NASA and Congress have been given the challenge of designing, authorizing, funding, organizing and executing a successful space program that not only has the broad support of the American public, but also can deliver on the goal of expanding our knowledge base through the further discovery and exploration of space. As the “Report of the Advisory Committee on the Future of the U.S. Space Program” stated, such a program requires a culture of excellence and risk-taking.
In the 1980s, when I served in the U.S. Congress, the House Armed Services Committee panel that I chaired was given the task of addressing several cost issues, which arose during the period of the Reagan era defense buildup. In fact, at that time, a number of major weapon systems appeared to be plagued by a series of cost overruns and schedule delays — most notably the Black Hawk helicopter and Patriot Missile System. The panel’s review took place amidst reports that the government had procured $500 hammers and $600 toilet seats for the Department of Defense (DoD).
As a result of our review, Congress enacted the Nunn-McCurdy provision as part of the 1983 Defense Authorization Act. This provision established a relatively simple “management by exception” reporting exception for programs whose cost growth exceeded the acquisition baseline by at least 15 percent.
In 2005, Congress recognized that part of the original problem had been an unwieldy requirements process that had burdened programs with increasing technical challenges which, when unchecked, resulted in increased costs and delays. As a result, Congress revised the Nunn-McCurdy provision to limit the Pentagon’s ability to redefine a program’s cost baseline against which cost increases are to be measured. It is estimated that next year, more than 50 DoD weapon programs will breach the Nunn-McCurdy thresholds as a result of baseline adjustments and problematic performance. The goal of the original provision remains: to improve oversight through greater transparency and management of major programs.
More recently Congress imposed a new set of cost-control guidelines on NASA, modeled on Nunn-McCurdy. However, the NASA provision goes well beyond Nunn-McCurdy by imposing an automatic ax on those technology programs that experience 30 percent or greater cost overruns. NASA, and other critical space programs in DoD and intelligence, must build systems that will operate in the most extreme conditions and are not — with the exception of Hubble — repairable. It also does not seem to take into account the fact that the space agency builds and procures a limited number of individual systems as opposed to DoD’s massive, multi year weapons programs. By imposing these stringent limitations, Congress has essentially handcuffed NASA’s ability to manage essential but challenging programs.
Although the pursuit of excellence is the goal, the burden still rests with NASA leadership to manage the cost and schedule of programs. The National Polar-orbiting Operational Environmental Satellite System (NPOESS), an important national initiative, has breached the congressionally mandated thresholds. Under Nunn-McCurdy, DoD must certify that the program is essential and bests any alternative approach. It can be argued, however, that NASA management does not have comparable flexibility to get a handle on the program and develop a viable plan to proceed before Congress starts to earmark programs that, in turn, compete for scarce resources. NASA, NOAA, DoD and Congress share the responsibility for deploying critical systems and must work together to design a viable plan, and then adjust contracts and schedules accordingly. NASA has long served as this nation’s engine of innovation.
Rather than imposing arbitrary cutoffs and repeating past mistakes, Congress should instead direct the agencies to review the myriad inter-related causes of program overruns, as well as the implications for innovation and program success. Increased budget pressures, a mismatch between funding and programs, and growing research-and-development costs combine to present enormous future challenges for congressional policymakers.
The key is to reduce risk and contract for performance using contract types and incentive mechanisms consistent with that risk. Congress should allow NASA to spend more on basic research, ensure the development of mature technology and fix requirements before moving ahead to full-scale missions. Congress must also exercise the discipline necessary to reduce the proliferation of parochial earmarks, and move beyond those earmarks to provide management tools that identify critical choices and elevate them to the level at which they will command the attention of politically responsible leaders.
ave McCurdy is the president and chief executive officer of the Electronic Industries Alliance. He served in the U.S. House of Representatives from 1981-1995. During his tenure in the House, he chaired the Intelligence Committee and subcommittees of the Armed Services and Science & Space Committees.