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By: Aaron Mehta WASHINGTON — Global defense spending hit $1.917 trillion in 2019, a 3.6 percent increase over previous year figures and the largest increase in one year since 2010, according to the annual report by the Stockholm International Peace Research Institute. The United States remains the world's largest defense spender in 2019, with its $732 billion representing 38 percent of global military spending, SIPRI has reported. That was followed by China ($261 billion, at 14 percent of global total), India ($71.1 billion, at 3.7 percent), Russia ($65.1 billion, at 3.4 percent) and Saudi Arabia ($61.9 billion, at 3.2 percent). All told, the top five nations accounted for 62 percent of overall military spending. “Global military expenditure was 7.2 percent higher in 2019 than it was in 2010, showing a trend that military spending growth has accelerated in recent years,” SIPRI's Nan Tian said in a statement. “This is the highest level of spending since the 2008 global financial crisis and probably represents a peak in expenditure.” Large year-over-year increases were seen in China (5.1 percent), India (6.8 percent), Russia (4.5 percent), Germany (10 percent) and South Korea (7.5 percent). Regionally, military spending increased in Europe by 5 percent, Asia and Oceania by 4.8 percent, the Americas by 4.7 percent, and Africa by 1.5 percent. Combined military spending by the 29 NATO member states was $1.035 trillion in 2019. SIPRI is widely considered to be the authority on military expenditures and exports, having gathered such data for decades. Other key developments, as noted by the researchers: Together, the top 15 countries spent $1.553 trillion, 81 percent of global military spending. All but three countries in the top 15 had higher military expenditures in 2019 than in 2010, the exceptions being the U.S. (15 percent drop), the U.K. (15 percent drop) and Italy (11 percent drop.) Total military expenditures of the 11 countries in the Middle East for which data is available decreased by 7.5 percent to $147 billion, driven in part by an estimated 16 percent drop from Saudi Arabia. That overall percentage also decreased in 2018. SIPRI was unable to calculate totals from Qatar, Syria, the United Arab Emirates and Yemen. Military spending in South America was relatively unchanged from the previous year, coming in at $52.8 billion. Fifty-one percent of that spending, $26.9 billion, came from Brazil. Combined military expenditures from Africa grew by 1.5 percent to an estimated $41.2 billion in 2019, the first time that region saw a spending increase in five years. That includes plus-ups in Burkina Faso (22 percent), Cameroon (1.4 percent), Mali (3.6 percent), the Central African Republic (8.7 percent), the Democratic Republic of the Congo (16 percent) and Uganda (52 percent). Of the 149 countries SIPRI studied, 10 allocated 4 percent or more of their gross domestic product to the military, which the group defines as the “military burden.” Thirteen countries had a military burden of 3 to 3.9 percent of GDP; 24 had a military burden of 2 to 2.9 percent; 65 had a military burden of 1 to 1.9 percent; and 34 allocated less than 1 percent of their GDP to the military. Three countries had no military expenditures in 2019: Costa Rica, Iceland and Panama. https://www.defensenews.com/global/2020/04/27/global-defense-spending-sees-biggest-spike-in-a-decade/

By: Joe Gould WASHINGTON ― Though the Pentagon is hunting for billions of dollars in a future package to combat the coronavirus pandemic, it looks like the next massive relief bill will be swamped in a partisan fight. The Pentagon announced it's seeking the funds to prop up the military's network of suppliers following $3 billion in new “progress payments" to increase cash flow to primary contractors and more vulnerable, smaller subcontractors. The details have yet to be disclosed as the Defense Department works through them with the White House budget office. But last week, Senate Majority Leader Mitch McConnell, R-Ky., said he wants to “push the pause button” on the next aid package and, because Democrats aim to center it on bailouts for states hit hard by the pandemic, “move “cautiously.” “You've seen the talk from both sides about acting, but my goal from the beginning of this, given the extraordinary numbers that we're racking up to the national debt, is that we need to be as cautious as we can be,” McConnell told reporters on April 21. The Senate will reconvene in full on May 4 to work on coronavirus aid legislation, McConnell said Monday. It would mark the first time the chamber has been back in full since late March. The prospects for a speedy compromise looked dim when House Speaker Nancy Pelosi, D-Calif., set herself at odds with McConnell last week, saying, “There will not be a bill without state and local” aid. Senate Minority Leader Chuck Schumer, D-N.Y., and other congressional Democrats have added pressure on McConnell by pillorying the majority leader's suggestion that states declare bankruptcy. “Republican Senators: Raise your hand if you think your state should go bankrupt,” Schumer said in a tweet. McConnell's negotiating stance comes as the Congressional Budget Office projected Friday that the federal budget deficit would quadruple to $3.7 trillion, driven by the coronavirus pandemic and a government spending spree on testing, health care, and aid to businesses and households. According to the report, the 2020 budget deficit will explode after Congress passed and President Donald Trump signed four coronavirus aid bills that promise to pile more than $2 trillion onto the $24.6 trillion national debt in the remaining six months of the current fiscal year. Meanwhile, defense hawks are warm to a defense spending boost. Senate Commerce Committee Chairman Roger Wicker, R-Miss., has voiced support for an additional cash infusion for the defense industry. “The federal government can play a vital role in keeping military suppliers afloat,” Wicker, a senior member of the Senate Armed Services Committee, said in his weekly newsletter to supporters. “Already the Department of Defense has announced it is spending $3 billion to reimburse contractors affected by work delays and breaks in the supply chain. “As Congress considers new relief measures, I will work to include targeted funding to ensure that suppliers get the stable cash flow and contracts they need to endure this crisis. These awards should go toward projects the military has already identified as priorities and should not break the bank." Also last week, Sen. Tom Cotton, R-Ark., introduced legislation last week that calls for $43 billion for military infrastructure and weapons as part of a larger effort to confront China in the Indo-Pacific region. That bill also calls for $11 billion to mitigate pandemic-related cost overruns on weapons programs and $3.3 billion to mitigate COVID-19 impacts to the defense-industrial base. But Cotton's proposal is also loaded with new weapons purchases that would prove a boon to defense firms, albeit at a slower pace than a direct cash infusion. There's an added General Dynamics/Huntington Ingalls Industries-built Virginia-class submarine; more Lockheed Martin-built F-35A jets; Boeing-built F-15EX fighter aircraft; a battery for the Terminal High Altitude Area Defense air defense system; and anti-ship/strike weapons. Cotton's bill follows a $6.1 billion China deterrence package from the influential ranking member of the House Armed Services Committee, Rep. Mac Thornberry, R-Texas. That bill would fund an Indo-Pacific Deterrence Initiative, also favored in principal by HASC Chairman Adam Smith, D-Wash. Observers predicted the added funding might find a way through any deadlock on a stimulus bill. “We don't foresee stand-alone adoption but do think elements of it could be spread across different spending bills,” analyst Roman Schweizer of the Cowen Group said of Cotton's bill in a note to investors. “With Congress in full-bore debt-spending mode, defense proponents might be able to bury this money in larger packages. The American Enterprise Institute's Mackenzie Eaglen proposed in a Defense News on Monday that the next package for the Pentagon should avoid submitting unfunded procurement priorities and also “focus on the health, safety and continuity of all the Pentagon's workforce.” “Democrats want another stimulus, ideally on ‘shovel ready' infrastructure jobs. DoD is absolutely going to need more help in some sort of bill to keep the defense supply chain from going to the unemployed lines, or worse, gobbled up by China,” Eaglen said in an email. “Most of defense stimulus is to prop up jobs and employment so I'd like to be optimistic and think Democrats would be very supportive.” Democratic leaders haven't yet signaled how they're predisposed toward added defense spending in a stimulus package. However, a House Democratic aide said that scenario would invite serious opposition from the progressive wing. Rep. Ro Khanna, D-Calif., a member of HASC and the House Progressive Caucus leadership team, previewed the messaging in this fight in a tweet on April 21 saying: “The Pentagon shouldn't get any more COVID relief money." “A single F-35 could pay for 2,200 ventilators. 1 nuclear warhead could pay for 17 million masks,” Khanna said, adding that the Pentagon budget dwarfs the combined budgets of the Centers for Disease Control and Prevention, the National Institutes of Health, and U.S. contributions to the World Health Organization. In the Senate, Sen. Bernie Sanders, I-Vt., “will strongly oppose no-strings-attached giveaways to the arms industry, as news reports seem to indicate are the Pentagon's likely request of Congress," said his spokesman, Keane Bhatt. "This is the time to put ordinary workers and small businesses first — not prioritize the profits of Lockheed Martin and Raytheon.” https://www.defensenews.com/congress/2020/04/27/storm-clouds-await-pentagons-request-for-defense-industry-cash/

By: Mackenzie Eaglen As Washington begins to draft another stimulus spending bill to combat coronavirus, the Pentagon needs a new plan to articulate its needs to lawmakers. Simply submitting unfunded lists whole cloth comes across as tone deaf and opportunistic. A better plan would be to focus on the health, safety and continuity of all the Pentagon's workforce: uniformed, civilian and contractor. Capitol Hill is (virtually) busy as ever these days, completing another injection of funds into the Coronavirus Aid, Relief and Economic Security Act last week. Congress and the White House will now begin formulating a phase 4 bill. President Donald Trump and House Speaker Nancy Pelosi have indicated they would both like to see domestic infrastructure spending inside. Negotiations are just beginning, but this bill will open the spending aperture compared to the CARES Act. For national defense, this legislation must focus on taking care of people and protecting jobs. Even as the U.S. military mobilizes to support the fight against COVID-19, the disease is hitting the Defense Department and its workforce much the same as the rest of America. The first order of business is for the Pentagon to ensure health and wellness for service members, their families, civilians and contractors by encouraging safe and flexible work policies. The Pentagon will need additional funding to pay for COVID-19 support deployments, mitigate the effects of stop-movement orders, increase the availability of personal protective equipment and sanitation, and expand its IT infrastructure for telework. Second, Congress and the Pentagon should provide financial assistance to the thousands of small businesses, subcontractors and suppliers to defense contractors building weapons, conducting maintenance or developing classified software. The defense-industrial base is built for maximum efficiency, not resiliency. Even seemingly minor production pauses of weeks are combining with broader quarantine restrictions to wreak havoc on program schedules. While the Pentagon has many tools at its disposal — accelerating awards and progress payments as well as lifting contracting restrictions — the acquisition team simply cannot respond to this crisis without more resources available. Absent additional liquidity, contractors face the impossible choice between letting workers go or facing the reality that they will have no jobs to return to. Small businesses and subcontractors are particularly vulnerable, as they have far less slack to respond to crises. Many live contract to contract, as indicated by a 2018 Department of Defense report on industrial base fragility. These small firms providing needed materials, labor and technology to companies designated as “essential” are struggling with COVID like everyone else. Their employees are either afraid to come to work out of fear of contraction and contagion, or they're sick with the virus. The vicious cycle — where people want to work but can't — means schedules slip. If there is no work, there is no revenue, which means layoffs. Already around the country, a major defense contractor had to shut down two plants; a shipbuilder is struggling to get employees to show up; another defense firm has laid off employees; and still others can't get to work because classified spaces are off limits. To ensure workforces remain intact, lawmakers need to move quickly to pay contractors who cannot work because of COVID-19 effects, as delays are now averaging three months. Fixing this is as simple as measuring the impact of COVID-19 on contracts and ensuring a reasonable payment for that delay, which will be billions of dollars, according to acquisition czar Ellen Lord. It's no different than legal remedies for “acts of God.” Also, the DoD can consider a subset of its unfunded priorities list to get projects on contract that are executable very quickly and inject liquidity into the defense contractor workforce. These unfunded priorities run the gamut, from weapons production to software development. Similarly, there are always “incremental” projects that can be accelerated, like facilities sustainment and depot maintenance. Using unfunded priorities to inject liquidity into the defense-industrial base isn't the ideal tool, but all options must be brought to bear to deal with this crisis. The majority of defense dollars allocated to the big prime contractors go back out the door to their suppliers and vendors — many of which are small businesses. While many of the easiest financial levers to pull involve getting contracts to primes, Congress and the Pentagon need to emphasize that this money — whether it be new contracts, accelerated contracts or increased progress payments — must be passed on to major suppliers and subcontractors. If the behemoths of defense industry don't share the wealth and take care of their supply chain, there won't be more money, contracts or authority for additional progress payments from Congress. Contractor leadership must take care of workers — including those of its vendors. Lastly, Congress can provide Defense Production Act Title III funding to directly target injections of cash to the emergent needs of small businesses and subcontractors, including many up-and-coming innovative firms and single-source suppliers. So far, DPA funding has been focused on contracting for additional personal protective equipment, but the DPA was equally built to protect the defense-industrial base. The industrial base was already hurt by the Budget Control Act, and it's been busy rebuilding under Trump, only to get whacked again by COVID-19. Employees need to know the work is there, their safety is a priority and their jobs are safe. If the Pentagon and primes don't take care of their suppliers and subcontractors, the defense-industrial base will contract again, losing crucial skills and talents permanently — and possibly seeing those companies bought up by China. https://www.defensenews.com/opinion/commentary/2020/04/27/what-the-pentagon-should-and-should-not-get-in-the-next-stimulus-bill/

ARMY H&L Contracting LLC, Bay Shore, New York, was awarded a $113,747,342 firm-fixed-price contract for reduction of storm damages from coastal erosion and flooding through storm protective reinforced dune, beach berm and dune construction. Bids were solicited via the internet with eight received. Work will be performed in Rockaway, New York, with an estimated completion date of April 26, 2024. Fiscal 2014 civil construction funds in the amount of $113,747,342 were obligated at the time of the award. U.S. Army Corps of Engineers, New York, New York, is the contracting activity (W912DS-20-C-0015). Capco LLC,* Grand Junction, Colorado, was awarded a $33,600,571 firm-fixed-price contract for 40 mm M320 and 40 mm M320A1 grenade launchers. Bids were solicited via the internet with one received. Work locations and funding will be determined with each order, with an estimated completion date of April 26, 2025. U.S. Army Contracting Command, New Jersey, is the contracting activity (W15QKN-20-F-0377). Columbia Helicopters, Aurora, Oregon, was awarded a $9,900,000 firm-fixed-price contract to procure overhaul/repair of helicopter rotor heads. Bids were solicited via the internet with two received. Work locations and funding will be determined with each order, with an estimated completion date of March 30, 2023. U.S. Army Contracting Command, Redstone Arsenal, Alabama, is the contracting activity (W58RGZ-20-F-0370). Columbia Helicopters, Aurora, Oregon, was awarded an $8,150,000 firm-fixed-price contract to procure overhaul/repair of helicopter rotor heads. Bids were solicited via the internet with two received. Work locations and funding will be determined with each order, with an estimated completion date of Nov. 30, 2022. U.S. Army Contracting Command, Redstone Arsenal, Alabama, is the contracting activity (W58RGZ-20-F-0369). Applied Aquatic Management Inc.,* Bartow, Florida, was awarded a $7,000,000 firm-fixed-price contract to provide vegetation management, environmental restoration and protection, vegetation/geographic information systems mapping and aerial photographs on various projects and properties within boundaries of the South Atlantic Division, U.S. Army Corps of Engineers. Bids were solicited via the internet with seven received. Work locations and funding will be determined with each order, with an estimated completion date of April 26, 2025. U.S. Army Corps of Engineers, Jacksonville, Florida, is the contracting activity (W912EP-20-D-0003). NAVY Environmental Chemical Corp., Burlingame, California, is awarded a $58,398,023 modification under firm-fixed-price task order (N62470-19-F-9101) to allot the second increment, which provides for the construction of the master time clocks and operations facility at the Naval Observatory. Work will be performed in Washington, District of Columbia, and provides for the construction of new master time clocks and an operations facility. Work will include construction of Building 51, demolition of Building 82, upgrade of Building 83 electrical components, renovation of Building 78, rehabilitation of existing Building 6 and 7 foundations, walls and piers, Pepco 13.2kV (electric power company name and service voltage) work inside and outside of the fence line at the Naval Observatory fence line to include Verizon fiber work. Work is expected to be complete by September 2024. The total contract amount after allotting these funds will be $90,696,992. Fiscal 2020 military construction, (Navy) contract funds in the amount of $58,393,023 are obligated on this award and will not expire at the end of the current fiscal year. The Naval Facilities Engineering Command, Washington, Washington, District of Columbia, is the contracting activity (N62470-18-D-8025). Vigor Marine LLC, Portland, Oregon, is awarded a $20,880,790 firm, fixed-price contract (N32205-20-C-4005) for an 87-calendar day shipyard availability for the overhaul dry-docking availability of the USNS Guadalupe (T-AO 200). The $20,880,790 consists of the amounts listed in the following areas: Category “A” work item costs, additional government requirement, other direct costs and the general and administrative costs. Work will be performed in Portland, Oregon. Work will include the furnishing of general services, shipboard access, clean and gas free tank voids and cofferdams, preservation of aft ballast and cargo tanks as well as the flight deck, overhaul repairs to main engine turbochargers and HP air compressor, davit arms and falls removal, cleaning and painting of hull freeboard and underwater hull, steel replacement and underway replenishment systems repairs. Work is expected to be complete by July 2020. The contract includes options which, if exercised, would bring the total contract value to $22,186,509. Funds will be obligated on April 24, 2020. Contract funds in the amount of $20,880,790, excluding options, are obligated for fiscal 2020 using working capital (Navy) funds. This contract was competitively procured, with proposals solicited via the Federal Business Opportunities website and one offer was received. Military Sealift Command, Norfolk, Virginia, is the contracting activity. (Awarded April 24, 2020) Huntington Ingalls Inc., Pascagoula, Mississippi, is awarded a $10,100,000 cost-plus-award-fee delivery order against previously awarded basic ordering agreement N00024-16-G-2303 to provide program management, advanced planning, engineering, design, material procurement/kitting, liaison, scheduling, participation in planning conferences and design reviews in support of the post shakedown availability for DDG-119 (guided missile destroyers). Work will be performed in Pascagoula, Mississippi (75%); and Norfolk, Virginia (25%), and is expected to be complete by August 2021. Fiscal 2020 shipbuilding and conversion (Navy) funding in the amount of $10,100,000 will be obligated at time of delivery order and will not expire at the end of the current fiscal year. This contract was not competitively procured in accordance with 10 U.S. Code 2304(c)(1), with only one responsible source and no other supplies or services will satisfy agency requirements. The Supervisor of Shipbuilding, Conversion and Repair Gulf Coast, Pascagoula, Mississippi, is the contracting activity. (Awarded April 24, 2020) PrimeTech International Inc.,* North Kansas City, Missouri, is awarded a $9,322,851 firm-fixed-price, cost reimbursable General Services Administration (GSA) task order for integrated logistics distribution support. Work will be performed in Albany, Georgia. Work is expected to be complete by May 2021. If all options are exercised, work will continue through November 2021. This contract includes options which, if exercised, would bring the cumulative value of this contract to $14,355,112. Fiscal 2020 operations and maintenance (Marine Corps) funds in the amount of $9,322,851 will be obligated at the time of award and will expire at the end of the current fiscal year. This contract was competitively procured as a small business set-aside via the GSA eBuy website, with seven proposals received. The Marine Corps Logistics Command, Albany, Georgia, is the contracting activity (M67004-20-F-4101). Bell Boeing Joint Program Office, Amarillo, Texas, is awarded an $8,126,000 modification (16) to a cost-plus-fixed-fee order (0073) against a previously issued basic ordering agreement (N00019-12-G-0006). This modification adds non-recurring baseline performance rig test efforts in support of the Improved Inlet Solution/Engine Air Particle Separator preliminary design on MV-22 and CV-22 Tiltrotor aircraft. Work will be performed in Indianapolis, Indiana (57%); Fort Worth, Texas (34%); Ridley Park, Pennsylvania (8%); and Jackson, Mississippi (1%), and is expected to be complete by April 2021. Fiscal 2020 research, development, test and evaluation (Air Force) funds in the amount of $1,862,344; and fiscal 2020 research, development, test and evaluation (Navy) funds in the amount of $1,241,562 will be obligated at time of award, none of which will expire at the end of the current fiscal year. Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity. DEFENSE LOGISTICS AGENCY Imagine Milling Technologies LLC, Fullerton, California, has been awarded a maximum $40,000,000 fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract for medical equipment and accessories for the Defense Logistics Agency electronic catalog. This was a competitive acquisition with 115 responses received. This is a five-year contract with no option periods. Location of performance is California, with an April 26, 2025, performance completion date. Using military services are Army, Navy, Air Force and Marine Corps. Type of appropriation is fiscal 2020 through 2025 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE2DH-20-D-0035). DEFENSE INFORMATION SYSTEMS AGENCY AT&T Corp., Columbia, Maryland, was awarded a firm-fixed-price contract modification to exercise Option Year Four for the Northstar Long-Haul Telecommunications Network and associated transmission circuits for an ultra-high frequency/line of sight communications system network. The face value of this action is $12,312,149, funded by fiscal 2020 operations and maintenance funds. The total cumulative face value of the contract is $68,464,912. The place of performance will be at various sites geographically dispersed across the continental U.S. The period of performance for this action is May 1, 2020, to April 30, 2021. The Defense Information Technology Contracting Organization, Scott Air Force Base, Illinois, is the contracting activity (HC1013-16-C-0001, P00014). AIR FORCE Boeing Aerospace Operations Inc., St. Louis, Missouri, has been awarded an $8,733,007 firm-fixed-price task order FA8134-20-F-5701 against basic contract FA8106-16-D-0004 for crew rest modification efforts on the Air Force C-32 fleet. Work will be performed at Joint Base Andrews, Maryland, and is expected to be completed by Feb. 28, 2022. Fiscal 2019 and 2020 aircraft procurement funds in the amount of $8,733,007 will be obligated at the time of award. Air Force Life Cycle Management Center, Tinker Air Force Base, Oklahoma, is the contracting activity. Sierra Nevada Corp., Sparks, Nevada, has been awarded an $8,161,843 cost-plus-fixed-fee contract for an Intent-Defined Adaptive Software (IDAS) Prototype. This contract provides for a software engineering performance baseline for measuring IDAS improvement over the current software by attempting challenges with existing tools and techniques and measuring the learning curve required for traditional developers to adopt emerging IDAS capabilities. Work will be performed in Herndon, Virginia, and is expected to be completed by April 27, 2024. This award is the result of a competitive acquisition and 20 offers were received. Fiscal 2019 research, development, test and evaluation funds in the amount of $737,596 are being obligated at time of award. Air Force Research Laboratory, Rome, New York, is the contracting activity (FA8750-20-C-0518). *Small business https://www.defense.gov/Newsroom/Contracts/Contract/Article/2167014/source/GovDelivery/

The service's new AimPoint plan builds very different forces for Europe and the Pacific – but new high-level artillery HQs are central to both. By SYDNEY J. FREEDBERG JR WASHINGTON: Call it the once and future king of battle. The Army's artillery branch, neglected over 20 years of hunting guerrillas, is being revived as the long-range striking arm for multi-domain warfare against Russia and China. That will affect everything from what missiles the service buys, to which officers get promoted, to how the service organizes itself for battle – a force structure outlined in a new Army Futures Command study called AimPoint. The biggest change? Having already created two experimental Multi-Domain Task Forces built around artillery brigades, the Army now plans to build new high-level headquarters called Theater Fires Commands to coordinate long-range missile warfare on a continent-wide scale. “That is a direct output of AimPoint,” said Lt. Gen. Eric Wesley, whose Futures & Concepts Center developed the force structure plan. While the Theater Fires Commands do not exist yet, he said, the service has already begun setting aside manpower in its Total Army Analysis process to staff them. In AimPoint's vision of the future, “the brigades largely look very similar to what you might see right now... except for your [increased] ability to connect to national assets” in space and cyberspace, Lt. Gen. Wesley told reporters last week in a wide-ranging discussion. (Read more here). The big changes, he said, will come at higher levels – division, corps, and theater command – that have largely played a supporting role in highly localized counterinsurgency operations, but which must take the lead in coordinating large-scale campaigns against well-armed nation-states. “If you look at echelons above brigade, what we're having to do is build out our capacity to fight large-scale, campaign-quality combat,” he said. “Those echelons we have mortgaged a bit in the last 20 or 30 years because our BCTs [Brigade Combat Teams] were so powerful relative to our opponent. [Today], because we are being contested in all domains and our two peer competitors are investing in their militaries, we have to build back some of that campaign quality at echelon, with the distinction being you've got to have information warfare, you've got to have cyber, you've got to have space access.” Once the shooting starts, however – and even before, when you're trying to deter the other side from shooting at all – you still need old-fashioned firepower, with a 21st century twist. Artillery has been a US Army strength since World War II, when its ability to quickly coordinate far-flung howitzer batteries to pour overwhelming fire on a chosen target was one of the few things the German Wehrmacht feared. But back then, and even throughout the Cold War, the limits of radio networks, artillery range and precision targeting meant artillery could only be decisive on the tactical level, supporting the face-to-face battle of infantry and tanks. Today, however, the precision-guided missiles that the US, Russia, and China are developing have such long ranges – hundreds or thousands of miles – that you need satellites to spot suitable targets and send back targeting data, plus superior cyber warriors to protect that communications network from hostile hackers. Bringing all those technologies together in the right organization with well-trained personnel, and artillery can make a decisive impact on theater-wide operations or even the strategic level. Dead Branch Resurrecting? But there's a problem. Over the three decades between the end of the Cold War and the reawakening to Russian and Chinese threats, the Army neglected its artillery branch. In 2002, the Army actually disbanded the artillery brigades in its divisions and dispersed their component battalions across its armor and infantry brigades. Then, in Afghanistan and Iraq, US firepower was so overwhelmingly superior, and air support was so readily available for even small patrols, that artillery troops rarely got to fire their guns, even in training, and were routinely retasked for other duties. By 2008, three artillery colonels co-wrote a paper that called their arm of service a “dead branch walking.” Meanwhile, Russian and Chinese howitzers, rocket launchers and surface-to-surface missiles came to not only outnumber but also outperform their aging US counterparts. That led Lt. Gen. Wesley's predecessor as the Army's chief futurist, Lt. Gen. H.R. McMaster, to tell Congress in 2016 that “we are outranged and outgunned.” The next year, in October 2017, the Army officially made Long-Range Precision Fires its No. 1 modernization priority. Now the Army is urgently developed new artillery systems, from rocket-boosted, precision-guided howitzer shells with a range of 40 miles, to 300-plus-mile tactical missiles, to hypersonic weapons that can fly thousands of miles at more than Mach 10. But technology alone is not enough. After two decades of its soldiers rarely getting to use artillery, the Army now needs experienced gunners to run its new high-level Fires Commands and make the most of its new long-range missiles. Sure, infantry and tank brigade commanders can call in strikes on the targets they see in front of them in a tactical fight. But it takes senior artillery officers and experienced, specialist staff to choose the most critical targets for an entire theater of war and to coordinate long-range strikes over hundreds of miles. While the Army recreated division-level artillery headquarters in 2014, it is now studying long-range fires commands at the corps and theater levels. What's more, the different theaters will require a different mix, not only of artillery systems, but of all the supporting players being developed as part of the Army's “Big Six”: Long-Range Precision Fires, Next Generation Combat Vehicles, Future Vertical Lift, Networks, , Air & Missile Defense (also an artillery branch mission), and Soldier Lethality gear. For Indo-Pacific Command, focused on the Chinese threat, the vast expanse of ocean means the Army must support the Navy. That means long-range artillery batteries – very long range, given the distances involved – based on friendly islands to control the surrounding sea lanes, forming unsinkable anvils for the Navy's highly mobile hammer. But, Wesley said, that also requires advanced air and missile defense systems to blunt the enemy's own long-range salvos, long-range high-speed aircraft to move ground forces from island to island and a sophisticated, secure network to coordinate it all. In Europe, by contrast, the distances are shorter – requiring a different mix of missiles – and ground combat is the central front, with small and largely landlocked seas on either flank. That makes armored ground vehicles and soldier gear, from new rifles to targeting goggles, much more important than in the Pacific. Those profound differences mean the Army cannot create a single universal unit with one set of equipment that can adapt to every situation, as the cancelled Future Combat Systems program once attempted. Even if a one-size-fits-all Army somehow made sense tactically, Wesley said, it wouldn't work out technologically. With rapid advances in computing affecting everything from targeting to logistics, there's no way to develop a new piece of equipment, mass-produce it and issue it to every brigade across the Army before something new and better comes along. Instead of “pure fleets” where every brigade has the same software, trucks, missiles, etc., organized in the same way, the Army must tailor its forces to the theater. For more from Lt. Gen. Wesley in his own words (edited for brevity and clarity), read on: Q: Historically, the Army has always wanted to standardize equipment, training, and organization as much as possible – after all, “G.I.” stands for “General Issue.” But Europe and the Pacific are very different. Do you need more of a mix of forces across the Army? A: The world and technology are moving too fast to believe I'm going to get Technology One in every single brigade [before Technology Two makes it obsolete]. We have to be more agile than that. Pure fleeting and even pure structuring is probably not an acceptable approach. Second, the reality is there are two pacing threats that we're looking at, and they're distinctly different, the geography is different, and so we have to consider different ways to approach those problems. You can expect that the force package we build for INDOPACOM will be distinct from the force package we build in Europe. Where there's commonality is in Multi-Domain Operations. MDO is a way of fighting, and I think you're going to see that way of fighting be consistent in both theaters, but the application of it will be different. What are those distinctions? In INDOPACOM, fires to help the Navy control sea lanes are indispensable. In Europe, the essence of the problem is the ability to conduct a very advanced ground maneuver effort. Those [Big Six] priorities that we identified are pretty consistent with what most of the data and analytics and the rigor of the experimentation we look at – those priorities are priorities for a reason. But if you look at the theaters, those priorities might look a little different. So in INDOPACOM, fires, air and missile defense, and the network are some of the really critical pieces, and Future Vertical Lift, I would argue. If you look to Europe, it's going to be long range fires, the network, next generation combat vehicles, and soldier lethality. Q: How are you designing that future force? A: Gen. Milley [the 39th Army Chief of Staff, from 2015 to 2019], asked us, in a perfect world, what that force looks like. [He] asked us to build a resource-unconstrained design that reflects the precepts and principles of multi-domain operations. That was affectionately called the White Board Force. CSA 40 [the new Chief of Staff, Gen. James McConville] and Gen. Murray, the AFC commander, asked us to do a resource-informed design. That's what is called the AimPoint. It tightens the shot group and it allows us to define our experimentation, analysis, and programming better. When you're resource-unconstrained, you can go out and buy a Maserati. When you're resource-informed, you might buy a Corvette. We just had to throttle back on some of the ambitious desires we were looking for. We're on a [trajectory] to 492,000 [active duty soldiers]: How would you organize that in order to achieve MDO? AimPoint is not a locked down design that everybody has to invest in and build towards now. It's really an architect's design, and now we have to get into the detailed engineering and blueprint of it. We need an enhanced posture forward in both INDOPACOM and in Europe – nothing like the 1980s, but larger than what we have now. That's obviously going to be informed by resource decisions, but already the Army [is reactivating] an additional corps headquarters with an operational command post forward [in Europe]. Q: How will the AimPoint Army be organized differently to fight? A: The brigades largely look very similar to what you might see right now, because you still have to shoot, move, and communicate. BCT [Brigade Combat Team] and below, what you see won't change a lot — except for your ability to connect to national assets. Why is that? Well, we're fighting multi-domain, which means access to cyber, access to space assets, in certain instances at the tactical level. You have to have the plugs to get connect to national assets. If you look at echelons above brigade, what we're having to do is build out our capacity to fight large-scale, campaign-quality combat. Those echelons we have mortgaged a bit in the last 20 or 30 years because our BCTs were so powerful relative to our opponent. [Today], because we are being contested in all domains and our two peer competitors are investing in their militaries, we have to build back some of that campaign quality at echelon, with the distinction being you've got to have information warfare, you've got to have cyber, you've got to have space access. So in each echelon you would have that capacity to fight all domains and integrate them. Each echelon has distinct problems that has to be solved in order to enable the force to get to a position of advantage. Sometimes that requires each echelon to have distinct capabilities. Competition [short of war] is the first joint problem that has to be solved. Frankly, a brigade commander cannot provide the resources, the solutions, and the decisions made, to compete with a peer competitor. That's got to be retained at the three- and four- star level. In the event of conflict, it requires long range fire to strike the Russian combined arms army or Chinese equivalent. Again, that BCT commander would not necessarily have either the assets or the authority to strike the targets we're talking about with long range fire. So you have to do that at a different echelon. There are problems that the BCT commander does not solve for the theater, and some of that needs to be done at echelon. Q: What kinds of higher-echelon capabilities from the Cold War era are being recreated, like corps level artillery formations? A: Building out the ability to integrate fires at echelon is really important to being able to fight at scale. When we went to modularity, with the BCT being the coin of the realm, we moved the artillery fires battalion [out of the division-level artillery brigade] into the BCT. Now what you're going to see is the need to return to some aspects of centralization of fires, with the ability to decentralize [as needed], which makes the problem even harder. So, how have we done that? Well, for example, you saw a couple of years ago that we went back into the [division-level] fires brigade. That might be further reinforced as we go forward. Then the theater fires command, as an example, that is a direct output of AimPoint. In the last TAA [Total Army Analysis] cycle, we started to [set aside] a wedge of structure that we can design against. So that does not exist [yet]. Q: What are you able to do in the near term? You already have one experimental Multi-Domain Task Force in the Pacific and another being stood up in Europe. A: We've got AimPoint, we've got this orientation to the future, but General McConville said, ‘hey, I want to get stuff out there now, because the customer needs it, and that is the capacity to penetrate with long range fires, with the ability to integrate all domains.' That is what a MDTF is, and we're building them right now, and we want to get them into each theater. As we deploy those, we're going to learn lessons on how they best connect with the joint force. You may see, for example, an MDTF subordinate to a theater fires command or subordinate to a corps fires element. Right now, they're individual [units] that are being built; we will experiment with them and learn how they plug in, but ultimately you're going to see that capability migrate to the [higher] echelons. Topics: army, Army AimPoint, army future, Army Futures Command, Army strategic fires, artillery, Big Six, China, europe, Gen. Eric Wesley, INDOPACOM, Long-Range Precision Fires, LRPF, Missiles, Pacific, Russia, strategy, Theater Fires Command https://breakingdefense.com/2020/04/army-rebuilds-artillery-arm-for-large-scale-war/

By THERESA HITCHENSon April 27, 2020 at 5:02 PM WASHINGTON: With the federal deficit expected to balloon to over $4 trillion in fiscal 2020 due to spending to pump the economy in the face of the COVID-19 coronavirus pandemic, downward pressure on the US defense budget is inevitable, several experts believe. “I think the budget comes down sooner rather than later,” Mackenzie Eaglen, resident fellow at the American Enterprise Institute, said bluntly in a webinar today. The best-case scenario is for flat defense budgets for the foreseeable future, but if history is a guide, the smart money is on defense budget cuts, explained Todd Harrison, DoD budget guru at the Center for Strategic and International Security (CSIS). “What has historically happened is, when Congress's fiscal conservatives come out and get serious about reducing the debt, reducing spending defense is almost always part of what they come up with for a solution,” he said. “So, we could be looking at a deficit-driven defense drawdown coming. ... At least history would suggest that that is a real possibility.” Indeed, even as Congress is pulling out all the stops trying to assist DoD and the defense industrial base to weather the COVID-19 coronavirus pandemic, DoD already is being eyed as the future deficit bill-payer, Eaglen told the webinar. “DoD is at the top of the list,” she said. Eaglen added that, at a more macro-level, the budget crunch could force DoD to re-look the goals of the 2018 National Defense Strategy (NDS) with an eye to downsizing. “There's going to be an impact across the board,” she said. “There probably will be a total relook — at even the NDS fundamentals, and what mission is going to have to go — in response to this.” Harrison noted that already DoD has been looking at flat budgets through 2021, which has caused it to have to take some risks as it tries to juggle divesting in high-maintenance legacy systems with investing in future programs while maintaining readiness to handle a possible peer conflict with Russia and/or China. “Just to divest legacy systems and invest in new ones and try to maintain, or slightly grow, force structure, DoD was already saying that it would need three to five percent real growth each year in the defense budget, going forward, just to fully execute that,” he said. This means that DoD leadership is going to face even more difficult decisions in the future, Harrison explained. “Now we're looking at an environment where the budget might be flat at the best case or trending down over time. Something's gonna have to give. And so, if DoD really wants to protect these key modernization programs, not only is it going to have to divest legacy systems, it's going to have to divest them faster, and it's going to have to make some reductions in force structure that's going to incur risk.” More immediately, Harrison said, as Congress moves over the next few months to pass a fourth, or even a fifth, economic stimulus package DoD already is signaling that it hopes to see a number of its “unfunded requirements” stuffed into those bills. “DoD is saying: ‘hey, if you want to fund more things for DoD to help stimulate the economy, and help the defense industry, well, here's a list you already have that you can pick from.” DoD's unfunded priorities list — the annual wish list of programs it would like to fund if only there was more money in the top-line — for 2021 includes a total of $35.9 billion for programs across the military services and the combatant commands. The Pentagon might also petition Congress for greater authority to use operations and maintenance funds appropriated but not spent due to work slowdowns to short up programs facing cost overruns because DoD paid contractors for work supposed to be done, but not actually done, while employees are home-bound due to the pandemic, Harrison said. “DoD has implemented the CARES Act implementation, saying that they would pay for paid leave for employees of defense industry firms that are unable to report to work. And so that cost is covered,” Andrew Hunter, who works on defense industrial base issues at CSIS, explained. “Those folks aren't necessarily going to be laid off; they will be kept on the payroll and paid. And again, that will create some costs down the road to then pay those folks to do the actual work that they're originally scheduled to do.” Most of the nearly $10.5 billion in the CARES Act, signed by President Donald Trump on March 27 to help DoD protect itself from the impacts of the pandemic goes into O&M accounts, according to CSIS. That said, some $1 billion goes to procurement funding, with an eye on health-related equipment. Further, it includes some $1.5 billion in the Defense Working Capital Fund, which allows DoD to make investments in things like depot maintenance, transportation and supply management in the near term and recoup the costs through future year pricing deals. However, the bill grants DoD a good deal of flexibility to move money around — with the exception of banning any funding for Trump's southern border wall construction. https://breakingdefense.com/2020/04/dod-budget-cuts-likely-as-4-trillion-deficit-looms/

Les industriels de la défense, qui sont venus défendre l'idée d'un plan de relance devant les parlementaires le 23 avril dernier, évoquent plusieurs pistes possibles : maintien de la loi de programmation militaire a minima, nouvelles commandes, plan pour l'innovation et implication de la Commission européenne. « Pour la LPM (loi de programmation militaire), nous souhaitons son maintien et que des idées soient données pour ajuster ces programmes dans le but d'alimenter notre industrie de défense, souligne Eric Trappier, président du GIFAS. Il faut être capable de relancer notre économie sinon il y a un risque pour l'emploi et l'activité. Je suis très attaché à l'emploi dans les territoires. Avant de parler de relocalisation, il faut rappeler que l'industrie de défense se situe déjà en France ». La Tribune du 27 avril 2020

Par Le groupe de réflexions Mars* Dans le but de permettre à la base industrielle et technologique de défense de contribuer à la sortie de crise et aux plans de relance français et européen, le groupe de réflexions Mars* souhaite partager, dans une série de tribunes, les réflexions qu'il mène notamment autour des sujets de la souveraineté et de l'autonomie, du sens donné à l'Europe de la défense et la place réservée à la défense dans un "plan Marshall" européen, des enjeux macroéconomiques et des enjeux industriels et d'innovation dans la défense. L'objectif du groupe de réflexions Mars est de trouver des solutions pour sécuriser les budgets de défense à court et à moyen terme. Qui dit crise économique dit plan de relance. La ministre des armées souhaite utiliser à cet effet l'investissement de défense (Titre 5), qui représente 80% de l'investissement de l'État. En réponse, les industriels du secteur proposent de sécuriser, voire d'accélérer la livraison des programmes d'armement prévus dans la loi de programmation militaire en cours. Est-ce pertinent ? L'industrie de défense est une industrie de souveraineté, au sens le plus fort du terme, à savoir que sans elle, il n'y a plus d'indépendance nationale, que la nation dépend de ses alliés pour sa défense. C'est le cœur des compétences régaliennes et la légitimité intrinsèque de l'État. Une protection n'est jamais gratuite. La sécurité a un coût. Autant que le circuit économique créé profite à la croissance de l'activité nationale. close volume_off Prospérité rime avec indépendance C'est ainsi que Venise inventa l'arsenal. On peut être un État commerçant ouvert sur le monde et garder jalousement fermée son industrie d'armement. La Chine de Xi Jinping a manifestement retenu les leçons de Marco Polo. Et Venise nous a appris que la prospérité dure tant que l'indépendance est garantie par ses propres armes et ses alliances. Survient une menace irrépressible (Bonaparte) et s'en est fini de l'indépendance et de la prospérité. L'arsenal vénitien est ainsi la mère de l'industrie d'armement, qui a gardé cette forme (et ce nom !) jusqu'à une date très récente. Pour des raisons d'efficacité économique et "d'ouverture aux marchés", la France a progressivement transformé ses arsenaux en sociétés anonymes. Le processus a pris 30 ans, depuis les poudres et explosifs au début des années 1970 jusqu'à la construction et la réparation navale au début du XXIe siècle. Il n'est d'ailleurs pas achevé : il en reste des traces sous la forme de prises de participation sous diverses formes et à différents niveaux, et surtout, il reste un "arsenal" : la direction des applications militaires du commissariat à l'énergie atomique (CEA/DAM). Tout cela pour dire que la préoccupation économique en matière de défense, disons l'efficience, est une idée très récente. Elle s'oppose aux notions militaires de "réserve", de "redondance" et de capacité de "remontée de puissance", indispensables à l'efficacité opérationnelle et à ce que l'on appelle aujourd'hui la résilience, c'est-à-dire la faculté de reprendre l'ascendant après avoir encaissé un choc d'une violence inhabituelle, voire imprévisible. Le dogme du principe d'efficience Le principe d'efficience est devenu la composante majeure de l'idéologie managériale qui a connu son apogée en France avec la révision générale des politiques publiques (RGPP) conçue et mise en œuvre entre 2007 et 2012 avec la brutalité et l'absence de discernement que l'on sait en matière de défense. Outre une saignée sans précédent en temps de paix dans les effectifs (54.000 suppressions), il en a résulté une série de fiascos (logiciel LOUVOIS) et de désorganisations (bases de défense, administration de proximité, subordination des soutiens) qui ont durablement affaibli les armées, l'instrument ultime de la résilience de la nation, notamment le service de santé. C'est la même logique managériale à l'œuvre dans les années suivantes qui a conduit à la liquidation des réserves de masques chirurgicaux et autres consommables permettant de faire face immédiatement à une épidémie sans arrêter brutalement l'activité économique. Autrement dit, le principe d'efficience est une belle théorie dont la mise en œuvre se révèle, dans la violence de ses conséquences, incapable de faire face à un évènement inattendu, même quand les experts en prédisent la survenue probable. La crise du Covid-19 a révélé le caractère foncièrement anti-économique de cette idéologie et la coupable naïveté des adeptes de l'ouverture aux marchés. Accepter de confier la sécurité d'un pays aux forces brutes des marchés relève de la même croyance candide que le pacifisme désarmera tout agresseur. On a le droit d'y croire, c'est beau, mais pas de gouverner au nom de tels croyances. C'est une question de responsabilité. Cela vaut aussi pour une certaine frange de la gauche. Dépense de défense, un effet multiplicateur de croissance Une fois admis l'ineptie du principe d'efficience dans les questions régaliennes et stratégiques, faut-il pour autant considérer que l'industrie de défense soit par nature anti-économique. C'est l'idée qu'on avancé certains théoriciens marxistes (dénonçant l'implication de la finance et donc de la classe dirigeante dans cette industrie) et les premiers keynésiens, au titre d'un effet d'éviction sur l'investissement privé. Curieusement, la théorie néolibérale dominante depuis 30 ans tend à reconnaître les effets positifs sur la croissance de l'investissement de défense par la dépense publique. Cela résulte moins d'études économétrique rigoureuses que des résultats empiriques des Reaganomics, qui ont permis aux États-Unis de surmonter la crise économique du début des années 1980 en s'appuyant sur une course aux armements qui a permis, accessoirement, de gagner la guerre froide. C'est sans doute pourquoi le gouvernement Fillon, pour sortir au plus vite de la crise de 2008, ne voit pas de contradiction, en pleine RGPP, à relancer l'économie notamment par une augmentation (mesurée mais réelle) de l'investissement de défense, au prix d'une augmentation de 50% de la dette publique. Depuis ce précédent, considéré comme réussi, de nombreuses études ont permis de mieux comprendre les mécanismes microéconomiques et macroéconomiques à l'œuvre. Un certain consensus des économistes spécialisés s'est même dégagé sur la valeur du multiplicateur de croissance de l'investissement de défense : en moyenne 1,27 à court terme et 1,68 à long terme, avec des disparités en fonction du degré d'ouverture à l'étranger. Peut-on en dire autant de toutes les dépenses publiques ? Cela signifie que l'on est dorénavant capable de prévoir qu'un investissement supplémentaire d'un euro dans tel secteur aura tel rendement à telle échéance. Mais les études vont encore plus loin dans l'analyse et s'intéressent au retour fiscal et social de l'investissement de défense. On sait désormais que ce retour est en moyenne de 50% au bout de deux ans et de 100% après un certain nombre d'années, en fonction des secteurs. Cela signifie que la défense ne peut plus être considérée comme un centre de coût, auquel on ne consent que par nécessité. On sait désormais que c'est un centre de profit, dont le rendement dépend de paramètres liés à l'autonomie stratégique. Relance par la défense : rendement optimal Moins un secteur industriel est dépendant d'un approvisionnement (ou d'une main d'œuvre) extérieur, plus ce rendement est élevé. A l'inverse, plus il y a de "fuites" à l'extérieur du circuit économique national, moins l'investissement est rentable économiquement. Reste à identifier ces fuites afin de les résorber gr'ce à une politique industrielle (et une planification) avisée. On sait que la relance par la "monnaie hélicoptère" et les baisses d'impôts n'ont pas un bon rendement, précisément à cause de ces "fuites" : vers les importations de biens de consommation d'un côté, vers l'épargne de l'autre. On sait que renflouer Air France (ou Renault) est nécessaire pour l'emploi, mais qu'en termes économiques, le retour sur investissement est faible, car cela revient, dans le cas d'Air France, à financer, outre Airbus, Boeing, les loueurs et les assureurs, tout en maintenant le pouvoir d'achat d'une catégorie sociale aisée dont le taux d'épargne est important. Dans le cas de la relance par la défense, le rendement est optimal, même s'il est encore possible de réduite les fuites. La "supply chain" des systémiers-intégrateurs et des grands équipementiers français du secteur de l'armement est essentiellement française. L'emploi se situe à 80% en province, y compris des emplois de haut niveau. Cette industrie à très haut niveau technologique fait appel à des savoir-faire quasi-artisanaux ; d'ailleurs, on ne parle pas d'ouvriers mais de compagnons, pas d'usines, mais d'ateliers. L'investissement dans l'innovation se répercute dans l'industrie civile, ne serait-ce que parce que la majorité de ces sociétés ont une activité duale. La balance commerciale de l'armement français est structurellement excédentaire, ce qui contribue au rendement économique d'un euro investi dans cette industrie, exportatrice par nécessité, du fait de l'insuffisante épaisseur du marché national pour absorber les coûts fixes. Un investissement qui rapporte En période de crise, l'effet contra-cyclique de l'investissement de défense permet d'absorber le choc de demande subi par l'activité civile. C'est particulièrement évident aujourd'hui dans le cas de l'aéronautique. Enfin, on sait aujourd'hui que cet investissement rapporte à terme plus que ce qu'il a coûté, y compris en tenant compte du coût du capital (particulièrement faible ces dernières années). Pourquoi s'en priver ? Oui, pourquoi se priver de tels avantages, au moment où le déficit public et l'endettement ne sont plus bridés par le Pacte de stabilité ? Au demeurant, la défense, pour ce qui concerne du moins les fabrications d'intérêt stratégique, est le seul secteur industriel (le seul !) à bénéficier du privilège exorbitant de n'être soumis ni aux règles de l'OMC, ni au droit commun du marché unique européen. Les biens et service de défense disposent d'une partie spécifique du code de la commande publique. Pourquoi s'en priver, alors qu'on pourrait relancer rapidement l'activité industrielle à droit constant, sans enfreindre aucune règle ? Aller vers une autonomie stratégique Pour finir, évoquons rapidement ce qui f'che. Si l'on veut que le rendement économique d'un euro investi dans la défense soit encore meilleur, il faut résorber les fuites résiduelles. Cela suppose d'abord de chercher à substituer des fournisseurs nationaux aux sous-traitants étrangers, tant pour des raisons d'autonomie stratégique ("désItarisation") que dorénavant pour des raisons de patriotisme économique. Cela est aussi valable pour les chantiers ayant pris l'habitude de faire appel, pour diverses raisons dont certaines sont difficilement critiquables (absence de personnel formé), aux travailleurs détachés, alors même que l'on sait à quel point les chantiers navals structurent l'activité dans les zones littorales. Enfin, il sera injustifiable de continuer à saigner la trésorerie des sociétés pour rémunérer des actionnaires qui se sont révélés défaillants dans leur rôle d'apporteurs de capitaux en période de crise. Le modèle anglo-saxon (cf. Rolls Royce) d'un "flottant" à 100% ne saurait convenir ; l'industrie de défense a besoin d'être détenue par des actionnaires fiables et responsables, y compris par gros temps. ------------------------------------------------- * Le groupe Mars, constitué d'une trentaine de personnalités françaises issues d'horizons différents, des secteurs public et privé et du monde universitaire, se mobilise pour produire des analyses relatives aux enjeux concernant les intérêts stratégiques relatifs à l'industrie de défense et de sécurité et les choix technologiques et industriels qui sont à la base de la souveraineté de la France. https://www.latribune.fr/opinions/tribunes/l-investissement-dans-la-defense-rapporte-plus-que-ce-qu-il-coute-846190.html

By: Joe Gould WASHINGTON ― Cash flow for small defense contractors is continuing to suffer under the coronavirus pandemic, according to a survey by the National Defense Industrial Association. The survey echoes warnings from the Pentagon that these firms, part of a vast network of suppliers that makes up the defense-industrial base, are especially vulnerable. The Pentagon this week announced it will make $3 billion in new “progress payments" to increase cash flow to prime contractors, expecting the money would then trickle down. Of the NDIA survey respondents: 67 percent of companies with less than $1 million in annual revenue have seen a cash-flow disruption. 60 percent said the crisis has interfered with their cash flow. 60 percent expect to have long-term financial and cash-flow issues stemming from the crisis. 66 percent said accelerated payments from the Defense Department or prime contractors would be the most helpful step toward business recovery. L3Harris Technologies said this week it will issue more than $100 million in payments to its small suppliers. Lockheed Martin announced Friday it executed $256 million in accelerated payment toward its $450 million goal. Both of these promised followed the Pentagon's announcement this month that it will boost progress payment rates from 80 percent to 90 percent for large companies, and to 95 percent for small businesses. The payments are made to contractors, usually on a monthly basis, for costs incurred and work performed under a contract; a 90 percent rate means that if $1 million in expenses are submitted on the program, the Defense Department will reimburse $900,000. Sixty-six percent of the respondents also said it would help them to receive flexibility on the performance of their contracts. Seventy-two percent expected to avoid overruns on their firm fixed-price contracts as a result of disruptions caused by COVID-19. On Thursday, acquisitions officials with the Army said they expect costs to rise, and in response will guard against program slips and closely watch vulnerable lower-tier companies with less slack in their workforces. Pentagon officials anticipate workforce and supply chain issues will yield a three-month delay across the majority of its Major Defense Acquisition Program portfolio. “The supply chain does have some challenges, and that's probably where the vast majority of any slips would occur that are tied to individual companies,” said Bruce Jette, the Army's acquisition chief. “These companies are small, and if one person gets COVID in the company, the next thing you know you've lost 14 days with the company because everybody that didn't get it is in quarantine.” As of April 10, 769 small businesses responded to the NDIA survey. The number of companies expecting cash-flow disruptions was slightly lower last month, when 458 small businesses responded. Factoring into cash-flow problems, according to the NDIA, are cuts to billable hours, delayed payments from prime contractors and government customers, a lack of telework options or schedule flexibility in contracts, and shelter-in-place orders that prevent employees from working. Beyond revenue expectations, meeting contract obligations and access to capital are where small businesses are taking the biggest hits during the pandemic. Other areas of difficulty were workforce availability, access to secure facilities, contracting officers accessibility, clear information from the Defense Department, confidence in the supply chain, and stock and cost of materials. The technology and services sectors reported more disturbances from the crisis than the manufacturing sector, NDIA noted. And businesses with fewer than 50 employees are feeling the brunt harder than businesses with more than 500 employees. Defense Contract Management Agency data this week showed that 106 out of 10,509 primary Pentagon contractors are closed, and 68 companies closed and then reopened. Of 11,413 subcontractors, 427 were closed, with 147 having closed and reopened. https://www.defensenews.com/2020/04/24/covid-cash-crunch-still-hurting-small-defense-firms/