The Army’s Tank Trap

[Richard]

I flipped a coin - 'The Soapbox' won the toss from 'General Discussions' on this one - the M1A1 and the politics of the Defense budget.

It's 2 parts:

The Army’s Tank Trap
Here's What Closing The Army's Ohio Battle Tank Plant Really Means
Richard :munchin

The Army’s Tank Trap
DODBuzz, 8 Mar 2012

Like the Rock of Gibraltar, the Army brass is completely fixed in its plan to idle the Lima, Ohio tank plant for three years, but congressional lawmakers are as relentless as the pounding surf.

The latest tactic, broached Thursday by a House Armed Services Committee panel, is standard Potomac Judo: Where’s the analysis that shows the Army would actually save money with this technique?

“I’m not sure shutting down the line saves money; there’s only one brief analysis on this,” said Maryland Rep. Roscoe Bartlett, the Air and Land Forces Subcommittee chairman.

“We no longer have the privilege in our country of riding on our a huge commercial industrial base,” he said. “We can’t just stop using it and expect it to be there when we want to use it again. So we hope we can get additional studies – we hope GAO can look at it, we just need to know if, in fact, will we save any dollars by shutting down the lines, letting them go dark, pay the cost to shut down, pay the cost of start up again. I don’t know that there’s any study that indicates we’ll save money. And I don’t know how we reached the point in this process where anyone thought we’d save money.”

That point arrived because the Army did its own study. Army Secretary John McHugh told House appropriators on Wednesday, in fact, that the service believes it would cost about $600 million to shut down the tank plant for three years and restart it, as compared to about $3 billion to keep the line running that whole time. The Army wants to take delivery of its latest batch of upgraded tanks and then let Lima go dark until 2017, when it would start upgrading its M1A1s.

Army officials acknowledged to House lawmakers on Thursday that they recognize how important it’ll be to maintain Lima’s skilled workforce, which they think can be done over the interim with foreign military sales and, possibly, supplemental contracts. But modernization boss Lt. Gen. Bill Phillips put it to lawmakers this way: The Army has more than enough tanks, and most of them are state of the art, with an average effective age of 2.5 years. So with a smaller budget than expected, “The Army has had to make some tough choices,” he said.

His colleague, Lt. Gen. Bob Lennox, put it another way: “Do you build more Abrams tanks for the Army when you have enough? Do you now go out and do that at the cost of the network and aviation priorities that are higher for us? … These are some of the aspects the Army took into account in making this decision. This was not done lightly. It’s a very serious decision. We know there are ramifications, so it’s a choice of where you want to take your risk.”

But tank advocates had another card to play, in addition to “analysis:” What about all the lower-tier contractors? General Dynamics is a great big defense giant, and maybe it can endure the Lima shutdown. But what about the companies that make the thousands of others parts for the Abrams?

” This vital aspect of our national security industrial base is highly specialized and is not something that can just be turned off and turned back on,” said Ohio Rep. Mike Turner. “When production is stopped, those highly skilled workers will leave. And suppliers will dry up.” Idling the tank line would have ripple effects all down the tank economy, Turner said, and that would be “not only irresponsible but risky.”

We get it, the Army witnesses said. Phillips told Turner the Army “is engaged with industry partners to make sure we understand the concerns not just at the prime level, but at the sub-tier level. We understand the issues related to sub-tier vendors to take action to seek resolution and keep those business viable that are necessary [when] we restart that plant.”

So what does that mean? Good question. It isn’t clear whether McHugh’s estimate includes the costs for the entire Abrams supplier network, or just GD Land Systems — or whether the Army will effectively pay vendors to sit around and do nothing just so they’ll be there when the tank upgrades resume. Those kinds of deals aren’t unprecedented in the world of defense contracting, as when the Navy, for example, pays shipyards to keep them from laying off workers while it works to award contracts later.

In Austerity America, however, it might not be politically kosher anymore for the government to pay a company just to continue to exist. So congressional tank advocates might continue pushing to keep the plant open and upgrading tanks, just as soon as they get their “analysis” confirming that will be the most cost-effective option.

http://www.dodbuzz.com/2012/03/08/the-armys-tank-trap/

[Richard]

Here's What Closing The Army's Ohio Battle Tank Plant Really Means
BusinessInsider, Aug 2012

General Dynamics has been quite open in its opposition to the Army’s proposed three-year closure of its tank plant in Lima, Ohio. But what has that actually meant, in practical terms?

The Center for Public Integrity detailed GD’s fight against the Pentagon in an excellent story this week, detailing the nuts and bolts of a high-stakes effort by a powerful company to protect one of its key interests. Multiply this story by the Defense Department budget and the many brand-name contractors that depend on it, and you’ve got a look inside the workings of the Iron Triangle.

As CPI’s Aaron Mehta and Lydia Mulvany write, official disclosures show that General Dynamics’ contributions to key lawmakers coincided with important events on Congress’ calendar:

Sharp spikes in the company’s donations — including a two-week period in 2011 when its employees and political action committee sent the lawmakers checks for their campaigns totaling nearly $50,000 — roughly coincided with five legislative milestones for the Abrams, including committee hearings and votes and the defense bill’s final passage last year.

After putting the tank money back in the budget then, both the House and Senate Armed Services Committees have authorized it again this year, allotting $181 million in the House and $91 million in the Senate. If the company and its supporters prevail, the Army will refurbish what Army chief of staff Ray Odierno described in a February hearing as “280 tanks that we simply do not need.”

They continue:

Top Army officials have so far been unable to get political traction to kill the M1. Part of the reason is that General Dynamics and its well-connected lobbyists have been carrying a large checkbook and a sheaf of pro-tank talking points around on the Hill.

For example, when House Armed Services Committee member Hank Johnson, D-Ga., held a campaign fundraiser at a wood-panelled Capitol Hill steakhouse called the Caucus Room just before Christmas last year, someone from GD brought along a $1,500 check for his re-election campaign. Several months later, Johnson signed a letter to the Pentagon supporting funding for the tank. Johnson spokesman Andy Phelan said the congressman has consistently supported the M-1 “because he doesn’t think shutting down the production line is in the national interest.”

The contribution was a tiny portion of the $5.3 million that GD’s political action committee and the company’s employees have invested in the current members of either the House and Senate Armed Services Committees or defense appropriations subcommittees since January 2001, according to data on defense industry campaign contributions the Center for Public Integrity acquired from the nonpartisan Center for Responsive Politics.

These are the committees that approve the Pentagon’s spending every year. Without their support, the tank — or any other costly military program — would be dead.

Kendell Pease, GD’s Vice President for Government Relations and Communications, said in an interview that the company — which produces submarines and radios for the military as well as tanks — makes donations to those lawmakers whose views are aligned with the firm’s interests. “We target our PAC money to those folks who support national security and the national defense of our country,” Pease said. “Most of them are on the four [key defense] committees.”

But Pease denies trying to time donations around key votes, saying that the company’s PAC typically gives money whenever members of Congress invite its representatives to fundraisers. “The timing of a donation is keyed by [member’s] requests for funding,” he said, adding that personal donations by company employees are not under his control. He said the donations tend to be clumped together because lawmakers often hold fundraisers at the same time.

In other words, contractors don’t even need to watch the House or Senate calendars to see when topics of interest are going to come up — lawmakers just ask forthrightly for donations when they need them. Sometimes, however, outside events will prompt an increase in donations, as Mehta and Mulvany write:

During the current election cycle, General Dynamics’ political action committee and its employees have sent an average of approximately $7,000 per week to members of the four committees. But the week President Obama announced his defense budget plan in 2011, the donations spiked to more than $20,000, significantly higher than in any of the previous six weeks. A second spike of more than $20,000 in donations occurred in early March 2011, when Army budget hearings were being held.

General Dynamics isn’t the biggest contributor of the big brand names, according to data analyzed by the Center for Responsive Politics, and defense is only the 13th biggest giver by interest group for this election cycle. Overall, defense firms have given more than $16.7 million since 2011, and the biggest givers are Lockheed Martin with more than $2 million; Boeing with $1.8 million; Northrop Grumman with $1.8 million; Raytheon with $1.4 million; and then General Dynamics with more than $1 million.

“Although the defense sector contributes far less money to politicians than many other sectors, it is one of the most powerful in politics,” as the Center for Responsive Politics puts it. Part of the reason is that lawmakers have an inherent political interest in protecting their districts, and part of the reason is the industry’s spending on lobbying: In 2012, “defense aerospace” firms have spent $28.8 million on lobbying, according to the center; “misc defense” firms have spent $18.4 million; and “defense electronics” companies have spent more than $18 million. Taken together, that’s more than $65 million as of this month. Last year’s total was $133.9 million.

So who are some of the lobbyists who advocated for GD on the tank question? Many of them are former staff members from the House or Senate Armed Services Committee, and Mehta and Mulvany include thumbnail profiles here.

http://www.businessinsider.com/general-dynamics-tank-plant-closes-in-lima-2012-8?utm_source=twbutton&utm_medium=social&utm_campaign=defense-contributor