Home » News » Acquisition Reform » $46 Billion Worth of Cancelled Programs

$46 Billion Worth of Cancelled Programs

by John Reed on July 19, 2011

So here’s an interesting bit of defense technology related info presented by the Center for Strategic and Budgetary Assessments at a press conference to discuss defense spending yesterday.

It’s a breakdown of just how much all those weapons programs that were cancelled in the last decade cost us:

Future Combat Systems (FCS) $18.1B

Comanche helicopter $7.9B

nPOESS satellite $5.8B

VH-71 Presidential Helicopter $3.7B

Expeditionary Fighting Vehicle (EFV) $3.3B

Transformational SATCOM (TSAT) $3.2B

Crusader $2.2B

Advanced SEAL Delivery System (ASDS) $0.6 B

Armed Reconnaissance Helicopter $0.5 B

Aerial Common Sensor $0.4 B

CG(X) next Generation Cruiser $0.2B

CSAR-X $0.2B

All told, that’s about $46 billion, a significant chunk of change. CSBA’s Todd Harrison (and many others throughout the years) urged the Pentagon to start programs off right with realistic requirements and tight oversight to prevent such cancellations from ever happening. Still, you’ve got to realize that a lot (but certainly not all) of the lessons learned in the development of these systems will be put to use in their replacements. Who knows how much tech from the Commanche was featured on the stealth helos that took out bin Laden?

Check out Steve Trimble’s list of successful DoD programs of the last decade and notice, as he points out, that they’re all derivatives of existing systems.

Click through for a copy of the CSBA report. The chart with the cancelled programs is on page 36.

FY 2012 Defense Budget

Share |

{ 71 comments… read them below or add one }

Dfens July 19, 2011 at 2:00 pm

Let's never stop paying contractors the same percentage of profit on development we pay them on production, because that's working out so damn well for us. Out of the $46 billion in cancelled programs, the prime defense contractors cleared $4.6 billion in profit. That's not even counting all the profit their subcontractors made. They risked absolutely nothing to make that profit. At least if they had to produce something, they'd have some risk they'd have to take to make their profit. Stupid people and their money should be parted, and thank God we have defense contractors to take that money away from the stupid US taxpayer.

Reply

blight July 19, 2011 at 2:02 pm

It makes you shudder to imagine what would have happened if all those programs were produced out to full build, and the consequent burden on the American economy it would be. It would make the Soviet military-industrial-complex based collapse look small by comparison.

Reply

tribulationtime July 19, 2011 at 2:24 pm

HA HA HA HA. A- money go anyway to Complex bla bla bla. B more money was added to buy systems what no meet requeriments C so begging other program to substitute the intering item. So 3 more cost at all but only 2 parts goes for weapons. Where goes 1/3 of money?.

Reply

WHAT July 20, 2011 at 10:06 pm

You don't make any sense… IDIOT

Reply

blight July 20, 2011 at 10:44 pm

I make sentence A B and C therefore one third

Reply

Vstress July 20, 2011 at 6:00 pm

This however is a direct stimulus to the economy.

Most technology cited here in these cancelled programs has direct impact on civilian (and also future) tech used elsewhere.

Personally I agree with the article, but in a slightly skewed way.

I think we should make sure we make the clear distinction between production items and technology demonstrators. A good example is the Commanche.

If this was run as a technology demonstration programme it would have been very successful.

Ensuring that supplier contracts are made, parts are ensured to handle the rigours of mass manufacture and the very large extra amount of engineering work required to pass safety regulations (flight envelopes, structural tests, etc.) when things are primed to be put into production all adds HUGE costs.

The problem however then lies with the fact that technology demonstrators never attract the costs and the interests that a production run will. However, with the tighter budgets, the companies should be more willing to bite on such smaller contracts.

Reply

poiu July 21, 2011 at 12:36 am

The contractors quit their jobs to come to work on a defense system with the hopes of helping their country while putting food on the table. Then after the contractor works tons of uncompensated overtime to adjust to the random requirements changes, the customer arbitrarily cancels the program forcing the contractor into a layoff possition, forced to sell home at a loss, forced into unemployment, etc. And to add insult to injury, the customer blames the contractor for costs directly associated with the customers bad decision making.
Yes the contractor takes on lots of risk!

Reply

blight July 21, 2011 at 8:51 am

"The contractors quit their jobs to come to work on a defense system…"

Lockheed employees working in State Design Bureau? What?

Reply

Jim July 19, 2011 at 2:47 pm

NPOESS's budget cut is not a clean $5.8B in savings… some of that money is getting redirected to NASA and NOAA for JPSS, which is basically the same satellite minus the sensors which couldn't be produced on time / on budget.

(F.D. – I worked w/ NPOESS, and its problem was essentially that the sensor developers and integrators accepted R&D levels of risk on an operationally-tight schedule.)

Reply

Matt July 19, 2011 at 2:49 pm

So the government has been deciding to take these life saving systems away from the soldiers for awhile, and now they want to step it up. That’s just great. Why can’t they save money by cutting from kept welfare and tax cuts? What are we going to do, rely on the EU for help everything something goes wrong? Worked so well w/Libya…

Reply

mpower6428 July 19, 2011 at 4:13 pm

no religion, no politics. here's your shot, now say something interesting or gtfo.

Reply

Matt July 19, 2011 at 9:46 pm

And how does that remotely relate to what I posted?

Reply

Matt July 20, 2011 at 12:02 am

I feel I can safely assume you’re “trolling” but you do realize out of all these comments you’re one of the few people (the others were in relpy to your post) to throw blame on a political group… Irony is fun isn’t it?

Reply

Brant July 20, 2011 at 9:57 am

"these life saving systems away from the soldiers for awhile"

I'm pretty sure the FCS, Crusader, VH-71, EFV, and CG(X) are all pretty irrelevant to the operations going on in the world today…

Reply

Matt July 20, 2011 at 11:58 am

FCS never had a chance of working and VH-71 wasn’t gonna go to soldiers. I admit my statement was hyperbolic. The other 3 you listed would help win a conventional war. Sure WWIII with Chins probably isn’t right around the corner, but what of Iran, N.Korea, etc?

Reply

Armored July 19, 2011 at 4:10 pm

It was a bad choice what they did to the Commanche helicopter; it had so much promise…..unless of course it was just 'officially' canceled but was still being produced and developed behind the scenes to the point where they could make a different model which was the one that was supposedly seen in the 'bin laden raid' but hey, it's anyone's guess.

Reply

mpower6428 July 19, 2011 at 4:25 pm

the commanche was anachronistic before the prototype left the ground.

Reply

Mister Rose July 20, 2011 at 10:51 am

I saw one flying in a Law and Order episode once. Maybe they have a future as movie props!

Reply

mpower6428 July 19, 2011 at 4:23 pm

only donald rumsfeld's "transformational, future combat systems" could put robert macnamara's "statistical wiz-bang" to shame. at least bobby can/could say he got the army and the navy using the same kind of 20mm ammo.

jeez…. rummy didnt even try, or maybe he tried not too…..

but hey, you're right, i shouldnt judge. at least the B-1 got some "combat" time, only enough to count on one hand but STILL…. its combat time right…?

Reply

blight July 19, 2011 at 4:57 pm

Rummy sacked the Crusader and may have been responsible for minor BRACing. Rummy followed Shinsekis "Stryker Brigade" idea and took it further with more electronics. He heralded the "who needs ground troops" shock-and-awe guys who were deluded into thinking Iraq would be a easy kill. He also got stuck with the untidy decisions like passing instructions to protect oil infrastructure over everything, but he seems to be unconnected to Bremer's order to de-Baathify.

Reply

WHAT July 19, 2011 at 5:55 pm

Please don't blame the cancellation of the Crusader to Rummy…. Just blame it on Obama Obummer, just like what other neocons would want to do it here.

Reply

WHAT July 20, 2011 at 12:31 am

My Fellow Republican Brown Shirts! Please don't blame our friend Rummy for the Comanche mess! Just blame it on Obama!

Reply

blight July 20, 2011 at 7:29 am

And Sgt York.

Hap July 19, 2011 at 5:04 pm

You guys suck, I got all excited when I saw the Comanche pic and thought they were going to bring it back.

Reply

Lance July 19, 2011 at 6:42 pm

Soon there will be more on there the New USAF bomber and the GCV and the silly Carbine competition will probably be there soon too.

Reply

Stan July 19, 2011 at 6:57 pm

It's only taxpayer dollars. Easy come, easy go.

Reply

Belesari July 19, 2011 at 7:13 pm

NO!, NO!, NO! you dont understand how can you ask us to develope systems using the tried and true method of evolutionary advancment to develope weapons systems.

We have to make them go POOF out of the air like magic while demanding completely irrelevent and many times unnessesary requirements "cough" 55kts sustained for a 400ft long LCS "cough".

It never ends.

Reply

Matt July 19, 2011 at 8:21 pm

If the bin laden Helo was a comanche decendent, they obviously didn't learn enough lessons considering 1 crashed on its first mission where they rebuilt a whole city block to practice for…stealth doesn't work very well when you smack it into a wall

Reply

SJE July 19, 2011 at 10:21 pm

….And the fact that the US flew an entire SPECOPS force right into Bin Laden's compound, right next to the Pakistan Military Academy, killed the guy, cased the joint and got out without a single friendly casualty? Are you saying stealth had nothing to do with that?

Reply

blight July 19, 2011 at 10:24 pm

I believe DefTech and other forums have hashed out questions regarding the timing of the operation.

1) Paki air defense radar is likely to be oriented towards India, and might be vulnerable to nape of the earth from Afghanistan.
2)While the first wave of helicopters was stealthy, the second wave was not, and if there was radar in the area pointed in the right direction, they could easily have detected the Chinooks.

We'll probably not know the truth for decades.

Reply

saberhagen July 19, 2011 at 11:15 pm

Genius, I wonder how on earth you know for sure that's its 'first mission'? Do you happen to work for SOCOM and know something we don't?

Reply

blight July 19, 2011 at 11:32 pm

"crashed on its first mission where they rebuilt a whole city block to practice for"

That's two pieces of knowledge. Though if you look at the area's GPS coords, it isn't exactly urban. It's in a outer area of the city that is a lot of walled complexes and fields.

Reply

Nymike July 20, 2011 at 11:45 am

How do you know it was their first mission??????????????/ ;-)

Reply

jimmy July 19, 2011 at 10:00 pm

what about retired and military ss cuts was included

Reply

STemplar July 20, 2011 at 4:00 am

Article sure makes a case for the argument if we really want to truly save money we should jettison problem programs far sooner.

Reply

Matt July 20, 2011 at 4:55 am

In my opinion there really only seems to be 3 combat vehicals whose replacements seem to leave big gaps in capablities (I have minimal knowledge on satilites/comms so I’m not even gonna mention them). Ok 4 if you count the technological magic that was FCS… But I doubt anyone still believes that could’ve been saved.

1) Comanche: America still doesn’t have a stealth helo, except to some modified Blackhawks.
2) Crusader: M109, to the best of my knowledge, still has a larger crew, no autoloader, and is heavier/slower moving.
3) EFV: Unless the Marines next amphib can hydroplane they’ll loss what was argueable the biggest advantage the EFV had over the AAV…

Reply

blight July 20, 2011 at 7:25 am

Crusader was also going to have longer range and a time-on-target mode; but export customers were likely to be locked up by PzH 2000, which isn't a bad gun either. Considering the Marines were about to buy the Growler and some French mortar piece…

Reply

Joe Schmoe July 20, 2011 at 5:22 pm

I believe the Marines and Army bought the Israeli "Keshet" mortar instead.

Reply

blight July 20, 2011 at 7:31 am

Alternatively, there is the M109 with a PzH 2000 gun. (M109L52).

Reply

Matt July 20, 2011 at 12:00 pm

Any chance of the US purchasing that varient?

Reply

Mastro July 20, 2011 at 1:00 pm

I think we can make due with the Paladin for another 10-15 years and then decide if we want to go light- like that Swedish Archer- or heavy like the PzH2000.

Frankly we don't know right now- its not like we use all that much arti in Afghanistan and no large mechanized army is threatening us now.

As cool as Crusader was- cutting it was a no brainer in regards to need.

Reply

rodinuk July 20, 2011 at 5:27 am

VH-71 was also a derivative of an otherwise successful program, just not a U.S. one. Then again it's cancellation was for political reasons not defense.

Reply

Guest A July 20, 2011 at 8:51 am

That airframe really is a beast, and they still don't have a replacement for the H-3s.

Reply

blight July 20, 2011 at 9:22 am

The R&D costs continued to spiral while the size of the buy was unlikely to get any larger.

They would be better served by moving helicopter responsibilities to the Secret Service, and thus out of the political theater known as "defense procurement". He may be CinC, but why should the Marines be flying him again? Would the defense contractors play nice with SS, knowing the SS isn't ready to shoot the breeze and accept cost overruns…?

Reply

Guest A July 20, 2011 at 11:03 am

The Secret Service does more than just protect the POTUS, for one. Even if they did take that responibility, they would still need all of the equipment that goes into the helos flown and maintained by the Marines which means they would still cost the same. They fly him for the very reason he is the CinC, just like the Air Force does.

Reply

blight July 20, 2011 at 11:22 am

With that logic, the PSD would be folded into the military. I've always thought the SS ought to split, with the law enforcement function returning to Treasury, and the protection detail combined with the State Department's Bureau of Diplomatic Security.

Reply

Jay July 20, 2011 at 9:31 am

Social Security improperly sent $6.5 billion in overpayments in 2009, so these programs over 10 years add up to 7 years of SS mistakes.
Or less than 1 year worth of medicare fruad, estimated at $60-80 billion annually.

The defense contractors are in the wrong business, if they want to get big money they should get into medicare!

Reply

Dean July 21, 2011 at 12:09 am

Oh yes, yes. How improper to issue checks to our own citizens when defense contractors make so much better use of our tax dollars. How shameful grandma can buy groceries and afford to see a doctor when we could be buying super-neat-o stealth cyber weapons to fight the scary poor and illiterate peasants and their sophisticated defenses. You're a real super person Jay. You're right, blowing up brown people on the other side of the planet is definitely the best use of the wealth of our nation. I mean, just look at your spelling, we definitely wasted public education dollars on you right there.

Reply

Brian Black July 20, 2011 at 9:32 am

Surely the biggest failure on that list is the presidential helicopter. To spend $3.7billion and have absolutely nothing to show for it is a disgrace.

At least with things like Comanche or the EFV, you'd expect the developed technologies to leach into other existing or subsequent programmes; but the Presidential helicopters are a near total waste of money.

And seriously, how hard is it to buy a helicopter for the boss – look through brochures, select cup holders and other options, order a bunch, paint the right shade of green, job done!

Reply

Guest A July 20, 2011 at 11:11 am

You would think it would be that easy. The problem was after LM won the contract at the price set, all the other agencies involved like the Secret Service and NAVAIR started adding requirements that they wanted and bogged the program down and costs went up. Throw in the fact that since it was a foreign purchase there were all kinds of ITAR related issues that added to the delays that snowballed with all the other issues and it went downhill from there.

Reply

Some Guy July 20, 2011 at 12:01 pm

Well it does have to have defenses. A well placed stinger shot and boom, by bye birdy. SO i bet it has to have a lot of countermeasures

Reply

Dfens July 20, 2011 at 9:56 am

I wonder when they'll make it official that C-130 AMP is cancelled? That should add another $4 billion to the total, making it an even $50 billion. $50 billion, that's starting to be real money.

Reply

blight July 20, 2011 at 11:27 am

And that omits the cuts during the "peacetime" Clinton years…

Reply

STemplar July 20, 2011 at 10:17 am

Too much of the right hand not knowing what the left is doing. Also, as long as Congress is essentially bribed by the defense industry there will never be change. We could absorb these cuts easily if we would just stop this fear mongering justification syndrome we use for making excuses for the atrocious performance of these programs. If we would just adopt the use of more OTS options applied in creative ways there would be huge savings. We cling to having to have all these purpose built solutions and as a result whatever we field ends up costing several times more per than necessary.

Reply

SJE July 20, 2011 at 11:08 am

Its not just Congress, but the Senior Officers who make decisions that just happen to favor contractors, and then go to work for the same contractors. We should be paying our Generals better than junior lawyers, so that they don't have to whore themselves to private industry.

Reply

blight July 20, 2011 at 11:26 am

I think you underestimate greed. What kinds of people rise to the top of any organization? In this regard, Wall Street and the Pentagon aren't so dissimilar after all…

Reply

shawn1999 July 20, 2011 at 5:12 pm

Yup- those who should be in power don't want to be. Those who should never be in power often are.

If things went intelligently, missed deadlines/delivery dates would result in the defense contractor PAYING FEES, not getting paid more, Congressional pork projects would result in the Congressperson being impeached (or whatever the equivalent for Congress is), and benefits/pay being slashed for Congresspeople, not our military and vets.

Reminds me of a joke:

An Indian walks into a cafe with a shotgun in one hand, pulling a male buffalo with the other.

He says to the waiter: Want coffee.

The waiter says: Sure, Chief. Coming right up.

He gets the Indian a tall mug of coffee…..
The Indian drinks the coffee down in one gulp,
Turns and blasts the buffalo with the shotgun, causing parts of the animal to splatter everywhere and then just walks out.

The next morning the Indian returns.
He has his shotgun in one hand, pulling another male buffalo with the other.
He walks up to the counter and says to the waiter: Want coffee.

The waiter says: Whoa, Tonto! We're still cleaning up your mess from yesterday. What was all that about, anyway?

The Indian smiles and proudly says:
Training for position in United States Congress:
Come in, drink coffee, shoot the bull,
Leave mess for others to clean up,
Disappear for rest of day

Reply

blight July 20, 2011 at 7:25 pm

The issue is possibly that procurement contracts are always tinkered with, so that things never quite finish: a homage to "development hell".

The other is that neither the military nor the company knows what they want out of a project, so it becomes a fishing project of prototypes, which can get expensive quickly.

Oh, for the days when there were more design houses, and before mass consolidation. Good for innovation and competition, but it meant too many companies to "feed" in tough times.

aSDF July 20, 2011 at 12:00 pm

these are not just cancelled programs, most of them have had a hell of an overrun

Reply

rptoy July 21, 2011 at 12:31 am

A customer walks into a car lot with 5 thousand dollars wanting a new car, not used and the cheepest new car cost 10 thousand but does not have the features the customer want. The Dealer wants to help out the customer by offering the car for 7 thousand. And then the customer complains that the car was over budget and did not have the features they were looking for. This is how the DOD buys new systems.

Reply

sferrin July 20, 2011 at 7:34 pm

So what the author is saying is that cancelled programs weren't free? WTF? I feel like my IQ has dropped 40 points just by reading this article and some of the comments here.

Reply

PeteCarter July 21, 2011 at 10:01 am

This is a higly biased and one-sided article, for the following reasons:
1) new systems originate from a) warfighter needs and b) enabling technology. If the technology is not mature (what's called TRL of 1-3), it is often "matured" through the Technology Development Phase. By definition this is R&D , and often the maturation process simply doesn't develop as it was envisioned (what do you think RESEARCH means?). Very often the R&D shows that the technology simply won't work for the proposed new system.
2) Often the technology's mature, the need is genuine, but the realized cost of production, maintenance, and sustainment makes it "out of reach". And it doesn;t become apparent until it's in early production. The F-35 is trending in that direction.
(Post is continued below.).

Reply

PeteCarter July 21, 2011 at 10:01 am

3) The systems shown above did not result in wasted dollars – technology was developed that can usually be applied to a related system. I as involved in Future Combat Systems for several years, allowing the Army to go forward with technology insertion in a number of areas, especially in the C4ISR and comms. areas.
4) very often system development is well underway and the threat either changes drastically or diminishes. Think about how many Cold War-oriented systems were in development when the Soiet Union dissolved in 1991.
5) and yes, sometimes it's purely political, as when a new Administaration comes in. The B-1 bomber is a prime example.
Many of us in Acquisition do our best to make the most effective use of every taxpayer dollar. Articles like these just perpetuate the typical "wasteful Pentagon" myth

Reply

blight August 3, 2011 at 6:49 pm

Categorizing the list:

Obsolete by Cold War ending:
Comanche helicopter $7.9B
Crusader $2.2B

Didn't meet targets?
Future Combat Systems (FCS) $18.1B
Expeditionary Fighting Vehicle (EFV) $3.3B
Advanced SEAL Delivery System (ASDS) $0.6 B

Change of heart?
VH-71 Presidential Helicopter $3.7B
Aerial Common Sensor $0.4 B
nPOESS satellite $5.8B
Transformational SATCOM (TSAT) $3.2B
CG(X) next Generation Cruiser $0.2B
CSAR-X $0.2B
Armed Reconnaissance Helicopter $0.5 B

FCS dominates the list, but was meant to fund a family of vehicles and all sorts of ear. Comanche is just one platform…but in the long run would probably have run into the stealth materials maintenance nightmare that mars low-observable coatings.

Reply

G. Donovan August 3, 2011 at 6:22 pm

I have doubts that the political establishment is even aware of their place in the global establishment. They cancelled the Comanche (for a lack of mission), even as the Russians and Chinese were rolling threat aircraft and vehicles off the assembly line. We've outsourced so much manufacturing, we can't even build replacements for what we have, without importing the parts and the fuel they need. We have so many dependencies and vulnerabilities that war has become unnecessary to contain our power and influence.

Eventually, we'll have a military that can only protect the Northeastern US and spy on American citizens (the REAL enemy, according to Homeland Security).

Reply

blight July 19, 2011 at 11:26 pm

If knowledge were a requirement on the internet, we wouldn't be running out of IP addresses.

Reply

blight July 19, 2011 at 11:29 pm

It's more like they have homed in on inconsistencies that appear in the general, deliberately vague accounts that have trickled out. However, in the absence of more substantial info conclusive answers are unlikely.

Reply

anon July 20, 2011 at 9:31 am

nah, Sgt York was in trouble when it opened fire on the people responsible for signing the cheques

Reply

blight July 20, 2011 at 10:45 pm

To use the analogy of housebuilding; if you end up with a never-ending house like the Winchester Mystery House in San Jose, wouldn't you want it to terminate it before it got out of hand?

Reply

STemplar July 21, 2011 at 2:57 am

sorry, commanche was a gold plated waste we didnt need.

EFV was a staggering piece of junk.

Presidential helo was a poster child for mismanagement.

FCS concept was a fairy tale and produced pretty close to nothing for the cash invested.

Reply

blight July 21, 2011 at 3:08 am

FCS was a "let's fund a bunch of ideas before the technology is there".

Might as well try to invent and market personal computers while still developing the transistor, then cut the buy of personal computers because the R&D for transistors and semi-conductors was too much.

Reply

Leave a Comment

Previous post:

Next post: