Thursday, January 06, 2011

The 87 Million-Dollar Mistake

If Air Force Lieutenant General Glenn Spears had designs on a fourth star, those dreams have probably been dashed.

According to the Tucson, Arizona Daily Star (via, General Spears has received a Letter of Admonishment for his role in a major overrun of the Air Force PCS budget in 2005. The over-spending, which totaled $87 million, was used to fund permanent-change-of-station moves by service members and their families.

At the time of the overrun, Spears was a brigadier general in charge of personnel policy at Air Force headquarters in Washington. Today, as a three-star, he serves as Commander of 12th Air Force at Davis-Monthan AFB in Tucson.

While auditors said that General Spears was not directly responsible for the overage, the Air Force determined that he (and three other general officers) "contributed to the problems by their actions or inactions." The service has refused to say what the officers did--or didn't do--in conjunction with the budget violation.

With the admonishment letter in his personnel file, Spears's prospects for promotion to general (four stars) are virtually nil. The other flag officers implicated in the budget scandal have retired from active duty. Spears is in the second year of his tour at 12th Air Force and will likely retire at the end of that assignment.

As we noted previously, General Spears is one of 14 Air Force flag officers who has been disciplined over the past two years, part of an effort to ensure greater accountability in the senior ranks. Some of the other generals who received letters of admonishment include the service's former Chief of Staff, General Michael Moseley; the former head of U.S. Air Forces in Europe (General Roger Brady) and the recently-retired chief of Air Education and Training Command, General Stephen Lorenz. Brady and Lorenz were punished for their role in the PCS budget over-run; Moseley was admonished for accepting gifts from an individual seeking an Air Force contract.

The Air Force's new insistence on accountability is welcome, but we do see a couple of problems with this approach. First, why won't the service come clean about what caused the $87 million overage, and the roles played by those four generals? Like the rest of the military, the USAF routinely experiences massive cost-overruns in weapons systems programs and other big-ticket items, and no one blinks an eye.

Consider the USAF's well-intentioned plan to modernize its fleet of C-5 Galaxy heavy-lift transports. Almost two years ago, the service began receiving the first upgraded jets, with new engines and improved avionics. Unfortunately, refurbishment costs spiraled to more than $140 million per aircraft (emphasis ours), almost double the original estimate and roughly twice the PCS over-run. Yet, no senior officers were fired or disciplined over the C-5 upgrade, despite the fact that the program was almost cancelled, and the service had to limit planned upgrades to older, less-fuel-efficient aircraft.

Indeed, some officers have continued their climb to the top, despite severe problems in the programs they supervised. Brigadier General Mark Shackelford was fired as head of the F-22 program office after that weapons system incurred multi-billion dollar costs overruns. Transferred to a missile defense post, Shackelford earned his second star, and was later promoted to Lieutenant General.

Obviously, Shackelford was elevated before the new push for accountability. In the current environment, it's unlikely he would have been promoted to Major General, let alone three-star rank. But that makes the flurry of admonishments over the $87 million mistake even more intriguing. Even in an era of greater scrutiny of flag officers, a mistake of that magnitude pales in comparison to billions in cost overruns. What was there about the PCS budget error that attracted the attention of auditors and (ultimately) led to the punishment of four flag officers? Sounds like much more than accounting mistakes and lax oversight. And unfortunately, the Air Force's lack of answers is only fueling speculation over what really happened.

1 comment:

Chris said...

Spot on as normal, but a few things I think are essential to the discussion.

With no experience in the personnel field, I would think Spears is being held more accountable because he had more direct control over his budget and its expenditure, vice an acquisition program manager dealing with cost overruns. With the PM, he's the messenger, not the cause of the overrun. The overrun occurs because the defense contractor says the work will cost more, then the PM tells his bosses the cost increase and impact, then the AF decides if it still wants to pay for the end item at a higher cost (see: JSF). In other words, it's not the dollar amount that's important, but the way in which the increase is handled and communicated up the chain of command (and, ultimately, was the military member at fault for the increase).

Additionally I feel the need to clarify an erroneous reference that has been made in this blog before, and that is in regards to Lt Gen Mark Shackelford. Your reference to him implies that, as a 1-star, he made a mistake and was not held accountable (or as accountable as he would today), proven by his receiving a 3rd star.

I would ask that you look at his official AF biography here:

Note his time as F-22 SPO Director: 7 months. Believe me, he couldn't have done ANYTHING in those 7 months to screw up the F-22 program that would have truly warranted his career being halted. As such, after the furvor died down, his career progressed and as such he has become an outstanding AF leader. And no, my name is not Mark Shackelford either.

If you choose not to post my response to your comments section, then that's OK by me. But at the very least I think it's important to have this dialogue, especially after reading your well-written post.