terça-feira, 14 de agosto de 2007

A Second Look: Taiwan's Desire for AEGIS

Thursday, August 9, 2007

A Second Look: Taiwan's Desire for AEGIS

When I posted on the subject this past Tuesday, my advice to the President and Congress was to walk away. In response I was challanged on two very different points. Rick made the point in comments that the Flight I DDG-51s lack facilities for helicopters and they are approaching expensive midlife upgrades. This Naval perspective is reinforced when you consider how expensive they are to operate, and that the Atlantic fleet Flight Is do not have the Ballistic Missile Defense upgrades the Pacific fleet Flight Is have, meaning we can spare them without a reduction in recent investments.

My counter argument was the Navy cannot afford to lose ships, and I would hate to see the Navy reduce the number of Ballistic Missile Defense ships from its intended 18. On that point I was challanged again by Robot Economist, who detailing a bit of inside info peeked my interest.

What is my basis for defying conventional wisdom? A conversation that emerged during a Presidential Management Fellows job interview I had at the Missile Defense Agency. Here is a rough dramatization of the conversation:

Robot Economist: So what would you think is the major drawback of working for the MDA? The political sensitivity of the work?

Female MDA Official With Too Much Eye Shadow: That is problematic to a certain extent, but right now, I would say being BRAC'd to Huntsville. We've been having trouble keeping young people who want to stay in the DC area.

RE: Are you going to staff any embassies or international field offices? Possibly some in Asia?

FMDAWTMES: Yes, we definitely will. The only one we have planned for the Pacific will be in Taipei.

RE: Wait, you mean Tokyo, right? The Japanese should get one since they are going to be such a big partner.

FMDAWTMES: No, I meant Taipei, in Taiwan.

The "Female MDA Official With Too Much Eye Shadow" was probably referring to the 2 Ultra High Frequency Long Range Early Warning Radars the US has been trying to sell Taiwan. From the March 2004 DSCA release:

On 30 March, the Defense Security Cooperation Agency notified Congress of a possible Foreign Military Sale to the Taipei Economic and Cultural Representative Office in the United States of Ultra High Frequency long range early warning radars as well as associated equipment and services. The total value, if all options are exercised, could be as high as $1.776 billion.

It turns out, that story ends like a large number of defense sales do with Taiwan. In June 2005, Raytheon concluded a contract worth $752 million to provide one Early Warning Surveillance Radar System to Taiwan by September 2009.92 By early 2007, Taiwan decided not to procure a second radar. CRS updated their research paper "Taiwan: Major U.S. Arms Sales Since 1990" in July 2007, and it isn't pretty.

The paper raises red flags all over the place, and left me with the impression the US needs to take a serious look at its policy towards Taiwan. The problems extend well beyond the United States, the Kidd class sale is the banner moment for maritime defense upgrades for Taiwan, results not typical. The Kang Ding class (French Lafayette) purchase was a clear disaster, reviewing the systems and technology on those ships makes one wonder how long they would last once the shooting starts, and it is unclear if upgrades to weapon systems has been funded.

Examining US discussions with Taiwan on military sales is insightful, there are too many sales almost made but never paid for, and almost none of the sales that do occur are made in full, instead almost always reduced. The AMRAAM purchase in 2003 is most typical, originally a purchase of 200, the actual number purchased was 120, and those were only purchased because an exchange rate adjustment freed up enough money with the F-16C/D purchase to buy the missiles.

Focusing on the naval defense negotiations, the Kidd class sale shines. The CRS report goes into extensive detail on all purchases, these captions sum up the maritime sales. As you will see, we have been down this path for AEGIS before.

Kidd-Class Destroyers

In October 2002, the Defense Committee of Taiwan’s legislature engaged in a sharp partisan debate over whether to approve funding (about $800 million) to buy the U.S. Navy’s four currently available Kidd class destroyers, ending with 18 lawmakers from the ruling Democratic Progressive Party (DPP) and Taiwan Solidarity Union (TSU) voting in favor, against 16 legislators from the opposition Kuomintang (KMT) and People’s First Party (PFP). Then, legislators conditioned funding on bargaining with the U.S. Navy on a 15% price reduction. On May 30, 2003, Taiwan’s legislature finally voted to release the funding.

The destroyers, the largest warships in Taiwan’s navy, are equipped with SM-2 air-defense missiles and a joint combat management system. The transfer ceremony for the final two Kidds took place in Charleston, SC, on August 25, 2006.

On April 3, 2006, Taiwan’s military submitted a request for U.S. assessment of the feasibility of using two phases (design then perhaps construction). Deputy Under Secretary of Defense Richard Lawless conveyed the U.S. policy response to Taiwan’s defense minister in an official letter on June 27, 2006, stating that a two-phased approach was “legally permissible and administratively feasible.” However, Lawless warned that such a program likely would increase costs and risks, making foreign design firms and their governments less willing to participate. The Defense Department estimated the design phase to cost $360 million, if Taiwan requests it.73 Following Lawless’ letter, Representative Rob Simmons wrote a letter to Defense Minister Lee Jye on July 17, noting that the next step is for Taiwan to request a letter of offer or acceptance for a phased approach to the design and acquisition of subs.

On June 15, 2007, Taiwan’s legislature passed the 2007 defense budget with $6 million to fund its own “feasibility study” and did not commit to the design phase or procurement of submarines (the two U.S.-approved options). Some legislators plan to use the $6 million partly for a trip to the United States in August 2007.
P-3C ASW Aircraft

After the United States approved Taiwan’s request for 12 P-3C planes, the two sides have negotiated the proposed sale. But Taiwan questioned the estimated cost of $300 million per new plane (in part due to Lockheed Martin’s need to reopen the production line) for a total cost of $4.1 billion (including parts and training) and sought alternatives in 2003, such as refurbished P-3Bs or surplus P-3Cs retired from the U.S. Navy’s fleet. A longer-term option is the Multi-Mission Maritime Aircraft (MMA) under development by Boeing’s subsidiary, McDonnell Douglas, for the U.S. Navy. In 2004, Taiwan’s Ministry of Defense sought approval from the Legislative Yuan (LY) of a Special Budget to include funds (about $1.6 billion) for 12 refurbished P-3C ASW planes (sold as Excess Defense Articles) with possible delivery in 2008-2011.

The LY committed to the procurement of the P-3C planes by budgeting about $188 million in the 2007 defense budget passed on June 15, 2007 (with a total program cost of $1.4 billion).
Aegis-Equipped Destroyers

The Department of Defense considered the Kidds as platforms to provide Taiwan’s navy with the necessary operational experience before any possible acquisition of more advanced Aegis-equipped ships. The U.S. Navy deploys the Aegis combat system (e.g., on the Arleigh Burke-class destroyer) for air defense and applies it in development of a future Navy missile defense system (using SM-3 missiles). An alternative to the Arleigh Burke that retains the Aegis Spy-1D radar, called the Evolved Advanced Combat System (EACS) has been considered. The Aegis combat system has the capability to track over 100 targets and to conduct simultaneous anti-air, anti-surface, and antisubmarine operations. During the U.S. war in Iraq in 2003, the Aegis combat system helped the Patriot missile defense system to detect and intercept Iraqi missiles. In 2003, Taiwan again requested four new Arleigh Burke-class, Aegis-equipped destroyers, for delivery in 2010 and at an estimated cost of about $4.8 billion.
So if we review this information of the AEGIS interest from 2003, 4 DDG-51s for 4.8 billion, and compare it to the most recent news report, something is amiss.

Taiwan wants to buy at least six Aegis-equipped destroyers from the United States at a cost of more than $4.6 billion, a newspaper said on Monday, a plan sure to anger China which claims the island as its own.

In other words, they want at least 6 AEGIS ships for 4.6 billion in 2008 after wanting 4 new AEGIS ships in 2003 for 4.8 billion. This implies the 6 ships must come from the existing fleet.

Or does it? How much would it cost to upgrade 6 Spruance class destroyers to AEGIS, or EACS? There happens to be 4 inactive Ticonderoga class that could be upgraded, and there also happens to be 6 Spruance class ships with VLS that are inactive as well. Could the Spruance class be upgraded to support AEGIS? I don't know that answer.

The four inactive Ticonderoga class cruisers include the USS Ticonderoga (CG 47), USS Yorktown (CG 48), USS Vincennes (CG 49), and USS Thomas S. Gates (CG 51). The six inactive Spruance class destroyers include the USS Fletcher (DD 992), USS O'Bannon (DD 987), USS Crushing (DD 985), USS Conolly (DD 979), USS David R. Ray (DD 971), and USS Arthur W. Radford (DD 968). Each link describes the condition, but whatever the NVR says, you can expect any inactive ship to be in need of massive repairs.

After this latest research, I am more convinced than I was on Tuesday this is fog, not smoke. The problem isn't need, it's political, and Taiwan doesn't have a very good track record for actually following through on interest in defense purchases.

To be honest, I'm not even convinced Taiwan government takes the Chinese threat of invasion seriously. Given their own lack of investment in defense, I think Congress needs to evaluate the current US policy towards Taiwan. China is commissioning a new submarine at a rate of 1 every 5 months, but Taiwan takes 6 years to decide whether or not to buy 12 P-3Cs for ASW, then pushes the purchase off for another 3 years. Taiwan is spending an average of 2.4% of their GDP on defense since 2002, with that kind of minimal commitment, it raises serious questions what kind of commitment the US should have towards Taiwan.

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