Before the Senate Armed Services Committee this week, Lt. Gen. Christopher Bogdan, the F-35 program manager, testified that his office was staffed with the full-time equivalent of 2,590 people—military, civil service, and contractors—at an annual cost of $70 million. In response, Senator John McCain offered that “that information that I have is it's nearly 3,000 [staff] and the cost is $300 million a year. But $70 million a year to run an office is pretty disturbing.”
Whether the number is 2,590 or 3,000, the fully-loaded cost certainly isn’t $70 million. Bogdan’s lower staffing and cost figures would work out to just $27,000 per person per year. As Flight Global reported, the general later explained that his number excludes “the bill for Navy and Air Force civilians and military personnel. [That bill] doesn’t come to me.” The Defense Department is still paying the salaries, just through the military departments’ military personnel and operating accounts. McCain’s number is a rough one, but $100,000 per person is a probably a modest underestimate of for the kind of engineering, contracting, and logistical talent needed to run a program office, including all their office space, equipment, and travel.
As for the sheer size of the operation, Bogdan continued, “I don’t know if that’s enough or not, or if it’s too much. It’s what we have… You ought to look at the F-35 numbers and remember that we’re building three variants for fourteen customers, so maybe it’s not a bad size for three program offices.” That admission refers to Bogdan’s earlier conclusion that the F-35A, B, and C are better described as a family of closely related aircraft than as variants of a single model. As I argued back in 2013, that’s why both the Air Force and Navy Departments are “trying to avoid another joint acquisition” as they wonder about what comes after the Joint Strike Fighter program.
But we should also ask whether 1,000 people are needed to run the program office buying any airplane. The V-22 program office is said to have a similar number, but why? We should care because there are two costs to bureaucracies of that size. The opportunity cost is obvious: if the JSF program office were half its size, the savings of $150 million could purchase each year a whole additional F-35 (and its engine, which is usually and bizarrely left out of the calculation). But do not discount the cost of the administrative sclerosis induced by the sheer size of the organization, and the layers of decision-making into which those people are organized. Like the general, I can’t prove that 1,000 people is excessive, but the Defense Department might consider benchmarking its operations against those of other countries, and asking some experienced advisors to consider what it really needs to run a program office.