Northrop Grumman Long Range Strike Bomber concept (LRSB)

WASHINGTON: “I’m optimistic,” said the new president of the powerful Aerospace Industries Association, David Melcher, looking ahead to 2016. That statement in itself is a departure from the often dire warnings of his predecessor, long-time AIA president (and former Breaking Defense contributor) Marion Blakey.

“Who would have thought four months ago that Ex-Im bank would be reauthorized?” Melcher asked, referring to AIA’s role in saving the Export-Import Bank, an essential lubricant to aerospace sales abroad. Or, he continued, who would have bet we’d have a two-year budget deal?

“I remember we had a meeting in AIA that said, ‘we need something like a Ryan-Murray 2.0 that would give us some stability through this year and election year.’ And a lot of people said, ‘that’s never gonna happen.’… Well, you don’t ever give up on these things.”

David Melcher

Yes, the budget deal sets the defense budget topline for 2017 lower than that for 2016 (which is already tight), acknowledged Melcher, a retired three-star general and Pentagon budgeteer himself. But, he said, “I’ll take a little lower — which is still over the BCA caps — any day, just for the stability of it.”

In his first speech to the Aerospace Industries Association’s hallowed year-end luncheon, Melcher made clear he brings a new public style — and perhaps new substance — to the mammoth trade group. Blakey would deliver her trademark mix of rapid-fire statistics on the industry and blood-curdling warnings about Budget Control Act cuts, aka sequestration, which at one point AIA predicted would cost two million jobs. By contrast, Melcher opened with nostalgic anecdotes about his father’s Silver Star, Billy Joel’s song “Allentown” (about the town where Melcher grew up), and AIA’s own 97-year history. Then he eased into a guardedly optimistic list of policy goals for 2016.

AIA’s working with the Pentagon to guide procurement reform, Melcher said, proudly noting the Defense Department has withdrawn this year’s proposal for tighter restrictions on industry’s Internal Research And Development (IRAD) reimbursements. It’s working with the Federal Aviation Administration to streamline certification of new aircraft, trying to build up the NextGen air traffic control system, and regulate small drones in private hands. It’s working with the Commerce Department to ease exports. And, as always, it’s pushing for more funding for the FAA, NASA and the Defense Department.

Melcher particularly singled out the long-awaited Long-Range Strike Bomber, replacement to the 1962-vintage B-52 that now forms of the bulk of America’s heavy bomber fleet. Yes, the program’s currently on hold because of a protest before the Government Accountability Office, with Boeing seeking to overturn the contract award to Northrop Grumman, he said, “[but] honestly, whoever ends up manufacturing this thing in the end, it’s gonna be a great capability that the nation needs.”

Lockheed/Boeing Long-Range Strike Bomber (LRSB)

All that said, Melcher was hardly a Pollyanna about the prospects of the Pentagon getting needed funded. With the current budget deal extending through the election, the crucial factor will be the next president — and we don’t know enough about the candidates yet, he said.

“I don’t think the presidential campaigns really have addressed national security issues yet,” he said. “I don’t think that we’ve really gotten sufficient explanation — at least to my liking — about what people think about national security, what their views are on what right looks like, what’s the appropriate amount of investment, and the larger picture of how do you balance spending, taxes, entitlement programs.”

“You can’t even fund any of your discretionary spending by 2030, because interest on the debt and the mandatory spending program and everything else swamps it; so there has to be a higher-level solution,” Melcher went on. “I’m happy to try to take that on, as one association that has a point of view and has a voice…. to help inform some of the campaigns.”

That’s a tremendously ambitious issue for any trade group to take on, particularly a large organization like AIA that operates by cautious consensus.