As we head toward a federal government shutdown, Congressman Porter is joined on PoliticsAside by two experts to discuss the implications of government shutdowns on national defense.
Join Congressman Porter, Chris O'Donnell, former senior executive at the Department of Defense, and Porter Group's Nate Fiala, as they dissect the real impact of the 14 shutdowns that have occured since 1981. Learn from insiders about the challenges faced by government employees, defense contracts, and the Pentagon's struggle to counter potential threats from overseas.
As we head toward a federal government shutdown, Congressman Porter is joined on PoliticsAside by two experts to discuss the implications of government shutdowns on national defense.
Join Congressman Porter, Chris O'Donnell, former senior executive at the Department of Defense, and Porter Group's Nate Fiala, as they dissect the real impact of the 14 shutdowns that have occured since 1981. Learn from insiders about the challenges faced by government employees, defense contracts, and the Pentagon's struggle to counter potential threats from overseas.
Thank you for joining. Politics Aside, and I'm going to start today's session, we're just asking a question. We're facing once again really down the barrel of a potential US government shutdown. Now that is very serious and I do not take that lightly and understand. Just across the street right behind me it's being debated and will continue to be debated, but it seems like it's always being debated. And while we're on the topics, certainly of a US shutdown, just to set the stage a little bit, I remain extremely concerned about the defense of our country, certainly the taking care of education, our seniors and our veterans and individual disabilities.
Speaker 1:But before we get into the particulars of a shutdown, I just really want to share with you quick history. There's been 14 shutdowns since 1981. And, as a matter of fact, one of those shutdowns that was in 1982, there was a shutdown of the US government because Congress, in its infinite wisdom and that of the White House, decided to have a barbecue at the White House for members of Congress bless President Reagan. But at the same time Democrats were having a fundraiser $1,000 a seat. So we go back in time. There literally has been lots of reasons and as I look through these 14 different shutdowns, there's some similarities in the threads that go through all these, and defense always seems to percolate to the top debates over who's in charge and how much spending from missiles that you name it.
Speaker 1:So my question today and I have two experts that are joining me to answer the question but my question today to our team on the call is a shutdown just baked into the funding of our military or defense establishment? Is it something that is just another groundshog's day or is it something we really need to pay attention to? So I've invited again a part of our staff, who I'll introduce in a moment. But most importantly, chris O'Donnell is the former senior executive at the Department of Defense 40 plus years of working in defense, since 1984. Also, Chris performed the duties of the Assistant Secretary of Defense for acquisitions where oversaw defense contracts in the last shutdown. So, chris, we're glad you're here, and Nate Fiala, with our team at the Porta Group, who work for the Department of Defense, work at the Pentagon, 2.8 miles, I believe, from where I'm standing right now, and he is director of our defense portfolio at the Porta Group. So with that, chris, is it baked in? Is it something we need to worry about when it comes to homeland security, or is this a very serious issue?
Speaker 3:It's a very serious issue from a Department of Defense standpoint because, funding aside and I'll talk about that in a minute the most important part is you can't start a new program until Congress passes the budget with that program in it. So here we are trying to come up with new, innovative technologies to deter the Chinese and the Russians, but a lot of those programs can't start until Congress passes the budget. So if that slips all the way until May, we've lost up to six months of time in which we could be deterring the Chinese and the Russians because we're working towards a CR and then eventually shut down CR and then an omnibus bill. The other part of it is when the government shuts down, of course the government employees are off, they're not doing their jobs, or most of them aren't, and that just slows the programs down, because a lot of the programs are funded in a two-year process for research and development and the companies understand how the budget works as well as we do. So when they look at what they want to do to meet their goals for the year, they like the contracts to slip over into that September, october, november, december time frame, because it gives them a boost in their fourth quarter and their end of years.
Speaker 3:So the contracting officers are trying to get all these contracts negotiated, get the money obligated so that we can meet our promises to Congress about using that taxpayer money in a judicious way.
Speaker 3:And now all those contracting officers are out of work.
Speaker 3:So it just delays the whole process of us getting the contracts out and it delays the program manager's ability to really keep things rolling, because once all those people are off you've got to get them back in and working again.
Speaker 3:The good part on a lot of this is the contracts themselves. The contractors already have the funding so they can continue to work on the programs, but it really affects the government side of the house and then that rolls over into a CR and those CRs really hurt the department. Besides the fact that we can't do new starts, there are certain programs that have increases in funding that don't occur and then we ask for anomalies from Congress and the staffers and the folks on the committees are great about talking through these things. But we understand there's a lot of big decisions being made this year. We worked very hard last year with the appropriators to try to get money put aside for us to do multi-year contracts for certain things and now that's all back into the negotiation process and while the government has shut down, we're hoping that the committees are working on those bills and trying to get those things back into the budget, as the president requested and as we worked on for a long time last year with the proper staffers.
Speaker 1:Well, chris, what does this mean to the world that's watching our adversaries? What is going to their mind today, or any day that we're debating a shutdown?
Speaker 3:So it brings into question just how serious we are about defending the country where we're not moving these things forward to be able to do the deterrence things that we need to do. So, as I've retired, I don't have access to as much information as I used to, but before I retired, mr Kendall, as the secretary of the Air Force when he was AT&L, went over to Congress and provided some briefings about the Russians and the Chinese capabilities. This was about 10 years ago and this was back when we still thought, hey, the Russians, the 80s called they want their history back. Our opponents are taking this seriously, especially the Chinese, and they have a five-year planning cycle. They don't stop. They continue to crank out new capabilities that are on par with some of our capabilities, and by delaying and having shut down the government, we delay our ability to do those types of things. So I think it hurts our deterrence against the Chinese and the Russians, and those, to me, are the biggest things to worry about right now.
Speaker 1:Well, it just seems, since there's been 14, it's become normal or normalized, and it sounds like the Department of Defense, with your leadership and others, have been building in programs to help prevent any loss of homeland security or national security. But moving into, I guess, history so 34 some days of a shutdown back in 2018, what was that like, those 34 days?
Speaker 3:So it's difficult from the standpoint that there are people who are considered essential employees or still working in the Pentagon, but most of the Pentagon is empty. It's almost sort of like it was when we were going through the first days of COVID. It's kind of spooky. It's easy to get to work that day because the roads are a lot less crowded than they normally are, but it does, and at that point we were engaged in the ending of things going on in other nations to defend our country and it just takes away from the Department's ability to do day-to-day operations.
Speaker 1:So you have your friend and, of course, my friend, nate. For those that are listening for Nate, he has two bosses now on the call with him. So, nate, give us your first-hand experience when you were at the Department of Defense dealing with these shutdowns.
Speaker 2:Yeah, of course, sir. Thanks. And the first thing that I want to mention is it's great to see you again, mr O'Donnell. I just want to highlight that I still have the 18 Polo that you provided me. So on Fridays when we did casual days I wore that 18 Polo and during the shutdown that was our uniform.
Speaker 2:So bottom line is the Department of Defense hates shutdowns for the various reasons that Mr O'Donnell already highlighted, but essentially it hurts military programs, it hurts the DOD workforce, it hurts the defense industrial base and it hurts our ability to pretty much project power in the defense of the nation. So some of the things that I also want to highlight is that some of the big contracts like, or contractors like, ocky Martin, boeing, raytheon, when they're negotiating their contract, they can kind of bake in the cost of a shutdown into those contracts when they're negotiating. What the shutdown really hurts are small businesses and other non-traditional contractors, like the Ability One program. That's a good example. So for those that are watching that aren't aware of the Ability One program, that's a government program that was established in the 1930s to provide jobs through the government contracting process for individuals and veterans with disabilities and they are considering non-traditional contractor much like small businesses. So when the small businesses, the Ability One program, non-traditional contractors, they do provide essential needs, either goods or services, to the Department of Defense. And they're not the big ones. They're not Lockheed Martin, they're not Boeing, they're not Raytheon, they're not doing multi-billion-dollar projects and platform systems. They're further down the supply chain but they're still essential to the entire supply chain and they actually make up the vast majority of the defense industrial base.
Speaker 2:So and as Mr O'Donnell was previously mentioning, they can't get on new contract. There's no contract renewals, there's no extensions, there's problems with stop-and-go funding, so incremental funding issues, and this can kill a small business. So small businesses are already operating on very small margins. There's a huge upfront cost to get your foot in the door with the Department of Defense. There's a lot of regulation to contract with the Department of Defense and that could take years that the small businesses having to foot the bill for because they haven't gotten a contract yet. And then they're almost about to get their contract and we have a shutdown. That means that there's no money that's coming in to fill their coffers, to pay their employees, to pay their subcontractors that are providing goods and services to them.
Speaker 2:So I mean it really does just kill the small business industrial base and for companies that are on the Ability One program, the individuals that are working in those contracts, who are individuals and veterans with disabilities I mean them going out of work is literally life-threatening in many cases because due to SSDI regulations Social Security, disability Insurance regulations they're not actually allowed to have a savings account over $10,000. So they don't have a savings account that they can then go live off of for a month or longer. They essentially are waiting for government assistance, which may or may not come in time. So it's bad for the Department, it's bad for the workforce, it's bad for the Defense Industrial Base.
Speaker 1:So, carislaw, I guess with your leadership role Department of Defense, I know that you work closely with the Ability One program and individuals and, as Nate has mentioned, the serious impact. But one of the priorities for the Department of Defense has been for some time was to provide a 1% goal and you can share your thoughts on the importance of the Ability One program and the nonprofits but, more importantly, the importance of that individual that needs help the most.
Speaker 3:So, as I was talking to Nate before the show started, I mean everybody in the government's got a skill craft pen someplace that was made by those industries and when you look back at the history of that program you know it helped in Desert First and Second Desert Storm. It helped us get through things when we were doing the COVID response. So it provides us somewhat of a surge capability for the Department to be able to go to these vendors and have them do things that the government needs in a slightly short and contractual way than we normally have to do things. So, plus the fact that anything that we can do to help our disabled veterans is always a great thing for the Department of Defense to be doing, because you know that's who we work for. Every day is for those warfighters. So it's good to see the fact that those warfighters are, you know, being able to come back and support the department and I know they're very, very committed to helping their buddies who are still here.
Speaker 1:And Nate, can you share a little bit again for your experience, the importance of a 1% goal to the Department of Defense and implementing the programs.
Speaker 2:Yeah, yeah. So and I can go a little bit into that. So when I was working for Mr O'Donnell and the Department of Defense, there was a FY17 NDA requirement for the 898 panel report and essentially that was Congress saying, hey, dod you look into the Ability 1 program and tell us what you think, provide us some recommendations on what we can do or should do to modernize the program? And you know the department took it seriously and worked on it for about four or five years and back and forth with various different other agencies and departments in the federal government and the Ability 1 representatives were. You know it was a really in-depth analysis and originally what the department determined was that, as Mr O'Donnell mentioned, their surge capacity with the Ability 1 workforce, which is essential in times of conflict and in times of crisis. So in times of crisis you could, for example, think of COVID.
Speaker 2:During COVID the ability, while we were seeing the larger defense industrial-based workforce, was shrinking, one because they couldn't go to work or weren't going to work or because they were just leaving the workforce. So we were seeing the larger defense industrial-based workforce shrinking. The Ability 1 workforce was actually increasing. They were going to work because they were deemed essential and, mr O'Donnell, you probably remember James who was our custodian, who would come in every day. He was an Ability 1 contractor. Everyone on those custodial contracts, on those cleaning contracts, they're all Ability 1 contracts. So you know that's a time of crisis with COVID and Mr O'Donnell did a lot of work during COVID to get those testers out to the nation and you can talk a little bit about that if you want to, mr O'Donnell. That was actually a really cool time period. Well, not COVID, but like what the department was doing to assist with COVID, but also in conflict.
Speaker 2:When we are in a conflict scenario, the Ability 1 workforce is able to surge because right now there are roughly 10 million individuals with disabilities individuals and veterans with disabilities in the United States.
Speaker 2:The Ability 1 program employs 25,000 of them, which means that there is a large segment of that population that can still be put on contract and can still provide goods and services to the federal government.
Speaker 2:In fact, the Ability the original 898 panel report, like the I think it was a second or third report that they submitted requested a 1.5% DOD contracting goal, which would be similar to a small business contracting goal, which would essentially put another 40 to 50,000 individuals and veterans with disabilities would put them on Ability 1 contracts so that they can provide goods and services. The final goal that was submitted in February of 2023, so it was just published was a 1%, and that would essentially double the amount of contracts that the Ability 1% could operate in, could take from the federal procurement list and move it over to the Ability 1 procurement list, because right now, only about 25% of DOD contracts are on the Ability 1 procurement list. So if you were to get a 1% contract, that would essentially double the amount of contracts which they could essentially double the amount of employees that are individuals and veterans that they could employ. It's a fantastic program that provides essential goods and services to the department.
Speaker 1:And Nate the department of defense, and this is for Chris as well, but you need authority to hire more individuals, correct?
Speaker 2:Yeah, it's actually about the procurement list. So right now things go on the federal procurement list and what the Ability 1 program has is they have an Ability 1 procurement list. So, and John Tenebla Mr Tenebla, who was the chair of the 898 panel, highlighted on page 9, if anyone wants to go look it up, page 9 of the 898 panel final report about In order to move as of right now, contracting officers have brought over as many contracts as they possibly can to the Ability 1 program procurement list In order to expand that procurement list, which the department wants to do because of the surge capacity and because of the workforce. In order to do that the department will need some sort of congressional signal, because right now all of those contracts are on the federal procurement list, which means that they're open and compete cause for federal contracting. So in theory, these contracts, these nonprofit Ability 1 agencies or nonprofit Ability 1 companies, would need to compete against the Lockheed Martins, the Boeing's, the Raytheons of the world for these contracts. And that's not what the Ability 1 program is meant to do, that's not what it's there for.
Speaker 2:So the department is essentially asked in their fourth and final report for the authority for a congressional demand signal to say, hey, we can actually move some contracts from the federal procurement list over to the Ability 1 procurement list and it won't violate the defaults, which is the defense federal acquisition regulations. Which is all, all, all federal, all defense contracts are regulated by these DFARS and those are all all. The DFARS are based off of statutory language that Congress has passed into law. So the department can't add more contracts to the Ability 1 list unless there is some sort of congressional signal like a goal, a contracting goal which is similar to what small businesses have. They have the 23% contracting goal. Ability 1 is just looking for a 1% contracting goal.
Speaker 1:Nate, I appreciate your summary of that and I know that both of you have taken a lead role in this, working with the Department of Defense for so many years, and I think sometimes the individuals that are served by Ability 1 and, on the front line, really by community-based nonprofits, are forgotten in this discussion, and that's why we wanted to talk about a little bit today for some and just appreciate all that you're doing. I'd like to, before we conclude, a couple other things. What does the future warfare look like? I am not a history battle, but I do note that a lot of our engagement in the past 15, 20 years has been pretty well ground-based. We had air superiority in them at least. What should we expect into the future with new technology?
Speaker 3:What are we seeing in the Ukraine has given us a little bit of a glimpse into what the next war will look like. Unfortunately, it's also showed us what war looked like in World War I, because of the fact that the Ukrainians don't have everything that they could use, that we would use in a full and open war. So I think we see a little bit of that, where we see a lot of small unmanned systems that are being used at the tactical level to great advantage. The American companies have provided a lot of capability to the Ukrainians, either through the USAID, the aid that the US has given to the Ukrainians, or, in some cases, the Ukrainians are buying them directly from the companies or the companies are donating them. So you see the proliferation of these small quadcopters and other small UAVs, showing you a whole different way of doing battle that we saw with ISIS, where, well, we had air superiority with ISIS. Isis with their small UAVs was actually scaring the heck out of the Iraqis, to the point where Iraqis had no problems dealing with 10,000 pounds of explosives in a wheeled vehicle, but if a quadcopter showed up and dropped a small bomb on the Iraqis, they retreated and it was a big deal for some of the equipment that we were able to give to the Iraqis to move forward in Mosul. So you're going to see a lot more of that, and the recent announcement by the deputy of the Replicator Program I think is a challenge to both the department and industry to say, okay, well, what could we do in a very short amount of time to add more deterrence to our quiver, to make the Russians and the Chinese think twice about doing anything? So I think, as the Replicator Program moves forward with the very ambitious goals of getting things out there in 18 to 24 months, you're going to see this desire to how do we make all these systems work together.
Speaker 3:So, when you start talking about how do things work together, the department's got the big JADC2 effort going on right now which, when you look at what each one of the services are doing, is very impressive. Each one of the services is moving very quickly, and then We've got to figure out how to integrate all this at the OSD level. So we've got our chief AI office now in the department that's going to try to put all that together, and I think that's what you're going to see is you know, the concern people have is if you're seeing, you're dead. So you know. How do you see the other guy faster? And then how do you have the weapon systems to give you the reach to hit them before they hit you, before they can see you? So another big area that we've got to look at is the electromagnetic spectrum, because the Russian's are very good at electronic warfare.
Speaker 3:The Chinese are setting new standards for electronic warfare and also for how they do integrated surveillance and reconnaissance, especially when we start to talk about space assets. So we're technology is going to play a very heavy role in what we do. You know look what we've done with some of the musk stuff in the Ukraine and using Starlink to provide most of their command and communications. So we're talking about how do we take these private innovations and put them in the hands of our warfighters so they can do a better job against peer competitors. So I think we're in for a real revolution right now.
Speaker 3:The interesting part is is that we've now grown a whole generation of military officers who are used to unmanned systems whether those are, you know, things as big as reapers or things as small as bomb squad robots that they understand that these things aren't there to replace them, they're there to help them do their job in a much more effective way.
Speaker 3:So I think we're much more open now to using the unmanned systems than we have in the past. And then the next question is how do you, how do you combine all those things for effects on target? And you know the the Army, the Air Force and the Navy and the Marines are all provide, are developing capabilities to have longer, longer effects in the Pacific region. And then the question is well, if an Air Force plane sees a target, does the Air Force shoot at it, or do you pass that information over to the Army and then have the Army shoot? So how that all goes together is is some grand experiments going on in Indo-Paycom right now, and I think that's what you're really going to see for the next, next generation of warfare is find them fast, hit them fast and, you know, just grind it out. Warfare we're seeing in the Ukraine is not what you would see in a peer to peer competition that we were involved with.
Speaker 1:What should we be concerned with? This new warfare? We're talking about that. Ai will someday artificial intelligence believe making these decisions.
Speaker 3:So in some cases, I'm not going to say AI is making those decisions, but when you look at some of our missile defense systems, machine learning and other things are already built into those systems.
Speaker 3:So whether you're an AGS, whether you're a THAAD, whether you're a Patriot system, they're already using computers to try to handle all this data stream. They're using things that are coming in and then give the user an output that says here's your choices, do you want to shoot this, this or this? And in some cases with our air defense systems, it's automated already, which gets us into a whole another conversation of killer robots and how all that's going to play out with the convention on conventional munitions. But it AI is for real and AI is going to be a and I'd say machine learning more than AI in some cases, because you want to specifically train your system to do what you want your system. So it's not going to be chat, gpt and can you fire that missile and tell me what's the best cappuccino is? It's going to be really how do you take all this data, integrate it and then make decisions at a speed at which we can counter what our opponents are doing?
Speaker 1:So I can assume that that is both good and bad. That technology, what would you? What keeps you up at night worrying about the future of warfare, and then how that fits into technology and computer world.
Speaker 3:But my biggest thing that keeps me up at night is how is the, how is the United States Department of Defense going to keep up with our peer competitors? The process that we have, the way that we do budgeting, the way that we do requirements, the way that we do acquisition, is it, could, it might not be fast enough to deal with a peer to peer competition in the next 10 years. If we have a peer to peer competition in the next 10 years, it's going to be very ugly, it's going to be very quick and hopefully everybody will stand back and we won't be shooting nuclear weapons at each other and we will both decide, hey, this is not a great way to fight because it's going to be billions of dollars and thousands of lives lost in a very, very short amount of time If we get into a real peer to peer competition.
Speaker 1:So when you say I'm sorry, because when you say peer to peer competition, would that also fit into the nuclear arms race today? Is that that's peer to peer an example of how there's an understanding, so that we're not going to go that far?
Speaker 3:It deterrents, as all nuclear system, nuclear weapons are all about deterrence, you know, making sure that the other guy won't do something, because our retaliation is going to be so overwhelming that it's not going to make sense for them to do it.
Speaker 3:And you know, we in the Russians have been doing this for, you know, decades.
Speaker 3:The Chinese, though, have, you know, are jumped in, and the Chinese are understand that they want to be a big player, so they are trying to get their nuclear forces, you know, to be able to compete with our nuclear forces, and the speed at which they are doing it is terrifying, and the United States is doing a great job, and Congress is doing a great job of providing the funding for us to do redo all three legs of the triad at one time. I mean, we've got to replace the Ohio class nuclear missile submarines, we've got to replace our land based ICBMs, and you know, the B 21 is is is going to be a great deterrent factor. I think, not just from a nuclear standpoint, but also from a conventional standpoint, that we may be able to be someplace somewhere in the world and be able to counter something that's going to happen with that, with that platform. Now, most definitely we have to upgrade our nuclear deterrence, and it's, it's primarily because the Chinese are starting to play catch up.
Speaker 2:Yeah, and the nuclear terms aspect is that's vertical escalation. And once we get into the concept of, like, the discussion or yeah, or concept of vertical escalation, we're, it becomes a very dangerous conversation very quickly. But with unmanned systems like drones, we're talking about horizontal escalation. So, for example, mr Donner, earlier you mentioned, you know, in the Pacific Theater a conflict in the Pacific Theater. You know, we're working on kind of figuring out how we would, how that that conflict would happen or play out. And luckily, mike Gallagher, for a long time there were a lot of members on Congress that just couldn't conceptualize it. So Mike Gallagher did a war game scenario with members of Congress and you could see, I mean almost the day before and then the day after you could see members of Congress, they're, they're. The brain just clicked Like, look, we don't have enough ships.
Speaker 2:China, if you add China's, their Navy, their, their, their merchant militia, their, like all the their Coast Guard, you add all of it together, it's like 600 ships. We only have, like what is it? 278? We were legally supposed to have 300 and something, but we only have. We like we don't have an. And also, in rotation, only a third of those are rotating around the globe at once. They're rotating between the various different oceanic sectors, so we don't actually have a size. We don't have a size one off fleet right now to compete with China, which is why those unmanned systems are essential, because we can produce them a lot faster and a lot less expensive than we can produce a destroyer or a carrier.
Speaker 3:As somebody who was a weapons engineer earlier in life what ships are called targets? So what we really need to talk about is do we have the magazine depth in our missile programs, especially our long range missile programs, to deter? And again, I always go back to deterrence and I didn't really get this until I got to the building 10 years ago. We never want to get in a fight with somebody. I mean, you know, what we saw happen in Afghanistan and Iraq are peanuts compared to what would happen if we went into a peer to peer competition. So we never want to get to the point where our adversaries think that they can do something and we won't be able to reply. And one of the things we really have to work on is our magazine depth for a long range weapons. So you can talk a lot about building another you know 12, $13 billion aircraft carrier which the Chinese see as a target. Where do we really need to increase the depth of our industrial base to build long range missiles and be able to deter that way?
Speaker 1:On that topic of munitions, like you know, I try to capture the reality from the debate, especially across the street here. How are we with our stockpile? I hear different segments on the hill saying we're running low because of what's happening in Ukraine. How are we with our munitions today?
Speaker 3:So the Ukraine fight has been a big wake up call to senior leaders in the building and to people on the hill because it's like well, just give the Ukrainians another 2 million 155 shells, just crank up the factories. We haven't cranked up those factories in 30 years. There is no crank up in those factories. You know we've been, we've funded munitions in a very uneven way. We'll buy, you know, 10,000 one year, then we'll buy a thousand the next year, then we'll buy 5,000 the next year. So industry gets these very uneven demand signals. And then, as Nate was talking before, our defense industrial base isn't Lockheed and Raytheon and BAE, it's the second and third order people below them. So when you, when everybody, wanted more javelin missiles, well, the problem with the javelin missiles were nobody was making the parts necessary to put the fuses and the warheads back together again. So you had to go back and reinvigorate this industrial base that, quite frankly, not the military industrial base but just the whole US manufacturing industrial base has fallen so far that it's very difficult for us to say simple things like forging, large forging. If you want to make a 155 howitzer, you have to forge and build these large metal pieces where we don't even do that a lot in the United States anymore. The 155 shells perfect example. There's only one factory in the United States that can forge the shells for 155s. So we need to.
Speaker 3:If we're serious about these things, we need to fund them in a much more sustained manner across the years. And that was the big conversation last year with the appropriators was let's fund munitions in a way that sustained over a five year period, and let's give that demand signal not just to Lockheed, northrop Grumman and Raytheon but to all those sub vendors that say hey, I'm going to stop making this little chip that goes in these weapons, because only people who are buying them are the Department of Defense, so I'm just going to stop. And we had that happen with Hellfire right in the middle of the biggest parts of the war against ISIS. We almost ran out of Hellfires because we didn't have chips to put in the Hellfire fuses. So we had a peace dividend for the last 20 years that while we were distracted with the rock in Afghanistan, we basically let the defense industrial base and base atrophy to build these weapons in a large capacity.
Speaker 3:If you listen to Dr Lapland he talks about this all the time that it's nice that we're developing new weapons, but until you build them at scale and they're producible and sustainable, it doesn't matter. And that's really what we've got to get to is that our defense industrial base and the third and fourth level suppliers see that there is a constant demand signal for these things and we definitely have a constant demand signal for them, and it's shifting from what we did in Iraq and Afghanistan. As you said, sir, that was mostly a land battle against people that we had total air superiority against and we could go anywhere we wanted at any time to know we're fighting components who have advanced area denial weapons that are going to keep our aircraft out, or at least concerned about keeping our aircraft out, and how do we get that standoff distance to do things? So there's a whole different generation of weapons that we need to fight these peer to peer competitions that we need to start really making sure the industrial base is strong to build those, and I just got done reading the Forge of Liberty where they talked about what it took to get the American industrial base switched over to a wartime footing in World War II. That didn't happen in a month. It took three, four years for them to turn American industry around and started before America entered the war. So I don't think we need to go on to a wartime footing, but we need to make better strategic decisions about what weapon systems do we need to ensure that we have enough of.
Speaker 3:I think the department's done an excellent job in the last few years. Dr Hicks has done an excellent job, cape has done an excellent job in looking at the big picture. The services worry about their title 10 responsibilities, which is their job, and then the deputy and Cape and OSD have been looking at. Okay, what does that mean? Across the board, you have the greatest ship in the world with the greatest missile, but there's only so many of you. Shouldn't the Army have that capability? Shouldn't the Navy have that capability? I mean the Air Force? Have that capability, marines? So I think that strategic thinking is really going to help us be able to explain to Congress what we want to do, not so much on a program by program basis, but on a capability basis. We need the capability to reach out and touch people from further away. We need more capability to be able to sense things from further away. We need to be able to dominate the electromagnetic spectrum and then figure out how we go about doing those things.
Speaker 2:And one of the highlights that you said there, sir, was demand signal. We have to send a demand signal to the defense industrial base, the third, fourth, fifth tier supply chain, further down the supply chain, so that there the gears are moving, and that takes time. And then the munitions industrial base takes years and because you also have to have a workforce, train a workforce, as you said, the vast majority of the workforce in the munitions industrial base. Well, defense industrial base at large atrophied because of the peace dividend. But really we just focused on a different type of warfare. We got away from focusing our attention on near peer conflict, which and now that's really hitting us in the face because China's been focusing on near peer conflict ever since we first invaded Iraq in the 90s and they've been preparing.
Speaker 2:And you mentioned the ability to project further and further capabilities. The Chinese have the Dongfang 26 intercontinental ballistic missile. I mean the carrier killer, if you will. That's the type of things that we have. That's 2,000 nautical miles out from their shore, that's further into the Filipino's sea. I mean that's the type of distance that we're talking about. We're not talking about a couple of miles, we're talking about 2,000 miles. But the workforce, the industrial base that it takes to build these capabilities. They need to have a demand signal, and that demand signal comes from Congress, because it's what they put into law and what they fund, that's what the department can do, and without that, the demand signal is gone, which is why the shutdown terrifies me.
Speaker 1:Well, you both have summarized the current situation pretty well and I know it literally could be different in an hour when we talk again, but I think some of this, the foundation, will remain the same for a while. We're going to need to conclude in a moment because, again, we appreciate your time, chris. Another thing that I'm asked periodically is how can a small business play a bigger role in being a part of our national defense? To some, it seems like the larger corporations have ownership of all segments. So how does a small business get more engaged? And more importantly I guess to answer a question earlier individuals with disabilities? What more should they be doing in organizations such as Ability One Program or Nonprofits to have a bigger employment base in the Department of Defense?
Speaker 3:So there's a big push inside the administration right now to lean more on small business, to lean more on innovative businesses and to try to change the trajectory of how the department works. I will say working with some of the bigs. I mean they're just as committed to doing those types of things and they're looking for those small businesses that have those innovative ideas to help them out. So the Small Business Office at OSD, both in the A&S side of the house where we do the small business, and over on the R&E side where they do the Small Business Innovative Research Program, are being very active right now in trying to explain to small businesses what their expectations should be when they come to the department. You have the better mousetrap and they just don't understand why. Well, just buy a million better mousetraps and everything will be fine. And we're trying to educate people to understand that, hey, if you have the better mousetrap you might buy a couple of them, but then we're going to test them, then we're going to give them the warfighters to see if the warfighters actually want to use them.
Speaker 3:And then my career growing up in the Navy and then coming to OSD. It's fascinating to watch the services Each decide that they like the mousetrap, but they're going to buy them from different people. So it is as Nate said before. It's a very frustrating business to get into working with the government. I'm now a small contractor. I've been filling out paperwork for three months now to work with one of the bigs and I look at every one of them and go, yeah, that was my fault. I signed the piece of paper saying that we had to do that.
Speaker 2:That piece of regulation. My bad, I'm sorry about that.
Speaker 3:So part of it is hey, stick with us. A lot of small businesses that started out are now big businesses that are making a lot of money. One of the companies, skydio, that I worked with for small drones went from making a handful of drones to hey. They made drones that were not Chinese drones and all of a sudden there was a lot of interest in not buying Chinese drones anymore. So that company is doing very, very well right now.
Speaker 3:So it's like anything else in this country. You got to be persistent, you know Edison said you know it's 95% perspiration, 5% inspiration. So, and don't be afraid to ask questions. You know there are offices, small business offices in the department that will try to help you be more successful, but it's you got to get out there and talk to the warfighter and talk to the users and find out who really wants your product. Or working through the mentoring programs that the larger companies have, where they'll partner with the smaller companies to help them try to move along.
Speaker 3:But it's not easy working with the department, but you know there's a big payoff in the end. And I was meeting with some venture capitalists and they were asking me a lot of questions about where the department's going and my question for them is the end was well, why do you want to work with the department of defense? It sounds like a lot of frustration for you guys. And they said one thing cash flow. You know the government. If they decide to buy your product, you're going to get the money, and that makes it easier for them to get either cash flow themselves or get cash flow from another investor to be able to do things. So that's the payoff from the end for any small businesses. If the government works with you, you know the money's coming, unless there's a CR and a shutdown.
Speaker 1:And then there's that groundhogs they, you know we stole NATO way to totally make it faster within DOD. Now for contractors to work with the department of defense.
Speaker 2:Yeah, I'm helping small businesses work their way through. You know. So, for those that are listening to the podcast at the like, at the local level there's the P-TAC, the procurement technical assistance center that they can. They just go onto Google, they type in P-TAC and they type in their local, like they're, they're whatever the city or area that they're in or state that they're in, or they could even type in the local university that's nearest to them, because most of the P-TACs are located on the university campuses. So you know, for example, you type in P-TAC Iowa city. There is a P-TAC center in Iowa City, iowa. So you know, that's that's how you can. You can reach out to them and they have expertise on how small businesses can get their foot in the door for the department of defense.
Speaker 2:Now, it's also important for for individuals to know that you know if you're a veteran owned, disabled veteran owned, minority owned, woman owned, native American owned these are all like.
Speaker 2:You need to be registered, and the P-TACs will explain this to you. It's you need to be registered for for this type of small business, because you can't just be a small business that wants to do work with the department of defense. You have to meet certain requirements and those those set-asides, disabled owned, veteran owned, woman owned, minority owned those are requirements that the department has to meet, based off the Small Business Act of 1973. But also, as as Mr Donald mentioned, the Mentor Protégé is a fantastic program where a prime like Lockheed Martin, raytheon, boeing, they partner with the small business because that small business has something essential that the prime wants in one of their platforms or weapon systems. So it's, you know, the department is working on this and, and as Mr Donald mentioned, on our in R and E, they have the Civersita program, which is a billion dollar program. So the department's working on it and Congress is funding small businesses.
Speaker 1:But, Chris, what I was trying to say is we we brought in Nate because we thought he was the impediment in the department of defense for all these other companies.
Speaker 3:He did slow the office down.
Speaker 1:I'm sure he did the last question and it's really back to something that Nate was talking about. In defense, your department, your folks have been just stellar and focusing on individuals with disabilities and you know we talk about a lot because it's a passion for us and we do feel an obligation to try to help people that need help the most. Is there any more? You think that the disabilities community, the Source Americas, the Ability Ones or NIBs, the industries of the blind, can be doing to help DOD Institute a goal such as 1%?
Speaker 3:But I read through the 898 report and John Tenaglia, who is the defense pricing and contracting lead and John is a great American who not only you know he was a retired Air Force colonel has been doing a great job, but he also, during all of COVID, was one of the lead people in the federal government making sure that we could get things very quickly to the American public to do things, you know. So I read through and I take whatever John says seriously and I agree with Nate that in the department you got to set goals. If you don't set goals, I mean every day a contracting officer's got 14,000 things they have to think about. So if you set a goal for them and if you can increase that goal, I think it's a very good idea to say, hey, move these things over to the other side of the ledger so that you know, people with disabilities have more of an opportunity to do this type of work. So with anything else, it's lobbying.
Speaker 3:I mean, you know, going to the Hill and saying you know it looks like the department is. If the department is willing to do something, then it just needs a little bit more push from the other side saying, hey, we really think this is a good idea, congressman. Why aren't we doing more of this? So they should be out there talking to their to their representation, and saying hey, we think this is a good idea, especially, you know, normally when somebody says that, the department says no. This is a case where the department's actually saying yes, which is very rare.
Speaker 1:Well, it's on the priority list. Is there a way to move it up the priority list within the DOD?
Speaker 2:Oh, you're talking about the legislative review process. So it was on, so, and that was for FY22. It was a legislative proposal that was on the legislative review process list, but then it was. It was taken off because the report wasn't done yet. And I'll answer that because I'm the only one that knows about that. I was the one that took it off because the report was. I was the one that took it off the list because the report wasn't done yet. Then we finished the report and published it in February, january, february of 23. So now it you know, now that it can be pushed like the ability one, one percent goal can be pushed with Congress, and we have been working there.
Speaker 1:That's great. Well, again, I appreciate everyone's time. Chris O'Donnell, thank you so much for your public service and I know a title doesn't always mean a whole lot. Your title means a whole lot as the director of defense, as, of course, with Nate, with our team, but as the former senior executive, as the Department of Defense, we value your opinion, your insights and are so proud of you for your service. So thank you for joining us and, nate, thanks for joining us as well.
Speaker 3:Appreciate the invite, sir. It was a great time.
Speaker 1:Look forward to additional conversations. Yes, sir, thank you.
Speaker 2:Thank you.