Monday, December 19, 2016
Saturday, October 01, 2016
A NOTE FROM THE EDITOR:
Those of us in the Military Veteran Community, as well as those among us who have worked for years with the federal government, have become concerned in recent years about the public view of the Office of the President.
Below are selected excerpts from a classic article by George Friedman, prior to the 2012 National Election. It is our hope that the content will continue bringing reality to American citizen expectations on the eve of the 2016 election.
STRATFOR GEOPOLITICAL WEEKLY
"The American presidency is designed to disappoint.
What the winner actually can deliver depends upon what other institutions, nations and reality will allow him or her.
Each candidate must promise things that are beyond their power to deliver. No candidate could expect to be elected by emphasizing how little power the office actually has and how voters should therefore expect little from him.
So candidates promise great, transformative programs. Though the gap between promises and realities destroys immodest candidates, from the founding fathers' point of view, it protects the republic. They distrusted government in general and the office of the president in particular.
Congress, the Supreme Court and the Federal Reserve Board all circumscribe the president's power over domestic life. This and the authority of the states greatly limit the president's power, just as the country's founders intended. To achieve anything substantial, the president must create a coalition of political interests to shape decision-making in other branches of the government. Yet at the same time — and this is the main paradox of American political culture — the presidency is seen as a decisive institution and the person holding that office is seen as being of overriding importance.
The president has somewhat more authority in foreign policy, but only marginally so. He is trapped by public opinion, congressional intrusion, and above all, by the realities of geopolitics. Thus, while during his 2000 presidential campaign George W. Bush argued vehemently against nation-building, once in office, he did just that (with precisely the consequences he had warned of on the campaign trail). And regardless of how he modeled his foreign policy during his first campaign, the 9/11 attacks defined his presidency.
Similarly, Barack Obama campaigned on a promise to redefine America's relationship with both Europe and the Islamic world. Neither happened. It has been widely and properly noted how little Obama's foreign policy in action has differed from George W. Bush's. It was not that Obama didn't intend to have a different foreign policy, but simply that what the president wants and what actually happens are very different things.
The power often ascribed to the U.S. presidency is overblown. But even so, people — including leaders — all over the world still take that power very seriously. They want to believe that someone is in control of what is happening. The thought that no one can control something as vast and complex as a country or the world is a frightening thought. Conspiracy theories offer this comfort, too, since they assume that while evil may govern the world, at least the world is governed. There is, of course, an alternative viewpoint, namely that while no one actually is in charge, the world is still predictable as long as you understand the impersonal forces guiding it. This is an uncomfortable and unacceptable notion to those who would make a difference in the world. For such people, the presidential race — like political disputes the world over — is of great significance.
Ultimately, the president does not have the power to transform U.S. foreign policy. Instead, American interests, the structure of the world and the limits of power determine foreign policy.
In the broadest sense, current U.S. foreign policy has been in place for about a century. During that period, the United States has sought to balance and rebalance the international system to contain potential threats in the Eastern Hemisphere, which has been torn by wars. The Western Hemisphere in general, and North America in particular, has not. No president could afford to risk allowing conflict to come to North America.
At one level, presidents do count: The strategy they pursue keeping the Western Hemisphere conflict-free matters. During World War I, the United States intervened after the Germans began to threaten Atlantic sea-lanes and just weeks after the fall of the czar. At this point in the war, the European system seemed about to become unbalanced, with the Germans coming to dominate it. In World War II, the United States followed a similar strategy, allowing the system in both Europe and Asia to become unbalanced before intervening. This was called isolationism, but that is a simplistic description of the strategy of relying on the balance of power to correct itself and only intervening as a last resort.
During the Cold War, the United States adopted the reverse strategy of actively maintaining the balance of power in the Eastern Hemisphere via a process of continual intervention. It should be remembered that American deaths in the Cold War were just under 100,000 (including Vietnam, Korea and lesser conflicts) versus about 116,000 U.S. deaths in World War I, showing that far from being cold, the Cold War was a violent struggle.
The decision to maintain active balancing was a response to a perceived policy failure in World War II. The argument was that prior intervention would have prevented the collapse of the European balance, perhaps blocked Japanese adventurism, and ultimately resulted in fewer deaths than the 400,000 the United States suffered in that conflict. A consensus emerged from World War II that an "internationalist" stance of active balancing was superior to allowing nature to take its course in the hope that the system would balance itself. The Cold War was fought on this strategy.
Between 1948 and the Vietnam War, the consensus held. During the Vietnam era, however, a viewpoint emerged in the Democratic Party that the strategy of active balancing actually destabilized the Eastern Hemisphere, causing unnecessary conflict and thereby alienating other countries. This viewpoint maintained that active balancing increased the likelihood of conflict, caused anti-American coalitions to form, and most important, overstated the risk of an unbalanced system and the consequences of imbalance. Vietnam was held up as an example of excessive balancing.
The counterargument was that while active balancing might generate some conflicts, World War I and World War II showed the consequences of allowing the balance of power to take its course. This viewpoint maintained that failing to engage in active and even violent balancing with the Soviet Union would increase the possibility of conflict on the worst terms possible for the United States. Thus, even in the case of Vietnam, active balancing prevented worse outcomes. The argument between those who want the international system to balance itself and the argument of those who want the United States to actively manage the balance has raged ever since George McGovern ran against Richard Nixon in 1972.
If we carefully examine Obama's statements during the 2008 campaign and his efforts once in office, we see that he has tried to move U.S. foreign policy away from active balancing in favor of allowing regional balances of power to maintain themselves. He did not move suddenly into this policy, as many of his supporters expected he would. Instead, he eased into it, simultaneously increasing U.S. efforts in Afghanistan while disengaging in other areas to the extent that the U.S. political system and global processes would allow.
Obama's efforts to transition away from active balancing of the system have been seen in Europe, where he has made little attempt to stabilize the economic situation, and in the Far East, where apart from limited military repositioning there have been few changes. Syria also highlights his movement toward the strategy of relying on regional balances. The survival of Syrian President Bashar al Assad's regime would unbalance the region, creating a significant Iranian sphere of influence. Obama's strategy has been not to intervene beyond providing limited covert support to the opposition, but rather to allow the regional balance to deal with the problem. Obama has expected the Saudis and Turks to block the Iranians by undermining al Assad, not because the United States asks them to do so but because it is in their interest to do so.
Obama's perspective draws on that of the critics of the Cold War strategy of active balancing, who maintained that without a major Eurasian power threatening hemispheric hegemony, U.S. intervention is more likely to generate anti-American coalitions and precisely the kind of threat the United States feared when it decided to actively balance. In other words, Obama does not believe that the lessons learned from World War I and World War II apply to the current global system, and that as in Syria, the global power should leave managing the regional balance to local powers.
As I have argued from the outset, the American presidency is institutionally weak despite its enormous prestige. It is limited constitutionally, politically and ultimately by the actions of others. Had Japan not attacked the United States, it is unclear that Franklin Roosevelt would have had the freedom to do what he did. Had al Qaeda not attacked on 9/11, I suspect that George W. Bush's presidency would have been dramatically different.
The world shapes U.S. foreign policy. The more active the world, the fewer choices presidents have and the smaller those choices are. Obama has sought to create a space where the United States can disengage from active balancing. Doing so falls within his constitutional powers, and thus far has been politically possible, too. But whether the international system would allow him to continue along this path should he be re-elected is open to question. Jimmy Carter had a similar vision, but the Iranian Revolution and the Soviet invasion of Afghanistan wrecked it. George W. Bush saw his opposition to nation-building wrecked by 9/11 and had his presidency crushed under the weight of the main thing he wanted to avoid.
Presidents make history, but not on their own terms. They are constrained and harried on all sides by reality. In selecting a president, it is important to remember that candidates will say what they need to say to be elected, but even when they say what they mean, they will not necessarily be able to pursue their goals. The choice to do so simply isn't up to them. There are two fairly clear foreign policy outlooks in this election. The degree to which the winner matters, however, is unclear, though knowing the inclinations of presidential candidates regardless of their ability to pursue them has some value.
In the end, though, the U.S. presidency was designed to limit the president's ability to rule. He can at most guide, and frequently he cannot even do that. Putting the presidency in perspective allows us to keep our debates in perspective as well."
STRATFOR Geopolitical Weekly-July 31, 2012 By George Friedman
STRATFOR Geopolitical Weekly-July 31, 2012 By George Friedman
George Friedman is a geopolitical forecaster and strategist on international affairs. He is the founder and chairman of Geopolitical Futures, an online publication that analyzes and forecasts the course of global events. Prior to founding Geopolitical Futures, Friedman was chairman of Stratfor, the private intelligence publishing and consulting firm he founded in 1996.
Thursday, September 01, 2016
Monday, August 01, 2016
“NEW YORK TIMES”
“These leaders created a false case for invading Iraq and then utterly mismanaged the occupation.
It seems a long time ago, and in a world far, far away, that George W. Bush, Dick Cheney and Donald Rumsfeld, enthusiastically supported by Tony Blair, went to war with Iraq.
“These leaders created a false case for invading Iraq and then utterly mismanaged the occupation.
It seems a long time ago, and in a world far, far away, that George W. Bush, Dick Cheney and Donald Rumsfeld, enthusiastically supported by Tony Blair, went to war with Iraq.
Yet now a long and long-overdue British report into Britain’s role in that war, the report of the official and independent Iraq Inquiry Committee led by John Chilcot, has been published, reopening wounds and forcing Mr. Blair back into the limelight to defend why, despite so much evidence and advice against joining in the Bush administration’s misguided enthusiasm for invading Iraq, he chose as prime minister to throw his full support behind America.
Mr. Blair’s message to Mr. Bush at the time — “I will be with you, whatever” — leaps out painfully from the report’s 2.6 million words, proclaiming a blind loyalty that the Iraq war only helped erode, and that seems especially archaic now that Britain’s vote to leave the European Union has raised questions about its role in NATO and its place as America’s closest European ally.
Mr. Blair’s critics are no doubt disappointed that in response to the Chilcot report, he has continued to defend his actions. “I believe we made the right decision and the world is better and safer as a result of it,” he said, which seems willfully blind to the current chaos in Iraq and beyond. But if he would not confess that he erred in his decision, he did acknowledge, “There’s not a single day that goes by that I don’t think about it.”
His plea for understanding the context in which he made his decision to stand with the United States, the confusion and the need for action after the terrorist attacks of 9/11, seems tragically inadequate and self-serving with so many lives lost — more than 200 Britons, at least 4,500 Americans and more than 150,000 Iraqis, most of them civilians — and so much treasure spent prosecuting a war that was built on falsehoods.
While there have been no consequences for Mr. Blair himself, the political judgment of the British has been decisive, rendering the Iraq war as a defining blot on Mr. Blair’s 10 years in office.
The report should not be read as an indictment only of Mr. Blair’s foolish decision. Though the United States was not the subject of the inquiry, it was the Bush administration that falsely sold and launched the invasion. There has been no comparable, comprehensive official inquiry in Washington by independent investigators into the origin and politics of the fateful decision to go to war. Years have passed, but the public, in the United States and abroad, still yearns for the full truth and deserves an American investigation on the scale of the 9/11 Commission.
Given the partisan divide in Washington, however, it is hard to believe a similar exercise would produce anything even remotely dispassionate or honest.
And yet it is the United States, far more than Britain, that needs to understand how national policy can be hijacked by lies and ideology so that there’s less chance it will happen again.”
Friday, July 01, 2016
“THE WASHINGTON POST”
“A 50-year restriction on the rehiring of military retirees as Defense Department civilians would be reinstated, requiring at least 180 days from when they leave the service to when — and if — they are re-hired.
That way the job can be open to competition.
The Senate voted last week to put it to a stop as part of the massive military policy bill that now goes to the House for conference.
Since the terror attacks of Sept. 11, 2001, military officers facing retirement have had a revolving door to walk through to a civilian job at the Defense Department.
Often it’s the same job they held while in uniform, and often they start the Monday after they retire and start collecting their military pension.
Under this arrangement, 41,630 military retirees — many of them senior officers — walked back into the Defense Department as civilians between September 2001 and August 2014, according to a government study. None of these jobs was advertised to the public. More than a third were hired before they officially retired, and more than half started their civilian careers within a pay period after taking off their uniform, an indication that no one competed with them for the job.
The Senate Armed Service Committee’s report on the issue said the current system “creates suspicions” that the federal merit system is being undermined.
The rule was waived after the Sept. 11 attacks 16 years ago to help staff up the Pentagon for the war on terror. But now the committee, led by Sen. John McCain (R-Ariz.), a former prisoner of war in Vietnam, is adamant that the flood of retirees who benefited have blocked more qualified civilians who did not serve from getting hired to Defense jobs.
“Most military retirees and other veterans already receive hiring preferences in recognition of their service,” says the committee’s report on the National Defense Authorization Act, explaining why the policy should change. “Beyond that, the committee believes veterans and retirees should compete on equal footing with other qualified applicants.”
By leaning too heavily on military retirees without allowing other candidates to compete for these jobs, the Pentagon is closing its ranks to a diverse workforce, the committee report says, “…not just in terms of diversity as it is traditionally defined, but also on diversity of thought, experience, and background within the Department that is desirable in any organization.”
McCain’s declined to comment, but his staff referred a reporter to the committee report.
The change, along with another provision of the defense bill that would scale back hiring preferences for veterans applying for federal jobs from outside the government, represent the biggest changes to the Obama administration’s push to reward veterans. Increasingly, hiring managers and members of Congress are concerned that the leg up given to veterans is not always bringing the most qualified candidates to federal agencies.
The provision on military retirees directs the Defense Department to report by January on how many were hired to civilian jobs in 2015 and 2016; whether they were officers or enlisted personnel and how many men and women were in the overall pool of applicants for civilian jobs.
Defense officials also would have to report on something that right now is hard to quantify: How the soft landing enjoyed by military retirees “has impacted .. the ability of the Department and the military services to consistently hire best-qualified individuals for federal service,” according to the committee report.
Defense Department officials declined comment because the legislation is pending.
The proposed change is drawing mixed reactions from veterans groups. The Military Officers Association of America is in opposition, spokesman Jonathan Withington said in this statement: “Existing policy is consistent with the country’s obligation to provide career opportunities to those who served, especially disabled veterans.”
But the American Legion, the country’s largest service organization, said it supports putting retirees back on equal footing with civilian job candidates.
“We support closing this loophole, because now if a military job becomes vacant it won’t be refilled by another military personnel,” said Louis Celli, Jr., the Legion’s acting legislative director. The current system is “degrading the fighting force,” he said.
And the current system benefits senior officers at the expense of junior ones, Celli said, by allowing them to walk into civilian jobs without competing for them. Someone who retired at a more junior rank would actually benefit from the extra points given to veterans competing for civilian jobs, he said.
“Senior military members seem to have the market cornered on these plush positions,” Celli said. “You’ve got these retired generals who get full retirement benefits and they start a second career, just like that.”
A spokesman for the House Armed Services Committee said lawmakers have not yet taken a position on the proposal.”
Friday, May 27, 2016
Sunday, May 01, 2016
Friday, April 01, 2016
“Too few veterans are helping shape national security decisions today.
The lack of veterans in key political posts has left a “deficit” in critical military and security discussions, and helped widen the knowledge gap between civilians and those who served in the military.
[Former Defense Secretary] Hagel said the lack of veterans in key political posts has left a “deficit” in critical military and security discussions, and helped widen the knowledge gap between civilians and those who served in the military.
“When you look at the presidential candidates today, not one is a veteran,” Hagel told the crowd of more than 200. “Our current president and vice president are not veterans. The entire senior White House security staff, none are veterans.”
“That doesn’t mean they’re bad people, that doesn’t mean they’re not smart, that doesn’t mean they don’t care about this country. But there is something missing here. And at a time when everything is hair-triggered, everything is nitro glycerine, and miscalculations can lead to a lot of trouble, we need veterans input.”
Hagel’s remarks were part of a larger event by HillVets to highlight contributions by military, veterans and advocates in politics and wider cultural efforts. The group honored Shaye Lynne Haver and Kristen Marie Griest, who last August became the first women to graduate from Army Ranger School, with a new leadership and service award.
Hagel praised their accomplishments and called the entire U.S. military the best trained and most skilled fighting force in the world.
But he also said he worries that too few Americans understand what that means.
“You all know the numbers — less than 1 percent of our society serves,” he said. “That does not mean this country doesn’t value our military or doesn’t value our veterans. Of course they do.
“But there is developing a wider and deeper gap between civilian society and our military, and our veterans.”
The Burden of War Falls on Fewer Americans Than Ever Before
The former defense secretary and two-term senator said he wants to see veterans in government “in all capacities,” including federal staffers and elected offices.
In the late 1970s, more than 70 percent of Congress has military experience in their backgrounds. At the start of the current Congress, that number dropped below 20 percent.
“We’re losing that perspective, and it’s not good for our country,” he said. “It’s not good for our policy making. We need the input of our veterans.”
Former Defense Secretary Hagel on Veterans In National Security Issues
Tuesday, March 01, 2016
“The defense budget process for 2016 (FY 2017) has just started, with the Administration’s $582.7 defense budget.
Here are red flags of waste:
Overseas Contingency Operations (OCO). Defense spending is divided into a base amount, in the regular defense spending bill, and another account, OCO, intended for unpredictable wars and commitments abroad, in a supplemental spending bill in 2017. Last year, Congress threatened to put massive amounts of regular weapons purchases into the OCO, to get around spending ceilings (which do not apply to OCO).
Because of last year’s deal about budget ceilings between the President and the Congressional Republicans, it seemed like the OCO maneuver, for padding the defense spending bill, would stop. Wishful thinking. It won’t. The Administration has announced a proposed $59 billion OCO, most of which would actually devoted to overseas operations (although $8 billion is in regular weapons buys). The House majority intends to treat that figure as a floor, not a ceiling, and want to fatten up defense spending via OCO by at least $15 billion, making room for defense pork.
Wasteful individual weapons. The prize, in terms of massive criticism, goes to the Littoral Combat Ship (LCS), meant for combat in shallow waters. A few months ago, Secretary of Defense Ash Carter wrote a blistering memo about how the Navy had to cut back its LCS purchases. Just recently, Senators John McCain (R-Ariz.) and Jack Reed (D-R.I.) said “practically no LCS mission capabilities [have been] proven.” But, the Administration budget would still buy two, and, Congress will want more.
The next overruns of the naval aircraft carrierm known as CVN 79. The Government Accountability Office (GAO) wrote about it, “Poor Outcomes Are the Predictable Consequences of the Prevalent Acquisition Culture.” The carrier is estimated at $11.5 billion, but, says GAO, “CVN 79 is likely to cost more than estimated.” Its predecessor has been plagued with cost overruns and other problems.
More F-35s. GAO has written voluminously about the shortcomings of the F-35. But, this Lockheed plane is a favorite of the powerful delegation from Texas, where it is made. Per the budget, the Air Force reduced its buys by 5, but, the Navy and the Marine Corps will buy 13 more. Congress will spend for even more.
The Global Hawk. Some years ago, there was an effort to cancel this. As Taxpayers for Common Sense entitled their analysis, “Pricey Drone is a Waste of Money.” It was unreliable in bad weather and needed an expensive retrofit to counter anti-aircraft, and it seemed like there was not a need for both the U-2 and the Global Hawk since both do reconnaissance.. But, the budget includes both.
For some time, the Defense Department has been preparing to undertake a whole new nuclear Cold War. For the Cold War nuclear competition with the Soviet Union, the U.S. had a triad of nuclear armed submarines, bombers, and missiles. The department envisages a complete set of new weapons for all three legs of the triad (call them #6 for submarines, 7 for bombers, and 8 for missiles), plus the new nuclear warheads (9). Altogether, the “nuclear modernization” will cost about a trillion dollars.
Kingston Reif of the Arms Control Association wrote, “The United States is planning to rebuild all three legs of the nuclear triad and their associated warheads at a cost and on a schedule that many military leaders say is unsustainable.” But this budget includes $8 billion for submarines, with $40 billion planned, fully funds the nuclear bombers, and spends $9 billion on nuclear warheads.
Further: As for the proposed $1.4 billion for new nuclear submarine, with $10 billion over 5 years, it will benefit Senator Reed’[s state (R.I.) and Senator Blumenthal’s state (Conn.) – both on Armed Services — because of General Dynamics facilities.
Further: In the realm of strategic nuclear weapons, the Defense Department budget does propose to bring to an end one gigantic white elephant, a plant to convert the old plutonium warheads to reactor fuel (MOX). But, a strong story in the New York Times showed that the delegation from South Carolina (the plant location) will probably keep funding it.
Guantanamo Bay. Secretary Carter says he still wants to close Gitmo, which would save half a billion dollars. Needless to say, Congress will not agree.”
Monday, February 01, 2016
"The U.S. Small Business Administration has resources available for veterans who want to start their own businesses or for small businesses that may have been affected by employees who have been deployed.
The numbers are substantial, according to the SBA: Nearly one in 10 small businesses in this country are veteran-owned; veterans are 45 percent more likely to be self-employed than non-veterans; and businesses owned by female vets have increased 297 percent from 2007 to 2012.
The SBA’s website has collected a list of programs that can offer help, especially in navigating the complexities of returning home for members of the Guard or Reserve after being deployed.
It has information on starting a business, financing, mentoring and training and selling to the government. It can be found on the website Veteran Owned Businesses
One example of a resource is the Military Economic Injury Loan, which provides funds to eligible small businesses to meet operating expenses when an essential employee is called to active duty. The filing period for businesses to apply begins on the date the essential employee is ordered to active duty and ends one year after the essential employee is discharged or released from active duty.
Another aspect to consider are laws that make federal contracting more attractive to veterans, particularly those with a service-connected disability. The Veterans Entrepreneurship and Small Business Development Act of 1999 established an annual government-wide goal of awarding at least 3 percent of all federal contracts to small businesses owned or controlled by service-disabled veterans.
There’s also Boots to Business, a two-step entrepreneurship training program open to service members and their spouses. The two-day course introduces participants to the opportunities and challenges of business ownership. An eight-week online course allows participants to work through the fundamentals of developing a workable business plan."
Friday, January 01, 2016
“NATIONAL DEFENSE MAGAZINE”
“American companies account for seven of the top 10 firms, and the other three are European.
New data on global arms sales show steady dominance of the market by U.S. manufacturers even as the volume of transactions by American and European companies has slipped over the past several years.
Sales by the top 100 firms have dipped by 1.5 percent in real terms between 2013 and 2014, and most of the drop came from companies in North America and Western Europe, whereas companies located in other regions of the world have collectively increased their military and defense sales, says a new report by the Stockholm International Peace Research Institute.
This is the fourth consecutive year in which the largest arms producers have seen a drop in sales, according to the SIPRI survey released Dec. 14.
Excluding China, deals by the world’s top 100 arms exporters reached $401 billion in 2014, and U.S. companies captured 54.4 percent. U.S. companies saw business decrease by 4.1 per cent between 2013 and 2014, which is similar to the rate of decline seen from 2012 to 2013.
One company bucking the downward trend is Lockheed Martin, whose sales grew by 3.9 percent in 2014 to $37.5 billion. Lockheed Martin’s lead over the second ranked company Boeing — which had total arms sales of $28.3 billion — increased by $4.4 billion in 2014.
“With the acquisition of helicopter manufacturer Sikorsky Aircraft Corp. in 2015, the gap between Lockheed Martin and other companies ranked in the top 10 will widen even further next year,” said Aude Fleurant, director of SIPRI’s arms and military expenditure program.
Western European companies’ arms sales decreased by 7.4 percent in 2014, SIPRI estimated. The exceptions were German and Swiss companies, whose business grew last year.
The SIPRI report confirms what many U.S. industry analysts have said for years about the global defense market becoming more competitive and creating long-term challenges for American firms.
Russia’s arms industry sales continued to rise in 2014 despite difficult national economic conditions, the report said. The number of Russian companies ranked in the top 100 went up from 9 to 11. “Russian companies are riding the wave of increasing national military spending and exports,” said SIPRI Senior Researcher Siemon Wezeman.
The survey identified several “emerging producers” that continue to strengthen their presence in the top 100. They include Brazil, India, South Korea and Turkey. Although their combined arms sales represent only 3.7 percent of the top 100, their revenues rose by 5.1 percent between 2013 and 2014.
While American defense contractors are not expected to relinquish their grip on the market any time soon, U.S. analysts have raised red flags.
“The appreciation of the U.S. dollar could be a huge problem” as U.S. defense contractors try to grow internationally, said Frank Finelli, managing director of The Carlyle Group, a private equity firm. If today’s currency trends continue, European and Russian weapons could become 30 percent cheaper than those made by the United States, Finelli said during a panel discussion at the Center for Strategic and International Studies.
Currency issues aside, U.S. companies will retain their advantage as long as foreign buyers continue to value their military ties with the United States, observed Joel Johnson, executive director of The Teal Group, a market analysis firm.
“Obviously, the exchange rate is not helpful, but I don’t think it is critical,” Johnson told National Defense. “Countries that want a U.S. weapon system because of performance and long-term relationships with the U.S. military are likely to go our way anyway.”
A more worrisome trend for American companies is the commercialization of defense technology. “I do think in the future we will see competition from countries that can provide an ’80 percent solution’ at 80 percent of the price, which may affect both us and our traditional European competitors,” Johnson noted. “Turkey, Ukraine, South Korea are worth watching, particularly with respect to ground equipment.”
The international arms market spotlight in the coming years will be on the F-35 joint strike fighter. Manufacturer Lockheed Martin and its major subcontractors have to be worried that if the Pentagon decides to cut back on future orders, the unit price of the aircraft could increase and make it unaffordable vis-à-vis other global competitors, Johnson said. “I suspect the problem is less about the exchange rate and more about U.S. budget restraints.”
If the United States decides to curtail F-35 buys, “it could scare off foreign buyers,” he said. “The unit cost impact will be greater than exchange rate impact.”