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Pentagon Fails 1st Audit, Space Force Price Plunges: DepSecDef Shanahan

Posted by Colin Clark on

Sydney J. Freedberg Jr. photo

Deputy Secretary of Defense Pat Shanahan

PENTAGON: The Pentagon didn’t expect to pass its first audit, the Deputy Secretary of Defense told reporters today, and it didn’t.

“We failed the audit. We never expected to pass it,” Pat Shanahan said.

While he praised Navy aviation for the excellent of its inventory tracking, Shanahan also noted the service didn’t have some buildings on its books that do, well, belong to the Navy. As a standard, Shanahan noted industry would expect 99.99 percent accuracy.

The Deputy Secretary also hinted at something we’ve already reported: that the real benefit from the audit of the $2.7 trillion organization will come from better understanding how all the Pentagon databases with all that data are linked (or not) and secured (or not).

US Air Force Space & Missile Systems Center (SMC)

Space Force Details

On the controversial subject of the proposed Space Force, Shanahan cited a figure less than half the Air Force estimate of $13 billion to stand up the new independent armed service, saying it “could be” less than $5 billion.

Shanahan also confirmed that the Space Development Agency will be the first part to get done of the vast space reform that includes the Space Force and Space Command. That’s because Congress doesn’t have to get involved, The new agency may not be led by a space expert, but it will have a competent leader, Shanahan made a point of saying.

Among the very many difficult issues that have not been publicly discussed:

  • Will NRO personnel and capabilities be included in the new agency?
  • Will the agency get a new headquarters, or will it just get new people and new authorities transferred to Space and Missile Systems Center (SMC) in Los Angeles?
  • What will the agency do that SMC doesn’t do, aside from build a few Navy and Army space capabilities?

Space Command should be launched in the first quarter of calendar 2019, Shanahan said, but that, of course, depends on legislation that only Congress can pass — and Rep. Adam Smith, the presumptive chair of the House Armed Services Committee, has already indicated he doesn’t think Space Command is necessary. Shanahan tried to smooth the gap between the administration and the Hill, saying he’d be speaking with Smith and that everyone agrees the US must get capabilities into space more quickly and at lower cost.

On the budget, Shanahan said the services will report back to him on Monday about the new $700 billion budget proposed by President Trump, a $33 billion cut from the earlier plan. As Shanahan noted, the Pentagon spent 10 months preparing the main budget and now has to come up with a new one. The trimmed version will get reviewed by Defense Secretary Jim Mattis and sent to the White House soon after Thanksgiving. The areas not likely to get cut: cyber, space, and — drum roll please, Army modernization.

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