Top Navy official says service needs a larger fleet and a larger share of the budget

NORFOLK, Va. — If you’re confused about the size of the future U.S. Navy fleet, you’re not alone.

The service and Pentagon officials have teetered between multiple plans for the last three years, moving back-and-forth between different approaches.

Indeed, in 2019, Navy and Marine Corps officials conducted an extensive analysis to plot out their ideal combined naval force. But before they could announce a decision, Pentagon officials took over that effort in early 2020, concerned the ideal fleet would well exceed what the department would fund.

But when then-Defense Secretary Mark Esper ultimately announced his version of the plan that fall, it outlined a future fleet larger than the Navy could have imagined: 355 manned ships by 2035, and 500 manned and unmanned ships by 2045.

Within months, the incoming Biden administration released a new, less detailed vision of a smaller fleet.

Amid these changes, one constant has been Chief of Naval Operations Adm. Mike Gilday’s priorities. He has consistently said the Columbia-class ballistic missile submarine is the service’s top spending priority, followed by readiness, modernization and lethality improvements, and then “capacity at an affordable rate.”

But at a January conference, he said: “I really want to make a shift here, and I’d really like to stop saying ‘at an affordable rate.’ I’d really like to have the top line to have a bigger Navy.”

“We can’t just keep on saying, ‘It’s all about the capability,’ ” he later added. “It’s about the capacity to bring those capabilities to the fight.”

His comments mark a strategic change to the way the Navy thinks about and pursues budget requests. Gilday confirmed to Defense News he is arguing the Navy needs a large portion of the pie — because a larger naval fleet will be critical to the U.S. military.

He foresees the Navy conducting distributed maritime operations, meaning it will need more ships to operate in more locations at once, spreading out firepower and sensors across wide swaths of ocean. “To fight in a distributed fashion, you need volume,” he said in a Feb. 4 interview with Defense News.

“The argument I make now simply is: Although we can’t have a Navy bigger than the one we can afford, capacity does yield capability. You can only get so much capability out of 296 ships, physically,” he said. “We do need a bigger Navy, and you can’t just talk about capabilities without talking about size.”

Still, Gilday won’t discuss specifics. Once the fiscal 2023 budget — which is expected to be a tough one for the Navy — is released this spring, more information will be available. The FY23 budget will include a five-year spending plan, unlike the FY22 budget request, he said, and the Navy will release its 30-year shipbuilding plan.

Why capacity matters

Vice Adm. William Merz, the deputy chief of naval operations for operations, plans and strategy, told reporters in February that capacity is a clear limiting factor for today’s fleet. “We’re facing capability shortfalls across every platform,” he said.

Pointing to the expeditionary advanced base operations concept as an example, Merz said the emerging capability must be scaled up.

“There’s a reason that one of the CNO’s priorities is capacity because we’re all giving him that feedback. And he sees it play out every day. His fundamental concern is the health and welfare of the fleet, so we are very, very committed to our rotational [deployment] models to make sure nothing gets broken — but that’s still going to provide a limit to the capacity that we can field at any one time, and that hip-checks right into the larger defense strategy on what we expect the Navy to do,” Merz said.

Merz, who in his last assignment led U.S. 7th Fleet in the Indo-Pacific region, said the Navy understands it needs the capacity to move around in a contested environment and to simultaneously address multiple threats; it just needs the top line to grow that capacity.

He said it’s unlikely the soon-to-be-released National Defense Strategy will ask the Navy to build anything dramatically new — “which gives us the luxury of focusing more and more on the capacity challenge, which is going to be very, very top-line dependent, which is still in negotiation.”

But when it comes to the actual platforms and technologies the Navy needs to accomplish distributed maritime operations, “we feel very confident that we are on very strong trajectories within the confines of the top line.”

The driving priority

Merz told reporters in February the distributed maritime operations concept is “the secret sauce” to Navy missions. After years of work, it’s now “very well defined, and you can probably see hints of that just in how we operate the fleet around the world.”

But the lack of long-range shipbuilding plans and budgets obscures how the DMO concept is shaping the future fleet. However, Gilday and Merz are confident the Navy understands the concept and will be ready to transition into the right platforms for optimal execution in the coming years.

The defining attribute of the future fleet, Gilday said, will be long-range firepower.

“The more I take a look at the progress we’re making across many lines — whether it’s [Project] Overmatch or unmanned — I keep coming back to long-range fires as a key capability for the future that we’re going to need to deliver on — not just from a Navy perspective, but from a joint perspective,” Gilday said. “That then becomes kind of a central focus of what we’re designing and why we’re designing it.”

“Looking through the lens of the distributed maritime operations concept allows us to begin to understand what the composition and size of the fleet is [in order] to deliver those long-range fires,” Gilday said, adding that these missiles will be “central to power projection” at sea.

Funding that vision

Several sources, who spoke to Defense News on the condition of anonymity because they were not authorized to discuss pre-decisional budget negotiations, said the Navy weighed dramatic options to pay for its shipbuilding needs — including retiring at least a dozen surface ships to pay for a second destroyer.

Rep. Mike Gallagher, a Wisconsin Republican who sits on the House Armed Services Committee, said in a January speech that all indications are the FY23 budget request will be a “bloodbath” for the Navy.

Gilday struck a more optimistic tone at the WEST naval conference in San Diego in February, saying the FY22 National Defense Authorization Act showed a commitment from Congress for more funding for the Navy and Marine Corps and that the FY23 budget request might begin to show the Pentagon is onboard, too.

Indeed, the longer it takes the Biden administration to release the FY23 federal budget request, the more optimistic think tank analysts appear. Reuters recently reported the administration may ask for more than $770 billion, though it remains unclear whether that top line would address concerns over an insufficient shipbuilding budget, or if the extra funding would offset challenges such as rising inflation.

Regardless, for the Navy to get the kind of funding to significantly grow the fleet, it would have to take a departure from past budgets that generally split money fairly evenly among the Army, the Air Force, and the Navy and Marine Corps.

“The top line is going to be what it’s going to be,” Gilday said. “The bigger question is, with respect to determining what the numbers look like and an end game is, what is the Navy expected to provide, and why. And I think that both the new National Defense Strategy, as well as highly classified concepts like the Joint Warfighting Concept, I think are going to have an impact on how money is distributed.”

He said the Pentagon should look across the joint force and identify areas worthy of more investment — either those where the U.S. has an advantage over chief rival China that it wants to maintain, like undersea warfare, or in areas of known capability gaps against China that must be addressed. Either way, he said, there’s a good argument for more funding for the Navy.

There’s certainly support on Capitol Hill for a budget proposal more heavily weighted toward the Navy. Rep. Elaine Luria, a Democrat from Virginia who serves as vice chair of the House Armed Services Committee, told Defense News “there’s a lot of consensus that China should be our No. 1 concern as far as national defense,” but the historical split of funding among the services is hard to change.

“Anyone who’s looked at a map or globe can see that this is a maritime issue,” she said. “But just between [the White House’s Office of Management and Budget] and the Pentagon — however that split happens over there — that paradigm just doesn’t seem to be able to be broken.”

Luria said the committee supports paying for the Columbia submarine program outside of the Navy’s budget in order to remove that pressure from the rest of the service’s budget and “free up more resources for some of the other potential platforms” in which it will need to invest.

She said Defense Department budgets often arrive on the Hill with little context regarding how they directly relate to the department’s priorities and address the most pressing threats.

If the Pentagon’s budget request “was presented to us with a sound strategy and a sound assessment of the risk of not shifting more resources to the Navy and the Air Force, I think Congress would be receptive to a proposal like that from the services,” she said.

Gilday said that could happen.

“I’m hoping ... this new [National Defense Strategy and] the Joint Warfighting Concept allow us to have a better understanding of what exactly we want to prioritize and put money against,” he said. “That ought to be reflected in the shipbuilding plan because that’s a public document that’s intended to provide both Congress and industry with a clearer view” of what the Navy needs to buy and why.

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