White House's Claim That Trump Cut Cost Of Final Air Force One Deal Just Doesn't Add Up
The president has reportedly shaved more than a billion dollars from the project's price tag, but the stated cost remains the same as its always been.
The White House is crediting President Donald Trump with personally negotiating down the price of two new specialized presidential aircraft, which will become the future Air Force Ones, by nearly $1.5 billion. Though this is something the president has long said he would do, the claims are highly suspect, with the supposedly reduced price tag being exactly the same as the Air Force's well established official estimates, with the cuts only being possible thanks to an entirely unexplained increase of more than a billion dollars to the the program's total cost.
Deputy Press Secretary Hogan Gidley and other White House spokespersons disclosed the "new" $3.9 billion deal to various outlets on Feb. 27, 2018. This final price tag includes the U.S. Air Force’s purchase of a pair of Boeing 748-8i airliners and the costs associated with having that company make substantial modifications in line with a series of unique and complex inter-agency requirements, which will harden the airframe and its various mission systems against a variety of attacks, including electromagnetic pulses from nuclear detonations.
“President Trump has reached an informal deal with Boeing on a fixed price contract for the new Air Force One Program,” Gidley told Fox News. “Thanks to the president’s negotiations, the contract will save the taxpayers more than $1.4 billion.”
In December 2016, then President Elect Trump famously Tweeted out that the Air Force One replacement program’s costs were “out of control” and that the U.S. government should “cancel [the] order!” In February 2017, he claimed he had been able to trim $1 billion from the project’s total price, which he himself had repeatedly said was around $4 billion.
The White House now says Trump had bad information about the total price, which it says had climbed over $5 billion. However, Gidley and the other spokespersons offered no details about how they had calculated this new figure or otherwise explaining how or why this dramatic and sudden cost increase occurred at all.
As of 2016, the Air Force had laid out plans to spend approximately $3 billion between the 2015 and 2021 fiscal years on the Air Force One replacement program. A Politifact analysis of the available details in December 2016 determined the actual total was likely around $3.8 billion, including research and development and other ancillary costs.
In December 2016, Defense One reported that Boeing had reportedly informally offered the president four different possible courses of action to help cut costs. The White House reportedly rejected all of those proposals, which ranging in price from $2.28 billion to $4.2 billion.
Not surprisingly, the Air Force's estimate for the total price of the new Air Force Ones remains effectively unchanged, at around $3 billion, in its latest budget request for the 2019 fiscal cycle. The budget documents also confirms that the service has already spent around $1 billion on the project, giving the project an overall price of, you guessed it, approximately $4 billion.
Since 2009, the Air Force has been actively working to replace the existing pair of heavily modified 747-200B-based VC-25A Air Force One presidential aircraft, which have served as the president’s primary means of travel since 1991. It is possible that new requirements could have emerged, especially in the realms of space and cyberspace, and drove the costs up, but if this is the case, the official Air Force budget requirements do not reflect it in any way.
At the same time, the service has already announced a number of cost cutting initiatives over the the past few years. The Air Force eliminated a number of the aircraft's planned features in a broad review of the program, cutting around $500 million from the project's cost, but did so before Trump won the 2016 presidential election. This included an immensely short-sighted decision to eliminate the mid-air refueling capability from the new jets.
The VC-25A has that feature specifically so the president and his closest advisers can remain airborne and away from danger for a protracted period of time during a major crisis. Its core to the aircraft’s ability to play its part in the larger “continuity of government” plans, which exist to make sure the U.S. government continues to function adequately no matter what might happen, including a nuclear exchange.
There were also reports that the new Air Force Ones could use a cheaper commercial grade environmental control system, which again seems like a decision that needlessly increases risks, though its not clear if that decision came before or after Trump entered office. The existing VC-25As almost certainly have more robust air filtration and recycling systems, among other features, in order to better protect against chemical and biological agents and nuclear fallout. According to Defense One, there may have been unspecified cuts to the aircraft’s power generation capabilities, which in turn could have an impact on its ability to carry certain mission systems or run them adequately at all times.
After learning about the decision to remove the mid-air refueling capability became public in 2017, members of Congress subsequently suggested that they might demand the Air Force reintroduce that capability to its list of Air Force One requirements as part of future defense budgets. Legislators could similarly decide to add in funding specifically for other features, as well. Again, this could turn into an especially costly endeavor depending on how far along the other modifications to the 747-8is might have already progressed.
The Air Force had also previously announced plans to buy 747-8i Jumbo Jet aircraft Boeing that had already built, but not delivered to a now defunct Russian airline in order to try and save costs. However, using those orphaned Jumbo Jets could end up costing the Air Force more in the long run, because Boeing did not build them from the ground up to accommodate all the necessary and complex modifications, both to the basic airframe and its on board systems.
These specialized capabilities by their nature come with high costs. In January 2018, the Air Force announced it had hired Boeing to build two new eight-compartment refrigerators for the galleys on the existing Air Force Ones, which have to be able to keep approximately 3,000 meals fresh for weeks at a time in order to be able to sustain dozens and potentially hundreds of passengers in an emergency. Those units together cost nearly $24 million.
None of this has apparently changed the Air Force's standing cost estimates, though, which have not delineated between plans to use newly built or existing non-delivered aircraft. At no point has the Air Force ever indicated that the program's costs significantly increased across the board or did so by $1 billion or more specifically.
But if the White House's claim is inaccurate, Boeing doesn't appear inclined to be the one to bring it up. As reports of the cost-cutting began to appear, the company Tweeted out a message of support, though it deftly avoiding giving any actual dollar amount.
"Boeing is proud to build the next generation of Air Force One, providing American Presidents with a flying White House at outstanding value to taxpayers," the company posted on Twitter. "President Trump negotiated a good deal on behalf of the American people."
Boeing has already been coy about the program's costs, especially the price the U.S. government is getting on the base 747-8is, which it says it needs to keep confidential because it still sells the aircraft commercially. List prices suggest the airliners run around $350 million apiece in a typical commercial configuration, but that is in no way representative of the costs associated with turning them into flying White Houses.
The Chicago-based planemaker's apparent support for Trump's cost-cutting claim represents a steadily changing in the relationship between the company and the president, who had been highly critical of the company, including accusing it of sending jobs overseas, especially to China, both as a candidate and after taking office. The two have apparently since made up, though, and Trump now routinely touts Boeing military and commercial aircraft during press conferences and other speeches.
This is hardly the first time we've seen this sort of dance between a defense contractor the president. Lockheed Martin similarly lent weight to Trump's inaccurate claim that he personally shaved hundreds of millions of dollars from the price of buying more F-35 Joint Strike Fighters in February 2017.
This minor victory was enough to turn the president, who had also declared the F-35 program was "out of control," into an ardent supporter of the project. There is growing evidence he may actually believe the stealthy planes are literally invisible.
The War Zone's own Tyler Rogoway has previously noted this dramatic change of heart, writing:
It is pretty clear Trump has been personally spoon-fed the F-35 brochure from LockMart and the program office. Without any point of reference, it all must seem pretty wondrous. Oh and the program he was so critical of during his campaign is now magically fixed because he made a phone call. Totally ridiculous to the point that its downright insulting. And really, nothing of this has to do with the jet itself, just a new slathering of politics that surrounds it.
To be honest, I had high hopes that Trump could spur systemic change within the DoD's procurement process. Those hopes have faded rapidly over the last three months. It seems that he is far more interested in selectively intervening in a few high-profile programs he has interest in so that he can claim fake victories and gloat about them endlessly to the press, and the defense industry is happy to oblige him if it means funding certainty and a strong order book.
As Trump would put it: "sad."
These changes in tone now from companies who appear eager to placate the president, both in order to avoid a Twitter rant that might send stock prices plummeting and to more easily secure future deals, continue to border on the farcical. It's even more embarrassing when the facts so readily appear to contradict these positive pronouncements.
And even if the White House's figures turn out to be accurate, a cost saving of a billion and a half dollars is a drop in the bucket in the context of President Trump’s new, largest ever proposed base defense budget. The Air Force One replacement program’s total $4 billion cost, which is spread out across at least another five years, represents just over one half of one percent of the defense spending request for the 2019 fiscal year alone. And since the White House says its Air Force One announcement stems from an informal deal, it's not immediately clear whether or not it might not change again by the time the Air Force and Boeing actually formalize the plan.
Suggesting Trump has succeeded in getting the costs of the new Air Force Ones down may give him another brief political victory, but as it stands now the basic numbers just don't line up.
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