Tuesday, July 22, 2008

Air Force Nominations Hearing Analysis

At the Senate Armed Services Committee nominations hearing today, a number of questions on the tanker were asked.

Senator John Warner (R-VA) juxtaposed Donley’s statement that the Air Force’s procurement system was not “fatally flawed” with the GAO’s recent report of the procedure’s “significant errors” as the foundation for his examination of the nominee:
“To me, when you make a statement that it is not fatally flawed against a background of a lot of problems, I find a lot of disconnect.”
Donley replied by reasserting that he did not see gross misconduct. Still, disagreements over the severity of the problems aside, Donley fully admitted that drastic changes needed to be made:
“While I do not believe the Air Force acquisition is fatally flawed, GAO’s findings are troubling. They indicate the need for changes that will ensure we are better prepared in the future to more fully document the details of source selections such that Air Force decisions will successfully withstand protests and thereby restore confidence in the acquisition process.”
As a remedy, Donley suggested specific fixes intended to improve the system:
“I have directed the Assistant Secretary of the Air Force (Acquisition) to identify the lessons learned from the recent GAO decision on KC-X, and previous decisions in which protests were sustained, and outline a near-term plan for improvement that will strengthen the major program and source selection decisions pending for later this year. I also plan two 90-day reviews of the Air Force acquisition process, one internal and one external, to recommend opportunities for longer-term improvement.”
Given the current state of Air Force procurement, and the reports that the Air Force has a closed mind going into the new tanker competition, Tanker War Blog believes only more house cleaning of personnel will ensure “longer-term improvement”.

There are just too many people in Air Force procurement who don't get how badly they failed or truly understand the dire consequences of having EADS think they somehow now deserve the tanker contract. More EU lobbying anyone?

Senator Hilary Clinton (D-NY) provided a poignant critique of the Air Force’s procurement system by questioning how Title 10, Subtitle A, PART IV, CHAPTER 144, § 2440 of the U.S. Civil Code, which requires the consideration of the US industrial base when granting contracts, was ignored during the tanker competition.

Donley lamely stated that it would be impossible to do so because “we live in a global economy,” adding that “attempting to go with U.S. sources only in particular situations where it seems to advantage one company over another is really a temporary perspective.”

His argument for not considering Title 10, especially in light of our country’s current economic situation, was quickly countered by Clinton.

She said her fear is that the decision to not consider Title 10 “will come back to haunt us” economically. She stated she was, "also extremely conscious of the impact of decisions made by our government with taxpayer dollars that undermines our competitiveness for the long run."

Not satisfied with Donley's answers, and running out of time to leave for a vote on the Senate floor, Clinton stated that she would submit further questioning for the record.

Another highlighted procurement controversy at the hearing was the Air Force's Senior Leader In-Transit Comfort Capsules. Senator McCaskill seized upon this as another example of a mindset that prizes appearance over mission, much like the Thundervision scandal.

There may be a KC-30 tanker connection to the this mindset as two of Australian A330 tankers will be converted to VIP planes. How much did ability to use the KC-30 in VIP mode influence the Air Force's decision? We will have to leave that to further investigation and another post.

In conclusion, while all the nominees preformed well, it was another bad day for Air Force procurement. It was also certainly no walk in the park for those being questioned, but unless some major issues arose in the closed session we see all of the nominations being eventually confirmed. Though, we do not rule out one of the nominations being put on hold until certain procument process assurances are given.

Here are some source documents and resources from the hearing:
Donley Prepared Testimony

Gen. Schwartz Prepared Testimony

Gen. McNabb Prepared Testimony

Below is a short Pentagon Channel news report on the hearing.

5 comments:

Anonymous said...

Thanks for the great coverage summary!

pfcem said...

While whether the USAF procurement system as a whole is broken or not is something that should be looked into more closely there is a rather simple fix to the KC-X fiasco.

1: FOLLOW THE RULES! Don't make exceptions to rules just so that a non-competative platform can compete.

2: Don't demand a competition just for the sake of having a competition because you don't like something about the obviously correct choice.

george hanshaw said...

Senator Hilary Clinton (D-NY) provided a poignant critique of the Air Force’s procurement system by questioning how Title 10, Subtitle A, PART IV, CHAPTER 144, § 2440 of the U.S. Civil Code, which requires the consideration of the US industrial base when granting contracts, was ignored during the tanker competition.

Donley lamely stated that it would be impossible to do so because “we live in a global economy,” adding that “attempting to go with U.S. sources only in particular situations where it seems to advantage one company over another is really a temporary perspective.”


And this has ALWAYS been the problem in DOD procurement, even when I worked there. The procurement people have always considered FOLLOWING THE LAW on procurement actions to be - OPTIONAL. And in all fairness, they have gotten away with this for decades, because they have been able to buy off the protests of losing contractors by throwning money at them in a future bid. But to mis-quote an old Air Force saw, that paradigm has done shifted.

They have screwed up too badly and too often and treated too many contractors unfairly. They are GOING to be taken to court on these cases in the future, and they are going to lose, and lose badly - just as they would have lost had Boeing taken this to court, had the SecDef tried to go through with this contract after the GAO report.

They are going to have to abide by the procurement laws in the future. I realize that's a new concept for tham, but it is now inevitable. They can squirm all they want, but the Seventies aren't going to come back. Time to deal with todays realities....

Anonymous said...

“While I do not believe the Air Force acquisition is fatally flawed, GAO’s findings are troubling. They indicate the need for changes that will ensure we are better prepared in the future to more fully document the details of source selections such that Air Force decisions will successfully withstand protests and thereby restore confidence in the acquisition process.”

An interesting comment. Not, "We realize we fouled up and will endeavor in the future to do better," or "We failed to abide by the law and good practices, and we must do so in the future," but rather "We need to do this somehow in the future so we won't get caught in our transgressions."

Nowhere was there admission of the fatal flaws in the process that the GAO found. This wasn't a matter of POOR documentation, it was a matter of DOCUMENTATION AGAINST INTEREST when both the oral and written testimony of the Air Force procurement personnel revealed that they had violated procurement law, normal standards of ethical conduct, and common sense.

Did he even bother to READ the GAO report?

Anonymous said...

Another couple of statements I found distressing is that they all agreed tha the KC-X is their top procurement priority, yet Schwartz also said he wants to increase the pace of F-35 to 2 to 3 times their current buying pace. If they have extra $$$$, shouldn't it go to their top priority the KC-X and increase the pace of replacement for the 135?