Righting the Listing Ship of Navy Readiness — Without Sinking the Pentagon

February 14, 2018

Hearings before Congress on the spate of deadly ship collisions last summer revealed a worrisome state of forward deployed forces’ readiness in particular that must be aggressively confronted. As the Strategic Readiness Review elucidated, training needs an overhaul (especially for operational forces), commanders need to be able to say no to their superiors without losing their jobs, and the Navy requires more ships to reduce deployment lengths and relieve overburdened crews.

The Navy has done well to acknowledge its shortcomings, but it is a long road ahead to get healthy. The recent budget deal is a positive step toward one aspect of giving the service dollars to jump start advance procurement of future ships. While long-term, stable funding is needed to refocus the military toward high-intensity warfare and the modernization of the nuclear triad, raising the spending caps alone is insufficient to address the Navy’s systemic woes.

More money now will not translate into more hulls forward for years especially given that the president’s latest budget for 2019 does not accelerate carrier production. In the meantime, the Navy could make an immediate policy change to improve readiness by capitalizing on new authorities to waive first-in-class shock trials for the USS Gerald R. Ford. The Navy has presented Secretary of Defense Jim Mattis this very choice. Mattis should know that getting this carrier into the fleet as soon as possible by delaying this specific set of trials would mitigate more risks than it would cause.

Furthermore, larger toplines now are not a guarantee of predictable funding later. Congress could still signal its enduring commitment to a genuine buildup by curtailing accounting gimmicks such as the National Sea-Based Deterrence Fund. Intended to pay for construction of the new Columbia-class ballistic missile submarines in a separate fund outside of the shipbuilding account, the deterrence fund would allow the Navy to capitalize at the expense of the Army and Air Force in the event that defense flat lines. This outcome is more likely given the inflation-only growth outlined in the five-year defense spending plan included in President Donald Trump’s 2019 submission.

After three solid years of growth from FY17 to FY19, this disappointing plan means prospects for long-term growth in the Pentagon’s budget above inflation are slim. The Navy must seize the moment to jumpstart readiness now, particularly by waiving shock trials for the USS Gerald R. Ford. But the Navy is not the Pentagon’s only responsibility. In preparation for a fiscal future likely devoid of real growth, gimmicks that allow the service to capitalize at the expense of the other services — like the deterrence fund — must be curtailed.

USS Gerald Ford Shock Trials: Getting to 350 Ships Requires More than Money

Despite herculean efforts to maintain the Navy’s global presence, carrier gaps persist. Strike groups were absent from the Middle East in late 2015, early 2017, and yet again in November of last year when tensions with North Korea drew the USS Nimitz away from the region. On average, U.S. home-ported carriers deployed for 232 days from 2014 to 2017, nearly 20 days longer than the Navy’s prescribed 7-month deployment per ship implemented after massive deployment overruns nearly broke the force. Had the Ford been available to the fleet during this period, the Navy could have projected the same posture and eliminated the average carrier’s deployment overrun entirely.

New replacements are not coming anytime soon. The recently updated 30-year shipbuilding plan does not accelerate carrier procurement above Obama-era plans until fiscal year 2036. Furthermore, there is no push to begin construction of a new aviation-focused amphibious assault ship within the coming five years. The next American carrier, USS John F. Kennedy is not scheduled to commission until 2024 and will then need to undergo shakedowns before it is deployable. Without work stoppages, reaching a 350-ship fleet is projected to take until the 2040s through new construction alone. This timeline could induce planners to push for further service life extensions to sustain the immediate number of hulls that can be pressed forward. However necessary they may be, these extension programs are expensive and inefficient compared to building and operating new ships, such as the Ford.

Fortunately, Congress has already passed legislation allowing the Navy to take action now which could shave years off the entry into service of some ships; chiefly, aircraft carriers. Thanks to a provision in the 2018 National Defense Authorization Act which Trump signed into law in December, the Pentagon has an opportunity to make the Gerald Ford rapidly deployable.

Previously, Mattis could have delayed full-ship shock trials, where charges are detonated proximate to the ship to simulate combat damage, until after Ford had completed its first deployment. The new law now gives the secretary of defense the authority to waive shock trials on the Ford entirely, delaying them until USS John F. Kennedy is commissioned.

Foregoing these trials until Kennedy is commissioned will alleviate pressure throughout the fleet by ensuring forward carrier presence remains steady. If Mattis decides to waive the trials, the Ford could be ready for its first deployment next year. If he instead decides to carry out the tests unnecessarily early, they will delay the ship by up to two years due to the disruptions caused to the Navy’s carrier deployment schedule.

Critics will contend that rushing Ford forward is fraught with dangers. Director of Operational Test and Evaluation Robert Behler wrote to Mattis that the “survivability of these newly designed systems remains unknown until the CVN-78 undergoes full ship shock trials.” Like previous directors, Behler takes a very technical approach in his definition. According to his reasoning, overall survivability is unknown because some information is missing, even if we have enough data now to make an educated guess. Though Ford will spend every moment between now and its first deployment undergoing testing, do not expect Operational Test and Evaluation to sign off on the survivability of Ford until 100% of trials are complete.

Of the critical systems Behler highlighted — aircraft launch and recovery, air search radars, and elevators to the flight deck — many of these have already undergone significant testing. Navy spokesman Capt. Danny Hernandez noted that since commissioning last July, the Ford has already undergone six underway tests involving over 700 aircraft launches and recoveries, including two days involving over 100 sorties each.

The survivability improvements which shock trials would identify are principally relevant only if deterrence fails and the carrier comes under attack. Yet, carriers spend the overwhelming majority of their lifespan in non-combat scenarios. In combat, they are surrounded by a battle group of other warships designed to counter threats from submarines to ballistic missiles. Ironically, cancelling the shock trials would decrease the risk of a combat contingency by increasing the potency of American conventional deterrence. Thus, while delaying the trials will generate transient operational risks, they would mitigate more profound strategic ones caused by a lapse of American conventional deterrent.

If the secretary of defense agrees with the Navy, outright revocation of the first-in-class ship trials would be far from unusual. The Navy did not conduct first-of-class shock trials on Burke-class destroyers, San Antonio-class amphibious vessels, or either variant of the Littoral Combat Ship. The Nimitz-class carriers which the Ford is replacing also did not undergo shock trials until their fourth hull, 12 years after the first ship in the class commissioned and began patrols to counter the Soviet Navy. This at the height of the Cold War, a time of rising military competition and increasing strategic risk.

Besides, most shock trials only result in small changes that shipbuilders implement incrementally during future refits. For example, these tests led the Navy to tweak parts of the lubrication oil piping on its Freedom-class littoral combat ships as part of what service leaders described as “relatively minor modifications.”

The principal advantage of shock trials over other forms of testing is to make sure hulls will remain intact and components will continue to function under enemy fire. Because Ford’s hull is so similar to her Nimitz predecessors, and as the carrier’s internal components have been independently shock tested, postponing these trials until the commissioning of Kennedy would not incur the same risks as delayed trials on brand new hull designs.

Congress has signaled its support for the precepts laid out in the new defense strategy by accepting that more resources are needed immediately to prepare the military to more efficiently prosecute counterterror operations and more intently focus on countering peer adversaries. Amid the many potential distractions to that pivot, Mattis’ postponement of the Ford’s shock trials by issuing the still-missing waiver would be a step in the right direction to showcasing the secretary’s commitment to his own strategy.

Whatever their benefits, waiving the trials will only have a transient impact on naval readiness. More permanent action is needed to remedy the Navy’s fundamental shortcomings in hulls forward. All defense procurement, but especially shipbuilding, requires a stable and predictable budget to enable the services to effectively plan for long-term purchases. However, The Navy’s most recent initiative to provide that security for its nuclear powered vessels would paradoxically jeopardize the long term health of the wider joint force.

Enter the National Sea-Based Deterrence Fund

Since the genesis of the ballistic missile submarine force in the early 1960s, the Navy has tried to avoid paying for its boomers. Navy leaders and their congressional allies have repeatedly argued that these are “national” assets that should be funded through a separate defense-wide account akin to the way ballistic missile defense is paid for owing to its role as an assured nuclear second-strike capability. After half a century of trying in vain, the Navy finally got its way with the establishment of the National Sea-Based Deterrence Fund to support the Columbia-class SSBN program in fiscal year 2015.

In short, this fund allows the Navy to double-dip into the Treasury by requesting funding for shipbuilding from two separate accounts. If defense spending increases in perpetuity, this is a non-issue. However, should toplines flatline or fall once more, this arrangement would preclude the hard choices planners will need to make about the future by rendering large components of the Navy’s shipbuilding budget politically untouchable under the remit of a fund supposedly of national importance.

Those days of difficult decisions almost certainly lie ahead. There is an impending bow wave of modernization facing the military, where the accelerating retirement rate of aging equipment will mandate large procurement expenditures to keep the force at a steady state. One need only look to the 30-year shipbuilding plan to see this acquisition crunch. While the fleet is projected to rocket to 326 ships by the end of FY23, it will take almost three decades after that to add the last 29 vessels needed to reach a 355 ship Navy. If Trump’s latest budget submission is any indication, the Administration is not prepared to spend its way out of having to make tough tradeoffs. The Sea-Based Deterrence Fund is designed as a vehicle to shepherd the Navy through this difficult time by safeguarding as many programs as possible under the vaunted title of “national assets.” When first unveiled, the fund only covered Columbia-class purchases. Amendments to the law undergirding the deterrence fund in fiscal years 2016 and 2017 allowed the Navy to use the special account to enter into incremental funding contracts for long-lead time components for the Columbia-class, specifically the so-called “common missile compartment.” The last sentence of subsection (i) of the law as it stood for most of 2017 extended procurement authority to “equivalent critical parts, components, systems, and subsystems common with and required for other-nuclear powered vessels.” While the Virginia-class attack submarines share numerous hull and reactor components with the Columbia-class, the subsection as written only funded common missile compartments, and thus could not support Virginia- or Ford-class vessels.

From the beginning, expanding the deterrence fund to support the construction of these other vessels was the Navy’s overt objective. Last summer, a proposal in the House’s authorization bill for fiscal year 2018 nearly made this a reality by striking the common missile compartment limitation and allowing the Navy to enter multi-year contracts not just for that system, but for any “critical component” for all nuclear-powered vessels. This proposed change would have made the remit of this fund much more expansive, as a critical component was vaguely defined as “any item that is high volume or high value.”

Had this small change in verbiage become law, the ramifications could have been significant. Because the deterrence fund enables the introduction of efficient multi-year contracts, bulk-buys, and advanced and continuous construction — any one of which is available for only a handful of procurements under the normal shipbuilding account — the Navy has strong incentives to route as much carrier and attack submarine funding through the account as possible. The House’s suggested change to the law would have facilitated this quiet funding shift by opening a pathway for the Navy to use the deterrence fund to finance any nuclear-powered vessel, including attack submarines and aircraft carriers, even though they have no role as a national nuclear deterrent. In the final version of the 2018 NDAA, the change from “common missile compartment” to “critical component” was upheld, with one critical limitation — the meaning of the latter term was strictly defined to a select list of components for Columbia-class vessels. However, many of these components, from spherical air flasks to torpedo tubes, are shared with Virginia-class attack submarines. While the special account has not yet been used to finance components for aircraft carriers or Virginia-class boats, this change brings the law one step closer to the possibility.

Legislators are already planning to use expanded authorities to benefit the Virginia program: the 2018 National Defense Authorization Act’s funding tables project $27 million in savings for Virginia-class submarines stemming from the deterrence fund. This is because whenever the Navy contracts for components common across the Virginia and the Columbia (for example, torpedo tubes), it can now negotiate the entire order under the cost saving measures introduced in the fund. It can do so regardless of which kind of submarine those components end up being installed in, and whether the money to finance the tubes came from the deterrence fund or the general shipbuilding account. Herein lies the great irony of the sea-based deterrence fund: there is nothing about creating a separate line item that inherently saves the Navy money. In fact, the Navy could generate more potent efficiencies by extending the same generous contracting provisions to all construction covered in its core shipbuilding account.

Expanding the deterrence fund to buy components for all nuclear-powered ships demonstrates the core problem with the accounting gimmick known as the deterrence fund: it is not about “national” missions at all. Instead, it’s a convoluted — and ultimately inefficient — way of increasing the Navy’s shipbuilding budget at the expense of the Army and Air Force. This seems less harmful when budgets are rising and all the services are benefiting from an infusion of cash. But the Trump budget is set to flatten, if not decline, soon. Hard choices unmade this year regarding a differing funding allocation between the services will only become harder when the financial outlook tightens.

The Pentagon Needs More Than a 350-Ship Navy

Without a higher defense topline, every expansion of the deterrence fund is just a cut to other defense priorities, which will make the overall readiness problems across the services worse. The Air Force operates the other two legs of the nuclear triad, but there is no separate fund for new ICBMs or bombers, despite belated pressure from the Air Force to be included in 2016 and support from then-Secretary of Defense Ash Carter. At a time when the Air Force is short an estimated 2,000 pilots and only seven in ten aircraft in the Air Force are mission-ready, it would be irresponsible to threaten to transfer even more money out of its budget.

Although proponents of the deterrence fund argue that it will shave off roughly 10 percent of the cost of the Columbia-class subs, these savings come from authorizations that allow the Navy to lock in orders early and buy in bulk, not from the deterrence fund itself. Rather than expanding the authority of the deterrence fund piecemeal, Congress should instead work to include the smart purchasing provisions contained within it to the normal shipbuilding account — and thus to every ship the Navy buys. There is nothing inherent to the deterrence fund that justifies having these provisions exist only for funds contained within it. The law says as much when subsection (i) gives the Navy the authority to use the NSBDF “in conjunction with funds appropriated for the procurement of other nuclear-powered vessels, to enter into one or more multiyear contracts (inducing economic ordering quantity contracts)” for procurement.

Advocates of the fund must remember that solely throwing money at the problem will not field the Columbia any faster. According to the recently released Nuclear Posture Review, the first Columbia cannot be expected until 2031. If the Pentagon is going to plan that far ahead, it must emphasize securing a Congressional commitment to long-term budgetary stability for the total topline above seeking transient advantages for parochial interests.

Nine consecutive years of continuing resolutions, government brinksmanship, three shutdowns and more have created turbulence across the Department. It is only natural that the Navy’s congressional backers would take advantage of that confusion to take actions designed to preserve the shrinking fleet. But expanding the National Sea-Based Deterrence Fund while the defense topline is projected to rise does little except posture the Navy to flourish at the rest of the Pentagon’s expense if (though more likely, when) budgets shrink once more. Ultimately, curtailing the deterrence fund will do more good than harm to the fleet by sending a powerful signal from Congress that increased investments without gimmicks are here to stay. It would also force Congress to attempt to reform the core authorities underlining the shipbuilding accounts to unlock the same tantalizing efficiencies promised by the deterrence fund, an effort that would have positive budgetary ramifications for decades regardless of the Pentagon’s topline.

There are key signals that Congress and the Pentagon can send to American adversaries that a defense buildup is real and change is coming to the force. Or not. Mattis should support increasing fleet size quickly with little risk by working to eliminate onerous requirements like shock trials rather than force the services to undermine one another by exploiting budgetary ploys like the National Sea-Based Deterrence Fund. And Congress should fully support him.


Mackenzie Eaglen is a resident fellow for national security at the American Enterprise Institute. 

Image: U.S. Navy