Thursday, April 24, 2014

Winslow Wheeler’s analysis of the ongoing F-35 "LifeCycleCost" Scam: Political Economy & Democracy In Inaction

When you have growing legions of poker players all trying to game the existing system (house rules) .... you don't even need to invoke originally planned fraud.

By their own momentum, such legions of poker players simply lose track of how out of date their targeted system has become, as contexts continue to change, including sheer scale-dependent details. What start as initially weak feedback signals for local or micro management issues, eventually ALWAYS become dominant feedback signals for macro management. It's only a question of when.

That reality is as true of economic policy as it is of of the MICC's beltway-bandit policy. If we don't continuously coordinate interleaved reform of local, regional & national policy .... then we can't survive. It's that simple. We either ALL hang together, or collectively hang ourselves.

If you extend credit to your neighbor, it's your problem. If hundreds of millions of citizens all depend upon neighbors near and far, for distributed credit ..... then it's OUR problem, and a policy issue.

(The following is an email from Chuck Spinney, posted with permission.)

"One of the oldest recurring front-loading scams practiced by the Military - Industrial - Congressional Complex (MICC) is the promise that high and increasing weapons procurement costs in the near term will be more than offset by lower operating (O&S) costs over the long term, thus decreasing the program's total life cycle costs (LCCs). 
The essential scam is to plant the myth that the future cost of supporting increasingly complex weapons will amount to a free lunch: i.e., that the total life cycle costs (LCCs) of increasingly complex weapons will be less than the total LCCs of the simpler weapons they replaced.

This game has been in play since at least the 1960s.
To wit: In the mid 1960s, the Air Force claimed that the highly complex all-digital avionics of the F-111D would cost less to operate than the far simpler analog avionics of the A-7. 
In the 1970s, the AF promised the F-15 would cost much less to operate than the less functionally complex F-4. 
In the 1980s and 1990s the AF promised the operating costs of the stealthy, supersonic cruising F-22 would be comparable to those of the far less complex, non-stealthy, subsonic cruising F-15. 
Beginning in the 1990s and continuing to this day the AF promised operating costs of its version of the stealth F-35 would be in the same league as those far simpler non-stealthy F-16/A10 aircraft the F-35 was replacing (even though the F-35 system's 20+ million lines of computer software code far exceed those of the F-22!)

Of course the beauty of the "lower LCC" front-loading scam is that by the time decision makers determine what a weapon’s true operating costs are, they will have already invested so much money, reputations, and time in buying the weapon, they are well into the third trimester of the acquisition life cycle, and are too pregnant to abort the program -- which, of course, is the whole aim of the Defense Power Games of front loading and political engineering.
As a matter of record, the F-111D’s avionics were a disaster that cost far more than the A-7 on a per flying hour basis; the F-15 cost far more to operate than the F-4 once you accounted for variable depot costs per flying hour (see DFOL pages 51 and 99; and the LCCs of F-22 are far higher than those of the F-15. 
For a remarkably candid portrayal of the F-22’s maintenance horrors, I urge readers to examine public releases by the Air Force’s 325th Fighter Wing Public Affairs office -- here and here). Bear in mind, these outcomes did not stop decisions makers from buying the programs -- the scam works!

Today, not enough F-35s have been operating in the fleet for a sufficiently long enough time to ascertain its true operating cost. This, of course, is most convenient for the contractor as well as the military services, because the F-35’s unit acquisition costs are still rising.
So, invoking the F-35’s lower LCC scam is still a viable front-loading strategy to justify the ongoing growth of F-35s nearer-term R&D and procurement costs -- i.e., the name of the game is to move deeper into the third trimester of the F-35's acquisition life cycle to permanently foreclose the abortion option.

Lest you think otherwise, attached herewith for your edification is my friend Winslow Wheeler’s analysis of the ongoing F-35 LCC scam."

Chuck Spinney, The Blaster

Winslow Wheeler, Director, Strauss Military Reform Project, April 23, 2014

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