2
Investment in Science and Technology
CONGRESSIONAL CONCERNS
Congressional concerns arose during the 1990s about reductions in the DoD S&T program, particularly in the Air Force S&T program. Figure 2–1 shows the relative changes in the total DoD budget since 1989. The decline in the total DoD budget by about 25 percent in real terms from FY89 to FY01 reflects attempts by Congress to realize a post-Cold War peace dividend and to deal with growing federal budget deficits in the 1980s and 1990s.
Figure 2–1 also shows that over the same period, the Air Force reduced its S&T program by about 50 percent—about twice the reduction in the overall DoD budget. In 1989, the Air Force S&T program was almost as large as the Army’s and the Navy’s S&T pro
grams combined; by 2000, it was the smallest program of the three (see Figure 2–2) (Tuohy, 1999), whereas the Navy’s S&T program had actually increased.
According to congressional staff members who met with the committee, the Air Force had proposed even deeper reductions but had been prevented from making them by the Director of Defense Research and Engineering. In addition, in 1999 the Air Force moved two relatively large programs, the Discoverer II space-based radar demonstration and the Space-Based Laser Program, which had previously been funded outside S&T, into its S&T funding line. But because total S&T funding was not increased, these two programs were funded at the expense of ongoing and new S&T programs (Gessel, 2000).
From FY89 to FY98, the Air Force reduced its S&T investment to about 46 percent of its FY89 level in real terms. From FY98 to FY01, the Air Force increased its S&T investment. By FY01 it had been increased to 54 percent of its FY89 level. Despite the turnaround, congressional concerns remained.
TRENDS IN FUNDING FOR DoD S&T
The committee examined overall DoD S&T funding trends during the 1990s to provide a context for evaluating the Air Force’s funding reductions. Tables 2–1 and 2–2 show the breakdown of DoD S&T funding in current and FY01 constant dollars, respectively, for FY89 to FY01. Table 2–3 shows DoD funding by major budget category in both current and FY01 constant dollars for the same time period; Table 2–4 gives the same information for the Air Force. Table 2–5 shows changes in
funding for DoD budget categories (1) as the average annual percentage change since FY89, (2) in terms of the largest annual percentage reduction in each budget category, and (3) as the annual percentage change between FY97 and FY01 for each budget category; Table 2–6 shows the same data for the Air Force. Table 2–7 uses the same three indicators to show the percentage changes in funding for each defense S&T category.
The tables show reductions, in real terms, in almost all categories of defense and Air Force funding since 1989: The total DoD budget is down approximately 25 percent in real terms (Table 2–5). The total Air Force budget is down 32 percent (Table 2–6). Total DoD research, development, test, and evaluation (RDT&E) funding, of which S&T is a part, is down about 21 percent (Table 2–5). Air Force RDT&E funding is down 26 percent (Table 2–6).
From FY97 to FY01, there was a significant turnaround. The total Air Force budget, driven by a strong increase in procurement funding (39 percent) and operations and maintenance funding (10 percent), increased about 7 percent overall (Table 2–6). Even in those five years, however, Air Force RDT&E declined another 8 percent (contributing to an 18 percent cut since FY90). Air Force S&T investment declined from FY97 to FY99 (in real terms) but rose in FY00 and FY01, resulting in a 9 percent increase for the five-year period (Table 2–7).
If DoD S&T funding is examined by agency, some differences are evident (Table 2–7). The Army shows an overall real increase in S&T funding of about 20 percent over the entire 12-year, post-Cold War period, with a 29 percent increase in the last five years. The Air Force shows an overall reduction of 46 percent for the entire period. The Navy shows a 47 percent increase in S&T funding over the 12-year period. The positive shifts in Navy funding are mainly the result of increases in advanced technology development (6.3), which increased more than 212 percent from FY89 to FY01. All three services experienced reductions in basic research over the 12 years. Army and Navy applied research grew during the period. Air Force applied research declined. Defense-wide S&T funding, which includes S&T funding directed by the Office of the Secretary of Defense and funding by the Defense Advanced Research Projects Agency
TABLE 2–1 DoD S&T Funding, Total Obligational Authority, FY89 to FY01 (current dollars, millions)
TABLE 2–2 DoD S&T Funding, Total Obligational Authority, FY89 to FY01 (FY01 constant dollars, millions)
TABLE 2–3 DoD Funding by Major Budget Category, FY89 to FY01 (current and FY01 constant dollars, millions)
TABLE 2–4 Air Force Funding by Major Budget Category, FY89 to FY01 (current and FY01 constant dollars, millions)
TABLE 2–5 Percentage Changes in Funding for DoD Budget Categories (FY01 constant dollars)
|
Since FY89 |
Deepest Annual Cut |
FY97 to FY01 |
Total Budget |
−25 |
−10 |
+5 |
Procurement |
−39 |
−20 |
+33 |
O&M |
−9 |
−16 |
+8 |
Military Personnel |
−33 |
−10 |
−5 |
RDT&E |
−21 |
−10 |
−2 |
S&T |
+2 |
−12 |
+14 |
Basic Research |
+8 |
−12 |
+21 |
Applied Research |
+13 |
−16 |
+24 |
Advanced Technology Development |
−8 |
−17 |
+4 |
(DARPA), the Ballistic Missile Defense Organization, and other defense research agencies, grew 17 percent (in real terms) following the end of the Cold War.
Table 2.2 shows that defense S&T funding fluctuated over the past 12 years. Overall, however, defense S&T funding was higher by FY01, including total DoD, Army, Navy, and DoD-wide S&T funding. The sole exception was Air Force S&T funding, which by FY01 was 46 percent lower.
VALUE OF DEFENSE S&T INVESTMENTSCOUNTERING A RANGE OF THREATS
To address the question of the level of investment necessary to maintain an adequate technology base in the areas of air, space, and supporting information systems, the committee examined how the value, or utility, of the defense S&T investment has changed since the end of the Cold War. The most striking characteristic of defense S&T resources, which represent only 2 to 3 percent of total expenditures for national security, is their astonishing impact on the shape of DoD. Since World War II, for example, investments in S&T have led to the introduction of intercontinental ballistic missiles, stealthy aircraft, and reconnaissance satellites. One could legitimately ask whether the war against Japan would have ended by August 1945, the Cold War in 1989, or the Gulf War only 100 hours after the allied ground campaign started if key S&T investments had not been made. Today, however, the national security situation has changed radically, requiring a reconsideration of both the level of national security expenditures and the proportion that should be devoted to S&T.
TABLE 2–6 Percentage Changes in Funding for Air Force Budget Categories (FY01 constant dollars)
|
Since FY89 |
Deepest Annual Cut |
FY97 to FY01 |
Total Budget |
−32 |
−10 |
+7 |
Procurement |
−45 |
−21 |
+39 |
O&M |
−19 |
−18 |
+10 |
Military Personnel |
−34 |
−12 |
−5 |
RDT&E |
−26 |
−15 |
−8 |
S&T |
−46 |
−23 |
+9 |
Basic Research |
−15 |
−17 |
+11 |
Applied Research |
−13 |
−14 |
−1 |
Advanced Technology Development |
−66 |
−34 |
+25 |
By their very nature, S&T resources entail management problems. Significantly useful S&T programs are almost always unique. The nature of the personnel and other resources involved make it particularly difficult to establish schedules and to predict financial requirements. The military payoffs of S&T programs cannot always be specified with certainty at their initiation and, in fact, are usually difficult to quantify even in retrospect because they gain utility in “system of systems” applications. Despite these difficulties, management must estimate the magnitude and direction of the defense S&T investment to provide a basis for determining the best mix of weapon systems to meet current and future security threats. Those threats have changed since the Cold War.
The Soviet Union had military systems and capabilities competitive with those of the United States, as well as potentially superior numbers of forces. Although there were other potential adversaries around the world, the overwhelming focus of U.S. military strategy, forces, and systems was countering the single adversary that could conceivably match the United States blow for blow in a full-scale nuclear or conventional conflict.
The symmetry of capabilities, combined with potentially superior numbers of forces, drove the United States to pursue weapons and systems development programs, as fast as possible and at almost any cost, to create and maintain a technologically superior military capability. In keeping with this single-adversary orientation, defense S&T programs were oriented toward developing technologies that pushed the limits of weapon system performance, range, lethality, precision, and survivability.
TABLE 2–7 Percentage Changes in Funding for DoD S&T Categories (FY01 constant dollars)
|
Since FY89 |
Deepest Annual Cut |
FY97 to FY01 |
S&T |
|
||
Total |
+2 |
−12 |
+14 |
Army |
+20 |
−27 |
+29 |
Navy |
+47 |
−14 |
+32 |
Air Force |
−46 |
−23 |
+9 |
DoD-wide |
+17 |
−18 |
+3 |
Basic Research |
|
||
Total |
+8 |
−12 |
+21 |
Army |
−5 |
−13 |
−16 |
Navy |
−11 |
+14 |
+8 |
Air Force |
−15 |
−17 |
+11 |
DoD-wide |
+71 |
−23 |
+43 |
Applied Research |
|
||
Total |
+13 |
−16 |
+24 |
Army |
+14 |
−26 |
+45 |
Navy |
+20 |
−26 |
+22 |
Air Force |
−13 |
−14 |
−1 |
DoD-wide |
+26 |
−18 |
+29 |
Advanced Technology Development |
|
||
Total |
−8 |
−17 |
+4 |
Army |
+38 |
−41 |
+19 |
Navy |
+212 |
−7 |
+61 |
Air Force |
−66 |
−34 |
+25 |
DoD-wide |
+2 |
−21 |
−18 |
With the fall of the Soviet Union, however, some of the impetus for the development of advanced systems has diminished. Despite Russia’s formidable conventional and nuclear forces and the improving military capabilities of other countries, the U.S. military, for the time being, is the predominant military force in the world. This does not mean, however, that the threats faced by the United States are simpler or less dangerous. In fact, the opposite is true.
Instead of a monolithic adversary whose capabilities and strategies are similar to those of the U.S. military, the United States now faces a growing number of threats. First, other nations continue to improve and increase their military capabilities in many areas such as intercontinental ballistic missiles and chemical and biological weapons of mass destruction. Although these nations could not yet prevail against the United States in a full-scale conflict, they can threaten and significantly harm the vital interests of the United States and its allies. In addition, international terrorism is increasing, and the U.S. military and U.S. allies are favored targets.
The asymmetry between these threats and U.S. military capabilities compounds the problem. The worldwide availability of advanced technologies has enabled relatively small forces or groups to wield great destructive power for striking at nonmilitary populations as well as military forces. As the U.S. military and the world are learning, a large, technologically superior military designed to fight a similar enemy is not necessarily well prepared to deal with these asymmetrical threats. The attack on the USS Cole illustrates how an asymmetric threat can seriously damage an opponent that was once considered overwhelming and invulnerable. Civilian societies are also vulnerable. For example, attacks on the electrical power, financial, or transportation systems through their supporting information systems could cause great damage. Concerns about whether the United States is prepared to defend itself against such attacks are now widespread.
No one knows which of these potential threats will become real, which terrorist group will be the first to possess a weapon of mass destruction, when and where it will strike, and what constraints will be imposed on a defense against them. The growing number of threats, their asymmetric nature, and their uncertainty have increased the complexity and difficulty of defending against them—and, as a consequence, the potential utility of S&T in helping to meet these challenges.
IMPETUS FOR ONGOING INVESTMENT IN DEFENSE S&T
Given the demonstrated value of DoD S&T programs over more than the past half-century and the need for strong capabilities to meet a changing global threat, the committee concluded that the post-Cold War trend toward reductions in S&T spending should be reexamined in light of the need to deal with the threats that have arisen since the Cold War. First, if current defense systems cannot defend against the new threats, new systems must be developed, which will require reoriented and increased investment in defense S&T. Because the nature and scope of these threats are uncertain, the S&T investment should be broad and flexible.
Second, increased S&T investments are needed to support aging military systems, many of which are decades old but are expected to last many more years
until new systems can replace them. All of the services, including the Air Force, have already discovered that S&T programs will be necessary to extend the lifetimes of these systems.
Third, rapid deployment and reduced dependence on overseas bases in force projection will require capabilities beyond those provided by current operational technologies. The Air Force’s Expeditionary Aerospace Force concept is a case in point. The S&T requirements to support new operational concepts are just beginning to be understood.
Fourth, although the impetus for the development of some advanced systems has diminished, continued investment in S&T supporting advanced systems is still necessary. Russia and other developed nations possess technologically competitive systems and, just as important, the capability to improve them. Other countries could buy these systems, thus increasing both their military capabilities and their own technology bases. The United States still relies on technological superiority to reduce casualties and provide a military advantage in the event of conflict. Therefore, maintaining the defense S&T base to ensure these advantages is prudent and necessary.
DoD and Air Force S&T programs are as important as ever, perhaps more important. In light of the current threats faced by the United States, the prospective utility of the U.S. investment in defense S&T has actually increased.
NONDEFENSE PAYOFFS
Although nondefense applications are not a primary criterion in the allocation of DoD resources, these payoffs have been, and can continue to be, extensive. Among the many recent nondefense economic and social benefits that have accrued as a result of military technologies being transferred to the nondefense public and private sectors are the Global Positioning System, the ARPANET (the forerunner of today’s Internet), communication satellites, fiber optics, laser technology for medical and manufacturing uses, and composite materials for sports equipment and automotive vehicles, to name only a few. Defense S&T programs have contributed directly to a stronger economy, safer automobiles and aircraft, and more cost-efficient logistics. Such nondefense payoffs are directly related to the investment in defense S&T.
Unique aspects of the public welfare such as national security require that the government make high-risk, sometimes long-term, investments that industry cannot or will not make. Most defense S&T programs are high-risk capital investments with a high potential for failure. Even large firms accustomed to taking risks can find it difficult to justify such programs on a commercial profit-and-loss basis.
Accounting in advance for the incremental economic benefits to be gained from defense S&T spending is problematic. The modeling of projected economic and social benefits is extremely complex and difficult to do. However, Congress should remain aware of the nondefense benefits that frequently accrue from defense S&T programs.
LEVEL OF AIR FORCE REPRESENTATION AND ADVOCACY FOR S&T
Currently, the highest S&T-dedicated military position in the Air Force is the 2-star AFRL commander position at Wright-Patterson AFB near Dayton, Ohio. The AFRL commander reports directly to a general (4-star), the commander of the Air Force Materiel Command (AFMC), of which AFRL is a part. AFMC headquarters is also located at Wright-Patterson. The AFRL commander is also dual-hatted as the Air Force technology executive officer and as such also reports to the Assistant Secretary of the Air Force for Acquisition, whose office is in the Pentagon.
The strength of S&T representation in the Air Force is weakened by the relatively small size of the S&T program compared with the Air Force’s total program and compared with the broad scope of responsibilities held by the assistant secretary for acquisition and the AFMC commander. In FY01, the Air Force total obligational authority (TOA) was approximately $85.6 billion. The TOA for RDT&E was approximately $13.7 billion, or about 16 percent. Of this amount, S&T TOA was approximately $1.2 billion, about 9 percent of RDT&E, or slightly more than 1 percent of Air Force TOA for FY01. The relatively small size of the S&T investment affects perceptions of its value and the amount of attention paid to it. The assistant secretary is a member of the Air Force Council, which is the Air Force corporate policy and decision-making body just beneath the Secretary and Chief of Staff of the Air Force, and is responsible for representing this S&T investment as the council makes its investment decisions.
However, he is also responsible for representing all Air Force acquisition programs, which comprise the “D” part of the RDT&E investment and are much larger combined than the S&T program.
The AFMC commander also has broad responsibilities. The commander is responsible for about 120,000 people, including approximately 5,700 people in AFRL, and the programs at four product centers, five air-logistics centers, three test centers, and two major specialized centers. In addition, until very recently, AFMC was not responsible for formulating the Air Force S&T program and budget or for including and representing them during the annual budget cycle. Instead, the S&T budget was formulated and represented by the assistant secretary’s office.
The broad scope of responsibilities of the AFMC commander and the Assistant Secretary of the Air Force for Acquisition, combined with the relatively small size of the S&T program, can prevent them from effectively advocating for Air Force S&T at the corporate policy and decision-making level of the Air Force. The AFRL commander is focused and dedicated to S&T; however, his position is several levels below the Air Force Council and he is located in Ohio instead of the Pentagon. His ability to effectively represent and advocate S&T during corporate decision-making is, therefore, limited.
The Air Force itself has recognized this problem and recently acted to increase the level of S&T advocacy within the Air Force. It announced plans to make the AFMC commander the advocate for S&T in the Air Force. In addition, starting in the FY03 budget, AFMC plans to include Air Force S&T in its budget formulation. These changes reflect efforts to increase the level at which S&T is advocated in the Air Force. However, the breadth of the AFMC commander’s responsibilities will not be diminished, and S&T will continue to represent a relatively small part of his overall responsibilities. Moreover, moving the responsibility for S&T budget formulation and advocacy from the assistant secretary’s office in the Pentagon to AFMC at Wright-Patterson also will distance the S&T voice from the locus of Air Force policy and decision making. Including the Air Force S&T budget in the AFMC budget also increases the possibility that S&T funding will be tapped to help pay AFMC’s bills, in addition to bills from Air Force headquarters. This would compound the effects of reductions that have already been made in S&T funding.
CONCLUSIONS
Decline in Air Force S&T
Conclusion 2–1. Although the DoD investment in S&T has fluctuated since the end of the Cold War, it was higher by FY01, except for Air Force S&T, which accounted for the bulk of DoD S&T support for air and space systems. Air Force investment in S&T declined disproportionately during the period, exceeding the rate of the overall DoD budget decline and the rate of the overall Air Force budget decline.
Impact of S&T
Conclusion 2–2. Despite the relatively small share of total defense resources allocated for S&T, that investment has had major impacts on defense. The United States relies on its defense S&T base for the technological superiority that provides a military advantage and reduces casualties in the event of conflict.
New Threats
Conclusion 2–3. Since the end of the Cold War, threats facing the United States have changed considerably. New threats are diverse, asymmetric, and fraught with uncertainty. Cold War-era forces were not designed to meet these threats, and countering them will require broad capabilities that can best be provided by a broad program of defense S&T.
Nondefense Spin-offs
Conclusion 2–4. Defense S&T often has important nondefense benefits, especially in high-risk areas where industry cannot prudently invest on its own.
S&T Representation and Advocacy
Conclusion 2–5. The committee strongly believes that the Air Force needs authoritative, S&T-focused and -dedicated representation and advocacy at the corporate policy and decision-making level of the Air Force to help make informed trade-offs and budget decisions. Without corporate-level understanding and consideration of the effects its S&T investment can have on the Air Force’s future, the committee believes that the Air Force S&T investment faces undue risk that it will not provide the technologies and systems needed to meet
future threats. The committee is encouraged by the actions that the Air Force has recently taken to increase the level of S&T advocacy in the Air Force and believes these actions can result in a stronger S&T program. Additional actions could make Air Force S&T even stronger.
RECOMMENDATIONS
Restore S&T Dollars
Recommendation 2–1. The Secretary of Defense and the Secretary of the Air Force should continue to increase the Air Force investment in science and technology (S&T) to reach one-and-a-half to two times its current (FY01) level. Investments in S&T for air, space, and information systems should all be increased. Increasing one by decreasing the others will not satisfy current S&T program shortcomings and may create new ones.
Redirect S&T for Evolving Threats
Recommendation 2–2. The U.S. Department of Defense (DoD) and the Air Force should continue to reorient their science and technology (S&T) programs toward discovery and development of technologies to meet evolving threats, enable evolving operational concepts, and support the aging military systems that are expected to last over many more years. In addition, DoD and the Air Force should ensure that their S&T programs remain broad and flexible to deal with the uncertainties of current threats. At the same time, DoD and the Air Force need to maintain an adequate S&T base to ensure the technological superiority of U.S. forces over potential adversaries with advanced systems.
Promote Technology Transfer to Nondefense Sectors
Recommendation 2–3. The U.S. Department of Defense and the Air Force should remain aware of the nondefense benefits that could accrue from defense investments in science and technology and should actively promote the transfer of research results and technologies to the nondefense public and private sectors.
Strengthen S&T Advocacy Within the Air Force
Recommendation 2–4. In addition to the actions they have already taken, the Secretary of the Air Force and the Chief of Staff of the Air Force should continue to look for ways and take actions to further strengthen S&T representation and advocacy at the corporate policy and decision-making level of the Air Force. There are a number of options they can consider, including (1) formally designating the Air Force science and technology (S&T) program as a corporate program, (2) having the current AFRL commander/TEO position report directly to the Chief of Staff or be a member of the Air Force Council, and (3) establishing an Air Force Council member position (normally an assistant secretary or a 3-star deputy chief of staff), to be filled by a person in the Pentagon who is focused on, dedicated to, responsible for, and authorized to represent and advocate S&T within the Air Force, formulate Air Force S&T budgets, and participate in Air Force corporate policy and decision-making activities. The Air Force can also benefit from carefully examining the special roles accorded the Chief of Naval Research and the Office of Naval Research in the Department of the Navy to consider how these roles could be adapted to the AFRL commander/TEO and AFRL to strengthen Air Force S&T. These options or others the Air Force identifies can address remaining weaknesses in Air Force S&T representation and advocacy and build upon the recent successes of the Air Force.
REFERENCES
DoD (U.S. Department of Defense). 2000. National Defense Budget Estimates for FY 2001 (Green Book). Washington, D.C.: Office of the Under Secretary of Defense (Comptroller).
Gessel, M. 2000. Congressional Perspectives, presentation by Michael Gessel, executive assistant to Congressman Tony Hall, to the Committee on Review of Department of Defense Air and Space Systems Science and Technology Program, Holiday Inn, Georgetown, Washington, D.C., January 24, 2000.
Tuohy, R. 1999. Review of Department of Defense Air and Space Science and Technology Program, presentation by Robert Tuohy, director, DoD Science and Technology Plans and Programs, to the Committee on Review of Department of Defense Air and Space Systems Science and Technology Program, Wyndham Bristol Hotel, Washington, D.C., December 16, 1999.