Thursday, April 2, 2009


This article from EIN News is useful because it explains, in very simple terms, the primary reason it's so difficult to trim budgets and why waste is tolerated.

“Taking on influential defense contractors will be tough.”
--President Barack Obama, March 24.

“Tough” hardly describes the battle that lies in wait for the President when he tries to make meaningful changes in defense contracting. More than 90% of the revenue generated by Lockheed Martin and Raytheon in 2008 came from defense contracts. For Northrop and General Dynamics, defense contracts accounted for more than 70%. Even Boeing, which dominates civilian aviation, depends on military work for half its revenue ...

When the President talks about reforming defense spending, these are the goliaths he's taking on. The entire defense contracting system is shot through with waste and abuse. Last year the GAO reported that 95 defense projects had overrun their budgets by $295 billion. The average delivery delay was nearly two years beyond what the contractor promised ...

This should be a ripe target for White House and Congressional cost cutters. Should be. But isn't. Why?Because defense contractors are adept at creating alternative political universes. Lockheed, for example, has subcontracted parts for the F-22 fighter plane to 1,150 firms in 46 states. Each one of those firms and the people in Congress who represent them is a lobbyist for building more F-22s. Last year, Defense Secretary Robert Gates decided to halt the plane's production. But that decision hasn't yet stuck.

Working through its constituent congressmen and senators, and the communities, business and labor groups that would lose money and jobs, Lockheed is waging a furious campaign to build more F-22s ... We're talking here about a plane that so far has cost taxpayers more than $65 billion and has seen no service in Iraq, Afghanistan, or any other combat. The F-22 was conceived about 30 years ago as a next generation fighter to compete with improved Russian Migs, which planners then assumed would be built as part of the continuing cold war. Then the cold war ended and the Russians cut back on military development ...
See the entire article here

- Mark

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