President-elect Donald Trump caused a stir Tuesday morning, attacking the airline company Boeing for out-of-control costs and issuing a “cancel order” on the renovation for Air Force One.
“Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion,” Trump tweeted. In his typical fashion, he punctuated the tweet with a final declaration — “Cancel order!”
Boeing is building a brand new 747 Air Force One for future presidents, but costs are out of control, more than $4 billion. Cancel order!
— Donald J. Trump (@realDonaldTrump) December 6, 2016
“The plane is totally out of control,” Trump told reporters Tuesday afternoon inside Trump Tower. “It’s going to be over $4 billion for Air Force One program and I think it’s ridiculous. I think Boeing is doing a little bit of a number. We want Boeing to make a lot of money, but not that much money.”
President-elect Trump on his desire to cancel Boeing’s Air Force One order: “We want Boeing to make a lot of money, but not that much money” pic.twitter.com/kIdpCy0JuX
— CNN (@CNN) December 6, 2016
While Trump’s desire to save money is admirable, his numbers and his assessment that the project is “out of control” are quite questionable. Shortly after this tweet, Boeing released a statement on the project. “We are currently under contract for $170 million to help determine the capabilities of these complex military aircraft that serve the unique requirements of the President of the United States,” the statement read.
“We look forward to working with the U.S. Air Force on subsequent phases of the program allowing us to deliver the best planes for the President at the best value for the American taxpayer,” the statement concluded.
“We don’t know where the $4 billion number came from,” Boeing spokesman Todd Blecher told PJ Media in an email statement. “The Air Force estimate released today is around $3 billion.” When asked if there has been any recent increase in estimates or spending to justify Trump’s claim that costs are “out of control,” Blecher said, “Not that we are aware of.”
The $3 billion refers to an Air Force budgetary document which projects that research, development, testing, and evaluation of the new pair of Air Force Ones (they are always manufactured in pairs) will cost $2.87 billion between fiscal years 2015 and 2021. The project will not be over in 2021, however, and PolitiFact reported that it would require another $1 billion after 2021 to finish the job. Specifically, the Teal Group estimated the project will require $858 million more between fiscal years 2022 and 2026.
The grand total? $3.73 billion over 12 years. Although that isn’t “more than $4 billion,” it is reasonably close — and an Air Force spokesman said the $2.7 billion estimate would likely “change as the program matures.” Furthermore, this estimate does not include operations and maintenance costs, including aviation fuel, upkeep, and pilot salaries.
“Canada was in line to buy the F-35, but then realized that they would [sic] actually had to operate the things, and they had sticker shock,” explained John Pike, director of globalsecurity.org. “Malaysia bought a bunch of Mig-29s without a service contract, to save money, and they soon turned into hangar queens.”
So while Trump’s general estimate of above $4 billion might be accurate, his description of this cost as “out of control” is not exactly fair.
Next Page: Why the Air Force One project is so expensive, and why it needs to go through.
The two current Air Force Ones — modified versions of a Boeing 747-200 class aircraft known as VC-25 — were purchased under President Ronald Reagan and delivered in 1990 under President George H.W. Bush. After Boeing closed down its 747-200 production line in 1992, spare parts for the planes have become hard to find and the plane is reaching the end of its expected 30-year life.
During his second term, President Obama ordered a replacement fleet — he would not use the delivered planes personally, and even Trump will almost certainly leave office before they are complete. The old model of the VC-25 is no longer made, so a new model will be developed, based off of the Boeing 747-8, with four engines and two floors.
Air Force One is also more than just a plane — it has state-of-the-art communications and safety features to protect the leader of the free world and enable him to do his job in the air.
Among other things, the plane must be able to refuel in the air, be equipped with robust defense systems like missile evasion, and have communications capabilities equal to the Oval Office — secure video conferences, classified computer access, and nuclear-strike controls. The new planes will be able to fly 7,730 nautical miles and produce 16 tons less of carbon dioxide on a typical flight. Each plane itself will cost $380 million.
While this is indeed a lot of money — $4 billion is nothing to joke about — it’s important to remember it comes over 12 years, not all at once, and that it represents a tiny portion of America’s defense budget. The most recent presidential budget proposal suggests defense spending between 2015 and 2026 will equal approximately $8.132 trillion. The new Air Force One project only amounts to 0.00049, or five-one-hundredths of 1 percent of all defense spending.
It also represents a small portion of Boeing’s business. In 2015, the company received $96 billion in revenues. Estimating the same revenues for the next twelve years, this project only represents 0.0034 — a measly 0.34 percent — of the company’s overall revenues.
Trump’s desire to rein in federal spending is indeed admirable, but this particular project is not only small in the grand scheme of things but also rather vital for key aspects of the president’s job like national security.
Cutting costs is important, but the most effective way to do so would be to target the vast sums of “entitlement” spending — in projects such as Medicaid, Medicare, and Social Security, also known as the “third rail of politics.” Alas, Trump consistently promised, throughout his campaign, to keep those programs in place.
If Trump really is serious about trimming the federal budget and keeping America safe, this is not the way to do it. Boeing has not stopped its work on the project despite Trump’s order, and with any luck it won’t have to. Let’s hope the president-elect devises a better way to save more of the taxpayer’s hard-earned cash.