The Air Force’s New Bomber Faces a Pentagon Budget Battle
The battle over who will build the U.S. Air Force’s next-generation stealth bomber came to a close last week, but a new conflict is already developing at the Pentagon. A defense budget passed Friday has Congress and military planners seeking $5 billion in defense cuts, as the Air Force prepares to squeeze another costly development program into a Pentagon budget already packed with big-ticket weapons buys.
Last week’s award of the Long Range Strike Bomber program, or LRS-B, to Northrop Grumman (“NOC”) over a joint bid by defense giants Lockheed Martin (“LMT”) and Boeing (“BA”) marks what is expected to be the Pentagon’s last major combat aircraft program for a decade. But as defense planners embark on a slew of much-needed modernization programs over the next decade, money remains scarce—and could grow scarcer still.
With limited funds to go around, the LRS-B program could find itself competing for funds with myriad Pentagon programs amid tightening budgets. The U.S. Navy has embarked on a major program—starting in the early 2020s—to replace its fleet of Ohio-class nuclear submarines, a key component of the nation’s nuclear deterrent. The U.S. Army is engaged in a multi-billion dollar effort to upgrade its ground vehicles and plans to develop and buy a whole new fleet of helicopters in the 2020s. Meanwhile, the Army, Navy, and Marines are all engaged in the $400 billion F-35 Joint Strike Fighter program.
Within the Air Force alone, the LRS-B will join a number of major new and ongoing programs. In the next several years, the service plans to begin replacing its fleet of E-8 ground surveillance aircraft known as JSTARS, its aging Vietnam War-vintage T-38 jet trainers, and its land-based intercontinental ballistic missiles. A new combat rescue helicopter and a replacement for Air Force One are in the works. Meanwhile, Air Force brass have also prioritized ramping up production on both the F-35 and the KC-46 aerial refueling tanker—made by Lockheed and Boeing respectively—at the same time the LRS-B is trying to get off the ground.
All this comes alongside a new two-year defense budget passed Friday that will increase 2016 defense funding over 2015 levels but comes in $5 billion short of the $612 billion the Pentagon was planning for. On Monday, Texas Rep. Mac Thornberry, Republican chairman of the House Armed Services Committee, told reporters that “painful” cuts were coming, as Congress and the Pentagon looks for ways to comply with the new budget—and no program is sacred.
“We’re looking at them all, and trying to do the least damage, but nobody should be under the illusion that you do this in a non-painful way…. There’s going to be pain,” Thornberry said.
That doesn’t mean the LRS-B will necessarily feel those cuts directly, at least in the near-term. But other programs certainly will. One candidate is the troubled F-35 program, which is in the midst of ramping up production in an effort to drive down the cost per aircraft. Other programs will feel the squeeze as well, particularly going into 2017 when funding will fall at least $14 billion below planned levels.
“I don’t see the LRS-B being affected in the fiscal ’16 budget,” says Bryan Clark, a senior fellow at the Center for Strategic and Budgetary Assessments. “The bigger challenge will be in fiscal ’17 when they’re going to have to find two or three times more savings than they did this year for next year’s budget.”
Congress could elect to insulate the new bomber from those budget pressures by appropriating funds specifically for the LRS-B program, but there’s no indication that it will take that measure. If it does not, the Air Force will fund LRS-B out of its general procurement fund, where it will have to compete with other programs for cash. While the Air Force has budgeted adequately for the LRS-B in the near-term, cost overruns within the LRS-B program (or in other major programs) could squeeze budgets everywhere, Clark says. That could make the LRS-B program vulnerable to problems in other programs like the F-35 or KC-46 tanker, both of which are already far behind schedule and well over-budget.
At a projected $511 million per aircraft, the new bomber’s relatively low cost—“relatively” being the operative word—remains a key selling point for the program. Keeping costs down will remain key to maintaining support in Congress and the Pentagon. To do so, the highly classified program will have to walk a fine line between secrecy and transparency, as it continues to makes its case for funding to lawmakers and the public.
Discrepancies in earlier cost projections delayed the awarding of the contract this summer when defense analysts projected that the program would eventually cost about $100 billion—or nearly double the $55 billion price tag reported by the Pentagon. Any cost overruns going forward could sour political support for the bomber as it vies for Pentagon dollars, wrote Todd Harrison and Andrew Hunter, senior fellows at the Center for Strategic and International Studies, in a paper released last week.
“With a total then-year cost roughly double what some have been reporting, there could be sticker shock in Congress,” Harrison and Hunter wrote. “Any cost overruns could quickly erode support for the program, especially since the Air Force has made affordability a key selling point for the LRS-B.”
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