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Acting Under Secretary of Defense (Acquisition, Technology & logistics) Remarks at Naval Submarine league Corporate Benefactor Days

I stand before you today and proudly look back at the great achievements and great service that our ‘Silent Service’ has provided our country; and I worry about the future as I evaluate the replacement rate being offered, and wonder if there should be an ‘Augustine Law’ applied to Submarines. That would be that there would eventually be a single submarine sailed by all the crews that would cost as much as the defense budget; and that the submarine would be all electronics. As you know it takes a long time to design and develop a submarine, and the replacement rate is somewhat definable by the build rate. The Navy has to decide how many ultimately will sail the seas, and what age is tolerable. Frankly due to your good work, that age is lengthening, as it is across our force structure. But, lest I digress too much-Recall…

America has a number of strengths that make us the leader and the envy of the world. Prominent among these strengths is our industry-our ability to design and build things of incredible complexity and utility. You built and equipped NAUTILUS and SEA WOLF and several classes of nuclear-powered submarines in between. As we meet here today, the artisans and craftsmen of Electric Boat and Northrup Grumman are applying the finishing touches to USS VIRGINIA as her reactor is critical and steam flows through her engine room. JIMMY CARTER is competing with VIRGINIA to see which will get to sea first. Though this is a “submarine audience, I know that many of you were involved in building and equipping ENTERPRISE and then NIMITZ. Now CVN·2 l is taking a remarkable and promising shape on the drawing boards of the best engineers in the world. It’s a great honor to discuss this with you.

Our Nation is continuing a healthy and energetic debate to determine the shape and size of our armed forces, including the Submarine Force. SSBNs prove during every moment of every day that they are the cornerstones of America’s national security. The TRIDENT submarine also provided the platform for one of our most significant transformational weapons systems, the SSGN. I will spend most of my time with you, however, on the current debate surrounding attack submarines.

I want to convey 4 messages. My first message is that I under-stand and appreciate the post 9/11 relevance of the Submarine Force. My second and third messages are more down-to-business: a few thoughts on the capabilities and affordability of VIRGINIA. Lastly, I will attempt to avoid touching the third rail and talk about the submarine build rate.

II. Submarine Force Relevance

Let me begin by giving you my view of the relevance of nuclear powered attack submarines in today’s security environment.

Today’s Submarine Force contributed significantly to Operation Enduring Freedom and Operation Iraqi Freedom. About one-third of the 800 Tomahawks fired in Operation Iraqi Freedom were launched from SSNs, including two British SSNs. In addition to performing Intelligence, Surveillance and Reconnaissance, Anti-Submarine Warfare, Anti-Surface Warfare, Maritime Intercept Operations, Tomahawk Strike and other operations in conjunction with Operation Iraqi Freedom, attack submarines are providing continuous coverage of highly important national missions around the world.

Endurance, persistence, firepower, and agility are critical attributes to submarines, but it is the stealth provided by the undersea battlespace that enables the submarine to carry out its mission effectively. Undersea platforms are virtually undetectable by other forces and their sensors, enabling them to move with impunity-covertly when required or overtly if desired-inside the adversary’s threat envelope in advance of less survivable joint forces. Stealth enables power projection from close in, be it deployment of Special Forces or on board weapons. Your ships bring tremendous capability to the battlespace.

III. Weapons Systems Capabilities

Today, relevance means capabilities. September 11′ taught us that the future holds many unknown dangers that we must prepare for. We must have the capabilities and force structure that can adapt quickly to new challenges and to unexpected circumstances. To spearhead this change, last year Secretary Rumsfeld issued Transformation Planning Guidance to lead the Department of Defense to meet the new world order. Each of the services has accepted his challenge to transform the defense establishment. Together we have shifted more than $500 billion over the FYDP to transform our armed forces. And there is more to do.

The 200 I Quadrennial Defense Review established a framework for adapting the U.S. defense posture to a security environment primarily characterized by uncertainty. Future military threats were identified as general trends because the fluid nature of our security environment makes it difficult to predict when or where armed conflict might actually occur. So the QDR embraced capabilities and capabilities-based planning, a concept that focuses on achieving key military goals regardless of the specific circumstances. We know that the threats are dispersed and the spectrum of warfighting has expanded dramatically. Our response needs to be dispersed as well, both in a geographic way where we must move quickly to the furthest reaches and act decisively-and in a tactical way where we must be able to act from domains where our enemies have no counter.

We put a premium on capabilities such as deception … surprise … persistence … adaptability … and precision firepower to meet these challenges. Each of these capabilities is inherent in large measure in our nuclear-powered submarines.

To achieve our goals and maximize our effectiveness and capabilities, we are moving in a big way to interoperability and networking together systems of systems. I call this knowledge-enabled warfare. Everything is a sensor, with some sensors as shooters, everyone has an IP address on the net, data is fused into actionable knowledge, the kill cycle is shorted from sensor to shooter to target, shooters are dispersed, fires are massed, battle damage assessment is instantaneous.

Tomorrow’s submarine promises even greater capabilities and greater relevance from the outstanding contributions I have just described. The Virginia class was conceived in the early 1990s with the littoral battlespace in mind. The design has extensive modularity to allow for future evolutionary modifications. The open systems architecture and COTs-based processors that you pioneered in SSN sonar and combat systems will be even more robust in this design. VIRGINIA’s C4I package promises to be revolutionary. I look forward to the ship’s arrival this year.

I must also mention that the introduction of SSGN will offer the combatant commander incredible capabilities. It will be an awesome platform with its 24 large and versatile ocean interfaces, and an unprecedented ability to deliver weapons and sensors from beneath the littoral sea.

IV. Affordability

Now let me move on to affordability.

Last month the Department of Defense signed a mulit-year contract to purchase 5 VIRGINIA’s over the next 5 years. This multi-year procurement is expected to save $400 million over the previous arrangement of a block buy, which itself would have saved us money over a regular one-per-year acquisition strategy.

This is great news. It moves us in the right direction for affordability. However, VIRGINIA still costs $2.2 billion per submarine. The question of affordability is posed as “what needed capabilities do we gain for the money we’ll invest? Let me make three points related to capabilities-for-dollars invested.

First, there is a new avenue developing within the Department to shape and express the answer. Proponents of VIRGINIA should welcome this opportunity. This new process is called, the Joint Capabilities Integration and Development System (JCIDS), under development within the Joint Staff. If there is a joint capability gap that can only be filled by VIRGINIA and with the force structure numbers the Submarine Force argues for, then the JCIDS process will not only make this clear, but the result should also allow VIRGINIA to be shown as very affordable. I suggest wholehearted involvement in this process.

Second, I think any case to be made for the affordability of VIRGINIA hinges on its modularity of design and construction. As you’re aware, this feature will allow timely insertion of new, genuinely needed technologies as future hulls are being built. This is certainly a strong example of evolutionary acquisition. We need to exploit this advantage with frequent, meaningful updates that wilt keep the class on the forward edge of technology and relevance without the need for a huge investment that would result from starting all over again. As I mentioned earlier, one of the most important capabilities to pursue is enhanced connectivity. Everyone is a provider and everyone is a user of network information. Industry must work with warfighters to determine what they need from the network and what data they can provide to the net-work. You are already keen in this area. Great re-sources to compliment your work are the Defense Science Board and DARPA. Keep thinking outside the box. Initiatives from industry will have a very positive impact on affordability. When other platforms and systems across the services reach obsolescence because they lack an inherent ease of technology insertion, a welt-developed VIRGINIA program may become an attractive place for increased investment.

Third, we must add to the affordability of this remark-able ship by finding and highlighting ways to reduce total lifecycle costs, both by new designs and existing designs. VIRGINIA shows great promise here by virtue of its sophisticated yet simplified design-fewer valves, pumps, and motors, and a smaller crew. As we collect real data from real lifecycle time, we need to make clear what we’ve found. You have already shown a great ability to engineer and streamline the maintenance plans of the Los Angeles Class and Trident submarines. I know we’re at the beginning of that process with the SEA WOLF class.

V. Build Rate and Force Structure

I would like now to comment on VIRGINIA build rate-what do we have to do to increase to 2 per year? In many ways, I am an observer to the requirements process but I would be happy to provide my personal views.

The Department went forward with a plan to begin advance procurement in FY2007 which would lead to the authorization of 2 hulls per year in FY2009. As you know, the congress rejected the proposal. At the same time, the multi-year buy was approved, netting the significant savings I mentioned earlier. As the Congress made these two decisions, the Appropriations Conference Report ex-pressed their rationale:

“The conference did not lightly agree to the Navy’s request for multi-year procurement for this program … The House and Senate Committees on Appropriations have maintained that multi-year procurement authority should be granted in situations in which the Service has accepted a fully tested and proven system and a production capability has been fully established.

So I think we did pretty well this round. We have multi-year authority before a single ship has gone to sea. As far as I know, that’s pretty rare for a program of this size. Futhermore:

” … the Committees on Appropriations will … reexamine the decision to grant multi-year procurement authority if program milestones are not met or costs escalate.

Once we deliver, the door could be open. We should consider the multi-year authority a great accomplishment, a great vote of confidence by the congress, and yet a great opportunity to perform up to their level of confidence.

So given this baseline, what do we do to get to 2 ships per year? Part of the answer is the need to get a strong demand signal from the Combatant Commanders. In this regard, the silent service cannot be silent.

First, get the lead ship out to sea. When VIRGINIA goes to sea, demonstrate the richness of needed capabilities that the Submarine Force leadership promised it would bring to the joint battlespace. Better yet, get it into the hands of the combatant commanders. Give them a chance to become your ardent advocates. As the compelling story comes together, we need industry to work with the Congress to help them understand the advanced and additional capabilities that VIRGINIA brings above and beyond other platforms.

Second, recognize that the Nunn-McCurdy breech will be remembered by some. To preserve the program at one ship per year, and move ahead to 2 per year, we must demonstrate beyond reproach that the program’s costs are firmly under control. As your VCNO, Mike Mullen, said to an industry group last week, “you must deliver on cost and on schedule. Congress also called for a fully established production capability from industry.

I think these two stipulations, that VIRGINIA demonstrates its promise to the warfighter and that we can demonstrate costs under control, are reasonable, and I’m confident we can live up to them. We need to genuinely check these two blocks because a sufficient force structure of very capable attack submarines is so important to our national security.

Let me conclude by tying together my 4 points. For now, the Los Angeles class is very effectively carrying a huge burden at every comer of the world. When VIRGINIA goes to sea just a few months from now, the burden will begin to shift. The real value of VIRGINIA class, that is, the essential capabilities delivered for the dollars invested, should become apparent. And as VIRGINIA class proves itself, moving to a two ships per year will gain more and more advocates. For the longer term future, a focus on breaking the cost spiral though innovative design will be mandatory. Investing in reducing total life costs within the present and future fleets will also be a challenge. These are mandatory for the force structure to retain its robustness. These are tall challenges. I off er no promises, but I think the Submarine Force and its industry partners are up to the task.

Thank you very much for this opportunity to speak to the Corporate Benefactors of the Naval Submarine League. Thanks for what you do to keep America Free, and God Bless.

Naval Submarine League

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