Defense firms need signal from Congress to improve production
The defense industrial base needs a clear signal from Congress and a sense of urgency to meet a growing demand for weapons worldwide, industry representatives told House lawmakers on Wednesday.
Years of continuing resolutions and defense budgets that are passed months after their due date hamper the industry’s capacity to build up the military’s arsenals quickly, according to representatives from aerospace, ship and defense companies.
They stressed the need for predictability and stability to the House Armed Services Committee on Wednesday as lawmakers worried about multiple stressors on the industry, including inflation, workforce shortages and supply-chain disruptions.
“The condition of the industry today is not the result of Russia’s invasion of Ukraine but successive decisions made over many years,” said Eric Fanning, president of the Aerospace Industries Association. “Federal policy and investment in our national defense can be summed up in two words: unpredictable and inconsistent.”
Congress’ reliance on continuing resolutions to fund the government — more than 120 in the past 25 years — have caused the industry to constantly hit the accelerator and then the brakes, said David Norquist, president of the National Defense Industrial Association. The industry in the meantime has shrunk, he said.
“These trends are not consistent with creating the defense industrial base required for great-power competition,” he said.
Matthew Paxton, president of the Shipbuilders Council of America, said unpredictable budgets create a volatile acquisition environment in which production lines stop and start. “We need a consistent upward and adequately funded demand signal,” he said.
The Navy should lay out a 10-year shipbuilding plan to help shippers make critical investments in facilities and its workforce, Paxton said. A new shipbuilding plan every year sends a confusing message to the industry, he said.
Rep. Chris Deluzio, D- Pa., said company consolidations that began in the 1990s led to a reduction in the number of aerospace and defense prime contractors from 51 to five, citing a 2022 Defense Department report.
Suppliers have disappeared during the same time, he said. Tactical missile suppliers dwindled from 13 to three, suppliers of fixed-wing aircraft decreased from eight to three and satellite suppliers fell by half, from eight to four.
“A weak or frankly, nonexistent, antitrust enforcement, in my view, allowed this to happen,” said Deluzio, a former Navy officer. “This lack of competition is leaving us, I fear, ill-prepared and harming national security and readiness.”