Fighter planes and student debt?

The F-35 Lightning II Joint Strike Fighter

The United States has a rich history in aviation. Engineering marvels like the F-14 Tomcat, the P-51 Mustang and the A-10 Warthog revolutionized warfare during their time. It is no surprise then that the United States continuously updates its military arsenal to stay ahead of the curve. In the modern era, air superiority is possibly the greatest tactical advantage in battle.

With this in mind, the F-35 Lightning was sanctioned by the Pentagon in December, 2006. The F-35 will continue to be operated through 2037. While deliveries of the F-35 have already begun, problems have besieged the program from the outset. For example: in 2009 computer hackers accessed the design files for the fighter; in 2013 the fighter still did not have the software that would allow it to drop bombs or fly in inclement weatherthe budget for the total acquisition costs of the plane have increased from $237 billion to $393 billion with more recent estimates pinning that number at over $400 billion; and even in 2014 the planes faces consistent groundings due to mechanical issues. The GAO also estimates an operating cost from 2007 to 2037 to be $1.1 trillion, or $37 billion per year.

Spending this amount of money on a project that has been plagued from the beginning seems irresponsible, but R&D for these kinds of projects takes years. Development for the current generation of fighters began in 1994. With such a long development time, starting on another plane now with an expedited schedule could lead to even more issues.

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Currently development is done through a corporate structure where the government develops design criteria, and then subcontracts the same criteria to several corporations. Based on these criteria, corporations create initial designs and the Department of Defense then chooses the one that they feel has the most promise. The F-35 was developed in the same way, and ultimately Lockheed’s design was chosen over the Boeing X-32 (which was designed to have low production and maintenance costs, as well as high reliability). With such a massive failure in design, it is time to question the industrial-military hierarchy and possibly replace it with a new model.

Developing a new model

The first step in developing a new model is to identify where the technological expertise needed to develop military projects could be found. The simple answer is that we have a large population of experts that have the knowledge to tackle many of the military’s research and development problems: universities.

Historically, universities have been involved in military R and D. Universities developed the first computers used by government, and have been involved in many other projects. In 2011 the United States spent $76 billion on military research and development. A new model for R&D would see a large portion of the $76 billion awarded to Universities in the form of grants. The government would still issue design criteria, however schools would make the designs and then those designs would be subcontracted to corporations that could improve on them and then produce. While this process adds an extra step to research and development, it has some significant advantages. First, the process can be spread across hundreds of institutions rather than a select group of corporations. Second, it creates a new revenue stream for Universities. Third, it reduces the cost of receiving a University education.

Student Debt

Let’s change gears for a minute now, and talk about student debt.

When tackling the problem of student debt, it is beneficial to understand how much higher education helps our economy.

First, and foremost, is the benefit that higher education has in helping people find jobs. The two most used metrics for this are unemployment rate and labor participation rate. The unemployment rate counts people that are unemployed but looking for jobs, while the labor participation rate is a measure of the amount of working age people (16 and older) that are still in the workforce.

Both of these metrics change dramatically based on the level of education an individual has. The unemployment rate for college graduates as of October 2014 was 3.1% while the participation rate was over 75%. For people with some college (an Associates Degree or lower), the unemployment rate was 4.8% while the participation rate was 67%. For those with only a high school diploma, the unemployment rate was 5.8% while the labor participation rate was 58%. Finally, those that do not complete high school have an unemployment rate of 7.9% and a participation rate of 48%. 

The amount of education that someone has directly correlates with a lower unemployment rate, and higher rates of labor participation. The benefits of this come on several levels. First, entitlement spending decreases because less people meet the threshold to be involved in these programs. Second, consumer spending increases because an educated workforce earns more money. Because minimum wage workers are primarily involved in service industries, this also results in more jobs for those with less education. Overall, making post secondary education more affordable benefits the economy on several levels.

This leads us to a problem, though…

Congrats class of 2014, you now owe more than any other graduating college class in the history of the United States!

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I am a college student at a small in state school. Room and board costs me $3,000 per semester, tuition is $3,100 per semester and books/other fees add another $500 per semester. Altogether it costs me $13,200 per school year. Luckily, I am at one of the most affordable schools in the nation, but every year tuition rises yet my income doesn’t. I still have to take out student loans, I will be one of the lucky ones because once I am done with my bachelors I will likely be less than $10,000 in debt, which is in line with 1993. But with the cost of about $15,000 per year to go to a state school, how does anyone expect to graduate without a tremendous amount of debt?

Our nation’s future is riddled with a massive amount of personal debt before they even leave school. $30,000 of student loans doesn’t represent a nation of irresponsible young adults, it represents the necessary investment it takes in order to enter the workforce with a college degree. With 13.4 million full time students in Universities across the nation, this is a crises that affects everyone. Those 13.4 million full time students pay a total of $201 billion per year to fund their educations, and once they exit school, collectively they will have $402 billion in student loans. Extrapolate this trend to ten years in the future, and that will be $1 trillion in debt.

No one will deny that credit card debt in our nation is problematic, but in 2010 student loan debt in the United States surpassed it as a share of household income. This means that decreasing student loan debt is one of the single greatest ways to decrease personal debt in the United States (and possibly the easiest).

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What does this have to do with planes?

Let’s think back to the F-35. The maintenance costs of these planes is estimated at $37 billion per year, which is the same as 36% of the yearly student debt in the United States. Now, focus on military research and defense spending, which is $76 billion per year. That is 76% of yearly student debt.

So what is my proposal?
(1) More transparency in military R&D
(2) Shift 30% of R&D costs to Universities in the United States
(3) Focus on projects that have lower maintenance costs

This solution does not solve student debt, and I can’t provide a number that shows exactly how much it alleviates per student. Going from the prior numbers, 30% of $76 billion would be about $23 billion. Not all of these savings would be passed on to the student, but assuming that even 80% of them could be, we would see a reduction of $19 billion. That represents 18% of yearly student debt. This policy change would also increase the prestige of STEM programs in the United States, which would have a tremendous impact on industry and commerce.

Overall, moving military research and development spending to Universities could have a huge positive impact.

Bernie Sanders and the free education

An even more radical proposal by Bernie Sanders (I-Vermont) suggests making state-run schools free of charge. The estimated cost? $70 billion per yer. Lets cycle back to the F-35. Remember the maintenance cost per year? $37 billion. Just this one program results in enough spending to pay for 53% of the tuition paid by students at public institutions. So we have a military program that doesn’t work, and the potential to make the education of millions of people in the United States an endeavor that is free of charge.

The amount of military spending on conflicts in Iraq, Afghanistan and other regions in the Middle East for 2015 were over $74 billion and since 2003 the United States has spent on average $124 billion per year on military operations in these regions. These conflicts should not, can not, and will not continue to require this amount of money. As public opinion shifts toward withdrawing troops, that money can be saved and put into programs that do public good. It can be argued that on a universal scale, nothing does more good than education. In national defense alone, there is enough wasted money, R and D funds and money spent on foreign wars to give every high school graduate in the country a free college education.

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