Army’s Budget Would Boost Rapid-Response for Asia, Hypersonics

(Bloomberg) -- The Army’s proposed $178 billion budget for fiscal 2021 would boost spending to practice rapid deployments in the Pacific, including a 1,000-member force equipped to counter Chinese aggression.

Army Secretary Ryan McCarthy said in an interview that the service is engaging in “financial engineering” to reposition from 17 years of wars in Iraq and Afghanistan to the current National Defense Strategy, which emphasizes a renewal of great-power competition with China and Russia.

The new unit may be headquartered in Japan with its troops, who will be equipped with hypersonic weapons and electronic and cyber warfare capability, dispersed through the Indo-Pacific region.

“The disposition of forces in that side of the world is important,” McCarthy said. “If you want to compete against China, against Russia, you’ve got to be there for longer duration.”

The service also wants to spend more on hypersonic weapons and a new radar from Raytheon Co. for the Patriot missile system that’s built with Lockheed Martin Corp., according to McCarthy and budget documents being released Monday.

Spending on the Army’s program for hypersonic weapons, which can fly five times the speed of sound, would increase to $821 million from $228 million, with test shots planned for 2022 and fielding in 2023. Some of the new weapons would go to the new “multidomain task force” deployed to the Pacific, McCarthy said.

The Army is aiming for a prototype hypersonic missile battery by 2023 that can be put on a C-17 transport plane, he said, “and we’ll send it somewhere.”

Upgraded Radar

The budget calls for about $1.1 billion over the next five years for research and an additional $838 million in procurement for the upgraded radar that detects and cues targets for Patriot batteries. Raytheon beat Lockheed for the radar program in October.

While the $178 billion Army budget, which includes $25 billion in war spending, is about $2 billion less than approved for this year, the service’s budget proposal continues a shift started in fiscal 2018 -- moving dollars to research, development and prototyping for a new generation of long-range cannons and rockets, vertical-lift aircraft, vehicles, improved navigation and soldier gear.

The budget requests $24 billion for procurement, including war spending, down slightly from what Congress appropriated for this year, and $12.7 billion in research, comparable to this year. The Army’s funds to fight Islamic State and train allies would drop to $845 million from $1.2 billion. Spending to train the Afghanistan Security Force would be $4 billion, or $200 million less than this year.

Shift to R&D

McCarthy said the five-year plan in the current budget shifted $30 billion toward research and development over the five years ending in fiscal 2024. The money would be gleaned from 186 program terminations and truncations.

The proposed budget would shift an additional $9 billion toward R&D for fiscal 2023 through 2025. Increased spending would be focused on modernization priorities including advanced helicopters, missiles, air defense and enhanced “soldier lethality.”

“We got the herd moving” in the right direction, McCarthy said.

The nonpartisan Congressional Research Service raised caveats Friday about the Army’s plans based on current budgets.

Some lawmakers may question whether the modernization plan is realistic considering “the Army’s somewhat optimistic assumptions about the budget, demand for forces, mature research and development and the pace of adversary modernization, as well as the scope and complexity of overall Army Modernization,” authors Andrew Feickert and Brendan McGarry said.

Cuts, Cancellations

The $9 billion shift in the latest proposed five-year budget includes about $5.3 billion gained from terminating or reducing 10 programs. They include about $1.3 billion in additional reductions to the Joint Light Tactical Vehicle built by Oshkosh Corp.; $1.2 billion from canceling a new “mobile intermediate-range missile” and $400 million from ending work on a helicopter rocket system from BAE Systems Plc.

The theory is that seeding programs in development now will give their technologies longer time to mature and offer the Army a variety to choose from in future years. Eight priorities set out by the Army would be increased to $63.7 billion through 2025, up from $54.7 billion in the current five-year plan. They include:

$16 billion for the Next Generation Combat Vehicle, up from $15.5 billion in this year’s plan;$13.1 billion for communications networks, up from $11.8 billion.$10.6 billion for air and missile defense, up from $9.2 billion.$8.2 billion for Long Range Precision Fires missiles, up from $5.5 billion.$6.9 billion for Future Vertical Lift, up from $5.1 billion.$1.9 billion for Assured Precision Navigation and Timing, up from $1 billion.

For fiscal 2021 alone, the Army is requesting $10.6 billion for the eight core areas or about $2.2 billion more than this year’s budget. One of the most closely watched areas is funding for the next generation of attack and reconnaissance helicopters -- $1.1 billion for fiscal 2021, up from $810 million this year.

The $30 billion in reductions to bolster R&D spending was the product of “night court” sessions led by McCarthy’s predecessor, Mark Esper -- now the defense secretary -- that cut, terminated or truncated 186 programs, including Boeing Co.’s CH-47 F-model Chinook helicopter.

But the Chinook initiative was previously rejected by Congress, which approved $28 million to keep the model funded after heavy lobbying by lawmakers from Pennsylvania, where the helicopter is built, and New Jersey and Delaware, where many workers live.

Undaunted, the Army once again proposes ending funding for the Chinook. But Ryan said he doesn’t expect the new budget to generate as much drama in Congress as did this year’s.

“Hard choices are ahead of us -- much harder,” he said. “This budget, quite frankly, is going to be easier than ‘22 and ‘23 because there’s going to be some ruthless” decisions to be made about which prototypes the Army will select to buy, reduce or cancel, he said.

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editors responsible for this story: Bill Faries at wfaries@bloomberg.net, Larry Liebert

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