WASHINGTON: “Unsustainable.” That’s the Navy’s own official assessment of the spending rates required to keep the fleet large and modern enough to do its missions. For the service to state this in writing ratchets up not just the rhetoric but the likelihood of future budget battles in the Pentagon and on the Hill — especially over the immensely expensive program to replace aging Ohio-class nuclear missile submarines (SSBNs), which the Navy desperately wants someone else to pay for.
Every year, the Navy publishes a 30-year shipbuilding plan. Every year, both partisan and neutral observers deride it as fiscally unrealistic: “The way you fund the shipbuilding plan is fantasyland,” House seapower subcommittee chairman Randy Forbes once told me. But this year, for the first time, the Navy plan itself admits it can’t be done.
Senior admirals and officials have been increasingly candid in recent months about the mismatch between the ships they want to build and the money they’ll have to build them. But they’ve never before been quite this blunt, not in an official report to Congress.
“The Navy’s started to be a lot more blunt when [Rear] Admiral [Richard] Breckenridge testified before HASC last fall,” one Hill staffer told me. “At the time we thought he was leaning forward, but eight months later, it seems to be a consensus issue” among Navy leaders.
Last year’s report, submitted along with the 2014 budget request, said blandly that “the Department [of the Navy] will encounter several challenges in executing this shipbuilding plan.” In stark contrast, this year’s report – sent to Congress months late, on July 1st — says bluntly that “it requires funding at an unsustainable level, particularly between FY25 and FY34.”
In particular, the new report continues, “the DON can only afford the SSBN procurement costs with significant increases in our top-line or by having the SSBN funded from sources that do not result in any reductions to the DON’s resourcing level.”
Navy boosters like Rep. Forbes have long argued that the at-sea leg of the nuclear triad is so important – and so expensive – that the Defense Department as a whole should bear the cost, not just the Navy budget. Admirals have said so as well. But to make the argument in the official shipbuilding plan amounts to a declaration of war against the traditional division of the budget among the four armed services.
What was unthinkable not too long ago, however, is now up for a vote in Congress. “I think we moved the ball with the SSBN special funding line,” the staffer told me. Despite bitter differences on many other issues, both the House and Senate Armed Services Committees have approved language creating a “national sea-based deterrence fund” outside the regular Navy budget to pay for the Ohio replacement. (The House passed the bill, the National Defense Authorization Act, but the full Senate has yet to vote).
The Ohio replacement isn’t the Navy’s only problem, though. With the new SSBN, the Navy estimates – arguably over-optimistically – that it will require an average of $17.2 billion a year for shipbuilding from 2020 through 2035, one-third more than the recent years’ average of $13 billion. But even without the Ohio Replacement Program, the plan admits, they’d still be a couple billion over, at $14-15 billion a year. What’s more, while the Ohio replacement cost peaks after 2025, the costs of replacing other aging ships spike earlier, in the early 2020s.
The problem is the Navy is still living off the Reagan buildup. “Most of our current fleet is comprised of ships being built between 1980 and 1990,” the plan says. With most classes prone to wear out after about 30 to 35 years of service at sea, that means “block obsolescence” and mass retirements from now through 2025. “These retiring ships will need to be recapitalized at rates that are unaffordable in today’s environment.”
Particularly under pressure is the Navy’s cruiser fleet, the aging CG-47 Ticonderoga class. In the past, the service has proposed retiring seven older “Ticos” to save money, only to be shot down brutally by Congress. In this year’s budget, however, the Navy suggests semi-mothballing 11 of the 22 cruisers for years, then returning them to service, with modernized equipment, when the other 11 retire. This “innovative approach,” the plan says, “will enable us to spread retirements across longer periods and mitigate the impact of block retirement.”
Republicans, however, remain deeply skeptical that the Navy will ever bring the cruisers back. The Democrat-led SASC approved the mothball plan, but the Republican-lead HASC did not. That sets up a conference battle over whether to keep the ships – and where to get the money to keep them when sequestration is set to slash the budget.