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Levin, McCain Take Aim at Acquisition

Two of the Senate's defense heavyweights came out swinging today against the Pentagon's dismal acquisition record of the last decade, with Sen. John McCain (R-Ariz.) declaring the nation faces a defense spending "train wreck" and joining Sen. Carl Levin (D-Mich.) in offering a sweeping new bill to rein in the acquisition system.

“We are going to do everything we can legislatively to put an end to these horrific cost overruns that we have seen,” Levin, chairman of the Senate Armed Services Committee, said Tuesday at a joint press conference with McCain, the committee's top Republican. McCain made clear he knew this legislation was just the beginning of the process.

The proposed bill would substantially beef up the Nunn-McCurdy legislation that requires congressional notification by the Pentagon of any program whose cost grows by more than 15 percent. Nunn-McCurdy used to be two words to strike fear in the hearts of a program manager or the head of Pentagon acquisition and give heartburn to taxpayers and to Congress.

But program after program -- the presidential helo, Future Combat System, SBIRS (twice), the C-5 modernization program, EFV, JASSM and almost every major space program -- has busted the Nunn-McCurdy cost and schedule restraints. McCain noted during today's press conference that congressional notification of breaches has become "routine," causing the consequences of a Nunn-McCurdy breach to carry must less weight.

The existing legislation requires the Pentagon to notify Congress when cost growth on a major acquisition program reaches 15 percent. If the cost growth hits 25 percent, the Pentagon must justify continuing the program based on three main criteria: its importance to U.S. national security; the lack of a viable alternative; and evidence that the problems that led to the cost growth are under control. The new bill would assume cancellation of any program to exceed the Nunn-McCurdy restrictions "unless the secretary determines that the continuation of such program is essential to the national security." This is the big change; existing legislating does not assume cancellation.

The 31-page bill also requires reports within 180 days by each service acquisition head about the state of their service’s requirement, acquisition and budget processes. It also requires them to examine the strategy and extent of systems engineering. The proposed bill also requires the undersecretary of defense for acquisition for acquisition, technology and logistics to produce a report within 270 days on the system engineering capabilities of the department.

Levin was willing to concede he and his colleagues were to blame in part for the parlous state of acquisition. "We have not done an adequate job of oversight," he told reporters. To help redress that, he and McCain said the Senate Armed Services Committee will hold hearing next week next week on acquisition issue to get the ball rolling.

One way, of course, to force lower spending on the Pentagon -- aside from improving acquisition – is to cut programs or force the Pentagon to choose between overlapping capabilities. But neither senator advocated major shifts to the programs actually being bought now, noting that President Obama has just nominated Ash Carter as head of acquisition and is still assembling his defense team. McCain noted that the country faces two wars and the majority of Pentagon costs arise from personnel cost, health care and direct materiel support to troops in the field.

Asked if the 25 percent cut to defense spending first suggested by Rep. Barney Frank (D-Mass.) would be supportable, McCain said he would “adamantly oppose” any such cuts in the face of two wars.

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