The Medium Extended Air Defense System (MEADS) program begins as a tri-national missile program among the United States, Italy and Germany. Its purpose is to replace the Patriot Missile system, which has been used by the United States and its allies for decades. By 2011, the United States had already spent $1.5 billion on the design and development phase of MEADS, but because of “technical and management challenges” the program has been plagued with total program cost overruns of $2 billion and is ten years behind schedule.
The press uncovers the fact that the Army opposes MEADS. In an internal memo recommending the cancellation of the program, Army officials said, “The system will not meet U.S. requirements or address the current and emerging threat without extensive and costly modifications.”
The Pentagon listens to the Army’s concerns and decides not to field the MEADS program. It cites an inability to meet schedule and cost targets. Several days later, Germany and Italy also announce they will never use MEADS and will abandon the program before procurement. Yet, President Obama budgets $400 million for further development of the system.
Department of Defense officials tell Congress they want another $800 million in funding for MEADS through 2013 or the U.S. will face termination penalties. The Pentagon never reveals how those costs are calculated or provides an assessment regarding the amount owed in termination penalties. Chief Financial Officer for the Department of Defense, Robert Hale, could not guarantee the Senate Armed Services Committee that the design and development phase of MEADS would even be able to hit its budget target of $804 million. MEADS is “a program that has had a very troubled history,” he told the Committee.
The Senate Appropriations Committee provides $400 million for MEADS anyway. The full Congress ultimately approves the funding in December.
President Obama releases his annual budget, which requests another $400 million for MEADS. One month later, support for killing MEADS is bipartisan. Eight senators – four Democrats and four Republicans – sign a letter calling on the leaders of the Senate Appropriations Committee and Senate Armed Services Committee to reject the Defense Department’s request for $400 million in 2013 to continue work on MEADS. “Facing a serious fiscal crisis, we cannot afford to spend a single additional dollar on a weapons system such as MEADS that our warfighters will never use,” the senators write.
The Department of Defense changes its tune on termination costs. In a private letter to Congress, DoD Acquisitions Chief Frank Kendall explains that MEADS funding is “subject to authorization and appropriation” by the U.S. and partner countries. In other words, if Congress does not approve the future funding, the U.S. will not be subject to termination costs. In the end, the “termination cost” argument was merely a straw man argument for the Department of Defense.
Both the House and Senate Armed Service Committees, as well as the House Appropriations Committee, zero out MEADS funding requested by the President.
Under pressure from Defense Secretary Leon Panetta, the Senate Appropriations Committee ignores three other congressional committees that cut MEADS funding and provides a $380 million earmark to the MISGUIDED MISSILE.
The September 2012 continuing resolution set to fund the federal government through March 27, 2013 included six-month’s worth of funding for MEADS.
Despite the National Defense Authorization Act specifically forbidding future funding for MEADS development, Congress passes a Continuing Resolution that contains $380 million for MEADS. Senate leaders and a small group of appropriators block a vote on Sen. Kelly Ayotte’s bipartisan amendment that would have stripped the funding for what she called a “Missile to Nowhere.”
Sen. Ayotte and Sen. Mark Begich introduce legislation to prevent the Department of Defense from spending any money on MEADS in FY 2013. Congressman Bill Shuster introduces a companion bill in the House. Shuster tells Secretary Hagel, “it’s foolish for us to be spending almost $400 million on a system that nobody’s going to procure, nobody’s going to buy.”
President Obama includes no funding for MEADS in his FY 2014 budget request to Congress.