'That's Not A Positive Change': Robert Garcia Says Losing DoD Contractors 'Stifles Innovation'

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At a House Oversight Committee Hearing in June, Rep. Robert Garcia (D-CA) spoke about the dropping number of contractors working for the Department of Defense.

Transcript

00:00And I recognize the gentleman from California, Mr. Garcia, for five minutes.

00:04Thank you, Mr. Chairman. Thank you to all of our witnesses for being here as well.

00:08And I also definitely want to agree with a lot that was said by both sides of the committee today.

00:14I'm going to thank you again for your time.

00:16I just want to just start, of course, by saying that I think everyone here agrees that our military

00:19needs the absolute best equipment, the best materials, those that serve our country.

00:24They also deserve, of course, the absolute best weapons, the best ships, the best planes.

00:31Whatever we can provide, I think we all can agree.

00:33And we all have, of course, responsibility to safeguard our national security.

00:37At the same time, as has been said already, we know the Department of Defense still can't pass an audit.

00:41I believe it's the only department in the government that consistently, every time there's an audit process,

00:47consistently essentially comes back and says, we're not able to do so,

00:50which I don't think anybody thinks is acceptable or a way to actually operate any type of organization.

00:55Now, the F-35 fighter jet, for example, will cost us $2 trillion over its life cycle.

01:01And we know that just that one jet alone is often delivered late, often can't fly,

01:07and has had numerous, numerous issues over the years.

01:10And that's just one example of all different types of aircraft, other types of equipment that we have seen

01:18that have had massive delays, massive cost overruns, and where the technology oftentimes is not working right.

01:25Now, we do know, of course, that taxpayer money is being wasted.

01:29I don't think anyone can disagree with that statement, and I agree with the ranking member,

01:34that if we really want to save money and actually be efficient in government,

01:37we should be looking at trying to save this waste, particularly the Department of Defense.

01:42And I want to also, you know, note, I think it's interesting, you know,

01:45we've had a lot of conversation in the broader Committee on Oversight,

01:49and certainly I said on the Doge subcommittee about efficiency and about waste,

01:54yet we have yet to discuss the Department of Defense.

01:56And there is so much opportunity that I think both sides of the aisle have been interested in

02:01in actually trying to cut some of this waste.

02:04And I think it's been a real missed opportunity on the behalf of this administration

02:08and certainly on behalf of the Doge subcommittee.

02:11So I would encourage our colleagues that are working on Doge,

02:16not just on the committee but across the government,

02:18to focus on the enormous amount of opportunity and work there is to do in the Department of Defense.

02:24Now, I am concerned, like many, that one of the President's first moves

02:28was to fire the Inspector General over at DOD,

02:31who, of course, has official responsibilities for holding the Department accountable.

02:36And I continue to have very serious concern about Secretary Hanks' ability to do the job.

02:40That's my personal opinion.

02:42But I think we do have opportunities to work on a bipartisan basis to improve our systems.

02:46Now, we've seen the number of major defense contractors has shrunk, actually,

02:50from about 51 down to about 10.

02:54That's not a positive change.

02:57I think any time you actually lose competition,

02:59it's harder for new people to enter the marketplace.

03:02It's harder for new ideas to enter and provide new models of functioning.

03:06It also will, I believe, stifles innovation.

03:09And so the idea that less and less and less contractors are now being used,

03:16particularly on major projects at the Department,

03:19I think should concern everyone on this committee in a bipartisan way.

03:23This also, of course, just creates more opportunities for higher costs and failures.

03:27We know there actually has been some progress when we look at space procurement.

03:31In 2019, the Department set up a space development agency,

03:34which has been an important partner for the private sector.

03:36I'll note that back in my hometown of Long Beach,

03:40we have one of the largest concentrations of space and aerospace development in the country.

03:44As mayor, we helped develop the Space Beach program.

03:47It's a major part of our economy in Southern California.

03:50My team, though, has heard directly from space companies that we may be losing some of our recent wins.

03:56There have been reports suggesting that some of the space development agencies' programs

03:59called the Trance 2 and Trance 3 Transport Layers Program could be terminated or consolidated.

04:06These programs within the space community are incredibly important.

04:11Canceling them, their opinion is, could threaten national security.

04:15So, Mr. Schwartz, just briefly,

04:16could you just talk about the importance of the Space Development Agency to the growing space industrial base

04:21and how that maintains competitiveness and national security?

04:25Absolutely.

04:25And I believe this administration and the last administration have both focused on space.

04:30Space is a new frontier, as it were,

04:33not just for the Department of Defense,

04:36but frankly, all of national security, independent of the agency.

04:40After we went to the moon and after a while,

04:42we did cut back on some space investments,

04:44and that came back to haunt us.

04:46And cutting key development efforts in space will take a long time to recover.

04:53So, as Ms. Boatner was saying,

04:56and this is particularly important not just for the Department of Defense,

04:58but for industry,

04:59consistency and understanding what the rules of the game are important,

05:03and it is important to make those investments

05:05and keep those investments

05:07because it's a lot cheaper to do things consistently

05:11than cut progress from them

05:12and have to recreate everything

05:14and get that entire team back

05:15and start from scratch.

05:17Thank you very much.

05:18I yield back.

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