2010 Budget Signals Funds for New Starts In Short Supply By JOHN T. BENNETT Published: 2 November 2009 PRINT | EMAIL The 2010 U.S. defense budget terminates several troubled - and costly - weapon programs, while devoting more resources to such things as intelligence-gathering unmanned aircraft, blast-resistant vehicles and helicopters, and analysts see those trends holding for several years. The budget also signals there will be less funding available to launch new weapon development programs. President Barack Obama signed into law a $680.2 billion 2010 defense authorization measure last week. A House-Senate conference prepares to fashion a final appropriations bill to send to the White House, but it likely will look a lot like the authorization act, which looks a lot like the Pentagon's request. Indeed, Obama and his Pentagon lieutenants will get more of the funding levels and program changes they proposed than most administrations. Defense officials have calculated lawmakers left intact "95 percent" of the 2010 spending request the Pentagon sent Congress in February, chief DoD spokesman Geoff Morrell said Oct. 28. Defense analysts last week predicted that as long as Democrats maintain control of Congress, Obama likely will get much of what he wants in defense spending requests. The 2010 budget sought to address several in-theater equipment needs, and senior defense officials have said for several months that the 2010 Quadrennial Defense Review and fiscal 2011 budget processes will continue that. For instance, David Ochmanek, deputy assistant secretary of defense for force transformation and resources, told reporters this summer that Defense Secretary Robert Gates is "very aware of persistent shortfalls that have existed in the ability to support forces in disbursed operations in Iraq and Afghanistan." He listed a few examples: "Rotary wing, lift, civil affairs, persistent ISR, and the exploitation and dissemination that goes with that, [and] intratheater lift." Intelligence, surveillance and reconnaissance (ISR) missions are increasing in Afghanistan, defense officials say. And that means the 2010 defense budget puts more money into ISR programs. Analysts say that is unlikely to change as long as U.S. troops are deployed to Iraq and Afghanistan, and as long as ISR proponent Gates remains defense secretary. Todd Harrison, a defense budget analyst at Washington's Center for Strategic and Budgetary Assessments, said the 2010 budget "saw a big turnaround to achieve Gates' ISR drive." The 2010 Pentagon budget also puts more funds into helicopter accounts, another trend budget experts and defense analysts say will continue for years. As the U.S. military increases its efforts in Afghanistan, commanders are relying more and more on helicopters to ferry fighters and equipment across the war-torn nation's rough landscape. "The rotorcraft business is thriving while the fixed-wing portion of the business is faltering," said Loren Thompson of Arlington, Va.'s Lexington Institute. "With the exception of the C-130J Super Hercules, all of the fixed-wing transports currently in production could terminate relatively soon. Facilities building the V-22 Osprey tilt-rotor and the CH-47 Chinook helicopter have a bright future." That should translate into greater profits for Boeing, which makes both the CH-47 helicopter and the V-22 Osprey tilt-rotor aircraft. Boeing's V-22 partner, Bell/Textron, should "benefit handsomely" from that program, Thompson said. The Pentagon's ever-strengthening push for rotary-wing lift is perhaps exemplified by the Army's 2010 aviation budget plan. The service sought $7 billion in 2010 aviation funding, and most of that will go for helicopter programs, according to service budget documents. The Navy's aviation budget swelled to $18.4 billion in the Pentagon's 2010 spending request, up from $14.7 billion in 2009. Helicopter programs got a healthy chunk of those additional funds. Also getting a funding infusion in 2010 were special operations forces and programs aimed at helping partners build their military and security forces. Other areas that got a boost from the 2010 defense budget were irregular warfare tools, analysts said. That push led to a greater emphasis on such things as intratheater lift airframes, UAVs and countermine-warfare systems. The kinds of irregular and stability missions senior Pentagon officials envision for the Army and Marine Corps will require boosting their personnel and operations and maintenance coffers. And with defense budgets expected to level off or decline slightly, those outlays will take funds from long-term weapon development and procurement efforts. Mackenzie Eaglen, a defense analyst at Washington's Heritage Foundation, noted spending on combat support and maintenance programs, along with things like cybersecurity and logistics programs, grew in 2010 - and likely will continue to swell in the Pentagon's 2011 spending request. And while major defense firms once jockeyed for massive development and procurement contracts, over the next few years, Eaglen said, "contracts for upgrades and reset will prevail." There are several long-range development efforts in the works. The Air Force is taking another look at building a new bomber. The Navy continues to mull over a new cruiser. The Army will soon take another shot at fielding a new family of ground vehicles. For the next few years, those efforts will get research and development dollars. It will be at least five years, Eaglen said, before annual funding for such efforts will ramp up. In the meantime, defense firms can only tussle over smaller contracts. "When it comes to major contracts, million is the new billion," she said. "There are no more multibillion-dollar defense contracts coming anytime soon." The 2010 budget continues a shift of funds from procurement accounts to research and development (R&D) efforts, Harrison said. There also is churn within the department's 2010 R&D portfolio, he said. More and more R&D funding is going into the system design and development phase, leaving less and less for the kinds of early research work experts say can pre-empt costly design failures and changes late in a new platform's life. "That indicates programs that are already started moving," Harrison said, "but it also shows there is no money for new starts." ■ E-mail: [email protected].