Winslow Wheeler: GAO (A Legislative Entity) Plays Courtesan to Lockheed, DoD, and the Congressional Recipients of Lockheed Largesse + F-35 RECAP

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DOD is circling the wagons to keep the F-35 propped up in the declining Pentagon budget. Importantly, as noted by a prime Lockheed mouthpiece offering his thankfulness for it, GAO's newest report on the F-35 offers a conclusion that the F-35 is on track for improvement–the data notwithstanding. In point of fact, what the GAO conclusion does show is that some long term negative–and management induced–trends have gone viral in the investigatory agency where I once worked. As a result, DOD has been allowed unseen influence on a GAO report. Skeptical? The latter half of a new piece at Foreign Policy explains.

The magazine's title for my article only off-handedly hints at the nature of the problem; it is not so much a “conspiracy” as the effects of an equal relationship between GAO and DOD. The piece is available at http://www.foreignpolicy.com/articles/2013/03/22/error_report and below:

Foreign Policy

Error Report

Is there a government conspiracy to save the F-35?

BY WINSLOW WHEELER | MARCH 22, 2013

Until recently, the F-35 Joint Strike Fighter had been having a pretty rough time.

In 2012, its estimated average “program acquisition unit cost” was reported to have doubled, from the $81 million per copy anticipated in 2001 to $161 million, flight tests revealed deficiencies in achieving the F-35's modest performance requirements, and scheduled full-rate production was delayed to 2019.

In 2013, the pace of negative events and reports has only increased. So far, the F-35 has been grounded not once but twice (with different components showing signs of failure). Also, not one but two reports from the Defense Department's director of operational test and evaluation (DOT&E) documented serious problems: Existing deficiencies, such as the inability to land safely on aircraft carriers, have not been resolved, and new issues, such as lower than predicted acceleration, are cropping up — just as the more challenging flight tests are beginning.

Even the F-35 program manager, Lieutenant General Christopher Bogdan, was quoted in Australia being volubly caustic toward the F-35's two largest contractors (Lockheed-Martin and Pratt & Whitney), saying they were trying to “squeeze every nickel” out of the program, not controlling their costs. Then this week, the Government Accountability Office (GAO) released this year's annual review of the program. It reported that the first four F-35 production contracts have overrun their targets by $1.2 billion; above that, the F-35s built before 2016 will need an additional $1.7 billion to fix the problems uncovered, so far, by testing. In addition, the amount needed to sustain the F-35 will climb to almost $14 billion in 2018, while the Pentagon is supposed to absorb cuts required by budget deals. As GAO also points out, the program faces a conundrum: Reducing production to save money will actually increase the unit cost of each F-35 built, thereby making the already unaffordable program that much more unsustainable.

And yet, it would seem that in other respects, the F-35 defenders are circling their wagons.

Lt. Gen. Bogdan is a more complicated personality in the F-35 saga than his highly quotable statements about greedy contractors might make him out to be. On inspection, he is an uncompromising defender of the F-35 — he has trashed unwelcome reports on the F-35's ineffectiveness and, more importantly, tried to intimidate subordinates who have unflattering things to say about the plane.

Speaking at a conference of DOD bigwigs funded by Credit Suisse and McAleese & Associates, Bogdan dismissed one of the DOT&E reports as “premature,” and then he went even further. One of the pilots quoted in the report had the strength of character and intellect (based on a few hundred hours of operational aircraft flight experience) to express concern that the design of the F-35 cockpit restricted pilots' ability to see threats to the rear, saying “aft visibility will get the pilot gunned [down] every time.” The comment addressed a real flaw in the F-35's airframe design, and it came from an experienced operator. What was Bogdan's response? He told the press at the bankers' conference that “we can always put that pilot in a C-2 [cargo aircraft]…where [he] won't worry about getting gunned down.”

Sure, general, that's just what DOD needs more of: Washington-based bureaucrats talking down to servicemen in the field with the character to express their experience-based concerns about defective equipment. Donald Rumsfeld did the same thing in 2004 when a reservist in Iraq had the gall to suggest that soldiers should not have to scrounge in scrap heaps to improvise “hillbilly armor” to survive in their vehicles in combat. Saying, “You go to war with the Army you have,” Rumsfeld told the soldier to suck it up.

Lt. Gen. Bogdan, welcome to your own personal alcove in Donald Rumsfeld's hall of conceit.

However, beyond arrogance from “milicrats” at financiers' conferences in Washington, something else — subtle, but perhaps more sinister — has been going on.

For years, the GAO has been reporting on the F-35. While some of the reports have not probed as deeply or as completely as others, they have all been a valuable, informative resource. In some respects, the new March 11 report is no exception: F-35 costs continue to grow; capabilities are being achieved late or moved out of the program altogether; after 10 years, most capabilities are yet to be verified, or even tested; what some call the “death spiral” (smaller numbers of aircraft at increased cost) is a major threat to the program.

However, this new GAO report, titled “F-35 Joint Strike Fighter: Current Outlook Is Improved, but Long-Term Affordability Is a Major Concern,” makes certain optimistic statements that it does not substantiate, suggesting the Pentagon may have influenced its findings.

Twice in the report, GAO asserts that the F-35 program has made “considerable progress” addressing the problems the F-35's high-tech helmet-mounted display. DOT&E reported that pilots in training frequently saw misaligned horizons, inoperative or flickering displays, and double, unfocused, jittery, washed-out and/or latent images in the helmet display, but the GAO report did not explain the problems, let alone any solutions. Then, GAO stated that “program and contractor officials told us that they have increased confidence that the helmet deficiencies will be fixed.” In other words, contractors and DOD officials told GAO the helmet was on the mend, and without meaningful evaluation or evidence, GAO simply regurgitated the assurance in its report.

In another section labeled “F-35 Program Met Most of Its 2012 Key Management Objectives,” GAO presented a matrix supporting inferred progress: Seven of ten objectives were declared met. GAO failed to note that several of the achieved objectives were almost impossible to fail. For example, GAO gave the F-35 credit for passing the objective titled “Begin Lab Testing” of the problematic helmet display and for receiving a go-ahead decision for the entire program from DOD's Defense Acquisition Board. These “accomplishments” are tantamount to students giving themselves a passing grade for starting a course, not completing it — let alone with a passing grade. Also, the F-35 was found to have passed the objective to “Begin F-35A and F-35B Pilot Training,” even though the DOT&E report raised serious questions about whether the F-35A was qualified to begin such training.

Interestingly, two of the objectives declared to have been failed were ones that are readily quantifiable: delivering the promised number of aircraft and achieving the Defense Contracting Management Agency's criteria for an audit. When pass or fail was quantifiable, there were problems.

Such vapid but positive findings gave one of the F-35's biggest boosters, Lockheed consultant Loren Thompson, license to author a paean to the GAO report, “GAO Gives F-35 Fighter Its Best Grades Ever,” citing the above-mentioned and other supposed signs of progress.

Having worked in the GAO for nine years, I am familiar with some of the problems this GAO report contains.

In the lunch room in the GAO headquarters, we used to crack jokes about weak, “officials told us” reporting. It may be accurate that contractors and officials said the helmet would be fixed, but where is the empirical — not rhetorical — evidence of the “considerable progress”? What has actually been improved, what is the proof (from test data) of that, and why would anyone simply repeat the advocates' assurances as the primary evidence? How sad that such fluff suffices as evidence for managers in today's GAO.

While there are other examples in the report of poorly supported assertions, GAO's conclusion is the real stunner: “Overall, the F-35 Joint Strike Fighter program is now moving in the right direction after a long, expensive, and arduous learning process.” Other than the weak examples cited, there is no substantiation of this sweeping statement. Indeed, reporting from others, such as DOD's own DOT&E, would seem to indicate the problems in the F-35 program may be growing, especially as it enters the more difficult part of its flight testing.

One has to wonder where GAO got the idea to print such a reassuring, but vapid, conclusion. I think I might know the answer.

Every GAO report should be, and is widely assumed to be, completely independent of any influence from outsiders, especially those who are the subject of investigation. The way I saw GAO operate during my tenure there as an assistant director and as former colleagues and other GAO contacts continue to tell me, that essential independence is sometimes compromised.

A basic element of the GAO report process is to send a final, manager-approved draft of a report to the agency being investigated for its official comments. These comments are routinely published in the report, and any time the agency under investigation finds what it considers to be errors of fact or judgment, it states them — publically and on the record. GAO has the option, on its own re-examination, to modify the report accordingly or to stick to its guns, citing its reasons why.

However, for many years this important process has been abused by some in GAO. Repeatedly, I would observe others at GAO providing early, not final, draft reports to DOD officials asking for their informal — not publically recorded — comments, plus any useful data to substantiate their claims. DOD would even edit report language. The agency's “suggestions” would always come back accompanied by the implication that “if you say it this way, we won't raise any serious objections to your report.”

For reasons that always seemed bizarre — at best — to me, many top GAO managers preferred findings, conclusions, and recommendations that gave DOD only limited, if any, heartburn. (I devoted a chapter in my first book, The Wastrels of Defense, to these and other serious problems in GAO research. However, to its great credit, the GAO division in which I worked, which specialized in program evaluation and methodology, refused to engage in this under-the-table agency-editing and report-correcting process.)

This problematic behavior has apparently taken deeper root in GAO — all of it unseen by the readers of GAO reports. DOD is now routinely given a written “statement of fact” that conveys the substantive parts of a report at an early, incomplete stage before the research is closed out. The DOD responses, including edits and other suggestions, are taken as a regular part of the report-writing process. Moreover, staff are admonished that a “good” report is one that DOD does not obstreperously object to: As few “non-concurs” as possible — if any — are highly desirable in the final, written agency comments that appear in the end of a published report.

In short, DOD appears to have an unseen hand in influencing the text of GAO reports, and the management guidance as perceived by the GAO staff is to accept the DOD guidance to reduce as much as possible any areas of disagreement. The differences may only be subtle in a final GAO report, or they could appear in the form of strangely unsubstantiated assertions and conclusions — the sort of vapid statements that appear in GAO's new F-35 report.

Indeed, the only other explanation for the data-free assertions might be that the work at GAO, especially the review process, was sloppy and did not merit what used to be the highly prized declaration (known as the “GAGAS statement”) that all the work for the report was performed “in accordance with generally accepted government auditing standards,” which — justified or not — appears on page two of the report.

My knowledge of this sort of practice led me to view as highly suspicious Appendix III in this latest GAO F-35 report: “Comments from the Department of Defense.” It is a one-page letter stating, “The DOD values the GAO's analysis of the F-35 program. We agree with GAO's concluding observations and appreciate the recognition of the Department's responsiveness to previous recommendations. The Department will continue to be supportive of the annual GAO review of the F-35 program.”

With a love letter like that from DOD to the agency that is supposed to be Congress's watchdog, it is time to worry how far self-interested interventions have penetrated a respected and heretofore sacrosanct agency. All may not be so well with the F-35 — or with GAO.

Winslow T. Wheeler is director of the Straus Military Reform Project of the Center for Defense Information, which recently moved to the Project on Government Oversight. For 31 years he worked on national security issues for U.S. senators from both political parties and for the Government Accountability Office.

Phi Beta Iota: GAO is required to do its analysis on the basis of prescribed assumptions from its Congressional masters that are inevitably corrupt — designed to suck the integrity out of any analytic endeavor. Despite this, GAO in the past has been relatively reliable as a source to mix with others. With the departure of the former director of GEO to front for Peter Peterson and Wall Street on a campaign to assure government payment of fraudulently contrived debt, GAO appears to have lost even more of its integrity under his succesor–evidently the 15 year assured term did not have its intended effect Right this instant, outside of Winslow Wheeler, Chuck Spinney, and a few other truly expert (and therefore marginalized) individuals, there is no one actually committed to the public interest or to telling the truth about this program. The truth at any cost lowers all other costs. We expect Chuck Hagel to cut the program using Dick Chenney methods,, i.e. not following established protocols, such that Lockheeds files suit and gets a multi-billion dollar pay-off, pure profit with no expenses. That will be the ultimate integrity break-down. Lockheed does some very good things — it's recent breakthrough on desalination filters is a wonderful example — but right now, what the US Government needs more than anything else is intelligence with integrity. Ending this specific program, legally and ethically, would be an excellent first big decision for the new Secretary of Defense.

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