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No deterrence impactMarvin, 11[Taylor, Prospect Journal of International Affairs UCSD, CUTTING US DEFENSE SPENDING ISNOT A T!EAT TO A"E!ICAN SECU!IT#,$ttp%&&prospect'ournal(ucs)(e)u&in)e*(p$p&+--&.&cuttin/0us0)efense0spen)in/0is0not0a0t$reat0to0a1erican0security&2o3e4er, US1ilitary spen)in/ far exceeds the level necessary to deter foreign aggression, e4en a/ainstperip$eral US interests( So1e of t$is e*cess is 'ustifie)% if A1erica 3is$es to fi/$t lon/ forei/n 3ars an) lea) international $u1anitarian 1ilitaryinter4entions t$e Penta/on 5u)/et 1ust support t$ese 1issions( Despite t$is, A1erican )efense spen)in/ is ulti1ately 4astly )isproportionate to its core

re6uire1ents( T$e US Na4y is a /oo) e*a1ple of t$is e*cess(A1ericacurrently fiel)s ele4en aircraft carriers( !ussia possesses

one, a Col) 7ar relic 4astly less capa5le t$an its A1erican counterparts( Despite C$inese na4al a15itionsin t$e3estern Pacific,C$ina $as stru//le) to refit an a5an)one) So4iet carrier,t$e e*08arya/, for co15at, an) t$e intro)uction of 1o)ern in)i/enousC$inese carriers is li9ely )eca)es off( It is not unreasona5le to suppose t$at A1erica:s )eterrence 4alue 3oul) not 5e )i1inis$e) if 5u)/et cuts force) t$e

Na4y to re)uce t$e US carrier fleet(7$ile a re)uction in t$e nu15er of US carrier 5attle /roups 3oul) si/nificantlyre)uce t$e nu15er of t$eaters t$e US coul) e*ert 1ilitary control o4er at any /i4en ti1e, this would likelynot make US military threats less credible; t$at is, C$ina 3oul) not 5e 1ar/inally 1ore li9ely to in4a)eTai3an ift$e US fiel)e) only se4en si* 5illion )ollar supercarriers( s $ar) to see $o3 t$ese )ra1atic cuts in fleet si=e fit into t$e

a)1inistration>s pi4ot to Asia( Na4al researc$ an) )e4elop1ent )o not fare 1uc$ 5etter( 7$ile t$e Na4y is to 5e co11en)e) on a/ettin/ so1e researc$ initiati4es ri/$t 00 suc$ as 5rea9in/ out a ne3 account for Future Na4al Capa5ilities focusin/ on a)4ance) researc$ an) prototypes,

increasin/ fun)in/ for t$e ittoral Co15at S$ip, an) increasin/ fun)in/ for t$e "arine Corps> Assault 8e$icles 00 1any of t$e Na4y>s !DTE)ecisions )o not appropriately resource t$e r$etorical e1p$asis on t$e Pacific(T$e 5u)/et slices t$e Po3erPro'ection Applie) !esearc$ account 5y nearly -@, affectin/ pro/ra1s li9e precision stri9e an) )irecte)ener/y 3eapons( Si1ilarly, Force Protection Applie) !esearc$ )roppe) 5y +, cuttin/ inno4ation in anti0su51arine 3arfare an) $ull assurance(A + cut in Electro1a/netic Syste1s Applie)!esearc$ affectsinitiati4es suc$ as electronic attac9, surface05ase) anti0cruise an) 5allistic 1issile )efenses , an) t$e Surface 7arfareI1pro4e1ent Pro/ra1, or SE7IP, 3$ic$ uses electronic 3arfare to )isar1 inco1in/ 1issiles( Ot$er !D cuts i1pact separate initiati4es on anti0su51arine 3arfare, un)ersea 3eapons, cy5er security, electronic 3arfare, sensin/, SATCO" 4ulnera5ilities, 1issile )efense counter1easures, S an) 05an) ra)ar inte/ration, an) ra)ar )efenses a/ainst electronic attac9( T$ese pro/ra1s for1 i1portant parts of t$e Na4y>s ne*t0/eneration arsenal,

especially 3$en it co1es to t$e Penta/on>s e4ol4in/ AirSea s 5u)/et( 7$ile t$e Na4y recei4e)

a HB 5illion increase in O" fun)in/ fro1 +-+, it coul) not co1e soon enou/$( The Navy has been stretched past thebreaking point in terms o operational readiness, 3it$ nearly one 6uarter of its s$ips failin/ t$eirannual inspection in +-- an) crac9s in t$e alu1inu1 superstructure of e4ery cruiser in t$e Na4y>s in4entory(

T$e na4al rea)iness crisis 3as so 5a) in +-- t$at 8iceA)1iral e4in "cCoy tol) t$eouseAr1e) Ser4icesCo11ittee t$at, 3e>re not /oo) to /o( Increase) O" fun)in/ for t$e Na4y $elps, 5ut 1ore nee)s to 5e )one in or)er to fi* t$e fleet(Itcertainly )oes not $elp t$at t$e Na4y is force) to pay nearly H. 1illion to retire s$ips early 3$ile t$e fleet si=e is alrea)y too s1all(8arious)efense officials an) 1ilitary c$iefs $a4e testifie) recently t$at t$e ser4ices are sacrificin/ si=e of t$e force foreit$er rea)iness or 6uality( Gi4en t$e rapi)ly risin/ le4els of ris9 associate) 3it$ t$e latest )efense 5u)/et cuts,it is likely both readiness and "uality will decline despite the #hiefs$ best efforts(

#an%t solve shipbuilding industry & too many structural problems from within.

http://prospectjournal.ucsd.edu/index.php/2011/09/cutting-us-defense-spending-is-not-a-threat-to-american-security/http://prospectjournal.ucsd.edu/index.php/2011/09/cutting-us-defense-spending-is-not-a-threat-to-american-security/http://blog.american.com/2012/02/u-s-navy-readiness-continues-its-decline-amidst-the-pivot-to-asia/http://prospectjournal.ucsd.edu/index.php/2011/09/cutting-us-defense-spending-is-not-a-threat-to-american-security/http://prospectjournal.ucsd.edu/index.php/2011/09/cutting-us-defense-spending-is-not-a-threat-to-american-security/http://blog.american.com/2012/02/u-s-navy-readiness-continues-its-decline-amidst-the-pivot-to-asia/

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Sarder et al, 1'In)ustrial En/ineerin/ Tec$nolo/y at T$e Uni4ersity of Sout$ern "ississippi K"D

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No naval hegemony china is on track to surpass the US)aplan 1' Senior Fello3 at t$e Center for a Ne3 A1erican Security, K!o5ert, Geo/rap$y of C$inese Po3er,M$ttp%&&prospetti4ainterna=ionale(5lo/spot(co1&+-&--&/eo/rap$y0of0c$inese0po3er($t1lGETTING SEA EGS T$an9s to t$is fa4ora5le situation on lan), C$ina is no3 free to 3or9 at 5uil)in/ a /reat na4y( 7$ereas coastacity0states an) islan) nations pursue sea po3er as a 1atter of course, )oin/ so is a lu*ury for $istorically insular continental po3ers suc$ as C$ina( In

C$ina>s case, t$is 1i/$t 5e a lu*ury t$at is fairly easy to ac6uire since t$e country is as 5lesse) 5y its sea5oar) as 5y its continental interior( C$ina)o1inates t$e East Asian coastline in t$e te1perate an) tropical =ones of t$e Pacific, an) its sout$ern 5or)er isclose enou/$ to t$e In)ian Ocean t$at it 1i/$t one )ay 5e lin9e) to it 5y roa)s an) ener/y pipelines ( In t$e t3entyfirst century, C$ina 3ill pro'ect $ar) po3er a5roa) pri1arily t$rou/$ its na4y( T$at sai), it faces a far 1ore $ostile en4iron1entat sea t$an it )oes on lan)( T$e C$inese na4y sees little 5ut trou5le in 3$at it calls t$e first islan) c$ain% t$e oreanPeninsula, t$e uril Islan)s, Japan Kinclu)in/ t$e !yu9yu Islan)s, Tai3an, t$e P$ilippines, In)onesia, an) Australia( All e*cept for Gol)stein Australia

are potential flas$points( C$ina is alrea)y e15roile) in 4arious )isputes o4er parts of t$e ener/y0ric$ ocean 5e)s oft$e East C$ina Sea an) t$e Sout$ C$ina Sea% 3it$ Japan o4er t$e Diaoyu&Sen9a9u Islan)s an) 3it$ t$e P$ilippines an) 8ietna1 o4ert$e Spratly Islan)s( Suc$ )isputes allo3 s na4al lea)ers are )isplayin/ t$ea//ressi4e p$ilosop$y of t$e turn0of0t$e0t3entiet$0centuryU(S( na4al strate/ist Alfre) T$ayer "a$an, 3$o ar/ue) for sea controan) t$e )ecisi4e 5attle( sfirin/ ran/e of it( In No4e15er +, t$e C$inese )enie) t$e USS itty a39 carrier stri9e /roup entry into 8ictoria ar5or 3$en it 3as see9in/ arespite fro1 5uil)in/ seas an) )eterioratin/ 3eat$er( KT$e itty a39 )i) 1a9e a 4isit to on/ on/ in +-( In "arc$ +., a $an)ful of PA na4ys$ips $arasse) t$e U(S( sur4eillance s$ip t$e USNS I1pecca5le 3$ile it 3as openly con)uctin/ operations outsi)e C$ina>s -+01ile territorial li1it in t$e

Sout$ C$ina Sea, 5loc9in/ its 3ay an) preten)in/ to ra1 it( T$ese are t$e actions not of a /reat po3er 5ut of a still i11ature one( C$ina>sasserti4eness at sea is also )e1onstrate) 5y its capital purc$ases(

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sea s$ippin/ as an alternati4e to o4er0t$e0roa) T an) truc9loa) ser4ices(7$at a1 I 1issin/$ere T$e i)ea of usin/ unioni=e)U(S( 1ariti1e ser4ices as an alternati4e to 1ostly non0union truc9in/ ser4ices is a pipe dream$ pure andsimple( It is 5ein/ pus$e), 1ostly in 7as$in/ton,5y a $an)ful of or/ani=ations, consultants an) politicians 3$o$a4e no i)ea about the real !orld o gritty reight transportation( iterally, t$is s$ip $as saile)00a5out -@ years a/o( #es, t$ere is a3ful con/estion on U(S( $i/$3ays( #es, t$ere nee)s to 5e 1ore capacity an) in4est1ent spent on U(S(infrastructure( #es, s$ippers are loo9in/ foranyt$in/ to $elp s1oot$ t$eir e4er0lon/er supply c$ains ( t /et 1e 3ron/( "ariti1e$as its place int$e /lo5al supply c$ain( It is i)eal for lon/, c$eap, continuous 1o4es fro1, say, t$e Far East to t$e U(S( 7est Coast, 3$ere o54iously tra)e fro1 C$ina

$as fuele) its /ro3t$( It is not t$e ans3er for /oin/ fro1

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con/este) an) )ri4in/ incon4enient, people 1o4e to 1ore accessi5le areas, re5uil) at $i/$er )ensities, tra4els$orter )istances, an) s$ift tra4el 1o)es( State) anot$er 3ay, people a)apt to con/este) en4iron1ents(

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T$e 9ey factor for a sustaine) econo1ic reco4ery is t$e 5uil)up of real sa4in/s( T$is 5uil)up can only 5esecure) 5y 3ealt$ /enerators an) not 5y /o4ern1ent spen)in/, 3$ic$ 3ea9ens t$e process of 3ealt$for1ation(

-ransportation Stimulus failsno job creation and causes deeper deficits

/ugy and Mitchell 11 L7or9in/ Paper% 7oul) "ore Infrastructure Spen)in/ Sti1ulate t$e Econo1yM 8eroni6ue De !u/y Kseniorresearc$ fello3 at "ercatus Center at Geor/e "ason Uni4ersity( er pri1ary researc$ interests inclu)e t$e U(S( econo1y, fe)eral 5u)/et, $o1elan)

security, ta*ation, ta* co1petition, an) financial pri4acy issues an) "att$e3 "itc$ell KMatthew Mitchell is a senior research fellow at the Mercatus

Center at George Mason University. His primary research interests include economic freedom and economic growth, government spending, state and

local fiscal policy, public choice, and institutional economics.) No. 11-36 September 2011. Mercantus Center: George Mason

University.

Four years into t$e )eepest recession since 7orl) 7ar II, t$e U(S( econo1y e*pan)e) at a rate of only ( percent in t$e first $alf of +--( T$is 1eans

t$at t$e econo1y is /ro3in/ at a slo3er pace t$an t$e population an) t$at capita output continues to fall( + Inresponse, t$e presi)ent $as announce) a plan for yet 1ore )eficit0finance) sti1ulus spen)in/( ? i9e t$e t3o pre4ioussti1ulus 5ills, t$is one focuses on infrastructure spen)in/( T$e presi)ents plan is roote) in t$e 5elief t$at sti1ulusspen)in/ an) )eeper )eficits 3ill /i4e t$e econo1y t$e lift it nee)s to create 1ore 'o5s( T$e $ope is t$at, e4entually, t$eecono1y 3ill /ro3 fast enou/$ to allo3 t$e /o4ern1ent to 5e/in to pay )o3n t$e national )e5t( T$ere are t$reepro5le1s 3it$ t$is approac$( First, )espite t$e clai1s of sti1ulus proponents, t$e e4i)ence is not at all clear t$at 1oresti1ulus 3oul) 5e $elpful ri/$t no3( Secon), e4en if one a)$eres to t$e i)ea t$at 1ore /o4ern1ent spen)in/ can 'olt t$e econo1y,spen)in/Rparticularly infrastructure spen)in/Rcannot 5e i1ple1ente) in t$e 3ay eynesians say it ou/$t to 5e(

T$is /reatly un)er1ines its sti1ulati4e effect( T$ir), 3$ile no one )isputes t$e 4alue of /oo) infrastructure, t$is type ofspen)in/ typically suffers fro1 1assi4e cost o4erruns, 3aste, frau), an) a5use( T$is 1a9es it a particularly 5a)

4e$icle for sti1ulus (In su1, furt$er sti1ulus 3oul) 5e a ris9y s$ort0ter1 /a15le 3it$ near0certain ne/ati4econse6uences in t$e lon/ ter1

Turns case% *ore stimulus spending !ill kill competitiveness andcrush the economydwards 110)irector of ta* policy stu)ies at Cato an) e)itor of333(Do3nsi=in/Go4ern1ent(or/( e is a top e*pert on fe)eral an) state ta* an) 5u)/et issues(

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A1erican /o4ern1ent )e5t $as also soare) to a5nor1ally $i/$ le4els( Fi/ure ? s$o3s OECD )ata for /ross /o4ern1ent )e5t as a s$areof GDP(? KT$e )ata inclu)e )e5t for fe)eral, state, an) local /o4ern1ents( In +--, /ross /o4ern1ent )e5t is -- percent of GDP in t$e Unite) States, su5stantially a5o4e t$eOECD a4era/e of percent(Bar1ful Effects of Deficit Spen)in/

Fe)eral )eficit spen)in/ $as e*plo)e)( E4en 3it$ t$e recent passa/e of t$e s 3oesillustrate( !esearc$ in)icates t$at econo1ic /ro3t$ ten)s to fall as )e5t risesa5o4e a5out . percent of GDP, as )iscusse) 5elo3(Econo1ists in t$e eynesiantra)ition )ispute t$e first point( T$ey5elie4e t$at t$e )e1an)0si)e sti1ulus 5enefits of spen)in/ areso i1portant t$at t$ey out3ei/$ t$e pro5le1s of 1icroecono1ic )istortions an) 1isallocations cause) 5y fe)eral pro/ra1s( o3e4er, it is 4ery )ifficultto see any econo1ic 5oost fro1 t$e $u/e )eficit spen)in/ of recent years(T$e total eynesian sti1ulus in recent years inclu)es not only t$e +. sti1ulus pac9a/e of 1ore t$an H 5illion, 5ut t$e total a1ount of fe)eral )eficit spen)in/( 7e>4e

$a) )eficit spen)in/ of HB@. 5illion in fiscal +, H-(B trillion in fiscal +., H-(? trillion in fiscal +-, an) H-(? tri llion in fiscal +--( Despite t$at $u/esuppose) sti1ulus, U(S( une1ploy1ent re1ains at $i/$ le4els an) t$e current reco4ery $as 5een t$e slo3estsince 7orl) 7ar II(@T$e O5a1a a)1inistration clai1e) t$at t$ere are lar/e 1ultiplier 5enefits of fe)eral spen)in/, 5ut t$erecent spending spree seems to have mainly just suppressed private(sector activities. Stanfor)Uni4ersity>s Jo$n Taylor too9 a )etaile) loo9 at GDP )ata o4er recent years, an) $e foun) little e4i)ence of any 5enefits fro1 t$e +. sti1ulus 5ill( Any su/ar $i/$ to t$eecono1y fro1 spen)in/ increases 3as apparently s1all an) s$ort0li4e)( ar4ar) Uni4ersity>s !o5ert

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,aundry list o solvency de-cits3ilburn, 4 Associate E)itor at Seapo3er "a/a=ine, Na4y ea/ue of t$e Unite) States K"att il5urn,L!esur/enceM, Na4y ea/ue of t$e Unite) States, "ay +, ProVuest A

T$ou/$ t$e 5usiness cli1ate see1s set for a s$ort0sea s$ippin/ 5oo1, t$ere are 1any 5arriers to t$ose enterin/t$e 1ar9et( Costs are a concern( Ar1stron/ sai) one 3ay to lo3er costs is to 9eep s$ort0sea s$ippin/ a3ay fro1 t$e )eep3ater, internationalports, 3$ic$ $istorically $a4e 4ery $i/$ la5or costs( S1aller ports t$at are less )eeply )re)/e) an) )o not $a4e t$e o4er$ea) an) union contracts scale)to3ar) international car/o( T$ese ports, $e sai), s$oul) 5e 1a)e to loo9 1ore li9e a truc9 ter1inal so it>s a 6uic9 roll0on, roll0off, /et t$e truc9s out oft$ere( No 3are$ousin/, none of t$ose 9in) of t$in/s, no co1plicate) custo1s or fancy /ates( Ar1stron/ sai) t$at )urin/ t$e ne*t four to fi4e years,

"assac$usetts 3oul) 5e in4estin/ H?@ 1illion0HB 1illion to up/ra)e ports at Ne3 s 'ust no 1ore roo1 on t$e

$i/$3ays( Financin/ is also an issue( S$ortsea s$ips coul) cost H+@ 1illion0H-@ 1illion, an) raisin/ t$at 9in) ofcapital is no easy feat(Accor)in/ to "ar9 #on/e, 1ana/in/ 1e15er of t$e consultin/ fir1 "ariti1e Transport o/istics A)4isors, Fortau)er)ale, FIa(, Title I loans, 3$ic$ pro4i)e s1all0 an) 1e)iu10si=e) s$ip o3ners 3it$ a fe)eral /uarantee oft$eir co11ercial 5an9 loans for t$e construction of co11ercial s$ips in t$e Unite) States, are currently notrea)ily a4aila5le 4ia t$e "ariti1e A)1inistration( T$e ar5or "aintenance Act is anot$er factor )iscoura/in/s$ortsea s$ippin/( Effecti4ely, it 1eans t$at a s$ip 1a9in/ stops at, for e*a1ple, se4eral East Coast ports,

3oul) 5e ta*e) at eac$ port 4isite)( T$e pro5le1, sai) U(S( !ep( Da4e 7el)on !0Fla(, is t$at s$ips on s$ort0sea routes aresu5'ect to t$e ar5or "aintenance Ta* eac$ an) e4ery ti1e t$ey stop as t$ey ser4ice ports alon/ t$e costs(T$is preclu)es 1any 4essels fro1 /oin/ to 1any A1erican ports in a se6uential fas$ion , $e sai) in a release( 7el)onis sponsorin/ le/islation t$at 3oul) eli1inate t$e ta* for s$ort0route s$ips 5ut not affect lar/er, ocean0/oin/ 4essels( So1e a)4ocates of s$ort0sea

s$ippin/ clai1 t$e Jones Act is an o5stacle to success( T$e la3 re6uires t$at all 4essels 5ein/ use) to transportcar/o an) passen/ers 5et3een ports in t$e Unite) States 5e o3ne) an) 1anne) 5y U(S( citi=ens an) 5uilt atU(S( s$ipyar)s( o3e4er, fe3 s$ips 1eet t$ose criteria( Ar1stron/ )oesn>t foresee any c$an/es to t$e Jones Act, an) t$in9s t$ats$ort0sea s$ippin/, once pro4en 4ia5le, 3ill 5e a spar9 to A1erican s$ip5uil)in/( o3e4er, $e fa4ors fe)eral 3ai4ers to t$e Jones Act as a 1eans to /et

t$e ser4ices un)er 3ay an) teste) 5efore s$ippin/ co1panies co11it to t$e construction of ne3 s$ips( T$ere are also tec$nolo/ical$ur)les to o4erco1e( If s$ort0sea s$ippin/ is to 5e 4ia5le, s$ip )esi/ners 3ill $a4e to )e4elop 1ore rapi) 1eansfor loa)in/ an) unloa)in/ s$ips, sai) Su4a( 8acuu1 1oorin/ syste1s, 3$ic$ allo3 a s$ip to 1oor 6uic9lyutili=in/ lar/e 4acuu1 pa)s rese15lin/ suction cups, 3oul) eli1inate t$e nee) for lines an) line $an)lers,increasin/ t$e spee) at 3$ic$ a s$ip coul) )oc9, an) /et un)er3ay( Sil4a 3oul) also li9e to see s$ips e6uippe)

3it$ 5o3 an) stern t$rusters, 3$ic$ allo3 s$ips to 1aneu4er 1ore easily 3$ile )oc9in/, re)ucin/ )epen)encyon tu/s for assistance(

5o solvencyno correlation between industry and naval growth, alt causes to naval decline.

6inter '+LGettin/ S$ip5uil)in/ !IGTM Donal) C 7inter( KC$air1an of t$e National Aca)e1y of En/ineerin/, B t$Secretart of t$e Na4y, lea)er ofA1erica:s Na4y an) "arine Corps Tea1, 1e15er of t$e National Aca)e1y of En/ineerin/ Unite) States Na4al Institute( Procee)in/s( Annapolis% Jun+( 8ol( -??, Iss( ; p/( -, @ p/s $ttp%&&)l+af@'f?e(searc$(serialssolutions(co1(pro*y(li5(u1ic$(e)u&ct*W4erQX?.(0+Bct*WencQinfo%ofi&enc%UTF0rfrWi)Qinfo%si)&ProVrftW4alWf1tQinfo%ofi&f1t%9e4%1t*%'ournalrft(/enreQarticlerft('titleQU(S(YNa4alYInstituteYProcee)in/srft(atitleQGettin/YS$ip5uil)in/Y!i/$trft(auQ7inter+CYDonal)YCrft()ateQ+00-rft(4olu1eQ-??rft(issueQrft(spa/eQ-rft(is5nQrft(5titleQrft(titleQU(S(YNa4alYInstituteYProcee)in/srft(issnQB-.Con4ince) t$e Na4y>s s$ip5uil)in/ pro/ra1 is )eeply trou5le), t$e Secretary of t$e Na4y )is$es out so1e tou/$ lo4e to $is ser4ice an) t$e contractors3$o 5uil) t$e nation>s 3ars$ips( Critics conten) t$at t$e Na4y>s s$ip5uil)in/ pro/ra1 is )eeply trou5le)( T$ey are ri/$t( Ta9in/ effecti4e action firstre6uires a 5rutally $onest assess1ent of 3$at 3e are )oin/ 3ron/, an) 3$at nee)s to c$an/e in or)er to i1pro4e our perfor1ance( T$e pro5le1s t$at$a4e 5een $a1perin/ our a15itious s$ip5uil)in/ efforts are fi*a5le, an) I a1 intently focuse) on )oin/ e4eryt$in/ in 1y po3er to put our s$ip5uil)in/pro/ra1 on a 5etter trac9( S$ip5uil)in/ is at t$e center of our transfor1ation efforts( T$e ? or so capital assets t$at co1prise our Fleet )efine t$e

/lo5al reac$ an) a3eso1e stri9in/ po3er of t$e Na4y0"arine Corps tea1( s security en4iron1ent re6uires t$at 3e re0capitali=e t$e Fleet across t$e full ran/e of our capa5ilities( Alt$ou/$ 3e $a4e t$e 5est Na4y in t$e 3orl) to)ay, no one can )eny t$at, 3it$outi1pro4e1ents, 3e 3ill not 5e a5le to e4ol4e, 5uil), an) sustain t$e Fleet 3e nee) for t$e future(

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operations( All t$is i1plies a nee) for inte/ration of ele1ents an) capa5ilities( T$e )ecisions re/ar)in/ 3$at 3e really nee) in a s$ip0 a s$ip t$at fi/$ts alon/si)e 1any ot$er platfor1s 0 are in$erently )ecisions t$at properly 5elon/ to t$e Na4y( Only 3$en 3e i1pro4e )o1ain 9no3le)/e an) re0assert /reater control o4er t$e ac6uisition process 3ill 3e 5e in a position to 1a9e 5etter o4erall

pro/ra1 )ecisions( Secon), t$ere is a li1ite) un)erstan)in/ 3it$in t$e Depart1ent of Defense of $o3 5usinessoperates, $o3 it respon)s to co1petition, an) $o3 it is affecte) 5y 7all Street>s e*pectations( T$e reasons for t$isli1ite) un)erstan)in/ are not )ifficult to )isco4er( Interestin/ly, in)ustry )oes un)erstan) t$e Depart1ent of t$e Na4y( In)ustry $ires our alu1ni, an)

runs an e*tensi4e an) effecti4e intelli/ence collection effort tar/etin/ us( s ac6uisition pro/ra1 1ana/ers )onot $a4e an in0)ept$ un)erstan)in/ of $o3 in)ustry operates, an) t$e Depart1ent as a 3$ole )oes not actstrate/ically in )ealin/ 3it$ in)ustry( It is 4ery )ifficult for /o4ern1ent to $ire fro1 in)ustry, particularly at t$e 1ore senior le4els(Furt$er1ore, 3e )o not pro4i)e t$e e*periences or trainin/ to our unifor1e) ac6uisition professionals t$at 3oul) ena5le t$e1 to fully un)erstan) or

anticipate in)ustry( Neit$er /o4ern1ent nor 5usiness can effecti4ely operate 3it$ t$is /ap in t$e /o4ern1ent>s a5ility to un)erstan) 5usiness( T$ir),t$e s$ip5uil)in/ 1ar9et is suc$ t$at t$e Na4y $as little a5ility to reap t$e 5enefits of co1petition( I n 1any cases, t$eco1petition consists of only t3o co1panies, an) so1eti1es e4en t$en t$ere are li1its on t$e )e/ree of co1petition 5et3een t$e1( Theconsolidation o the shipbuilding industry has reduced competition to the point thatthere is no competition or many ma"or systems that !e purchase # Un)er nor1al 1ar9etcon)itions, co1petition )ri4es inno4ation an) in4est1ent, an) 3it$out intense co1petiti4e pressures, 5ot$

3ill ine4ita5ly suffer( As a result of t$e lac9 of co1petition in s$ip5uil)in/, co1petiti4e factors rarely )ri4e us to3ar)s opti1alsolutions, or a)e6uate in4est1ent le4els( Fourt$, t$ere $a4e 5een unrealistic e*pectations of t$e potential for co11ercial solutions to ouroften co1ple* an) uni6ue Na4al re6uire1ents( frustration 3it$ DOD>s poor recor) 3it$ respect to cost esti1ates an)5u)/etin/( T$ere is a fear t$at a /i4en pro/ra1 3ill not 5e appro4e) if realistic cost assu1ptions are 1a)e )urin/ t$e pro/ra1 appro4al an) contract

ne/otiation p$ases( 7$ile settin/ reasona5ly a//ressi4e cost tar/ets 1ay 5e a stan)ar) 1ana/e1ent tec$ni6ue, settin/tar/ets t$at are unac$ie4a5le $ar1s our cre)i5ility, creates )istrust 5et3een Con/ress an) t$e Na4y, an))esta5ili=es future 5u)/ets as cost o4erruns co1e $o1e to roost( Opti1is1 is part of t$e A1erican 1ilitary et$os( It is alsoc$aracteristic of 4isionary 5usiness lea)ers( s nose un)er t$e tent, so to spea9,so1eti1es lea)s to s$ortcuts in )esi/n, resultin/ in cost pro5le1s )o3n t$e roa)(

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una5le to )o so( A))itionally, it 3ill li1it t$e a5ility of states to utili=e so1e of t$e inno4ati4e tollin/ pro/ra1s t$at3oul) assist in1ana/in/ traffic con/estion, suc$ as esta5lis$in/ $i/$ occupancy0tolle) KOT an) 4aria5ly price) or 1ana/e) lanes( Fifteen states arecurrently 1o4in/ 1a'or pro'ects for3ar) t$an9s to inno4ations allo3e) un)er t$e 8alue0Pricin/ Pilot Pro/ra1, Ur5an Partners$ip A/ree1ents, an) Con/estion !e)uction

De1onstration Pro/ra1s, an) 3e 3oul) not 3ant to see t$e pace of t$ese inno4ations falter( "ore fun)a1entally, in failin/ to inclu)e suc$ pro4isions in "AP0+-, t$eSenate $as )enie) statesan) 1etropolitan re/ions t$e a5ility to create inno4ati4e an) fle*i5le pro/ra1s to finance t$eirtransportation nee)s, as fe)eral fun)in/ sta/nates or )eclines( 7$ile 3e reco/ni=e t$at t$e scope of t$is conference 1ay li1iCon/ressional aut$ority to e*pan) t$e fle*i5ility of states an) 1etropolitan re/ions to intro)uce tollin/ an) user0c$ar/e re/i1es 5eyon) current la3, 3e ur/e t$e conferees to

see9 all a4aila5le opportunities to 1a*i1i=e suc$ state an) local )iscretion( T$e a5ility to esta5lis$t$ese ne3 user0relate) re4enue strea1s3oul) /reatly en$ance t$e capacity of states an) 1etropolitan re/ions to le4era/e a))itional pri4ate capital forin4est1ent int$e restoration, rehabilitation, and expansion of major transportation facilities t$rou/$ suc$ cre)it an) cre)iten$ance1ent pro/ra1s as TIFIA an) t$rou/$ pu5lic0pri4ate partners$ips KPPPs( "AP0+- 3oul) /reatly e*pan) TIFIA, an) a co1para5le e*pansion of TIFIA 3as containe)in t$e 5ill a)opte) 5y t$e ouse Transportation an) Infrastructure Co11ittee KT I in t$is session of Con/ress( Suc$ a pro4ision 3oul) $a4e 1uc$ /reater i1pact in t$econte*t of e*pan)e) opportunities for tollin/ an) user05ase) fees at t$e state an) local le4els( 7e are also are concerne) t$at certain pro4isions incorporate) into "AP0+-coul) )iscoura/e states fro1 partnerin/ 3it$ t$e pri4ate sector an) fro1 )e4elopin/ inno4ati4e tools to attract pri4ate capital to transportation in4est1ent, for fear of losin/ apercenta/e of fe)eral fun)in/( T$ese pro4isions 3oul) also eli1inate t$e option to use pri4ate acti4ity 5on)s KPA