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Extended Interview: Air Force Gen. Ronald Fogleman

May 6, 2008 at 5:40 PM EDT

KWAME HOLMAN: General, was it understood … what the need was for a new tanker?

GEN. RONALD FOGLEMAN (Ret.), Air Force chief of staff from 1994 to 1997: Well, the United States Air Force has maintained a fleet of about 550 air refueling tankers going again back to the 1950s. The reason that these tankers are so important to us is that with the end of the Cold War, the United States of America has really become an expeditionary kind of force. We end up putting people in lots of remote areas, that are very difficult to get into and so you need these tankers to extend the range of your cargo aircraft, to extend the range of your fighter aircraft, your intelligence and reconnaissance kinds of airplanes.

Unlike most nations in the world, there are other nations that operate tankers. Saudi Arabia has tankers. They never operate them outside of their national borders. Australia has got tankers, but it’s a regional kind of thing to get to the West, not a power projection, not an expeditionary kind of force, and so this country, because it is an expeditionary and becoming more and more a continental U.S.-based force, has a requirement to have this kind of capability to be able to extend the range of all these other investments that we make. And the United States Air Force provides the refueling capability also for the Navy as well. So it’s not just for Air Force aircraft.

KWAME HOLMAN: So the contract went out, this was a big contract, 179 planes as it turned out, billions of dollars, what was the thinking? Boeing’s going to get it?

GEN. RONALD FOGLEMAN: I think that, I think that the Air Force wanted very, very much to have a true competition, OK. The issue became how do you have a competition with somebody who has been experienced in the business for 55 years who has the only experience in building air refueling booms and all this, who else is there out there to compete against these people. And of course, what we ended up with was a combination of the Northrop Grumman folks teaming with EADS, Northrop Grumman is really no longer in the big airframe business so they, they partnered and this became the competition.

KWAME HOLMAN: What was your reaction when you learned of the decision to award Northrop Grumman EADS?

GEN. RONALD FOGLEMAN: Well, I guess I was somewhat shocked, but I think there were a lot of people who were shocked including the Northrop Grumman EADS people, but quite frankly I made a decision at that time that I was going to stay neutral on the issue until I saw the results of the formal debriefing that the Air Force owed to both Boeing and Northrop Grumman.

And you know I have an operational background. I have a unique perspective I think on air refueling. Forty some years ago I was in a fighter sitting behind these things taking gas and over the years continued to refuel off of different airplanes, etc., but then at a point in my career I became a flag officer, a general officer. I became an air component commander in Korea. I was responsible for the air portion of the war plan in Korea so I really began then to understand air refueling requirements from a different perspective. That of a major commander who’s got to figure out how to make these things integrate into a war plan.

I went from there very unexpectedly to being the commander of the air mobility command which owns and operates all of our tankers. And at the same time I was dual hatted as the commander in chief of the U.S. Transportation Command, so I found myself there then interfacing with the rest of the Unified Commands and charged with the responsibility of finding places to bed down tankers when we needed them.

And during the period of time that I was there was when we were in Somalia. We were engaged in activities in Africa, we were engaged also at that time, Saddam (Hussein in Iraq) was from time to time coming up on the net and so we would have to deploy and employ operations. So I saw it not only from the operator’s standpoint, but I also saw it from the commander perspective.

And I came to appreciate the fact that there’s more to this requirement than just an airframe. And so I wanted to see what happened in terms of how were the two proposals rated and what was it that led Northrop Grumman to be selected by the Air Force.

Now, I also came at it from a different perspective once I saw the debriefing. In my retired life, like a lot of retired generals, I sit on corporate boards of major corporations in America, and I have come to have an appreciation for the responsibility of management, corporate leadership in terms of its fiduciary responsibility to its shareholders, and so when the decision was announced, I just said look, I have no comment. I will wait and see what comes out of this.

After the Air Force had debriefed the Boeing folks, I was invited to come in and sit down and get a summary of what that debrief was. And I was shocked at that point. I mean when I saw the debrief then I couldn’t believe the decision that had been made. I did not understand how the decision could have been made the way it was given the, you know, just going down the scores, the grading, what the requirement was and how the decision turned out.

So when the Boeing company, when they look at this thing and they saw the same data, you know boy people do not protest these decisions over frivolous things and quite frankly the Boeing company had a fiduciary responsibility in my view to do this protest once they saw, I mean this is a big contract. That’s one thing, but it’s also been a large part of the Boeing company’s business in the past and it’s going to be a large part of somebody’s business going forward.

What happened with the process?

KWAME HOLMAN: In a nutshell if you can ... what went wrong with the process?

GEN. RONALD FOGLEMAN: Well, first of all I think that the United States Air Force tried very, very hard to have an acquisition process in place that was squeaky clean from a legal perspective. But there were a couple of things that really disturbed me along the way. The first was that when the request for proposal came out, and if you remember it came out really kind of last year, early in the year, both companies looked at it and the Northrop Grumman EADS team basically went back to the Air Force and said hey, if you don't change the criteria we're not going to compete.

And so at that point the Air Force and I really believe it was the Air Force Acquisition Community because I talked to operators at the time, but the Air Force actually changed the parameters in the model that we use to determine what are suitable bed down locations, etc. And they changed these parameters so that a bigger aircraft could compete and I think at that point the process started to become flawed. Because we were moving away from the fact that the purpose of this request was to get air refueling capability...

KWAME HOLMAN: Let me stop you there, general. Now they made that change, they let both Boeing and Northrop know about it. What was Boeing's reaction?

GEN. RONALD FOGLEMAN: I can tell you that within the group that was advising Boeing, there were people who were saying look this ought to be a decision that you guys go back now and say look, this is ridiculous. You have changed the purpose of this program by changing this air refueling model and you have moved away from trying to replace a KC-135 to some other measure of merit you're putting in this thing other than fueling.

KWAME HOLMAN: The airports open the door in simple terms for a larger plane.

GEN. RONALD FOGLEMAN: Exactly, and they changed the basic operational model which means that it changes assumptions in terms of how many airplanes you can put on an airfield. It changes the assumptions about the size of the airplane it can operate off a given taxiway or runway. And so this, in my view, was the beginning of a process that led to a flawed decision from an operational perspective.

I'm not an expert on acquisition and so I'm not going to make comments about how the acquisition process unfolded or whatever, but from an operational perspective, I think that this began a process that led us to the situation that resulted in the decision that came out in February and it's also then what led Boeing to the point where when they looked at the criteria that was stated in the RFP (Request for Proposal), even including this change that had been made, it became very difficult for people to understand how the decision was made in the way it was.

KWAME HOLMAN: Was Boeing insufficiently alarmed by that change of parameter, opening the door for a larger plane? Should they then have offered their 777?

GEN. RONALD FOGLEMAN: Again, I think that there was a lot of discussion within the Boeing company at that time. I wasn't privy to all of it, about gee, should we go with a bigger airplane if that's what they want? I mean they could have offered a 777, but I think there was a large group of people who went back and read the RFP and it says look, we're looking for a 135 replacement. We've got the right sized airplane here. It meets all the criteria that these guys have put out, so if we get judged against the criteria, we're going to be in good shape. Now, if they judge us against something else, you know we don't know how that's going to come out.

A larger airplane

KWAME HOLMAN: What's wrong with a bigger plane?

GEN. RONALD FOGLEMAN: The 767 can carry passengers and cargo. In fact in the RFP there was a minimum amount of cargo and passengers, both competitors were required to meet that. And the way the RFP grading structure was explained to everybody, is once you met that, then you met the criteria and you didn't get any extra credit for having additional cargo space.

Now you ask me what's wrong with a bigger airplane. Let's just start with the airplane, the 330 tanker version that is being presented here weighs more which means for the life of the airplane, you're going to be burning more fuel, putting that weight through the air, and in fact, independent analysis has shown that in the life cycle, a 40-year life cycle of these two airplanes depending on how much you assume a gallon of jet fuel's going to cost, it's going to add somewhere between 24 and 29 billion dollars to the cost of the program for this bigger airplane.

Now the other place, my primary concern with a bigger airplane is I know from having been the commander-in-chief for the U.S. Transportation Command, and the commander of Air Mobility Command, that when you start going into countries and trying to negotiate for bed down of tankers, these countries are not interested in having their taxiways and their ramps destroyed by heavy weight airplanes and by their very nature tankers are heavy. It's just that in this case you've got one that's over 100,000 pounds heavier than the other. And so what will happen is you'll have fewer and fewer places that you can put this. In fact the analysis done again by the Boeing company but I think it's a pretty solid analysis shows that for 767s you can operate off of twice as many airfields as you can with the 330.

KWAME HOLMAN: Doesn't Northrop say we think we can go into 80 percent of the airfields that are used now and those we can't our range will make up for that?

GEN. RONALD FOGLEMAN: That may be their argument, but unfortunately that's not the way the United States Air Force uses tankers today and I'm not sure that they're going to be able to change the Ops concept in the future. That's this flawed argument. When you start changing tried and true parameters on how you do things, and I love to think out of the box and I want to try and do new and innovative things, but there are some parameters that if you're an operator who knows his business, you don't want to change because it's going to put people and airplanes at risk.

So clearly there's two sides to this argument and I'll let the Northrop Grumman guys make their side of the argument, but the fact of the matter is, I can tell you that a major, major consideration in any operation that I was ever involved in as a senior officer, the number of airplanes that you could get in a given amount of space was critical to you. And the only way that you can make that big airplane fit even close to the same space is you change the parameters in which you use to bed down airplanes and when you do that I think you end up putting people at risk. Just an example, historically in the model we have always used 50 feet, wingtip to wingtip.

KWAME HOLMAN: The amount of distance between the airplane.

GEN. RONALD FOGLEMAN: Because you've got support equipment, you've got loaders, unloaders, people, fuel trucks, all this moving around. So what they did is they decided that they would change that 50 feet to 25 feet. If you use 25 feet then you could get more of these big airplanes onto that ramp spaceâ?¦

KWAME HOLMAN: Is it dangerous?

GEN. RONALD FOGLEMAN: I think that ultimately you put, what happens is the kids that are out there who are working 12 hours and 16 hours a day, you've just given them an added dimension of a way that they can have an accident. â?¦ Is it more dangerous? Sure. I mean 50 feet versus 25 feet? It's more dangerous. Now how much more dangerous? I can't tell you, but intuitively, anybody who says it isn't doesn't understand how mechanical things operate.

So another area where I think in the life cycle cost of these airplanes that the size of the 330 versus the size of the 767 and the 135, the 330 turns out to be 32 feet longer and it has a 41 foot wider wingspan. What that means is that virtually every Air Force base that we have tankers on today, is going to have to be rebuilt. They don't fit. They won't fit in the hangars that we have today, and because of the, of the weight of the aircraft on taxiways and runways they're going to have to go back and look at that.

And so ... it's very difficult at this time to begin to calculate how much more that's going to cost in terms of life cycle costs of the airplane, but it will be a major cost. I got to tell you, if you're the Air Force senior leadership and you're supposedly fighting for dollars to have effective programs, you know people ought to be thinking about the totality of this stuff. Because you start thinking about spending another billion dollars on infrastructure, to bed down an airplane that's not compatible with your bases, and that billion dollars is going to come out of military family housing, it's going to come out of other kinds of projects that are in that military construction build.

Scoring the criteria

KWAME HOLMAN: General as you know, Northrop says and Sue Payton's testimony to some degree supports the five criteria Northrop was ahead in four, maybe tied in a fifth, they say ... what about those criteria?

GEN. RONALD FOGLEMAN: I have in fact a document with me that says that's absolutely not true. If you go look at the criteria that was published in the RFP and you go down through the major criteria they had the same scores in, I mean the same scores. When you started to look at a thing that goes into the acquisition process called discriminators, the Boeing proposal had far, far more favorable discriminators than the Northrop Grumman airplanes did. ...

Let me give you an example if you will -- survivability. OK. And this is very important because survivability equates to operational utility and so in the survivability area the 767 received 24 favorable discriminator comments whereas the KC-30 received five. And if you go look at it in terms of the major survivability discriminators, Boeing had 11, Northrop had 0. And if you look at it in just the others, 24 to 5 that's five times as many favorable discriminators. If you go looking at air refueling which is the primary mission and you look at the documents that were graded, the 767 had 21 favorable discriminators and the KC-30 had 7. If you look at operational utility, the 767 had 37, the KC-30 had 10. If you look at product support, the 767 had 4, the KC-30 had 1.

KWAME HOLMAN: And these are favorable rating points if you will.

GEN. RONALD FOGLEMAN: The Air Force identified positive discriminators, Boeing had 98 and Northrop Grumman EADS had 30. And of Air Force identified weaknesses, Boeing had 1 and Northrop Grumman/EADS had 5. And so you know this is the data that I, I was presented you know after I went in for that debrief. Up until then I was neutral. I just wanted to see how this thing came out. What were the scores. I see this and ... if the Boeing senior leadership didn't protest, their shareholders ought to throw them out.