DEFENSE NEWS By Justin P. Oberman
“There are just five major prime contractors; they are loath to compete with one another, and they can and do block new entrants. Further, the Center for Strategic and International Studies found that the number of first-tier defense vendors declined by roughly 17,000 companies, or 20 percent, between fiscal 2009 and fiscal 2015. Congress can help.”
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“Since World War II, our military technological superiority has served as the linchpin of the global international order, helping create and sustain an extended period of global peace, security and unparalleled economic growth. This claim seems risible in the wake of recent events in Afghanistan. While the efforts of our men and women in uniform, those at the embassy, and veterans and contractors have been actually heroic in evacuating more than 100,000 people in a matter of days, we cannot reasonably continue to make policy or spend money in future similar scenarios like we did in this case.
But this essay isn’t about policymaking in Congress and the administration, or even about defense budgeting. It’s about drawing a useful lesson, one that was so well-articulated by Ezra Klein: “Too much agreement can be as toxic to a political system as too much disagreement. The alternative to polarization is often the suppression of dissenting viewpoints. If the parties agree with each other, then they have incentive to marginalize those who disagree with both of them.”
If you swap out “political system” for “technology development,” and “parties” for “prime defense contractors,” the challenges we face become clear. New and divergent approaches should be welcomed, not suppressed; they should be sought out, not swatted away. Disruption should be redefined for the world we live in, not prior eras that we have emerged from, neatly or messily.
Operationally, the U.S. military suffers a readiness crisis because of antiquated rules and cultural norms for how the government works with the commercial sector in developing new technologies. This can’t continue.
It may come as a surprise to some that the private sector — not government — is the leading investor in the research and development that underpins what should be next-generation military technology. Hundreds of companies working on self-driving cars, highly engineered spare aircraft parts and everything in between devote significant resources to beating their competitors in the private sector. But far too many stay away from the defense market because there is so much friction — because their “viewpoints” are “suppressed.”
How so? First, they must navigate a gauntlet of burdensome regulations that don’t exist in the private sector. Second, they can lose control of aspects of their intellectual property, which threatens viability in many commercial markets. Third, there is significant reputational risk in the Capital Beltway market, which chases headlines and clicks regardless of their veracity.
These conditions weaken the defense-industrial base. At a time when venture capital investment breaks new records every quarter, and a decade of progress on technology can now be demonstrated in a matter of months, the military ecosystem is going backward.
Congress can help by:
Loosening certain appropriation restrictions to make it easier and more attractive for the private sector to invest alongside official programs of record so that new solutions can be deployed at scale.
Measuring and subsidizing exigent R&D costs unique to the defense sector.
Providing funding to cover shortfalls created by unique market conditions, e.g., specialized R&D, maintenance of antiquated fleets (aircraft, vessels, etc.), and warped supply/demand mismatches in sectors with only one or two customers.
Facilitating new commercialization paths for federally funded research and development centers and their military and civilian client agencies who together spend $15 billion each year on new technology but need to engage private sector innovators more actively.
Our current approach is woefully lacking, but imagine how much worse off we would be if we didn’t have world-leading talent and capital to activate. While it may not seem like it right now, our future is in our hands. But if we wait too long to act, we won’t get there first.”
Justin P. Oberman is the founder of Assemble, which seeks to encourage federal innovation, and the CEO of a stealth startup working to provide dynamic airspace data functionality for the U.S. aviation system. He helped up set up Transportation Security Administration and served as a Senior Executive at the U.S. Department of Homeland Security.
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