navy pilot shot down over Vietnam, sounded mollified. The Marine Corps had decided to base a squadron of 16 early-production F-35Bs in Yuma, Ariz. Joining Lockheed executives and Marine Corps officers, McCain said at a dedication ceremony: “I am—after many years of frustration and setbacks—encouraged that the overall program is moving in the right direction.” The F-35, he added, “may be the greatest combat aircraft in the history of the world.” In addition to maintenance jobs at the Yuma base, the plane provides work for 24 subcontractors in Arizona, supporting a total of 4,620 jobs, according to Lockheed.

Across the country in Vermont, the independent Senator Bernie Sanders has disparaged the F-35 in the Burlington Free Press as an example of the Pentagon’s “long record of purchasing weapons systems from defense contractors with massive cost overruns that have wasted hundreds of billions of taxpayer dollars.” Nevertheless, Sanders has endorsed the idea of bringing 18 of the fighters to Burlington International Airport in 2019 to replace a squadron of aging F-16s flown by the Vermont Air National Guard. In the face of local opposition to noise and other environmental objections, Sanders said at a town hall meeting in 2014: “My view is that given the reality of the damn plane, I’d rather it come to Vermont than to South Carolina. And that’s what the Vermont National Guard wants, and that means hundreds of jobs in my city. That’s it.”

Lockheed says the jobs total in Vermont will exceed 1,400. South Carolina won’t lose out: There’s a squadron of F-35s stationed at the Marine Corps air base in Beaufort. There are also detachments in California, Florida, Maryland, Nevada, and Utah.

Bogdan at Nellis AFB in Nevada in 2015. Courtesy U.S. Air Force
Since Lieutenant General Bogdan took over the F-35 acquisition program five years ago, by all accounts he’s kept it from going further off the rails. A blunt, informal officer who leads a 2,000-person bureaucracy devoted exclusively to the F-35, Bogdan wears an olive one-piece flight suit to his office in suburban Virginia. He explains that the F-35’s stealthy profile and matte finish are designed to allow it to succeed against foes with sophisticated radar and surface-to-air missiles—the Chinese or Russians, for example. “You’re the guy who’s going to knock down the door by going very deep into enemy territory, survive, and go against the very toughest threats,” Bogdan says. When in stealth mode, the F-35 carries only two bombs and two air-to-air missiles in an internal weapons bay. But once the opposition’s defenses are eliminated, the plane can be outfitted to carry six additional weapons, three beneath each wing. “I can go and wreak a lot of havoc,” Bogdan says.

He points to a three-week aerial exercise in February called Red Flag, which pitted dozens of U.S. warplanes against one another in mock battle over the Nevada desert. The F-35s, the stars of the show, recorded a 20-to-1 kill ratio, meaning they took out 20 opposing planes for each one they lost. And they dropped 51 practice bombs, with 49 direct hits—a level of accuracy Bogdan calls “incredible.” Other military leaders share his enthusiasm. “We can’t get into those aircraft fast enough,” Lieutenant General Jon Davis, the Marine Corps’ aviation chief, told a House Armed Services subcommittee in mid-February. “We have a game changer, a war winner, on our hands.”

The F-35, in one of its most futuristic advancements, projects flight data—airspeed, altitude, heading, potential targets, and warnings—onto the curved visor of the pilot’s helmet. It’s almost a virtual-reality experience, pushing the skills of even today’s Xbox-weaned twentysomethings. Six infrared cameras mounted on the exterior stream real-time imagery, allowing the pilot to “see through” the skin of the plane, including straight down. In a process called “sensor fusion,” the main onboard computer can meld data from the exterior cameras, the plane’s powerful radar, and an “electro-optical” targeting system. “It’s always looking in every direction,” says Major John Dirk, a Marine Corps test pilot. The visor’s profusion of images and information takes getting used to, he adds, but “I can see threats I wouldn’t have been able to see before.”

The F-16. Courtesy U.S. Air National Guard
Some experts warn that test flights and mock battles are different from the real thing—and that the military’s enthusiasm should be viewed skeptically. “It’s groupthink,” says Pierre Sprey, who worked at the Pentagon during the Vietnam War. He belonged to a clique of aeronautical designers and engineers who called themselves the “fighter mafia” and helped design two respected aircraft: the F-16 Fighting Falcon, a maneuverable specialist at air-to-air duels, and the heavily armored A-10 Thunderbolt II, better known as the Warthog, which supports ground troops by flying low and slow, strafing the enemy with a seven-barrel 30-millimeter Gatling-type autocannon. “The F-16 and A-10 each do one thing well,” Sprey says.

The Marine Corps’ “obsession” with short takeoff and vertical landing, he says, led to F-35 attributes that limit the plane’s maneuverability—the stout fuselage, which increases drag, and small wings, which cut weight but reduce the amount of lift the plane can generate. If F-35s “face the best Chinese or Russian fighters, they will be lucky if they can turn and run,” he adds.

One could question Sprey’s objectivity, given that the F-35 is intended to put his creations, the F-16 and A-10, into retirement. Not so J. Michael Gilmore, who served from 2009 to January 2017 as the Pentagon’s director for operational test and evaluation—the military’s chief weapons tester. Gilmore, who has a Ph.D. in nuclear engineering, warned in a memorandum to the Air Force last August that the F-35 will need support from other planes “to locate and avoid modern threats, acquire targets, and engage formations of enemy fighter aircraft due to outstanding performance deficiencies.” According to Gilmore, the sensor-fusion system fails to display some potential threats clearly, and the plane’s electronic warfare capability—a reference to classified radar-jamming weapons—is weak.

In a separate 2016 annual report released in January, Gilmore addressed the F-35’s protection of soldiers on the ground, saying the plane “does not yet demonstrate close air support capabilities equivalent to those of” the A-10 and other older aircraft. He cited the F-35’s limited weapons load while in stealth mode. The F-35 burns fuel fast, making it difficult for the jet to circle above a battlefield for long, Gilmore wrote. And he pointed out that test pilots aren’t unanimously enthusiastic about all aspects of the newfangled helmet. “Symbol clutter,” he wrote, obscures the visor representation of air-to-ground strafing, making that function unusable.

The A-10. Courtesy U.S. Air Force
Perhaps most troubling are the complexities of the autonomic logistics information system (ALIS), which hooks up to the plane in the hangar and provides the information technology backbone for maintenance of each aircraft. ALIS requires 16 million lines of code, compared with 8 million for the F-35 itself. When ALIS malfunctions, which it does somewhat regularly, maintainers have “to use time-consuming workarounds,” Gilmore said. Last April the GAO pointed out that all F-35 data from across the U.S. fleet are “routed to a central point of entry and then to ALIS’s main operating unit with no backup system or redundancy. If either of these fail, it could take the entire F-35 fleet offline,” threatening to ground the planes.

Lockheed’s Rein declines to comment on Sprey’s assessment. As for Gilmore’s critique, the Lockheed spokesman refers to a Jan. 17, 2017, written statement by Bogdan. “The basic design of the F-35 is sound,” it said, but “we recognize there are known deficiencies that must be corrected.”

“This plane has a long way to go before it’s combat-ready,” says Dan Grazier, a defense analyst at the nonprofit Project on Government Oversight in Washington. “Given how long it’s been in development, you have to wonder whether it’ll ever be ready.”

In an interview, Bogdan responds to criticism of the F-35 with equanimity. He stands by the overall reassurance he offered President Trump but concedes the plane has kinks to be worked out. ALIS, he says, “is nowhere near as good as it should be,” and upgrades are under way, including building in the kind of redundancy the GAO noted is absent. Meanwhile, he acknowledges, F-35 maintenance personnel do have to “do a lot of workarounds.” Bogdan also worries that ALIS could be hacked. The planes themselves have been well-secured against cyberattack, he says, but ALIS connects to other government networks that are potentially vulnerable. This isn’t an abstract concern. A Chinese businessman pleaded guilty last year in the U.S. to participating in a conspiracy with hackers from the Chinese military who prosecutors said stole plans for the F-35 and other American warplanes. Beyond ALIS, Bogdan says the other sensor and software glitches Gilmore and the GAO identified are being addressed and will soon be fixed.

The knock on the F-35 that it’s not maneuverable obscures a basic point about contemporary aerial warfare, Bogdan says: Up-close dogfighting is a thing of the past. “This airplane is very maneuverable,” he insists, “but it doesn’t have to be to kill another airplane air-to-air.” Its sensors can identify a foe long before the two pilots can see each other—and fire a missile with deadly accuracy at that distance, Bogdan says.

By contrast, close air support of ground troops presents “a tricky question,” he says. The F-35 “doesn’t have all the capabilities it needs yet.” One feature that will be added to new planes—and retrofitted on older ones—is the equivalent of a laser pointer for tracking moving targets. Currently the F-35 has a surprising weakness in its inability to zero in on swift-moving enemy vehicles, Bogdan says. Only F-35As have internally mounted 25mm guns for ground strafing; in the future, similar weapons will be added in externally mounted belly pods on Bs and Cs. “When people are complaining about close air capability of the F-35,” he says, “they’re looking at what it can do today, and what it can do today is limited. What it can do tomorrow is going to be very, very good.” But not as good, he admits, as what the venerable A-10 already can do. “We designed the F-35 to be a decathlete,” he explains: versatile and adaptable, if not necessarily a medal winner in any one event.

Grazier frames this another way: “You have a plane that at best is a jack of all trades, master of none.”

Lockheed CEO Hewson. Courtesy Lockheed Martin
On Feb. 3 the White House announced an $8.2 billion contract with Lockheed for 90 F-35s, the latest and largest batch yet. Based on a per-plane cost for the F-35A of less than $100 million, the deal trimmed $728 million from the last purchase. That savings exceeded the $600 million Trump took credit for after intervening with Lockheed CEO Marillyn Hewson.

Since late last year, Hewson has met with Trump at Mar-a-Lago, Trump Tower in New York, and the White House. But long before Trump began tweeting about the plane, calling Bogdan, or meeting with Hewson, negotiations last year between the Pentagon and Lockheed were pointing to a significant volume discount. Bogdan told reporters in December that the contract would be valued at about $8 billion overall and that per-plane costs would decrease—both of which happened.

The president has balanced his praise for the plane with the admonition that Lockheed shouldn’t get too comfortable. He’s warned that he’d consider substituting some F-35 purchases with Boeing F/A-18 Super Hornets. During a Feb. 17 tour of a Boeing plant in South Carolina, he said, “We are seriously looking at a big order” of F/A-18s. Lockheed’s rival as the second-biggest U.S. weapons contractor, Boeing has naturally tried to encourage Trump’s interest in the Super Hornet. “We’re excited to work with the new administration to bring the right capability to the war fighter,” says Dan Gillian, who heads the company’s fighter jet program. First flown in the 1990s, the twin-engine F/A-18 has seen action over Iraq and Afghanistan. It’s not really comparable to the F-35. The Super Hornet, which is designed to fly off aircraft carriers, lacks the F-35’s stealth characteristics and its array of advanced sensors.

Still, the president wants Lockheed and the Pentagon to know he’s in touch with Boeing’s CEO, Dennis Muilenburg. When Trump telephoned Bogdan for the second time, on Jan. 17, Muilenburg was in Trump’s New York office listening in by speakerphone. Bogdan says he didn’t think Muilenburg’s presence was inappropriate: “The things I talked about in front of Mr. Muilenburg were clearly publicly releasable information. I understand the rules.” (In mid-March, Trump selected a senior Boeing executive, Patrick Shanahan, to serve as the Pentagon’s second-ranking official. If confirmed by the Senate, Shanahan would have to recuse himself from Boeing-related matters for two years.)

Formalizing Trump’s fighter jet commentary, Secretary of Defense James Mattis has ordered a Pentagon “review” of the extent to which the F/A-18 could “provide a competitive, cost-effective fighter aircraft alternative.” But the review doesn’t constitute an existential threat to the F-35. Mattis limited the F/A-18 comparison to the Navy’s F-35C carrier-based model. The Navy is scheduled to receive only 260 of its version of the fighter, with the majority of planes—1,763—slated for the Air Force.

Lockheed’s Hewson has become something of a Trump foil. At a Feb. 23 White House meeting with manufacturing CEOs, the president complimented her—and himself. “She’s tough, but it worked out well, I think, for everybody,” he said of the recently agreed-upon Lockheed contract. “She cut her price over $700 million, right? By over $700 million. Do you think Hillary would have asked for $700 million?”

Bogdan, who’s announced he will retire in coming months, is already negotiating the next order of 130 F-35s. He expects the total price to exceed $10 billion. Looking further into the future, beyond the F-35, Lockheed’s Skunk Works is again collaborating with Darpa on what the company’s website heralds as “next-generation” planes that will “maintain U.S. air dominance capabilities in the post-2035 world.”

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