Star Wars Faces a Budget Hit

An article in Business Week reports that "there's probably more than missile mishaps behind the dollar drop for Star Wars."

"The war on terror and Iraq may have taken their toll on missile defense and changed the way Defense Secretary Donald Rumsfeld assesses potential threats. He went into office worried about space issues, the ballistic-missile threat, and transforming the military. Then came September 11, Afghanistan, and Iraq. 'The Rumsfeld vision of future warfare has had a severe collision with reality,' says Loren Thompson, chief operating officer of the Lexington Institute, a conservative think tank in Arlington, Va. The problems facing missile defense, he says, are 'the relatively weak case for the overall mission and the need to spend money in other ways.' "

"After more than 20 years of effort, major parts of the system are nowhere near ready for prime time, notes Philip Coyle, a top Pentagon weapons tester in the Clinton Administration. Neither the sophisticated X-band radar nor the Space-Based Infra-red System-High (SBIRS-High), both of which are critical to detecting and tracking incoming missiles, is close to operational. SBIRS-High is running into such difficulties that Lockheed Martin (LMT ) has agreed to defer a $10 million award -- its total profit on the project for 2004-2005. After a major restructuring in 2002, the cost of this one part of Star Wars was pegged at $4.4 billion -- and since then has swelled to $5.6 billion. What's more, every time there is an attempt to intercept a missile, the target carries a beacon to tell the interceptor where it is -- a service an enemy isn't likely to offer. The bottom line: The system 'has no demonstrated capability to defend against a realistic attack under realistic conditions,' Coyle says."