The Defense Department may be good at planning for doomsday scenarios, but dealing with fiscal disasters is a different art form.
A new report by the Center for Strategic and International Studies analyzed the decline of the defense budget and drew up a list of affordable military options for the government in the next decade.
The report operated on two assumptions: By 2021, the base defense budget will have declined by 21 percent, in line with sequestration requirements set forth by the Budget Control Act of 2011. In addition, the dollar will have lost 15 percent of its purchasing power compared with 2012.
Using this framework, the report’s authors outlined four possible ways the military could spend money to build capability while staying within its means.
The authors then picked one option they termed least bad for the national security of the country.
The winner? A strategy called “Great Power Conflict,” in which the Pentagon would concentrate its efforts on preparing for a potential conflict with China and Russia, by investing in military power and concentrating less on building a presence to assure its allies.
This strategy is also the most beneficial to government contractors, since it calls for a $10 billion investment in procurement and research and development, but at the expense of military workforce development.
“It’s important to remember that all of the options are bad for contractors,” said Clark Murdock, senior adviser at CSIS and lead author of the report.
The aim of the report, he said, was to plan for a fiscal reality that the government is yet to accept.
“The Pentagon is getting more realistic, but it hasn’t started to accept the reality of budgetary caps,” Murdock said. “I think Congress is in complete denial.”
The alternative strategies were: A greater emphasis on presence in the Asia-Pacific region (in line with the administration’s “pivot to Asia”), a baseline military that would adhere to all budget constraints or increasing America’s ‘soft power’ across the world through foreign assistance and joint military exercises.
Bethesda-based defense and aerospace giant Lockheed Martin has agreed to acquire Zeta Associates, a Fairfax-based information technology company, the two announced last week.
This is Lockheed’s second recent acquisition; in June, it agreed to acquire Deposition Sciences, a Santa Rosa, Calif.-based company that makes thin film technology.
Zeta Associates makes software and hardware that converts airborne signals to a digital form for intelligence and defense customers. For instance, the company makes radio-frequency switches, synthesizers and other products.
The transaction, whose terms were not disclosed, is expected to close in the third quarter of 2014.
“Zeta Associates’ expertise in cross-platform information collection, analysis and dissemination is an ideal complement to our national security capabilities,” Marillyn Hewson, chairman and chief executive of Lockheed Martin, said in a statement.
Zeta Associate’s technology could help the company deliver ground, air and space-based intelligence support, she said.
Zeta Associates has about 350 employees based in Fairfax and Denver, Colo., among a few other customer locations. Lockheed does not currently have any plans to move the employees — Zeta will become a wholly owned subsidiary after the acquisition closes, according to the company.
Dulles-based Orbital Sciences launched another NASA satellite last week, but the company’s earlier mission that suffered from an engine failure has yet to be rescheduled.
The Orbiting Carbon Observatory, a NASA experiment to measure atmospheric carbon dioxide, was successfully launched aboard a Delta II rocket on July 2. The satellite will be operated by Orbital engineers from the Dulles Mission Operations Center as well as scientists from NASA’s Jet Propulsion Laboratory in Pasadena, Calif.
Orbital’s other mission, a supply run to the international space station set to launch from Virginia’s Wallops Island facility, was delayed when an AJ26 engine failed a standard inspection in May. The company said inspectors were making progress on the engine failure investigation, but a launch date was likely only after July 10.
All other aspects of the mission are ready to go, Orbital said in an update on its Web site, including its Cygnus spacecraft.
Earlier this year, Orbital announced a $5 billion merger with the defense arm of Alliant Techsystems. The union will create a new aerospace company named Orbital ATK.
Mohana Ravindranath contributed to this report.