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(The Hill)   Defense contractors complain they can't make a profit without taxpayer money. If only there was some sort of market that tied a corporation's profit with its performance   (thehill.com) divider line 208
    More: Fail, killer, Pratt & Whitney, EADS, carbon sequestration, House Armed Services Committee, defense contractors  
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3933 clicks; posted to Business » on 19 Jul 2012 at 1:54 PM (2 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-07-19 02:03:23 PM  

TommyymmoT: Hey, learn how to manufacture something else then.


That is why most have branched out into homeland security...
 
2012-07-19 02:04:45 PM  

DirkValentine: Am I the only person that is sick and farking tired of the way the media and politicians throw 10 year numbers around like they are for one year?


I find it sick that they throw around numbers in the billions like they're trying to decide what to do with that extra few bucks you got back from your tax return.
 
2012-07-19 02:05:18 PM  

SphericalTime: incendi: GAT_00: I'm not an idiot, I know jobs will be lost. But we spend half of the world's military budget for little return on investment and countless boondoggles on pointless designs that were never going to go anywhere. Military spending requires more dollars per job of any sector of government spending. It's the first place we should cut when the budget needs trimmed, because it is the least efficient.

I'm not calling you an idiot, I'm agreeing at length, despite the fact that if it happens it would likely cost me my own job. There are people though that somehow think that the defense contractors are lying when they say that government defense cuts will cost jobs, when that's precisely what will happen. I think we ought to be spending (not quite as much, but still spending) on better things, and that would definitely cost jobs in the present, but ultimately be a lot better in the future.

Going all of the way back up this thread to Thoguh's reply:

If we shift some of that defense money into infrastructure development, many of those materials and building engineers would find work in rebuilding and making our country run better into the 21st century. He says that like all engineers in the U.S. can't do anything other than build missiles.


True, but any company that tried to get an infrastructure contract with as many cushy overexpenses and automatic cost increases as DoD contractors do would be laughed out of the State Capitol. Most REAL government contracts come with penalties for noncompletion or lateness. DoD contracts come with extra profit.
 
2012-07-19 02:06:44 PM  
secretaryclinton.files.wordpress.com
 
2012-07-19 02:08:19 PM  
I suspect that a large military budget is a very Keynesian policy because it creates economic activity without distorting consumer markets. Dump a billion into this program with no civilian use and you employ 30,000 people for the next year, which trims the market for those skill sets and reduces the oversupply of college graduates in engineering.

If you actually cut military spending to something like a quarter of a trillion dollars you would spike the unemployment. And if we default on our debts, or just print money like mad to pay them off, we sure as hell will need all these decades of military debt spending for all the wonderful toys it produced.

The sad thing is that it's just the defense contractors that know how to spend that money properly to generate economic activity. If you dumped $100 billion a year into education at the federal level things would get so gummed up we'd see a drop in teacher salaries.
 
2012-07-19 02:08:22 PM  
Look, there are two possibilities here:

a) PURE FREE MARKET LAISSEZ-FAIRE HAYEK HERITAGE.ORG TAXED ENOUGH ALREADY - Defense contractors can eat the same shiat as everyone else. If we need aggressive cuts then the largest and most useless part of the budget - the military - can get the biggest bite taken out.

b) Government has a place in the economy - We can talk about what that place is but you have to be able to make cogent arguments instead of waving ideological bullshiat around.

My personal opinion is that defense should be drastically slashed at every level and some of the money should be diverted to jobs programs for displaced workers and ramping up civilian research and engineering. It could be done, and done in a way that would lower unemployment AND take a big chunk out of the national debt, but that would take political will.
 
2012-07-19 02:09:26 PM  

GAT_00: Well, as I see it, I'm working for another month for a powerful government body that has a measurable presence in real research and they're getting cut back bad, and they spend a fraction of what defense does. All defense spending does is employ a few people on building $180M airplanes that can't fly without crashing constantly. You can take a few cuts.



So someone working in science and research on government money is saying that money should be contingent on successful achievement of desired results which are real and quantifiable? I'm fairly certain you would not like having the standard you advocate for defense spending applied to the field you work in.
 
2012-07-19 02:10:12 PM  

JK47: So someone working in science and research on government money is saying that money should be contingent on successful achievement of desired results which are real and quantifiable? I'm fairly certain you would not like having the standard you advocate for defense spending applied to the field you work in.


That standard is applied everywhere!
 
2012-07-19 02:12:32 PM  

Thoguh: Yeah, let's fire all the engineers in the country, right! Because when money is spent on defense it is just burned and not at all used as paychecks for an educated workforce of engineers and scientists. Nope. Certainly not.


so defense spending as welfare for engineers then? I'm more likely to support you argument if we agree to call it what it is.
 
2012-07-19 02:14:33 PM  
If only there were some high-level philosophy we could all agree to & bring some sanity to our defense spending. A strategic narrative, if you will.
 
2012-07-19 02:14:51 PM  

DirkValentine: Am I the only person that is sick and farking tired of the way the media and politicians throw 10 year numbers around like they are for one year?


Yeah, that would sound like me spending $100,000 on hookers and blow this year.
 
2012-07-19 02:16:38 PM  
fark the defense contractors and the millions they employ.


/amidoingitrite
//all government spending is stimulus....
 
2012-07-19 02:17:11 PM  
Best submission caption I've read in weeks! Well done stubby!
 
2012-07-19 02:17:56 PM  
Because F-22's won't fix themselves, amirite?
 
2012-07-19 02:18:13 PM  
I'd be happy if we just started with scrutinizing existing contracts and enforcing the terms. We'd save a ton just doing that.

I know this, ironically, because I used to consult to DoD Finance (DFAS). No oversight whatsoever. Budget and time overruns, overbilling....it's insanity.
 
2012-07-19 02:20:58 PM  
What really sucks is that we can't significantly cut our defense spending without pretty disastrous consequences. It's not called the "military-industrial complex" for nothing.

Many jobs would be lost of we chopped defense spending by even 10%. And realistically, we need to cut it by about 50%, at least. That would throw us into the worst depression the WORLD has ever seen.

It's a mess that has taken 60 years to create, and it will take nearly that long to fix, if you want to to it without causing another World War. Seriously.
 
2012-07-19 02:23:25 PM  
This is what happens when Republicans get 98% of what they wanted.

If you change the sequestration in any way, they ruined the country's credit rating FOR NOTHING!
 
2012-07-19 02:26:00 PM  

realmolo: What really sucks is that we can't significantly cut our defense spending without pretty disastrous consequences. It's not called the "military-industrial complex" for nothing.


But cutting a few billion in defense spending means the government can contract out work to fix infrastructure.

Spending FAR less, they can actually put Americans to work fixing, you know, America. So maybe some of these engineers at Lockheed can't get their exact same jobs back with the exact same pay... Cry me a river.

India and China need engineers. If they really want their money, they can move.
 
2012-07-19 02:26:15 PM  

AkaDad: DirkValentine: Am I the only person that is sick and farking tired of the way the media and politicians throw 10 year numbers around like they are for one year?

Yeah, that would sound like me spending $100,000 on hookers and blow this year.


We should totally hang out sometime.
 
2012-07-19 02:29:52 PM  
Hell, looks like they'll already have the contacts.

http://www.nytimes.com/2012/06/29/business/global/arms-contractor-ple a ds-guilty-on-china-exports.html

A Canadian subsidiary of the Connecticut-based military contractor the United Technologies Corporation pleaded guilty on Thursday to federal charges that it had illegally helped the Chinese government develop an attack helicopter now in service there....

The Canadian subsidiary, the Pratt & Whitney Canada Corporation, violated the Arms Export Control Act by providing the Chinese with 10 engines to power Z-10 helicopters in 2001 and 2002, according to an announcement by the United States attorney's office for the District of Connecticut. Technology for the engines, the authorities said, had originally been created for United States military helicopters.
 
2012-07-19 02:31:26 PM  
oh well
 
2012-07-19 02:33:21 PM  
But I was assured that government spending doesn't create jobs.
 
2012-07-19 02:36:22 PM  

damageddude:

Why can't the defense industry transform to build things that benefit the civilian population?....
there is a heck of a lot of old infrastructure in this country that needs to be updated.....
but developing technology to upgrade our freight rail system, for example, is useful too.


Because infrastructure is often paid for through taxes and taxes used to purchase goods and services for society is socialism.
 
2012-07-19 02:36:55 PM  
nathantimmel.com

"Won't someone please think of the Military Industrial Complex?!"
 
2012-07-19 02:37:46 PM  
Sorry, but the last time the Democrats and the repubs went eyeball-to-eyeball over this issue, the Democrats blinked. This time it's the repub shibboleths on the line (the Democrat ones too, but everyone agrees the interests of the poor, the elderly and the infirm can be safely ignored when taxpayer money is at issue). Personally, I would like to see both social welfare and defense programs saved, but if the Democrats are to do anything except accede to every repub demand in the face of fiscal blackmail, the line must be drawn somewhere. You'll note that no one is demanding that the budget be balanced exclusively through defense cuts. The shoe is now on the other foot and the questions is whether repubs are willing to follow their principles into the abyss or accept tax increases to save both the programs they support and those they do not.
 
2012-07-19 02:41:07 PM  

GAT_00: Well, as I understand it, any company that can't survive without government handouts should die.


I wouldn't call it handouts.. These companies are selling a product to the government, the government is saying they won't be buying their product anymore. Company is saying, well we will probably go out of business if no one is buying our product.
 
2012-07-19 02:41:09 PM  

DirkValentine: Am I the only person that is sick and farking tired of the way the media and politicians throw 10 year numbers around like they are for one year?


I'm not sure when that started, but it's very annoying. Especially so when they say something-or-other will "save X dollars," and it turns out that 99% of any savings happens in year 10 when presumably the stuff that there was no political will to do in the intervening 9 years suddenly becomes feasible.

i50.tinypic.com
 
2012-07-19 02:41:47 PM  

Diogenes: I'd be happy if we just started with scrutinizing existing contracts and enforcing the terms.


First, we'd need to make the DCAA/DCMA worth half a shiat, which would cost money that nobody wants to spend.
 
2012-07-19 02:41:54 PM  
Poor war machine is poor and needs some socialism bailout action plz. kthxbye

Boy, you'd think they could be bootstrappy and adjust their business model. They've known these cuts would be coming for quite some time. If they stand to lose they have only themselves to blame.

At least that's what conservatives have been spouting for 3 years now about everything else.
 
2012-07-19 02:43:13 PM  

Satanic_Hamster: But I was assured that government spending doesn't create jobs.


You think using tax dollars to building billion dollar aircraft is a net positive to the economy?
 
2012-07-19 02:44:48 PM  

TommyymmoT: It's pretty farked up that the richest country in the world can waste trillions on junk that will never even be used, but we can't shell out a few bucks to treat sick children.


Those sick children don't deserve medical care unless they earn it.

/At least, that's what a Republican/libertarian/Randroid/psychopath would say.
 
2012-07-19 02:45:03 PM  

Giltric: fark the defense contractors and the millions they employ.


/amidoingitrite
//all government spending is stimulus....


I have a great idea, why don't we have the us government fund a program that makes Really Big Boats and Things That Explode. We'll pay the highest wages out of any competitor to attract America's best and brightest to the industry. No one would dare mess with a country with so many Really Big Boats and Things That Explode. Of course the Really Big Boats will need massive crews for maintenance and repair, and the Things That Explode contain highly dangerous chemicals that will need to be properly disposed of and monitored for decades once they get old and become Things That May Or May Not Explode. Everyone will have a job! Fixing boats and producing/monitoring dangerous substances. It's the perfect system.
 
2012-07-19 02:45:31 PM  

MugzyBrown: Satanic_Hamster: But I was assured that government spending doesn't create jobs.

You think using tax dollars to building billion dollar aircraft that can't fly in the rain and that suffocates the pilot is a net positive to the economy?


FTFY
 
2012-07-19 02:48:10 PM  

MugzyBrown: Satanic_Hamster: But I was assured that government spending doesn't create jobs.

You think using tax dollars to building billion dollar aircraft is a net positive to the economy?


No, I'm just saying that for years Top Republicans have been assuring me that government spending doesn't cause anyone to be employed everywhere. So how can cuts to defense spending cause layoffs? It just doesn't make sense.
 
2012-07-19 02:48:13 PM  

jjorsett: DirkValentine: Am I the only person that is sick and farking tired of the way the media and politicians throw 10 year numbers around like they are for one year?

I'm not sure when that started, but it's very annoying. Especially so when they say something-or-other will "save X dollars," and it turns out that 99% of any savings happens in year 10 when presumably the stuff that there was no political will to do in the intervening 9 years suddenly becomes feasible.

[i50.tinypic.com image 300x364]


Bingo.
 
2012-07-19 02:49:18 PM  

Satanic_Hamster: No, I'm just saying that for years Top Republicans have been assuring me that government spending doesn't cause anyone to be employed everywhere. So how can cuts to defense spending cause layoffs? It just doesn't make sense.


Because you're not considering what's unseen when the gov't hires people.
 
2012-07-19 02:50:15 PM  
What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?
 
2012-07-19 02:54:29 PM  
Bwhahahahahahahaha!

To the Republicans and Defense contracting companies this is what austerity looks like. Suck it up biatches! You would not allow us to raise taxes, so now you reap what you sowed.

To the people who lose their jobs, I'm sorry. That sucks I hope you land on your feet, but your heroic sacrifice today will insure a better future for America (fark YA!) tomorrow.
 
2012-07-19 02:54:41 PM  

zarberg: What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?


zarberg: What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?


zarberg: What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?


zarberg: What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?


zarberg: What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?


zarberg: What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?


zarberg: What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?

 
2012-07-19 02:55:53 PM  

Slaves2Darkness: To the Republicans and Defense contracting companies this is what austerity looks like. Suck it up biatches! You would not allow us to raise taxes, so now you reap what you sowed.

To the people who lose their jobs, I'm sorry. That sucks I hope you land on your feet, but your heroic sacrifice today will insure a better future for America (fark YA!) tomorrow.


The saddest thing is that the people who most need to be cut won't be because they're in flagship programs. They'll cut a whole pile of smaller, necessary programs, but won't cut nonsense like KC-X.
 
2012-07-19 02:56:02 PM  

monoski: TommyymmoT: Hey, learn how to manufacture something else then.

That is why most have branched out into homeland security...



AKA military grade weapons and gear for mall grade local PDs.
 
2012-07-19 03:03:26 PM  

MindStalker: GAT_00: Well, as I understand it, any company that can't survive without government handouts should die.

I wouldn't call it handouts.. These companies are selling a product to the government, the government is saying they won't be buying their product anymore. Company is saying, well we will probably go out of business if no one is buying our product.


I can think of two possible partial solutions:

Diversify: You don't see Boeing up there with their hat in their hand, because they have a large and healthy commercial division. Their entire business plan doesn't consist of the single bullet point, "government contracts".

ITAR/State Dept. Easing: If the US GOV doesn't want to fund its defense contractors anymore, it needs to let up a bit on export restrictions to our allies. Let Lockheed sell some of their products to India or Australia without having to devote millions to regulatory compliance. If the government is no longer interested in buying their products, they should have a reduced say in quashing innovation.
 
2012-07-19 03:04:34 PM  

zarberg: What's killed more Americans in the last 20 years, a broken healthcare system or foreign enemies?


Exactly my point! Proves that the defense contractors are worth every penny, hooah!

Just like the rock I use to keep away tigers
 
2012-07-19 03:05:23 PM  
Well, I guess we could let them sell the really good stuff on the open market. I'm sure that wouldn't lead to any problems.

Let's face it. They will be losing jobs it's inevitable.
 
2012-07-19 03:06:37 PM  

sabreWulf07: ITAR/State Dept. Easing: If the US GOV doesn't want to fund its defense contractors anymore, it needs to let up a bit on export restrictions to our allies. Let Lockheed sell some of their products to India or Australia without having to devote millions to regulatory compliance. If the government is no longer interested in buying their products, they should have a reduced say in quashing innovation.


I can only speak to my company but we're one of the Big Four (or Five) and about 26% of our contracts are with foreign governments. I am not the CEO, but I'm guessing at least part of the reason we're trying to gobble those up is specifically to mitigate the risk of domestic defense spending cuts.
 
2012-07-19 03:07:02 PM  

sabreWulf07: Diversify: You don't see Boeing up there with their hat in their hand, because they have a large and healthy commercial division. Their entire business plan doesn't consist of the single bullet point, "government contracts".


A big part of that is the amount of logistics required to really produce large body aircraft. There's a reason a lot of the large bodies have traditionally also been used as commercial airlines (the 707 airframe is a great example).

sabreWulf07: MindStalker: GAT_00: Well, as I understand it, any company that can't survive without government handouts should die.

I wouldn't call it handouts.. These companies are selling a product to the government, the government is saying they won't be buying their product anymore. Company is saying, well we will probably go out of business if no one is buying our product.

I can think of two possible partial solutions:

Diversify: You don't see Boeing up there with their hat in their hand, because they have a large and healthy commercial division. Their entire business plan doesn't consist of the single bullet point, "government contracts".

ITAR/State Dept. Easing: If the US GOV doesn't want to fund its defense contractors anymore, it needs to let up a bit on export restrictions to our allies. Let Lockheed sell some of their products to India or Australia without having to devote millions to regulatory compliance. If the government is no longer interested in buying their products, they should have a reduced say in quashing innovation.


This is kind of a circular problem - most countries don't want to spend the money on defense because we already provide it. For example, Europe has problems meeting NATO air refueling requirements because the US sells tanker hours to them significantly below cost. Without that going away, they will have no desire whatsoever to get their own tankers. This has to be part of a much broader shift in American geopolitical methods away from being the primary military force in international actions.
 
2012-07-19 03:09:05 PM  
From another thread:

We spend more on the illusion of defense, than the next 26 countries combined, and 25 of them, are our allies.

i487.photobucket.com

I say illusion, because all it takes, is a few guys with nail cutters, to make us panic like a bunch of shrieking little girls who just saw a spider.
 
2012-07-19 03:09:48 PM  
Wasn't it just the other day the libbys were gloating about how Goverment millitary spending brought them the internet?


Silly libbys. Once again proving thier political beliefs are based on weak economic theroy and confusion about markets.
 
2012-07-19 03:10:32 PM  

sprawl15: This is kind of a circular problem - most countries don't want to spend the money on defense because we already provide it. For example, Europe has problems meeting NATO air refueling requirements because the US sells tanker hours to them significantly below cost. Without that going away, they will have no desire whatsoever to get their own tankers. This has to be part of a much broader shift in American geopolitical methods away from being the primary mil ...


Well, shift a little southeast from Europe - would we need such a large military presence there if we had put trillions into alternative fuel sources back in the 1990's?

They hate us because we come in and take their oil and leave them with crap.
We come in and take their oil and leave them with crap because we need oil to power our military.
We need oil to power our military because they hate us.
 
2012-07-19 03:14:20 PM  

zarberg: Well, shift a little southeast from Europe


Why? We don't sell tanker hours to the middle east.

zarberg: would we need such a large military presence there if we had put trillions into alternative fuel sources back in the 1990's?


That's why I said it has to be part of a larger geopolitical shift. Simply easing ITAR won't be anywhere near enough to change the system of dependence.
 
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