Estimates of Potential Savings by Retiring Two Aircraft Carriers Early

Abstract

You asked us, as you have alluded to, to assume that the Coral Sea and the U.S.S. Midway would be the aircraft carriers that would retire. The committee also asked us to make some other assumptions which we used in developing the three estimates that are shown up on the chart (chart found in CRS statement) that you have displayed. A wide range of estimate*: can be calculated for the early retirement proposal, as you have said, Mr. Chairman, depending on the assumptions used. Estimates differ depending on the rate at which fleet modernization arid expansion would continue, whether aircraft would be retired or used to fill existing shortfalls, and whether indirect as well as direct operational and support costs would be avoided. Savings estimates, as the charts (charts found in GAO statement) show, differ between CBO, GAO, and the Department of Defense, because of that variation in assumptions, as well as because of a variation in the data sources that were used to compile the estimates. We based our analysis primarily on cost reports, Navy cost reports, which aggregate the expenditures associated with ships and aircraft, and used that as the fundamental source document to compute our estimates. Potential savings we calculated over the 7-year period, from fiscal years 1990 through 1997, range from a low of about $1.1 billion to a high of about $5.1 billion in budget authority. Let me just briefly summarize the assumptions associated with each case. Our case one generally parallels the DOD savings estimate and its assumptions about fleet shortfalls and modernization requirements, although I should point out that that in no way implies, as the DOD witnesses suggested, that they agree with the proposal for an early retirement. This case assumes that there would be no indirect cost savings, such as shore base support associated with the retirement.

Open PDF

Document Details

Document Type
Technical Report
Publication Date
Jan 01, 1989
Accession Number
ADA640713

Entities

Organizations

  • United States Government Accountability Office

Tags

Communities of Interest

  • Air Platforms
  • Ground and Sea Platforms

DTIC Thesaurus Topics

  • Accounting
  • Aircraft Carriers
  • Aircrafts
  • Budgets
  • Cost Analysis
  • Cost Estimates
  • Costs
  • Department Of Defense
  • Force Structure
  • Indirect Costs
  • Military Personnel
  • National Security
  • Navy
  • Procurement
  • Security
  • Ships
  • Warfare

Readers

  • Life Cycle Cost Analysis
  • Public Financial Management and Budgeting
  • Theoretical Analysis.