Christopher Leonard
Updated Wed, August 2, 2023 at 7:42 AM CDT
One Sunday in early 2022, German Chancellor Olaf Scholz gave a speech that reversed more than 70 years of pacifist foreign policy in his nation. Vladimir Putin had just invaded Ukraine, and Scholz’s address to parliament was short, urgent, and written for the ages. Scholz announced that Germany would immediately invest about $100 billion in its military—more than doubling annual spending levels—and boost its defense budget to 2% of its annual GDP from then on. Scholz framed Putin’s invasion as the beginning of a new era of global tension, and he promised that Germany would meet the moment. But while his rhetoric was sweeping, Scholz took time to mention a specific product that he wanted Germany to buy: the ultraexpensive F-35 fighter jet, made by American defense contractor Lockheed Martin.
This might seem puzzling to anyone who follows the news. Almost since the F-35 program was announced in 2001, it has been the symbol of America’s dysfunctional military-industrial complex. The jet is 10 years behind schedule for final approval and almost 80% over budget, its production repeatedly stalled by defects and miscalculations. Last fall, comedian Bill Maher captured the conventional thinking about the fighter during a monologue on his HBO show. “We spent $1.5 trillion on the F-35, which has never worked, and never will, and yet we still buy it,” Maher declared, concluding, to peals of laughter, “It’s the Yugo of fighter jets.” Maher’s critique was a little off: The estimated cost of developing, building, and maintaining the F-35 fleet over its anticipated life span of about 60 years is actually $1.7 trillion.
Nonetheless, Germany ended up buying nearly 40 of the jets, at a reported cost of $8 billion. Soon after Scholz’s speech, Canada announced that it wanted 88 planes. As the war in Ukraine dragged on, Greece, the Czech Republic, and Singapore all expressed interest in the F-35. And this came on the heels of massive new orders in 2021 from Finland and even the famously neutral Swiss.
If the F-35 is such a boondoggle, why are so many governments clamoring to buy it? The answers to this question are vitally important to America and its allies, and to every U.S. taxpayer.
The F-35 is the largest program inside the Pentagon, by far, with an annual budget of about $12 billion. Taxpayers have invested heavily in the F-35 for more than 20 years, to the exclusion of other defense and domestic priorities. The opportunity cost is measured in hundreds of billions of dollars.
The program is also a measure of the health of Lockheed Martin, the largest weapons company that has ever existed. Lockheed brought in about $66 billion in revenue in 2022, virtually all of it for arms. (The company makes missiles, missile defense systems, warships, and a host of other combat aircraft, among other products.) It sits at the top of an industry that’s more important to national security than ever: About 58% of the Pentagon budget went to private contractors in 2020, the highest share in 20 years, according to the Center for Strategic and International Studies.
Ultimately, the F-35 is a test case of Lockheed’s and the Pentagon’s ability to deliver results. Put simply, the calculus runs like this: Either the F-35 was a massive waste of resources—the worst-ever example of the defense industry overpromising and underdelivering—or it was a savvy long-term investment that gives America and its allies a substantial advantage over their enemies.
Not surprisingly, Lockheed Martin and the Pentagon endorse the latter interpretation. Lockheed says the F-35 will be a central node of the U.S. war machine for years to come. “The F-35 is, without question, the most advanced fighter aircraft in the world. We continue to make advances to it, to keep it ahead of the threat,” says Bridget Lauderdale, Lockheed’s vice president and general manager of the F-35 program. Michael Schmidt, the Air Force three-star general who oversees the program for the Department of Defense, says the plane isn’t just a success, but a necessity. “These are investments that we’re making on behalf of our country and our allies to ensure that we own the skies,” Schmidt tells Fortune, in an office with sweeping views of the Pentagon and Capitol Hill. “That’s the only way you’re going to win in war.”
FORT WORTH, TEXAS (Nov. 03, 2022) – F-35 Joint Program Executive Officer (PEO) Lt. Gen. Michael Schmidt stands elevated above the production floor at Lockheed Martin’s Air Force Plant 4 in Fort Worth, Texas, Nov. 03, 2022, with the F-35 assembly line in the background. This was Schmidt’s first visit to the facility since having assumed the duties of F-35 PEO. The F-35 Joint Program Office is the Department of Defense's focal point for the 5th generation strike aircraft for the Navy, Air Force, Marines, and our allies. The F-35 is the premier multi-mission, 5th-generation weapon system. Its ability to collect, analyze and share data is a force multiplier that enhances all assets in the battle-space: with stealth technology, advanced sensors, weapons capacity, and range. The F-35, which has been operational since July 2015, is the most lethal, survivable, and interoperable fighter aircraft ever built. (U.S. Navy Photo by Chief Mass Communication Specialist Matthew Olay/Released)
FORT WORTH, TEXAS (Nov. 03, 2022) – F-35 Joint Program Executive Officer (PEO) Lt. Gen. Michael Schmidt stands elevated above the production floor at Lockheed Martin’s Air Force Plant 4 in Fort Worth, Texas, Nov. 03, 2022, with the F-35 assembly line in the background. This was Schmidt’s first visit to the facility since having assumed the duties of F-35 PEO. The F-35 Joint Program Office is the Department of Defense's focal point for the 5th generation strike aircraft for the Navy, Air Force, Marines, and our allies. The F-35 is the premier multi-mission, 5th-generation weapon system. Its ability to collect, analyze and share data is a force multiplier that enhances all assets in the battle-space: with stealth technology, advanced sensors, weapons capacity, and range. The F-35, which has been operational since July 2015, is the most lethal, survivable, and interoperable fighter aircraft ever built. (U.S. Navy Photo by Chief Mass Communication Specialist Matthew Olay/Released)More
Contrary to popular belief and Bill Maher, the F-35 does work. Lockheed has delivered about 960 of the jets so far, with about 630 going to the U.S. military—and the plane has performed effectively in combat multiple times. The F-35 has yet to face protracted battle against a sophisticated foreign military. But if or when it does, its design incorporates technological breakthroughs that could confer a huge edge in battle, enabling it to evade detection while linking U.S. and allied forces in a data-sharing network that could outmaneuver and overwhelm an enemy.
The F-35 is indeed plagued by cost overruns and delays. But those problems are inextricably linked to the advances that have gradually won over pilots and governments—advances that until recently have, almost literally, flown under the radar.
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The original point of the F-35, ironically, was to save money. In the 1990s, with the Cold War over, military budgets were being cut, and the Pentagon wanted to launch a cheaper, more efficient fighter jet program. The F-35 is called the Joint Strike Fighter because the objective was to build a single plane—lightweight, stealthy, heavily armed, and easy to fly—that could be slightly modified to work for the Air Force, Navy, and Marines, like a uniform car chassis that could be adapted for different models.
Lockheed Martin itself was born from the cost-saving mindset of the 1990s, as defense contractors merged to survive leaner times. Daniel Tellep, then-CEO of Lockheed Corp., oversaw its merger with Martin Marietta in 1995. Long before then, Lockheed had become expert at winning enormous long-term contracts. Its core business was based on managing extraordinarily complicated projects, pushing the boundaries of the scientifically possible. Tellep said in a 2019 interview that Lockheed’s greatest strength was its ability to read where the Pentagon was headed, and to get there first. “We did not skimp on investing in advanced technology, research and development, and so forth,” said Tellep, who died in 2020. Lockheed’s famed Skunk Works research base built top-secret planes for the CIA, for example, and helped invent stealth technology, which enables aircraft to evade detection by absorbing or dispersing radar signals.
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