The Top Secret Pentagon Project That Had Its Own Super Bowl Commercial – Bloomberg Business

Lauren Thomas

The U.S. Air Force’s newest bomber is poised to emerge from the shadows of the Pentagon’s so-called black budget.

As soon as this month, the government will pick Northrop Grumman Corp. or a Lockheed Martin Corp.-Boeing Co. team to lead the Long-Range Strike Bomber program. It’s a decision that will expose the multibillion-dollar program to Washington adversaries long before the jet sees combat in the 2020s or beyond.

Black budget projects are used to protect classified and secret government programs, such as advanced weapons systems and intelligence operations, from public disclosure. Once the award is made public, some of the details will also emerge, though not all.

“The budget environment could make this a unique debate in Congress because the overall budget looks very uncertain,” said Todd Harrison, senior fellow at the Washington-based Center for Strategic and Budgetary Assessments. “There will be a lot of questions about funding and how the priority of the LRS-B program is placed above others.”

The contract award may offer a rare glimpse at a major weapons system entering the public spotlight. Air Force Secretary Deborah Lee James is grappling with how much to reveal about the highly classified aircraft, suggesting that she’ll discuss funding and acquisition but not “the crown jewels — the technical capabilities.”

Black projects are so closely held that the military won’t confirm their existence beyond a title in a budget document. The B-2 bomber’s public rollout in 1988 followed years of hush-hush development. And the most-secret U.S. intelligence agency, the National Reconnaissance Office, wasn’t acknowledged until 1992, more than three decades after it was set up.

The long-range bomber is something of an exception; its broad outlines and basic five- and 10-year budgets have been disclosed. Given the history of defense cost overruns, the Pentagon faces widespread skepticism over its advertised price of $55 billion for a 100-jet fleet, or $550 million each.

However, the new bomber will have improved sensors and navigation equipment that’s harder for adversaries to spoof or disrupt, and more advanced stealth technology to counter advances in ultra-low-frequency radar and other detection gear and to enable the plane to withstand adverse weather better than the B-2 can, said two officials with knowledge of the LRSB program. Both spoke on the condition of anonymity to discuss the advances, which are classified.

The research and development costs of those and other advances made by a number of companies also remain classified, both officials said.

Black budgets have become a place to hide runway spending, said Edward Turzanski, a scholar at the Foreign Policy Research Institute in Philadelphia. With Congress squeezing defense budgets, there’s a temptation to “spread the pain” by placing programs in the black.

Bloomberg Government analyst Robert Levinson has estimated that the Pentagon’s fiscal 2016 spending request to Congress for classified and intelligence programs will be an 11 percent increase to $66.1 billion — a pool of cash about the size of the gross state product of Idaho that’s shielded from the eyes of U.S. taxpayers and enemies alike. The bomber’s slice: $1.2 billion.

The Air Force is promoting the jet as a replacement for its aging bomber fleet, which consists of 50-year-old B-52s as well as B-1 Lancers and the B-2 Spirit. It has committed to $15.1 billion in spending through 2020, according to its latest budget plan, which doesn’t include any work done in secret.

Investors won’t get any help from U.S. Securities and Exchange Commission filings in trying to figure out what Northrop and Lockheed-Boeing may have received so far, according to Brian Lane, a former SEC corporation finance director.

“The SEC is sensitive to claims of national security when it comes to disclosure,” Lane said.

Congress will be considering the bomber amid shrinking budgets and skepticism that it’s needed in the fight against current global threats. Northrop cranked out a 30-second Super Bowl ad subtly trying to link its jet — shown as a flying-wing shape under a shroud — to the company’s B-2 and other past aviation glories.


Classified programs like the B-2 once “stayed black” from R&D through procurement because the government sought to shield new capabilities for as long as possible, said Steven Aftergood, a director at the Federation of American Scientists.

“Maybe the LRS-B program today is less of a departure from what we already have out there,” he said.

The new bomber will be manned, with the possibility of conversion for unmanned flight in later years. Defense analysts expect it to have radar-evading stealth traits like the B-2. Beyond describing the plane as having a worldwide reach, the Pentagon isn’t discussing specifics, and neither are the two would-be contractors.

The Boeing-Lockheed entry will give the U.S. “a flexible, credible, global precision strike capability,” said Todd Blecher, a spokesman for the team. Northrop spokesman Randy Belote said the company’s history with the B-2 leaves it “well positioned for the LRS-B competition.”

Building 100 jets is the linchpin of the government’s cost estimate. There’s a caveat: Each bomber’s cost would rise with the inevitable reduction in the number the U.S. buys, said Gordon Adams, a former White House budget official who is now a foreign-policy professor at American University in Washington. That’s what happened with the B-2, whose per-copy tag ballooned to $2.2 billion when that fleet was capped at 20 aircraft.

“The Air Force is saying the plane will cost $550 million in 2010 dollars, but we are in 2015,” Adams said. “If the law of averages holds true, it’s going to cost us two times as much because we aren’t going to buy as many planes.”

Harrison of the Center for Strategic and Budgetary Assessments said the government’s promise to disclose the schedule and funding for the new jet isn’t enough.

“My opinion is that it is incumbent on the Air Force to be transparent about funding for the LRS-B program,” Harrison said. “It has chosen to make affordability one of the bomber’s main selling points.”

The Top Secret Pentagon Project That Had Its Own Super Bowl Commercial – Bloomberg Business.