Senate Appropriators Whiff on MEADS | Citizens Against Government Waste

Senate Appropriators Whiff on MEADS

The WasteWatcher

Senate appropriators do not appear to have gotten the memo.

Despite being rejected by three-out-of-four relevant congressional committees, the Senate Defense Appropriations Subcommittee on July 31, 2012 included in its version of the Department of Defense (DOD) spending bill $380 million for the Medium Extended Air Defense System (MEADS). Previously, the House Armed Services Committee, the House Defense Appropriations Subcommittee, and the Senate Committee on Armed Services (SCAS) have zeroed out funding for MEADS. Since no authorization exists for MEADS, the funding added by the Senate subcommittee qualifies as an earmark under Citizens Against Government Waste’s (CAGW) longstanding criteria.

This development comes on the heels of a letter from Defense Secretary Leon Panetta to the Senate Appropriations Committee urging further funding for MEADS. Panetta cited the age-old excuse that cancelling the program would “negatively affect allied willingness to join future cooperative endeavors, [and] likely would lead to a dispute with Germany and Italy, both of which have indicated that they would assert that the United States has unilaterally withdrawn from the [Memorandum of Understanding] (MOU).”

However, a confidential DOD report to the SCAS in April 2012 and obtained by CAGW concluded that the U.S. can withdraw from the contract without committing additional money or paying termination fees. The report cited language in the 2005 MOU among the three countries stating that activities related to MEADS were subject to “the availability of funds appropriated for such purposes.” The DOD interpreted this to mean that if Congress fails to appropriate funding for MEADS, the U.S. can extricate itself from the program without penalty. In other words, the objections of Germany and Italy would not matter. Further, discontinuing funding for MEADS does not seem likely to irrevocably alter defense procurement cooperation between the U.S. and Europe given the skepticism with which Germany and Italy view the long-term viability of MEADS, and the close partnership the U.S. has with European nations on many other defense projects.

The Obama Administration has previously advocated cancelling MEADS after the completion of the so-called Proof of Concept phase that was to run for two years ending after fiscal year (FY) 2013. To this end, the President requested $400.9 million for MEADS. Secretary Panetta also indicated his preference for the U.S. to complete funding for the final year of the Proof of Concept before cancelling the program.

MEADS’ troubles have been well-documented by CAGW. The program has been plagued with cost overruns of nearly $2 billion and is 10 years behind schedule. A March 9, 2010 Washington Post report quoted an internal U.S. Army memo asserting that the program “will not meet U.S. requirements or address the current and emerging threat without extensive and costly modifications.” A March 2011 Congressional Budget Office (CBO) report recommended terminating MEADS in favor of continuing production of the Patriot. CBO cited an internal Army memo that urged “harvesting MEADS technologies and improving the Patriot program it was designed to replace.” It’s been the Pentagon’s policy since February 2011 that it would not continue funding for MEADS beyond FY 2013, and that it had no intention of procuring the system.

Support for MEADS within the subcommittee does not appear to be unanimous. Senate Defense Appropriations Subcommittee member Lindsey Graham (R-S.C.) stated on July 31, 2012 that moving forward the program “…will be a point of contention.” When asked if he would offer an amendment to strip funding for MEADS, Graham said, “to be continued.” Clouding the issue is an amendment prohibiting funding for MEADS in FY 2013 submitted by SCAS member Sen. Kelly Ayotte (R-N.H.) that was incorporated into the defense authorization bill.

The missile defense program certainly has the support of Senate Defense Appropriations Subcommittee member Richard Shelby (R-Ala.), who said “Funding this final year of MEADS development is the right thing to do for the country.” Sen. Shelby’s stance is eminently unsurprising as the MEADS program office is based in his home state.

With the recent agreement between House Speaker John Boehner (R-Ohio) and Senate Majority Leader Harry Reid (D-Nev.) on a six month continuing resolution beginning in September, the issue is unlikely to be decided this year. As a result, MEADS will likely receive at least an additional six months of funding. So while taxpayers lost this particular battle, the larger picture is the astronomical cost still remaining to complete and procure MEADS. The design and development and procurement phases of MEADS will cost $16.5 billion, so ending the program prior to those stages is absolutely vital give the economic state of the country.

After witnessing the tortured path of the MEADS project, it’s not hard to understand why Congress faces such gridlock when determining solutions to avoid the automatic DOD cuts posed by sequestration. Members can’t even agree to rid taxpayers of a program that has encountered such massive cost overruns, delays, and poor performance. Eliminating MEADS would serve as a fine example of a judicious approach to trimming DOD waste; the continuation of funding by the Senate Defense Appropriations Subcommittee represents a squandered opportunity.

Taxpayers can only hope that the Senate comes to its senses prior to the next MEADS skirmish.

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