In a recent posture hearing with the House Appropriations Committee, U.S. Navy Secretary John Phelan, a former Wall Street executive, took a hard stance against the Navy's wasteful spending habits.
Phelan, along with acting Chief of Naval Operations Adm. James Kilby, highlighted the Navy's inefficient acquisitions contracting system and bloated workforce, which employs 56,000 individuals but only processes two contracts per month per employee.
According to the Daily Caller, Phelan emphasized his commitment to reducing waste and leveraging his unconventional background to enhance efficiency, thereby ensuring the Navy's readiness for combat. He revealed that the Navy processed a total of 217,000 contracts in 2024, with an average employee handling only 34 contracts.
Phelan didn't mince words during the hearing, stating, Ill also be honest, when I look at our contracting, its poor. We dont control our [intellectual property]. We cant repair stuff. We dont have very good penalties built in for lack of performance. These are all things we are going to really try to change.
In April, Phelan made significant cuts to numerous Navy programs, saving a total of $568 million, as reported by DefenseScoop. He also expressed his intention to reduce the overall workforce while retaining essential employees.
Phelan also made a bold commitment to ensure the Navy passes a financial audit, despite the Pentagon's failure to pass its seventh consecutive audit in 2024. The Defense Department's budget is projected to exceed $1 trillion in 2026 as the various military branches compete for funding.
Accountability is not just a regulatory requirement. It is the bedrock upon which we will build a stronger, more efficient Navy and Marine Corps, Phelan declared during the hearing. Under my leadership, the Department of the Navy will achieve a clean audit, following the example set by the Marine Corps, which has completed two consecutive unmodified audits.
While the Navy grapples with excessive spending and a cumbersome contract system, it also faces challenges in deploying ships, particularly at a time when China is exhibiting aggressive behavior in the Pacific Ocean.
The Navy has struggled to maintain its existing fleet, and new ships have been subject to significant delays, with some contractors extending their deadlines for ship delivery by up to three years. According to a January Congressional Research Service (CRS) report, China surpassed the U.S. Navy's total ship count in 2020, boasting 360 ships compared to the U.S. Navy's 296.
Phelan and Kilby are determined to redirect the Navy's focus towards shipbuilding to comply with President Donald Trumps executive order calling for increased ship production.
I will lead this department with three focus areas that will guide our Navy and Marine Corps: strengthen shipbuilding and the maritime industrial base, foster an adaptive, accountable, and innovative warfighter culture, improve the health, welfare, and training of our people, Phelan stated during the briefing. This commitment to efficiency, accountability, and readiness underscores the conservative values of limited government and individual freedom, ensuring the Navy remains a formidable force in the face of global challenges.
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