In ordering the largest contract cancellation in Pentagon history, thus denying the Navy its treasured A-12 stealth attack bomber, Defense Secretary Richard Cheney has sent a needed message to the military-industrial complex.
With the Cold War ending, the Soviet threat diminishing, the federal deficit soaring, the costs of Operation Desert Shield impinging and Congress finally putting the clamps on government spending, neither the military brass nor defense contractors can continue business as usual.
Business as usual in this case would have had the Pentagon issuing fixed-cost contracts for an advanced weapons system to contractors who fully expected reimbursement for predictable and costly overruns. But with the Pentagon facing budget plans requiring cuts of $108 billion over the next four years, new systems will have to pass cost and performance muster or face oblivion.
Earlier this year, Mr. Cheney refused to bail out such troubled programs as the Navy's P-7A submarine-hunting aircraft and the Army's FOG-M missile. But cancellation of the A-12 Avenger, along with the dismissal of the Pentagon's procurement chief and two admirals and a captain involved in the program, plus potential criminal investigations of the whole matter, is of an order of magnitude that leaves the military-industrial complex stunned. The original program called for the production of 620 aircraft at an estimated cost of $52 billion.
It is not just that the defense secretary was embarrassed when his assurances to Congress that the A-12 was on track were soon overtaken by disclosures of a two-year delay and a development overrun of $2.7 billion. Nor is it solely because Congress warned last November that the aircraft is "seriously overweight, far behind schedule, increasingly complex in design and more difficult to manufacture and suffering from management deficiencies." What is also driving the Cheney decision is the prospect of savings of $2 billion a year immediately, rising to $8 billion by the end of the decade.
The Pentagon insists it still will need a new generation of carrier-based bombers, with an almost invisible radar signature, capable of eluding sophisticated surface-to-air missiles that have proliferated worldwide. But budget realities suggest the Navy will have to make due for some time with upgraded versions of its A-6 Intruders, F-A-18 Hornets and F-14 Tomcats. They should be capable -- or made capable -- of dealing with regional conflicts threatening the post-Cold War world.