Exhibit V-4.A retyped paper that was presented at AEI Conference, Washington, D.C. on October 7, 1977

Overview -- Navy V/STOL Aircraft -- Rationale Against

In view of the great impact of the V/STOL aircraft program on the future of the Navy, a more detailed review is warranted than has been provided in the papers involved in this session. From the evidence publicly available, it appears that the decision makers have been victimized by overzealous salesmanship perhaps coupled with some disconnects in communications between the Navy's technical community and the program planners.

As now described, the Navy is to transition toward an all V/STOL fleet of aircraft deployed on both aviation and non-aviation ships. A similar goal, believed achievable by some in 10 years, was suggested in the Bureau of Aeronautics in the early 1950s after the success of early developmental tests on "tail sitter" models. The twin problems of capability and cost, which caused abandonment of the plan then, remain, with little hope in the future for a simultaneous solution when compared to more conventional approaches.

First, let us consider the case involving the large carrier and its ultimate replacement. We have the option of continuing to buy carriers with complements of conventional carrier aircraft, which we will call CATOAL, for Catapult Assisted Take-Off and Arrested Landing, or we can buy ships of the same size operating V/STOL aircraft of the same capability but without benefit of catapult and arresting gear. For this case, it can be shown that:

1. Procurement and operating costs for the ship are small compared to those of the air group, on the order of 1/3.
2. The differential in ship costs due to inclusion of catapult and arresting equipment is small, probably on the order of 10%.
3. The differential in air group costs between a new V/STOL group and a new CATOAL group is large, probably at least 50% with individual design variations between 20% and 100%.

With the facts, V/STOL can obviously not be justified. In the real world, one must consider also the possibility of procuring not new CATOAL airplanes, but only more of those already in service. The weight differential between a new V/STOL and an old CATOAL would be reduced. The cost differential is less capable of treatment by broad generalizations due to the different production status of each of the service models. It is probable, however, that unless the total force level is increased, the old airplanes will cost even less than their new and lighter replacements. That issue, however, can be deferred for handling on a case-to-case basis, since any new carrier could handle the current aircraft.

For non-aviation ships, the issue is almost as clear cut despite the confusion caused by discussion of both V/STOL A and V/STOL C for this application. If "C" were the only VTOL for this application, and designed as the LAMPS III replacement, the decision on its development could be deferred since there is no coupling with the carrier issue or the other V/STOL designs. If V/STOL A is assumed capable of use on modifications of the DD-963 and other larger ships, it must be considered against LAMPS III and other helicopters. The low disk loading helicopters are virtually certain to be more successful within their own operating envelope, but have limitations in speed and altitude. At the present time, it would be difficult to justify the probable cost spread of two or three times between V/STOL A and LAMPS.

In addition to the large unit production and operating cost penalties associated with the V/STOL program, it is burdened with by far the most expensive R&D program ever laid out for naval aviation. That cost, of course, must also be amortized.

The V/STOL program should be drastically revised. With naval aviation already seriously underfunded from its position vis-a-vis the threat for years past, the plan greatly aggravates the situation. The issue of small, medium, or large carriers should be made on the merits of each and not confused with the V/STOL issue. On a positive note, carriers and carrier based airplanes have done their job well. The world's most capable tactical STOL aircraft are now deployed. The concept is proven, sound, and can do the job in the future.