Subcommittee on Coast Guard and Maritime Transportation: Examining Cutter, Aircraft, and Communications Needs

“The Coast Guard’s FY2014 Five Year (FY2014-FY2018) CIP (Capital Investment Plan–Chuck) includes a total of about $5.1 billion in acquisition funding, which is about $2.5 billion, or about 33%, less than the total of about $7.6 billion that was included in the Coast Guard’s FY2013 Five Year (FY2013-FY2017) CIP. (In the four common years of the two plans—FY2014-FY2017—the reduction in funding from the FY2013 CIP to the FY2014 CIP is about $2.3 billion, or about 37%.) This is one of the largest percentage reductions in funding that I have seen a five-year acquisition account experience from one year to the next in many years.”–Ronald O’Rourke, Specialist in Naval Affairs, Congressional Research Service

The video above is long (one hour and forty two minutes) but I think it is important, and it might even make you mad. This is a hearing before the House Committee on Transportation and Infrastructure’s subcommittee on the Coast Guard and Maritime Transportation. The first hour and ten minutes are fairly routine and I’ll summarize some of it below. It includes the obligatory thank you to the Department Secretary (Secretary Nepolitano has been “particularly supportive”) when in fact the Coast Guard has been cut far more deeply than the rest of DHS. The real meat begins with Ronald O’Rourke’s presentation at 1hr.10min.

(1:10 to 1:15) Mr. O’Rourke’s stance is neutral, as befits a good researcher, preparing a balanced assessment for the law makers, but he succeeds in making some of the best arguments I have heard for increased funding for the Coast. (Unfortunately this seems in marked contrast to the passivity of the Coast Guard leadership. Hopefully this is more apparent than real and there are things going on that we do not see. There is some indication this is true, here and here.) He also takes the Coast Guard to task for not employing multi-year and block buy contracting.

(1:15 to 1:19) Dr. Bucci provides his personnel view, noting that the Coast Guard has not learned to play the Washington bureaucratic game of asking for more than really need. (He also specifically advocates an exemption to the Jones act to allow the Coast Guard to lease foreign built icebreakers.)

(1:19 to 1:24) Dr. Korb advocates a Unified National Security Budget that looks as trade-offs between the Departments of Defense, Homeland Security, and State. He also advocates including the Commandant in the Joint Chiefs of Staff and appointing a Civilian Service Secretary to act as an advocate. Later, when questioned, he points out that the Coast Guard’s unofficial motto is “We can do more with less” and if that is what you ask for “that is what you will get.” Among his telling points was that the Navy budget is 16 times that of the Coast Guard even though they have only eight times the people.

(1:24 to 1:42) Testimony of these three witnesses continued in response to the Representatives’ questions.

You can take a short cut and read the text of the prepared statements, but the Congressmen’s questions and reactions are also instructive, and generally supportive of the Coast Guard.

(0:00 to 1:10) Discussion with Vice Admiral Currier, Vice Commandant

Vice Admiral Currier’s prepared statement was completed at 14 minutes. Questions, answers and committee member statements continued to 1 hour and 10 minutes.

(Note, I am not taking the points in chronological order as discussed)

C-27J: The Coast Guard is apparently counting on getting at least 14 of these aircraft, perhaps as many as 21. Eighteen C-144s have been funded so far of a total of 36 in the “Program of Record.” Substituting C-27Js (which do have a higher operating cost) for the remaining 18 could represent a savings of up to $800M in acquisition costs. Calling it a strategic pause, the Coast Guard has zeroed additional C-144 purchases as it waits to find out if it will get these surplus Air Force assets.

Zeroing future C-144 purchases accounted for about a third of the reduction of the CIP compared to last years. As much as I have supported this course of action, and as confident as the subcommittee sounded, this is really not a done deal because the Air National Guard wants to keep the planes and they are very well connected politically. Additionally there are others who also want these aircraft.

Webber Class WPCs: Another major change was the decision to fund only two Fast Response Cutters annually instead of the four or six funded previously. Simply spreading out the buy is a really bad decision. Building six per year cost less per ship. Buying only two per year will require a renegotiation of contract. In addition, inflation in the ship building industry is not only higher that inflation in general, its rate is higher than the interest rate on government borrowing, so it would cost less in the long run to borrow money and build as rapidly as we can, even including the interest paid on the bonds. This consideration applies to the Offshore Patrol Cutter as well as the FRC. I don’t think this is the last word on construction of the FRCs, and we may see more money added to the budget.

Bertholf Class WMSLs: It now appears all eight National security Cutters will be completed, but we can waste time and money if we do not fund long lead time items and this is currently the plan. This was also discussed and generally deplored.

Multiple Crewing: Questions were raised about when the Coast Guard would demonstrate the “Crew Rotation Concept” which has been touted as being able to provide 225-230 days per year from each of the larger cutters. The Vice Commandant responded that the plan would not be implemented until 2017, but until that time the NSCs are expected to average 210 days AFHP.

Offshore Patrol Cutters:  VAdm Currier said the CG expects to select to three preliminary designs for further development by the end of this FY, and that the final selection will be made a year later, by the end of FY2014.

Unmanned Air Systems: The uncertain future of the Coast Guard’s Unmanned Air Siystem (UAS) programs, and its dependence on the US Navy’s development, was discussed, with Representative Garamendi pointing out this represented a major hole in the Coast Guard’s plan to maintain Maritime Domain Awarenes (MDA).

Response Boat Medium: A Representative questioned why the Coast Guard had stopped the Response Boat, Medium program at 170 RBMs rather than building the 180 approved by Congress, without submitting a justification report for the smaller program as required by Congress.

Port Security: Representative Janice Hahn, California, expressed discomfort with the current container inspection rate of only 2 to 3%. She also suggested the possibility of diverting from some customs money to port security.

The Arctic: A pleasant surprise was that VAdm Currier expressed confident that the Coast Guard can already demonstrate good Maritime Domain Awareness (MDA) in the Arctic. Don Young, Alaska, asked several questions about icebreaker. He opined that the Coast Guard should lease an “American built” icebreaker, never mind the fact that no heavy icebreakers have been built in the US since the Polar Sea. We could of course lease a ship someone would call an icebreaker, but that sort of misses the point. VAdm. Currier did say the Polar Sea could be returned to operation after about three years work at a cost of $100M and have a seven to ten year additional useful life.

Missions: The question, what missions the Coast Guard will not do, given reduced funding. The only answer was that we will have to make some tough choices and the CG and the Department will do a portfolio analysis, date of completion unknown.

Tone: Generally the Committee was supportive. The irony of spending $5B for an East Coast Missile Defense system while shorting the Coast Guard assets that are necessary to prevent a much more probable method of introducing weapons of mass destruction was not lost on the Committee. They also saw the foolishness adding $46B to  beef-up patrols along the Mexican Border and simultaneously undercutting the Coast Guard. They also discussed the double standard by which they could write a $2.6B blank check to purchase unspecified aircraft for Afghanistan, while demanding detailed justification for all Coast Guard purchases. They seemed to recognize that if “National Security” were considered in a holistic fashion, the Coast Guard would do a lot better, but that the committee structure in Congress prevented this kind of evaluation of trade-offs.

Sexual assault: The Vice Commandant addressed this in his prepared remarks and it was also discussed in the subsequent question and answer period.

Things the Coast Guard might do differently:

There was a clear message from the three civilian witnesses that the Coast Guard has not learned to “play the game,” that the Coast Guard has been excessively modest in pointing out its needs, and that because of this reticence important missions are being short changed.

We have repeatedly told our elected representatives about our successes, but that leaves the impression everything is alright. Everything is not alright. We need to keep reminding them what is not getting done and the possible consequences of inaction. Every time a Congressionally mandated task is not done to the fullest extent, it should be reported, and they should be made to understand that the reason it was not done is lack of resources. We need to put the onus on Congress and the Executive.

When asked what mission the CG will not do, Adm Currier “we can adjust.” Given an opportunity to address why the aging fleet’s patrol hours now down 8-12%, Admiral Currier said, Currier, “We are OK for OPC/MEC” (Frankly I don’t think that is true. The Coast Guard’s own studies point out a need not only for newer replacements but also more ships) and “The gap is in the Offshore and the NSC is key.” The construction of the eight NSCs seems assured, it was time to point out how the fleet will continue to age and deteriorate. We can expect even more breakdowns and higher maintenance costs for the legacy fleet. In the nine years 1964 to 1972, 28 new ships entered service with the Coast Guard (3.11 ships per year). Only three have been replaced and we are building at a rate of less than one a year, and we don’t expect to deliver more than one replacement per year until at least 2023 and then never more than two a year. Things are going to get much worse before they get better.

We have done an absolutely terrible job of conveying an sense of urgency in replacing our over-aged patrol ships. I have on my desk the August issues of the Navy League’s magazine “SeaPower” and the US Naval Institute’s Magazine “Proceedings.” Both magazines carry happy glowing reports of the Coast Guard’s successes. There is hardly a word about the growing problems with our major cutters. There is hardly a mention of the OPC and certainly no article designed to explain the urgency of its funding and why the naval and maritime community should be excited about it.

The Coast Guard needs to publish a 30 year ship building plan. When I first saw that the Navy was doing this, I thought it was ridiculous, but think about what it does for you. It lays out intentions far into the future and prepares the decision makers to deal with uneven funding requirements. It also highlights the bow wave effect of deferring acquisitions.

If the Coast Guard can get seven to ten years out of the Polar Sea for $100M then compared to 30 years from a new $800M to $1B icebreaker then the costs are not out of line. Perhaps we should not reject the idea. By the time the new icebreaker is ready, the remaining life in Polar Star will be used up (if it actually lasts that long) and we will still have only one heavy icebreaker. Putting an second heavy icebreaker into the fleet, as soon as possible, is the best way to create a presumption that there will be a second new icebreaker to follow the one currently planned. These ships break, we really need more than one.

Perhaps it is also time to make another examination of the legacy of Deepwater that is still with the Coast Guard. Are there alternatives to the long range aircraft/UAVs and the ship types that have been perpetuated long after the program failed?

The Coast Guard has belittled its role in national defense and in doing so has also minimized the future utility of its assets in this role. Fear is a stronger motivator than altruism. We need to recognize that the nation is motivated more by fear than by the desire to do good or maintain its infrastructure. This is the reason the Defense Department is well funded.  The national defense role of the Coast Guard, both against terrorism in peacetime and as a naval auxiliary that can bring needed additional numbers to the fight in wartime needs much more emphasis. It is obvious, listening to the subcommittee, that the counter-terrorism role was what they had in the forefront of their minds.

The Sub-Committee:

—Republicans

Duncan Hunter, California, Chairman
Don Young, Alaska
Howard Coble, North Carolina
Frank A. LoBiondo, New Jersey
Patrick Meehan, Pennsylvania
Steve Southerland, II, Florida, Vice Chair
Tom Rice, South Carolina
Trey Radel, Florida
Mark Sanford, South Carolina
Bill Shuster, Pennsylvania, (ex officio)

—Democrats

John Garamendi, California, Ranking Member
Elijah E. Cummings, Maryland
Corrine Brown, Florida
Rick Larsen, Washington
Timothy H. Bishop, New York
Janice Hahn, California
Lois Frankel, Florida
Nick J. Rahall, II, West Virginia, (ex officio)

10 thoughts on “Subcommittee on Coast Guard and Maritime Transportation: Examining Cutter, Aircraft, and Communications Needs

  1. “Fear is a stronger motivator than altruism. We need to recognize that the nation is motivated more by fear than by the desire to do good or maintain its infrastructure.” Although a sad commentary in and of itself, it’s simply true. I’m gonna have to watch that video tomorrow.

  2. The Coast Guard has over a hundred years of experience in being politically reluctant. There have been some bright moments but these did not create any continuance of the theme. This same problem has a long history. The Coast Guard has been culturally apolitical and reluctant to express itself about its needs and requirements to be an efficient service. This is one reason the “government major” was created at the CGA to educate some officers beyond the narrow confines of the engineering curriculum. It has not been a total success because not enough time has passed to have some of these near liberal arts majors rise into the senior decision making ranks.

    This is an area where Coast Guard History is not working. As noted, the idea that only the successes are presented is a by-product of the Coast Guard’s History Program (or lack of one). The history presented since 1880 has been romantic in nature and up beat by product. Even when mass deaths occur, as in the Tampa incident, it is seen as a positive because the Coast Guard has been allowed to make the claim of having the largest loss of naval personnel during WWI. It may be perverse but it a much touted accomplishment.

    Historically, I find little different in the hearings from those a century or more old.

  3. How much is that new building and how much over budget is it? Was all of that money well spent?

    Also ICGS was under a program wide performance guaranty that they said was “unconditional”. The guaranty was to guaranty ICGS ability to satisfy the mission requirements from the USCG. Not only did they not do that the USCG is now ten years behind that plan. ICGS was fully funded for most of the years of that contract from 2002-2010. To the degree they were funded and for what they proposed and were under contract to do they guaranty should be making up the massive financial shortfall. (The guaranty was also false which means ICGS should have actually never won Deepwater. it was fraudulent inducement of the contract).

    Not a dime has been paid under the guaranty for the 10 year gap, the 123s, the FRC composite hull debacle or the NSC hull longevity issues. The USCG just keeps rolling over for the contractors.

  4. Perhaps the CG could borrow some political advisors from the USMC and some contracting/acquisition advisors from the USN.

    A Secretary of the Coast Guard would be great. Someone with political connections and back-benching with the right Congressional staffers could get info and sell plans for a re-focusing of the CG more oriented to Homeland Defense as we’ve been discussing in the “Reinvent the 5th Armed Service thread.” That would also be a person in the chain of command who could cut through the service’s officer’s corps, who would likely be reluctant to big changes. The key to aswaging those fears would be for the secretary to show they have the political capability to get it done the right way so the officer corps need not feel threatened.

    I love the fact the concerns and discussions run right along the lines we discuss and are informed about by Chuck’s articles. Shows what a class place this is.

    It’s also reassuring that civilians doing research and Congressmen and staffers all agree that CG is politically naive. It does beg the question of why they don’t give the CG more than what it asks for, though…?

    • I don’t think the Cg leadership is naive. They are ego-centrically challenged and not the big time players they think they are or want to be. Admiral Allen given all his exposure as Commandant and Katrina is not Naive. I would imagine Admiral Loy sitting on Lockheed’s board isn’t either. The reason these guys don’t get what they need is because deep down and off the record congress doesn’t think highly of how they ran the Deepwater program and are still running things since then. The night before my hearing in April 2007 Admiral Allen and several congressmen when to see the 123s. At that meeting Admiral Allen apologized for giving congress and his own IG the run around. Right after he decided to ask for a refund for the 123s. Congress also knows the USCG tried to claw back a critical document in the DoJs case against ICGS as well as plan to send the key USCG witness, of the fraud, on a national security mission the exact week we had him scheduled for trial. There is also the program wide performance guaranty he decided not to use to help fix the massive performance gap.

      The idea for a Secretary of the USCG is great. As long as they get someone who is not part of the Commandant clone factory.

      When the USCG leadership proves it is not a joke and puts the service first as opposed to themselves they will get more money.

      • I see what you are saying, but I’m not talking about one or two recent Commandants. My point is that there is an ingrained/institutionalized perspective within the CG which thinks the way to Congressional, or perhaps all, political favor, is to be a yes-man, even when it is unrealistic and means being expected to do more with less, and never, ever making a stink. From my very detached perspective, the appearance of how this works is that an officer will not get promoted far (flag-rank, perhaps?), if they do not display this characteristic. It’s deeper than the Commandants and goes back 100 years.

      • @Bill

        Got it. And I agree. it is very unfortunate. After 9/11 they gained a massive amount of political capitol, a massive and earnest budget to upgrade and wasted it

  5. Pingback: Coast Guard Capital Investment Plan, 2014-2018 | Chuck Hill's CG Blog

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