Therefore, the Air Force and OSD CAIG estimate of the life cycle cost differential between the B747 and the preferred best C-5B program is $2.6B (FY 81 dollars) lower for the B747. Finally, the Air Force does not agree that 48 is the number of B747s required to replace the 50 C-5s to be added to the USAF organic airlift force under the DoD airlift program. Even when using Boeing's assumptions (with which the Air Force does not fully agree) about the helicopter disassembly, acceptable loading clearances, and C-5 allowable cabin loads the Air Force estimates that 55 B7478 (48 PAA) are required to provide the same force closure capability as 50 C-5Bs (44 PAA). Based on these numbers, the life cycle cost comparison becomes: AF FY 81 $ billions AF 50/C-5B $14.7B This estimate is $.9B lower for the B-747, rather than the nearly $6.0B differential claimed by Boeing. The far greater military capability and utility of the C-5B clearly justifies this additional cost. GREATEST MILITARY UTILITY In your opinion, regardless of the life-cycle cost which do you believe has the greatest military ANSWER: There is no doubt that the C-5B, which was designed as a military airlifter, has far greater military utility than the B747. AMENDMENT OF SENATOR JACKSON Senator STEVENS. This battle, I understand, is going to be fought on the floor on Tuesday in terms of an amendment of Senator Jackson dealing with a 1-year concept of purchasing the surplus 10's and 747's with 1983 money and looking to 1984 to start something, C-17's or C-5B's. I would like to have your analysis of that option. Have you analyzed that option, Senator Jackson's option? General ALLEN. I am not familiar with this option, Mr. Chairman. With regard to this DC-10 question, however, in our request for proposals for the conversion of wide bodies from passenger carrying to passenger to cargo we got in 53 bids on DC-10s. Forty-nine of those were the 10's and only four of them were the longer-range 30's. Senator STEVENS. I would be interested in your analysis of this option. I think it is going to be, as I understand it, a Tuesday vote now. We just received word the DOD bill has been continued until Tuesday. As I understand the proposal, the 1983 moneys could be used to purchase oversized equipment available on the market. The 1984 moneys would be committed to either starting the C-5B or starting the C-17. [The information follows:] PURCHASE SURPLUS 10'S AND 747's WITH 1983 FUNDS The Air Force has not evaluated a proposal to buy surplus aircraft on a single year procurement. We have evaluated the purchase of a fleet of such aircraft over several years and have rejected it because the aircraft available do not meet our requirement for additional outsize capability. General ALLEN. Well, inasmuch as the lack of outsize capability is our most critical shortfall, if there were some combination of that nature, as the Commander in Chief of the Military Airlift Command I would prefer to start and get the additional outsize capabilities represented by the C-5 and give the second priority to 747's. FUNDING TO START C-17 Senator STEVENS. Well, what would be the funding to start the C-17 in 1983? General ALLEN. I would defer to General Burke on that. General BURKE. I would think we would start around the $200 million level. The staff says we could get going with that, assuming that we spend the $32 million that we now have. Senator STEVENS. How much do you have in here for the C-5B? General BURKE. $800 million. Senator STEVENS. Thank you, gentlemen. We appreciate your help. SUBCOMMITTEE RECESS The subcommittee will stand in recess until Wednesday, May 12 at 10 a.m. when we will receive testimony on RDJTF/Readiness. [Whereupon, at 12:15 p.m., Thursday, May 6, the subcommittee was recessed, to reconvene at 10 a.m., Wednesday, May 12, 1982.] DEPARTMENT OF DEFENSE APPROPRIATIONS FOR FISCAL YEAR 1983 THURSDAY, JUNE 24, 1982 U.S. SENATE, SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS, Washington, D.C. The subcommittee met at 8 a.m., in room 1114, Everett McKinley Dirksen Senate Office Building, Hon. Ted Stevens (chairman) presiding. Present: Senators Stevens, Garn, Rudman, and Eagleton; also present: Senator Mattingly. AIRLIFT ENHANCEMENT PROGRAM NONDEPARTMENTAL WITNESSES OPENING STATEMENT OF SENATOR STEVENS Senator STEVENS. Good morning, gentlemen. This is the time. scheduled to hear non-Government witnesses interested in the military airlift enhancement issue. This issue, obviously, has become a major controversy. In its action on the 1983 Defense authorization, the Senate rejected the Defense Department's request to begin acquiring 50 C-5B aircraft in favor of commercial wide-bodied transports adaptable for military use. We do not know yet what the House decision on this issue will be. Meanwhile, there is revived interest in the C-X program under which the Air Force wants to develop and acquire a new generation transport suitable for intratheater and limited airport operations as well as outsize cargo. Regardless of what happens with the authorization bill, this committee will have to make far-reaching decisions with respect to airlift enhancement, not only for the type of aircraft to procure and maintain in reserve, but the overall scope of the proposed expansion. Related issues include the acquisition of KC-10 aircraft, and the upgrading of C-130's, C-141's and others. We have already conducted a lengthy hearing with witnesses from the Defense Department, notably from the Air Force. It was at this hearing that the Air Force supported its request for new C5B procurement, but stressed a continuing need in the future for a new aircraft such as the C-17 selected under the C-X program. Today's hearing is to help gather more factual information from those directly involved in aircraft development and production. It would be in the committee's own interest to keep this hearing impartial, but to encourage a free exchange so that as much information can be gathered as possible. We also have a witness representing interests not directly tied to the military or defense contracting industry. We are going to proceed first with representatives from major contractors who were specifically invited to attend. We will hear first from Boeing, then from Lockheed and then from McDonnellDouglas in that order. We welcome you all to the committee. In each instance we will see that your complete prepared statement is printed in the record. We ask you to highlight your major points in your statement and be available for questions from the committee. We also ask that you identify those who are with you at the witness table for the record, before you proceed. VALIDITY OF LOBBYING EFFORT I have one comment to make about the problems to date. That pertains to our reaction-not only mine, but I think other members of the committee-to the document that indicates that there has been not only a coordinated intense lobbying effort, but also a computerized lobbying effort as far as this issue is concerned. We have been asked to look into the question as to whether or not this lobbying effort violates existing law. I will have a meeting of the committee and we will take that up at a later time. But I will say that the lobbying on this issue is geting more intense than any issue I have seen this year so far in the defense area, and my advice to you is to cool it, because everyone is going to lose in terms of this effort to improve the airlift if the sides are drawn so firmly that no one is willing to look at what is in the best interest of the country as a whole. I am going to stop having appointments with any member of any firm that has any interest in this issue. If we want additional information we will ask for it. That is what the law says at the present time. That includes the Air Force. There has just been too much lobbying as far as I am concerned, and if you will take my advice you will stay away from the other members of this committee, too. The first witness is Mr. Clyde Skeen, senior vice president of the Boeing Co. Pardon me, my good friend from Missouri, Senator Eagleton. OPENING REMARKS OF SENATOR EAGLETON Senator EAGLETON. I have a brief statement. I join with you and the other members of this subcommittee in welcoming this morning's hearing and the witnesses to testify. I commend them for their attendance at this early hour and I look forward to receiving their testimony. Also, I would like to commend you, Mr. Chairman, for convening this hearing. As we all know, airlift has become the subject of considerable controversy, you have highlighted that by your concluding remarks. Congressional approval to proceed with the program to cor rect nonairlift deficiencies may yet be denied or deferred unless we can clear up some of the confusion that surrounds this program. With the possible exception of the MX no program has changed configuration so often in so short a period of time. No program is as haunted by contested cost and production estimates. No other program has seen the testimony of administration officials change so dramatically from hearing to hearing and from month to month. Airlift is certainly not the most glamorous of Pentagon programs, but it is, perhaps, the most pressing military issue confronting the Congress today. Decisions made during the next few years concerning airlift will define the extent of our ability to meet military commitments abroad for at least the next quarter of the century. If the Congress is going to faithfully execute its responsibility in this matter, we must know the facts and have accurate information. In this regard, convening this hearing was not simply appropriate, it was essential. I wish to identify myself with your concluding remarks with respect to the intensity and ferocity of the lobbying on this issue. Lobbying is an accepted technique of petitioning Congress, but whether it is carried on at such length with such unlimited zealotry, it can, in fact, be counterproductive. I think your advice of “cool it" was sage advice and I hope it will be heeded." Senator STEVENS. Thank you, Senator. Senator Garn, do you have a statement? Senator GARN. I have no opening statement. Senator STEVENS. We have Senator Mattingly with us, a member of the full committee. Do you want to make a statement? Senator MATTINGLY. No. Senator STEVENS. Our first witness is Clyde Skeen, senior vice president of the Boeing Co. Mr. Skeen, I would be happy to hear your testimony. THE BOEING CO. STATEMENT OF CLYDE SKEEN, SENIOR VICE PRESIDENT, THE BOEING CO. ACCOMPANIED BY MICHAEL BOYCE, 747 MILITARY AIRLIFT PROGRAM MANAGER, SEATTLE BIOGRAPHICAL SKETCH Mr. SKEEN. Mr. Chairman, members of the committee, I would like to thank you, sir, for providing the Boeing Co. this opportunity to present our views regarding this important airlift issue which is before Congress this year. As you stated, my name is Clyde Skeen. I am a senior vice president of the Boeing Co. My responsibilities include direct corporate supervision of the three principal Boeing companies which do business with the Government. I first joined the Boeing Co. right out of college in 1940 and became assistant secretary-treasurer and divisional controller in 1949, corporate controller in 1952, and I was elected vice president in charge of systems program management in 1958. 92-385 0-82——7 |