US Navy Wastes Billions Modernizing Cruisers: GAO Reports

Modernizing a fleet is never easy, but when a billion-dollar program intended to extend the life of vital naval assets ends up as an example of inefficiency and waste, the implications go beyond mere budgeting errors. The Government Accountability Office (GAO) report released last December 17 shines a harsh light on the US Navy’s 12-year effort to modernize its Ticonderoga-class cruisers—a program that cost taxpayers $3.7 billion but ultimately resulted in the premature decommissioning of four ships and $1.84 billion wasted.

This ambitious project, marred by poor planning, oversight failures, and contractor missteps, underscores the need for reform in how the Navy approaches major modernization efforts.

The Ambitious Plan and Its Fallout

The Navy launched the phased modernization program in 2012 with the goal of extending the service life of aging Ticonderoga-class cruisers into the 2030s. At its inception, the program was seen as a compromise after Congress denied the Navy’s request to decommission these ships early. Instead, the Navy proposed operating a select number of cruisers while inducting others into an ambitious modernization schedule.

However, what began as a plan to maintain readiness and combat capability quickly spiraled into a costly quagmire.

Between 2015 and 2019, seven cruisers entered modernization. Today, only three—USS Gettysburg (CG-64), USS Chosin (CG-65), and USS Cape St. George (CG-71)—have successfully completed the process or are nearing completion.

Meanwhile, four ships—USS Hué City (CG-66), USS Anzio (CG-68), USS Cowpens (CG-63), and USS Vicksburg (CG-69)—were decommissioned before modernization could be finalized, delivering no operational value despite nearly $2 billion invested.

Oversight and Coordination Failures

One of the most glaring issues highlighted by the GAO was the Navy’s failure to implement robust oversight mechanisms.

Unlike traditional acquisition programs, the cruiser modernization effort lacked the standard planning and accountability tools that might have helped prevent runaway costs and delays.

Adding to the confusion was the program’s unique structure: control of the ships shifted from the fleet to Naval Sea Systems Command (NAVSEA) during modernization, only to return midway through the process. This muddled chain of command hindered coordination, creating gaps in oversight that allowed inefficiencies to proliferate.

The report also cited poor contractor performance as a major contributing factor.

In the case of the USS Vicksburg, contractors resorted to using unauthorized materials—including plastic wrap and store-bought super glue—in an attempt to repair the ship’s sonar window. Such incidents not only reflect poorly on the contractors involved but also highlight the Navy’s inability to enforce quality standards during critical repairs.

The Cost of Failure

The financial implications of the program’s failure are staggering.

The Navy spent hundreds of millions on each of the four cruisers that were eventually decommissioned. For example, the USS Vicksburg consumed $754.1 million before being divested.

Despite these expenditures, the program fell short of delivering on its promises, with only one ship—USS Gettysburg—having deployed post-modernization.

Even the three remaining cruisers are slated for decommissioning by 2030, raising questions about whether the investment was worth the limited operational returns.

Beyond the monetary losses, the failed program represents a missed opportunity to bolster the Navy’s fleet at a time of increasing global naval competition.

The Ticonderoga-class cruisers, with their advanced guided-missile capabilities, were envisioned as vital components of the Navy’s surface warfare strategy. Their premature decommissioning leaves a gap in the fleet that will need to be filled by newer, more expensive ships—placing further strain on an already stretched budget.

Lessons for the Future

The GAO report provides six recommendations to guide future modernization efforts, emphasizing the need for clear roles, robust oversight, and better contractor management.

The Navy has acknowledged these shortcomings and pledged to apply the lessons learned to upcoming projects. However, implementing these reforms will require more than just acknowledgment; it demands a cultural shift within the service to prioritize accountability and efficiency.

The failure of the cruiser modernization program also highlights the need for greater congressional scrutiny of defense spending. While Congress initially pushed back against the Navy’s request to decommission the cruisers early, it ultimately failed to ensure that the alternative plan was executed effectively.

Moving forward, lawmakers must work more closely with the Department of Defense to establish realistic timelines and budgets for modernization programs.

You can check out the full GAO report here.

Conclusion

The Navy’s $3.7 billion cruiser modernization plan serves as a cautionary tale about the dangers of inadequate planning, poor oversight, and contractor mismanagement.

At a time when the US military faces growing challenges from near-peer competitors like China and Russia, the inability to deliver on such a critical program is deeply concerning. The GAO report should serve as a wake-up call for the Navy and Congress alike: without significant reforms, the risk of repeating these mistakes remains high.

Modernization is an essential part of maintaining military readiness, but it must be executed with precision and accountability.

As the Navy looks to the future, it must ensure that every dollar spent contributes to the operational capability of the fleet. Anything less is a disservice to the American taxpayer and a compromise of national security.