It’s never been easier to get a small contract. There’s pitch days, their DIU, there AFWERX. That’s not the challenge. The challenge is, how do you take a $1 million SBIR program, for example, and transition it across the valley of death into a $50 million, $100 million, $500 million, $1 billion program. That’s the thing that I think is hard for the defense establishment to imagine right now. That’s the thing where I think the DoD can make it a lot easier. Congress has an important role to play.
That was Chris Brose on the War on the Rocks podcast, “The Fleet, the Fight, and the Future.”
I think it’s entirely imaginable that more transitions would occur if money didn’t have to start getting lined up two to five years in advance. Let fundamental units of organization, like Program Executive Offices, freely make tradeoffs within a budget ceiling to whatever project is most promising at the time of decision.
The primary importance of the budget seems to be gaining attention, as reported under the FCW headline, “Tech investment requires flexible funding, Thornberry says.” Not much detail is reported there, but here is an excerpt of Rep. Mac Thornberry from the full Brookings conversation:
I can’t tell you how many companies don’t have the resources of Microsoft and Amazon. They’ll win an award, have something cool, then there’s the proverbial valley of death where funding dries up until it is taken up with a program of record and they don’t have the resources to keep the people and production lines going. This is something we’ve talk a lot about this year — having small to mid-sized companies fill in the gaps — but it requires flexibility of funding, and I hope the appropriators will see the wisdom of that.
It ended there. But ultimately, budget flexibility means NOT executing the program plan. So why classify budgets by program output if we can’t optimize that years in advance?
The logical conclusion is instead of focusing financial control on programs — requiring many predictions of future technologies — financial control should focus on mission-oriented organizations which have flexibility to shape program plans in the year of execution. This is how the defense establishment managed itself up until 1949 in theory, and 1961 in practice. Perhaps there’s wisdom there.
And then when questioned about the reprogramming for Trump’s border wall, Rep. Mac Thornberry said:
I support a wall… What I do not support is any administration that would take a bill that is signed into law and as they choose move money around. For whatever it is for, whether they transfer money to DHS or not. The answer we got last week was, ‘oh, it’s excess to need.’ But that’s not their choice!
One of the ways Congress has forced change in the Department was to say, ‘no, you’re not going to retire those A-10s… yes, you are going to buy those Predators even though you didn’t ask for them. There’s a whole list of things where we look pretty good — now we make mistakes too — but the Constitution says that’s our choice. So I am interested and concerned about leaving this unilateral rearrangement of funds and programs unanswered.
Is that inconsistent with the concept of budget flexibility? And there’s this from Brose:
I don’t hate our current system. I every now and again curse its name. But I think it’s going to be the system we have. Everyone has to figure out how to compete inside of it and advance their interests where there are real people and real interests that matter. You can’t just hand wave stuff away.
End note: The fact Congress saved the A-10 and forced the Predator on the Pentagon is a good point. Indeed, it took a letter to President Teddy Roosevelt to get continuous aim fire approved in the Navy. But that doesn’t require program-oriented budgets. Just hold leaders accountable for whether they did it or not. I would argue that aligning budgets and programs means you can’t sacrifice an out-of-date program for a promising program without simultaneously sacrificing the program officials and their standing. Better tradeoffs will be made if organizational leaders have flexibility within a budget ceiling.
Rep Thornberry’s concerns are legit and he probably understands this concern better than anyone in Congress. But the cost and time to communicate is so low right now. There’s got to be a quicker, easier way for Congress to get checks-and-balances while giving DOD more tradespace. This is one of the fundamental benefits of the digital age: Many new ways to do business are faster, cheaper, AND more disciplined.
Agree. Funding is a tough nut to crack, but if information is what Congress requires, then getting the obligations and payments information in good shape and real time would go a long way to providing Congress with a level of comfort so that they can see where the money is going, and who to hold accountable.