The Complex

Pentagon Spent $5 Billion on Weapons on the Eve of the Shutdown

The Pentagon pumped billions of dollars into contractors' bank accounts on the eve of the U.S. government's shutdown that saw 400,000 Defense Department employees furloughed.

All told, the Pentagon awarded 94 contracts yesterday evening on its annual end-of-the-fiscal-year spending spree, spending more than five billion dollars on everything from robot submarines to Finnish hand grenades and a radar base mounted on an offshore oil platform. To put things in perspective, the Pentagon gave out only 14 contracts on September 3, the first workday of the month.

Here are some of the more interesting purchases from Monday's dollar-dump.

First up: the Defense Logistics Agency, the Pentagon branch that provides the armed services with things like fuel and spare parts. DLA has the honor of dropping the most cash in one contract last night with the $2.5 billion award it gave to aircraft engine-maker Pratt & Whitney for "various weapons system spare parts" used by the Army, Navy, Air Force and Marines. Other highlights of DLA's last-minute spree included: $65 million for military helmets from BAE Systems, $24 million for "traveling wave tubes" to amplify radio signals from Thales, $17 million for liquid nitrogen, $15 million for helium and $19 million on cots. Yes, cots.

Then came the Navy. The sea service spent hundreds of millions of dollars on 31 contracts buying everything from high-tech Finnish hand grenades to janitorial services.

The service's biggest contracts were aimed at protecting ships from underwater attack. It gave Lockheed Martin a total of $139 million for sonar that allows Arleigh Burke-class destroyers to detect submarines and underwater mines. The Navy is also buying $40 million worth of hand grenades made in Vihtavuori, Finland, that allow "users to choose the level of blast needed for the situation." Another $18 million is going to Phoenix International Holdings to operate a robot submarine called the Submarine Rescue Diving and Recompression System that can save people from disabled subs sitting up to 2,000 feet underwater.

Not everything the Navy spent its end of year cash on was high tech, however. The service also gave $64 million contract to build a new fuel pier in Point Loma, Calif. It also added $9 million onto an existing $138 million contract for janitors at Navy medical centers in San Diego.

The Air Force, traditionally DOD's biggest spender, was relatively restrained; it dished out only 17 contracts. One of the big themes of the Air Force's spend was spying. The service spent cash on everything from spy satellites to drones to planes that can be used to hunt drug dealers.

The air service gave General Atomics $49 million to help France buy 16 MQ-9 Reaper drones. It also dished out $64 million to Lockheed for help operating spy satellites that are equipped with infrared cameras. Another $9 million went to URS Corp. for maintenance work on the Air National Guard's fleet of RC-26B spy planes that help domestic law enforcement agencies catch drug dealers. Johns Hopkins University got $7 million from the Air Force Research Lab to develop software that can monitor raw communications signals and images collected around the world to detect significant "events" in real time. $8 million is going to a company called McCrone Associates to analyze particles in order to ensure someone is complying international ban on nuclear weapons tests. It doesn't say who that someone is or what type of particles are being analyzed.

The service also spent $9 million on a new gym at the Air Force Academy that includes areas for CrossFit training, space for the academy's Triathlon Club and a "television studio."

The Army only had a couple of relatively large contracts last night. The first was a $600 million award spread out between nine companies to develop alternative energy projects for the Army Corps of Engineers. The ground service also spent $200 million on for Interceptor-brand body armor made by Federal Prisons Industries for sales to other countries. In addition to these deals, the service gave out plenty of relatively small contracts -- and relatively is an important word here -- for everything from renovations on a reserve center in New Jersey to the purchase of 60 Mercedes Benz trucks for African countries.

The Missile Defense Agency (MDA) gave Raytheon $230 million to support operation of the massive, sea-going X-band radar station that MDA uses to detect ballistic missile launches in Asia. MDA also gave Trex Enterprises $6 million for telescope mirrors that are impervious to changes in temperature.

The Defense Threat Reduction Agency, the Pentagon's arm responsible for defeating threats posed by weapons of mass destruction, gave Johns Hopkins University $9 million for research into detecting "chemical, biological, radiological, nuclear and high-yield explosive material."

Finally, U.S. Special Operations Command got in on the spending last night, giving out one $49 million contract to Boeing for development work on an upgraded version of the Army's MH-6 Little Bird chopper.

This goes to show that even when the federal government is shutdown and the military has temporarily lost half its civilian workforce, the Pentagon can spend money like almost no one else.


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The Complex

U.S. Stealth Jets Have 363 Production Flaws, Inspectors Say

The Pentagon's inspector general has found 363 problems in the way Lockheed Martin and five other defense contractors build the Pentagon's primary fighter jet of the 21st century. Hundreds of production errors "could adversely affect aircraft performance, reliability, maintainability, and ultimately program cost" of the F-35 Joint Strike Fighter, according to an IG report published today.

The flaws largely consist of the companies' failure to follow safety and quality control techniques while building the stealth fighter jets. Contractors failed to make sure that manufacturing spaces were clear of harmful debris or that glues used to hold parts of the jets together had not passed their expiration dates. Instructions telling workers how to install parts on the airplane were incorrect.

These production flaws likely contributed to each jet in a recent batch of F-35s needing an average of 859 "quality action requests" before they were ready for delivery, according to the IG. This means that about 13 percent of all work done on a brand-new F-35 is "scrap, rework and repair" work to fix problems built into the planes, according the 126-page report.

"This was a wake-up call that we had to be more rigorous," Eric Branyan, Lockheed's F-35 vice president of program management, told Reuters. Branyan said the company plans to get the rework rate down to about 6 percent.

The report also knocks the Pentagon's F-35 program office and the Defense Contract Management Agency for "ineffective" oversight of Lockheed and the five other contractors that make the fighter jets.

"Although it would be unrealistic to expect first production to be issue free," the contractors need to improve their "quality assurance" techniques, how they communicate design requirements to subcontractors, and their discipline in adhering to manufacturing processes "if the Government is to attain lower program costs," reads the report.

This echoes what Lt. Gen. Christopher Bogdan, the Pentagon's man in charge of the $400 billion fighter jet program, said a year ago when he was the No. 2 military official involved in the program.

In September 2012, Bogdan told Killer Apps that the F-35 effort must fall back on the fundamentals of good weapons buying if it were to have a shot at success.

"That means know where every penny is, know where every person on the program is and what they're doing, and know where every pencil is. What I mean by pencil is, all the equipment -- you've got to have that kind of discipline." Bogdan reiterated that last sentence when asked how the F-35 program will be run going forward.

"There is no more money or no more time in the development of this program," said Bogdan. "We will not go back and ask for anymore."

If the program is run with discipline, transparency, accountability, and a focus on how to make the airplane affordable in the long term, "we've got a shot at getting this done. We've got a shot -- it will not be easy, though," Bogdan added.

The Defense Department plans to buy a total of 2,443 F-35s for the Air Force, Navy, and Marine Corps over the coming decades. The F-35 will replace thousands of the U.S. military's Cold War-era fighters and ground-attack jets such as F-16 Vipers, A-10 Warthogs, AV-8B Harriers, and F/A-18 Hornets. Eleven other countries also plan to fly the stealth jets. Total cost over the program's estimated 50 years: $1.5 trillion.

The F-35 has been plagued by development problems leading to hundreds of millions of dollars' worth of redesigns. These redesigns in turn have led to years' worth of production delays for the airplane and a massive reduction in the planned number of jets the Pentagon plans to buy. The latest figures indicate that the military will only have 365 JSFs by 2017 instead of the 1,591 it originally planned on having by then.

Pentagon and Lockheed officials have blamed the F-35's production woes on the fact that Lockheed is trying to design, test, and build a supersonic stealth fighter all at once.

To be fair, it looks like Bogdan and Lockheed are making progress on these fronts. The Pentagon says it has already addressed 269 out of the 363 problem "findings" identified by in the IG report.

Just a couple of weeks ago Bogdan told reporters that Lockheed is on track to deliver combat-ready jets to the Marines by late 2015 and the Air Force by late 2016. But that was before this latest report.

Lockheed Martin