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| March 16, 2000 |
| March 16, 2000 |
The Continuing Arms Trade Muddle
Colonel Dan Smith, USA (Ret.), Chief of Research, dsmith@cdi.org
In early March Lockheed Martin and the United Arab Emirates finally closed a deal for 80 U.S. F-16 airplanes estimated to be worth $6.4 billion. The sale, first proposed in 1998, had been in limbo awaiting a U.S. government review of the technology that would be transferred. Specifically, the U.A.E. wanted the very latest software enhancements to avionics and threat identification capability, upgrades that are not yet in any U.S. Air Force F-16s.
As with domestic military spending, dollar figures for sales of U.S. armaments are spiraling upward. On its website, the Pentagon's Defense Security Cooperation Agency shows government-to-government arms sales for Fiscal Year (FY) 1998 totaled $8.6 billion. This jumped 30% in FY1999 to $12.2 billion, and the Pentagon estimates the number will rise above $13 billion in FY2000. Depending on how one counts the U.A.E. sale (it was signed in November 1999), that $13 billion figure has already been surpassed. In this fiscal year Norway and Greece have ordered 80 F-16s at a cost of $2.6 and $3.1 billion, respectively. South Korea has request Patriot (PAC-3) air defense equipment worth $4.2 billion and other equipment totaling another $1 billion.
Despite burgeoning figures like these, the U.S. defense industry is pushing for streamlining the approval process for military exports that is administered by the State Department. In this drive, industry is being supported by the Pentagon for sales to NATO and other core U.S. allies. In early February of this year the U.S. and Britain signed an agreement in principle on military industrial cooperation, and similar agreements are being discussed with other NATO allies and Australia. European defense industries, with an eye to avoiding the strong competition from U.S. defense giants, are encouraging their governments (and the U.S. industry) to work to simplify the rules governing technological cooperation.
But the message from Washington is mixed. As a result of the Cox report's allegation that two U.S. firms provided unauthorized help to China to correct problems with rockets used to launch U.S. satellites, new restrictions were decreed by Congress. For the last twelve months, approval for all commercial satellite exports was transferred from the Commerce to the State Department. More onerous is another law signed in November that requires exporters to submit to the State Department detailed shipping information -- exit port, country destination, end-user, and quantity, description, and value of items -- all within 15 days of shipment. In turn, State is required to submit a consolidated report with these specifics to Congress every three months.
Outsiders must be confused. On the one hand the Pentagon touts sales of U.S. equipment as one way to achieve interoperability of systems among allies. At the same time, until the F-16 sale to the U.A.E., the U.S. has never provided its very best equipment to another ally (and certainly not a non-core ally) before it was in the hands of U.S. operating forces. While members of Congress support interoperability with close allies, Congress also seems to be going in the direction of more controls over exports and more reporting requirements so that it (and the Administration) will have better information about what is being transferred to other countries.
Industry bemoans these restrictions and reporting requirements and is pushing the main government agencies with a role in the export process -- DoD, State, Commerce -- to develop clear processes and policies that will speed approval of proposals and bring in even more money.
One idea reportedly being considered is to issue project licenses to firms that are working with foreign companies on arms developments. Such blanket permits would go only to "trusted" companies whose track record on reporting and tracking of exports is exemplary.
What has yet to be mentioned under such a scheme is which agency will decide which companies have exemplary export records. After all, Hughes Electronics and Loral, cited for circumventing restrictions on satellite and missile technology transfers to China, are not insignificant players in defense (Loral was bought by Lockheed Martin, the largest defense contractor, in 1996 and Hughes was acquired by number three Raytheon in 1997) and in building commercial satellite (Hughes was number one and Loral number three). Industry will not look favorably on the State Department making such a choice as they are unhappy with the pace of approvals and the tight interpretation of export policies under the current system. Congress seems disinclined to let Commerce rule because it believes Commerce was too lax with regard to China. Defense seems disinclined to take on this task although (as evidenced by its role in the current debate) it generally supports industry.
Since the end of the Cold War there have been few in Congress or the defense industry who have questioned the morality of the U.S. continuing to arm the rest of the world. Now there is the possibility that there will be equally few who will object to selling our first line technology to nations that are not even our core allies -- technology that is better than what our own forces possess. But then, perhaps these points are thought to be too fundamental -- until the day Americans are killed by weapons that Washington permitted to be sold.
Turkey Looks to U.S. for Attack Helicopters
By Rachel Stohl, Senior Analyst, rstohl@cdi.org
After months of delays and postponements, the government of Turkey has narrowed its list of candidates for the purchase of attack helicopters to three companies. The finalists are: the United States' Bell Helicopter Textron AH-1z King Cobra, Italy's Agusta A-129 International, and the joint effort of Russia's Kamov and Israel's Israel Aircraft Industries, the Ka-50-2. Boeing's AH-64D Apache and the French-German Eurocopter Tiger were dropped from consideration. According to unnamed officials quoted in Aviation Weekly and Space Technology, the Apache was removed because it was considered too expensive to maintain and operate, and the Eurocopter was eliminated because of controversy surrounding the German government's displeasure at Turkey's human rights record.
Human rights activists around the world are also concerned with the possible sale, because of fears that the helicopters could be used for continued repression on Turkey's Kurdish population. Turkey has long been criticized for its poor human rights record, and the February, 2000 edition of the State Department's Human Rights report stated that "Torture, beatings, and other abuses by security forces remained widespread, at times resulting in deaths."
To address human rights concerns in Turkey, the U.S. State Department gave assurances in 1998 that human rights conditions would be taken into account in determining whether to allow a proposed attack helicopter sale and in approving the final export license. The elements to be considered, enumerated to non-governmental organizations (NGOs) by senior State Department officials in January, 1998 are: decriminalization of free speech; release of jailed journalists and parliamentarians; steps to end torture/accountability of police; re-opening of NGOs closed by the authorities; democratization and expansion of political parties; lifting of the State of Emergency in southeast Turkey; resettlement of internally displaced persons; and verification of end use of U.S.-exported arms.
The attack helicopter sale is worth an estimated $4 billion. Initially, the contract will be designed for the sale of 145 helicopters. The total may be reduced to 90 after the first delivery of 50 helicopters is completed and Turkey reassesses its security situation. The first delivery had been scheduled for November 2002, but as a result of the continued delays in making a final decision, the delivery date will likely be pushed back until 2003.
The helicopters will be manufactured as a joint venture between the company awarded the contract and Turkish Aerospace Industries (TAI) and will include, therefore, technology transfers as well as the actual helicopters. Before the final decision is made, Turkey has asked companies to provide additional financial and technical details. Turkey has also requested export guarantees for the helicopters. To date, only Russia has been able to provide a letter of guarantee. The United States will be unable to provide such a guarantee because of domestic law -- the Arms Export Control Act -- which requires licensing approval from Congress and the Office of Defense Trade Controls in the State Department.
Experts believe that Bell Textron will most likely win the contract. Turkey already has Bell helicopters in its arsenal, and therefore, less additional training of Turkish personnel would be required. Further, Bell has indicated that it will lease 10 Super Cobras to Turkey before the initial deliveries of the King Cobras begin to fill Turkey's immediate need for helicopters. The inclusion of the Agusta and Russian-Israeli helicopters on the short list is seen as a move to put continued pressure on the United States and Bell to ensure the conditions of the sale as Turkey is demanding.
Turkey has announced that it will make its final decision on the helicopters at the end of 2000 , both because the Turks want to see the results of the test-flights of the King Cobra in September and the outcome of the U.S. Presidential election in November.
F-22 Slips Further Behind Schedule
Christopher Hellman, Senior Analyst, chellman@cdi.org
The Air Force's highest priority program is slipping further behind schedule says the General Accounting Office (GAO), with deliveries of test aircraft delayed and only 500 hours of flight testing completed. The report, entitled "F-22 Aircraft: Development Cost Achievable if Major Problems are Avoided," (NSIAD-00-68) is the most recent in a series of GAO studies of the troubled program. It states that while the Air Force has experienced delays in the delivery of test aircraft and the completion of flight and ground testing, it has not extended the...completion date of the development program and therefore may not be able to complete development flight tests before the development program is scheduled to end." That end date remains August, 2003.
The roughly 500 hours of flight testing completed through the end of 1999 represents 13% of the total planned flight testing. At this time last year, it was expected that the F-22 would have completed 601 hours through the end of October, 1999. These delays come after the Air Force announced in November that it was going to accelerate the testing program as a way to cut costs, reducing flight test hours from 3,947 hours to 3,757 hours.
The November decision was actually the second time in recent years that the Air Force cut the amount of flight testing during the aircraft's development phase. In the fall of 1998, the service announced that it would delay external weapons testing until after the end of the development phase. This reduced the amount of development flight testing from 4,337 to 3,947 hours. Thus, over the last year and a half, the amount of flight testing of the F-22 that will occur during the critical development phase has been reduced by 13%.
Manufacturing problems have further delayed the testing program. Delivery of the third test aircraft, expected this week, is more than eight months behind the schedule set when the F-22 program was restructured in 1997, and delivery of the next four flight aircraft are expected to be late. As a result, the GAO says, "the Air Force now has over 29 fewer flight test months available to complete the development flight test program and has lost over 626 flight test hours that would have been available had these aircraft been delivered on schedule." By the Air Force's own estimates, if the current problems persist, 37 to 50 percent of the total flight test hours will not be completed by the time the development program ends.
On the budget side of the ledger, the GAO notes that the Air Force has identified cost increases of as much as $757 million in the development program. The report also states that the service believes it has found sufficient savings within the program to more than offset these increases and keep the program under the spending cap set by Congress.
But is this for real? The National Defense Authorization Act for Fiscal Year 1998, which capped the cost of the development program at $18.688 billion, but permits the limit to be adjusted for cost changes due to inflation and to allow the program to comply with all federal, state and local laws. As a result, the Air Force has adjusted the program's cost limit to $18.880 billion and, according to the GAO, will adjust it again later this year to $20.4 billion. Thus, while the aircraft is officially still complying with the congressionally mandated spending cap, the cost of the F-22 has grown by nearly 10% in two years.
Meanwhile, the special composite material used in the wing of one of the aircraft "delaminated" during testing last week. The plane's builder, Lockheed Martin, has announced that it is replacing the wing segment with one made of titanium. The incident has caught the attention of Congressman Jerry Lewis (R-CA), the Chairman of the House Defense Appropriations Subcommittee, and a critic of the program. The problem will require "some redoing of the existing aircraft we have already produced," said Congressman Lewis. "What that does to delay testing, what that does to cost -- we need answers to that."
For additional information, visit CDI's TACAIR website, or look at the GAO report "F-22 Aircraft: Development Cost Goal Achievable If Major Problems Are Avoided," NSIAD-00-68, March 14, 2000.
Russia Prepared to Sign Mine Ban Treaty -- The Russian government has announced that it will sign the Ottawa Landmine Treaty after being convinced it could cheaply destroy its stockpile of landmines (a provision of the Treaty) and that nuclear installations and other significant defense sites could remain protected. Russia has set aside approximately $105 million over a seven year period to destroy landmine stocks. Experts believe Russia has stockpiles of 60 million anti-personnel landmines. Russia has been accused of using landmines in its current conflict with Chechyna.
Trouble in the Balkans Again -- U.S. troops raided a suspected weapons cache in northern Kosovo on Wednesday, confiscating dozens of grenades, rifles, and land mines. The weapons were most likely intended for use in Presevo, a predominantly ethnic Albanian area north of Kosovo. Presevo was hit with a wave of violence in the past few months -- Albanian guerillas, factions of the former Kosovo Liberation Army, have been attacking Serbian police there in hopes of provoking a violent crackdown. A Serbian police action, the logic goes, could provoke a NATO response and deployment of peacekeepers leading to Kosovo-style quasi-independence.
JSF Still "Winner Takes All" -- A member of the Pentagon's team that is examining the effect the military's "winner takes all" strategy for selecting the prime contractor for the Joint Strike Fighter on the fighter industry says that the strategy is unchanged. Darlene Druyun, the Air Force's principal deputy assistant secretary for acquisition and management says that at this time the Pentagon still plans to award the entire contract to either Boeing or Lockheed Martin. The team's final report is due March 31. Meanwhile, a draft report by the General Accounting Office is recommending that the selection of the prime contractor, scheduled for March or April 2001, be delayed. The GAO says both contractors' development programs are behind schedule and over budget.
Military Families on Food Stamps -- According to the General Accounting Office about 13,500 families of armed forces enlisted personnel received food stamps last year, and 8,290 received state child-care assistance. The GAO also found that 117,000 families, or roughly 10% of the enlisted force, were in the Women, Infants and Children (WIC) program. WIC provides prenatal and infant care to low-income families.
Japan Pledges Solution to Incinerator Problem -- The Japanese government has pledged to reduce toxic emissions from the Shinkampo incinerator, a private plant located just outside the Atsugi Naval Air Facility near Tokyo. The Japanese have also promised to provide temporary off-base housing for anyone who requests it. The base is the home of 3,000 U.S. service personnel and their families. The incinerator has been the source of complaints for more than a decade. Defense Secretary William Cohen, on a visit to the base this week, said of the incinerator, "if it can't be cleaned up then it should be closed down."
This week on America's Defense Monitor: "Nuclear War Between India
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