Search This Blog

Saturday, October 26, 2013

The One Year Budget Cycle Must Go

                                                                     Photo Courtesy "Dabble With" dot com
Ken Larson

Having  dealt with the funding process in the government contracting industry  (both large and small business) for over 40 years through many  administrations and much frustration, I can discuss with  some  credibility a major weakness in the huge machine we call the US  Federal  Government -- the one year budget cycle. Its tail end is whipping everybody this month and we have undergone another sanctimonious "Shutdown", with the promise of more to come.  

A huge reason for much of the largess in this entire area is the one year budget cycle in which the US Government is entrenched. 

About mid-summer every agency begins to get paranoid about whether or not they have spent all their money, worried about having to return some and be cut back the next year. They flood the market with sources sought notifications and open solicitations to get the money committed. Many of these projects are meaningless.

Then during the last fiscal month (September) proposals are stacked up all over the place and everything is bottle-necked. If you are a small business trying to get the paperwork processed and be under contract before the new fiscal year starts you are facing a major challenge.

Surely the one year cycle has become a ludicrous exercise we can no longer afford and our government is choking on it. It is a political monstrosity that occurs too frequently to be managed.

Government must lay out a formal baseline over multiple years (I suggest at least 2 fiscal years - ideally 4 - tied to a presidential election)  - then fund in accordance with it and hold some principals in the agencies funded accountable by controlling their spending incrementally - not once year in a panic mode.

Naturally exigencies can occur. A management reserve can be set aside if events mandate scope changes in the baseline due to unforeseen circumstances. Congress could approve such baseline changes as they arise.

There is a management technique for the above that DOD, NASA and the major agencies require by regulation in large government contracts.    It is called "Earned Value Management" and it came about as a result of some of the biggest White Elephant overruns in Defense Department History.

I contend we have one of the biggest White Elephants ever in front of us (a National Debt approaching $17 Trillion)

We need to get this mess under control, manage our finances and our debt or it will manage us into default.

Tuesday, October 01, 2013

"The Plane that Ate The Pentagon- The Politically Engineered F-35"

The F-35A at Eglin Air Force Base -"Vanity Fair"


"In "Vanity Fair", Adam Ciralsky investigates the F-35 aircraft, or Joint Strike Fighter, that was meant to streamline and update the military’s fleet of planes. When Ciralsky first saw the jet he said he “didn’t know whether to genuflect or spit.”

The plane offers hopes of a futuristic military combat system with technologies far superior to what we have now. But it’s also seven years behind schedule and millions of dollars over budget. When first conceived in 2001, each F-35 was supposed to cost $81 million. In his piece POGO’s Winslow Wheeler puts the true cost of the airplane at $219 million or more per copy:

So what went wrong? In 2001, Lockheed Martin won a valuable government contract worth an estimated $233 billion to create the plane. Instead of testing the plane’s various aspects before production, Lockheed Martin decided to use a practice called concurrency–producing and testing the plane at the same time.

As of now, the planes can’t drop bombs and have only 2% of the necessary coding to be used in combat. During testing, pilots have ended up abandoning their futuristic helmets mid-flight due to the confusion they cause. The planes also can’t fly in inclement weather, something a  $60,000 Cessna can do.

Another basic question: why hasn’t the government stepped in to keep Lockheed Martin on track? Ciralsky believes it’s due to an expensive and brilliantly conceived manipulation of our political system.
The political process that keeps the Joint Strike Fighter airborne has never stalled. The program was designed to spread money so far and so wide—at last count, among some 1,400 separate subcontractors, strategically dispersed among key congressional districts—that no matter how many cost overruns, blown deadlines, or serious design flaws, it would be immune to termination. It was, as bureaucrats say, “politically engineered.
 POGO has reported on the problematic F-35 in the past. Recommendations include cancelling the more expensive and problematic variants of the F-35 and replacing them with proven, less expensive systems. Wheeler, though, believes the project should be abandoned all together. He wrote in Foreign Policy, “There is only one thing to do with the F-35: Junk it. America’s air forces deserve a much better aircraft, and the taxpayers deserve a much cheaper one. The dustbin awaits.”

Read the rest of the article in Vanity Fair to see how just how bad the F-35 program has become."