US DoD on glide path to bankruptcy

[G. Shoda]

Chuck has made a good point about flexibility, esp. when applied to naval aircraft. On a flight deck, having a lot of different types of aircraft will limit the ship's strike force and ability to air absorb losses. I suspect that some US procurement practices seem counter-intuitive and wasteful, but cannot be avoided. For instance, as Chuck says, having companies compete for contracts with prototypes is just too expensive these days. The loser will be bankrupped and probably go out of business.

[Werner]

Chuck has made a good point about flexibility, esp. when applied to naval aircraft. On a flight deck, having a lot of different types of aircraft will limit the ship's strike force and ability to air absorb losses. I suspect that some US procurement practices seem counter-intuitive and wasteful, but cannot be avoided. For instance, as Chuck says, having companies compete for contracts with prototypes is just too expensive these days. The loser will be bankrupped and probably go out of business.

There is absolutely no doubt that the taxpayer is going to have to foot most of the bill for prototype aircraft. The way it worked before MacNamara was that the military ordered enough prototypes from the manufacturer to cover the costs. They then sometimes found interesting alternative uses for the "leftovers". For example, the B-19 was a recruiting tool for a while and ended it's life as a cargo airplane.

I don't see any problem with this as the route for new aircraft, although at a lower level (the US spends less on military hardware as a proportion of the Government budget or domestic product than at any time since the new era of the Navy in the 19th Century).

[Werner]

So what if the personnel expenses are higher today than in 1908? What does that have to do with appropriate level of GDP to be spent on defense? As personnel expenses for the defense sector have increased, so have the personnel expenses for the civilian sector. So why should the military sector be compensated at the expense of the civilian sector?

We were talking about total defense appropriation and total defense procurement of this nation. ....

No, go back and read my post. I was only talking about hardware procurement.

The quote which revved you up (on page 2) was:

I don't see any problem with this as the route for new aircraft, although at a lower level (the US spends less on military hardware as a proportion of the Government budget or domestic product than at any time since the new era of the Navy in the 19th Century).

Don't put your words in my mouth. It's dirty enough.

I made the statement as a toss-off about being able to support purchase of multiple prototype aircraft to keep the industry healthy. Cheez, I so don't know why you have to make a Martha Stewart style Federal Case out of an auxiliary argument. I'm not in support of a perpetually expanding military, and never said I was.

Please don't drag this out any more by insisting I meant anything else.

[At request of others I have pruned the off-topic sidebar]

[bengtsson]

Maybe the old Soviet system would work. This consisted of government supported design bureaus with seperate design teams. The competetion is there to win the competition for your design and production teams, while going bankrupt is prevented by government support.
The winner gets the contract, the loser doesn't, but design costs are paid for by the government. A good three firms for each contract should be enough. We already have socialism for Wall-Street Investment Banks, I would argue our national security is at least as important to taxpayers as the 33.5 Billion in bonuses paid to IB bankers while they throw 100s of billions of worthless paper onto the US central bank [otherwise known as the taxpayers].
I think the Soviet system produced some pretty good aircraft.

Using GDP over decades as a measure is also wrong. The methods of measuring GDP have changed in order to boost the numbers. So a 2008 GDP is much. much different than a 1950 GDP. Most Wall-Street investors know modern GDP is a cooked number and does not reflect industrial production or the nations real wealth or ability to build real things, like weapons.

Bob B.

[Lesforan]

Yes, the Soviet system did manage to produce some fine aircraft, but, as you described, it was by imitating a process inherent in a free market. The Soviet practice of funding both the winners and the losers had to be one of the things that got their system in trouble, and we can neither afford it.

Let these guys compete like anybody else at their own expense. Years ago, if an aircraft firm came up with a really innovative design, they would design and build a prototype at their own expense, like an automobile company. Most, if not all, of the WWII era aircraft originated this way. You have to admit, some pretty good designs came about this way.

[chuck]

Yes, the Soviet system did manage to produce some fine aircraft, but, as you described, it was by imitating a process inherent in a free market.

Imitating the west? Hardly

Look at how many people were shot effectively because they were losers in political, managerial and policy competitions inside the early Soviet Union. Look at how cut-throat was the competition in fields the Soviet state tried to nurture. Cut throat competition on a vastly greater scale and of a vastly more deadly intensity than ever experienced in any capitalist system is intrinsic to the early Soviet Communist system. The thing that ultimate caused such a competitive society to topple was that the Soviet Communist dogma did not allow this pervasive competition to reach into sectors that the state did not consider to be paramount to the immediate strengthening of the state on the international stage, and the Soviets did not fully understand the importance of the civilian economy to the strength of the state until it was too late.

[Lesforan]

No, no. Competition is anathema to a Communist society. When all industry is a state monopoly, funding competing "firms"
(design bureaus in this case) is a waste of money. The state has to finance both the winners and the losers (this is why I am opposed to public financing of political campaigns).

This is why setting up a competition is an extreme, expensive measure, no doubt done out of desperation. In order to bring out the creativity of its people, the Soviets had to adapt a capitalist model. They must have about choked on it, which explains why the losers were punished so severly.

[chuck]

No, no. Competition is anathema to a Communist society. When all industry is a state monopoly, funding competing "firms"
(design bureaus in this case) is a waste of money. The state has to finance both the winners and the losers (this is why I am opposed to public financing of political campaigns).

This is why setting up a competition is an extreme, expensive measure, no doubt done out of desperation. In order to bring out the creativity of its people, the Soviets had to adapt a capitalist model. They must have about choked on it, which explains why the losers were punished so severly.

You are completely confusing a superficial interpretation of orthodox Marxism that propagandists in the west has harped upon, with the realities of the Soviet communist state. The early Soviet communist state believed that everything that mattered can only be achieved through life or death competition. To ensure the competition results in the best possible variation of the state wants, the state sets rigid rules for each competition. Thus those who broke rules are shot, and those who lost are shot. Or they might be sent to an Arctic gulag, which amounts to the same thing.

[Werner]

No more on politico-economic models, please. I think we will all be working within the current system for quite some time.

[bengtsson]

You may have put your finger on the problem there Werner. The current system is the problem. The system is not what it once was. I always harp on WWII, because America was a nation of great industrialists at that time. They performed miracles of production in record short time. No one would argue that for what we spend on military hardware, we are getting miracles of production now.

Bob B

[Lesforan]

Maybe we really are in a "post-industrial" society. The globilization of heavy industry has resulted in the movement of industries, even those with close ties to the military, to parts of the world where political considerations are apparently overlooked. Thus we find Boeing in China, GE in Iran. I don't think this does our country much good.

Chuck and I are just going to have to disagree on our interpretations of conditions inside the former Soviet Union. I think we can agree that the situation was pretty bad, and no doubt contributed to the total collapse of the state.

[chuck]

Political consideration overlooked????

Actually, US policy is already completely submerged in an amorphous goo consisting of multiple flavors of admixing domestic political posturing and short sighted international political jockeying. Nothing but political consideration matters in US foreign policy. It might be that you prefer the outward appearance of one set of political consideration, mainly based on amateurish crayon depictions of who is good and who is bad coupled with crude demonization of everyone who is painted as evil under this "system", rather than another which may postulate that completely free market will eventually make every one a friend of America. But neither set, nor any of the others in popular circulation, has much merit, nor is it being circulated for any merit they may actually have. On the balance all of them are constructed and circulated as political smoke screens to over the gaining of short-term benefit by a few slick domestic and international political operator working on behalf of certain coalition of domestic-international interest groups, and at the expense of over all interests of the economic and political entity called the United States.

[Werner]

Sorry, I wish I knew for sure what that means. I think you're saying the US political planning horizon is 2-3 years. I agree on that. After each election there will be a modest to severe shift in US foreign policy, meaning both our allies and our enemies cannot count on anything.

[Lesforan]

Werner,

I think Chuck's reply was directed at me. If political considerations were being taken into account, what possible political advantage is there in GE selling to Iran or Boeing selling to China? It looks to me like profit motive is what is driving this.
I'd say more but my crayon broke.

[Werner]

There is no disadvantage to such sales, because the likely political memory of the event is 3-4 years, with 8 years being the about the absolute tops. So, if your political planning cycle is 12-16 years, you will always win.

[chuck]

Sorry, I wish I knew for sure what that means. I think you're saying the US political planning horizon is 2-3 years. I agree on that. After each election there will be a modest to severe shift in US foreign policy, meaning both our allies and our enemies cannot count on anything.

If you mean political planning as far as foreign policy is concerned, then that is not universally the case. Whether American foreign policy planning horizon is short or long depends largely on whether several domestic interest groups are competing to gain control over a particular aspect of American foreign policy, or if one group has secured a reliable control over a particular aspect of American foreign policy. History shows that a single pressure group can sometimes maintain control over elements of US foreign policy for long periods of time, and impose remarkable consistency and goal orientation on American policy over that period. These pressure groups tend by nature to have goal orientation and consistent objectives, and they achieve this long lasting control by disguising the conflicts between the objectives of the pressure group and the welfare of the United States, and obscuring the damage done to American interests in the furtherance of their own interests. They can achieve this because they tend to be adept at coming up with the right mix of exploiting public indifference or ignorance, manipulating public opinion, and wiping up loud ruckus of cynical sloganeering to squelch public debate.

[chuck]

Werner,

I think Chuck's reply was directed at me. If political considerations were being taken into account, what possible political advantage is there in GE selling to Iran or Boeing selling to China? It looks to me like profit motive is what is driving this.
I'd say more but my crayon broke.

One the overall level, It is a political objective of the United States to maximize the profit of our capitalist institution. Furthermore it is also our objective to let these profits be made from as many foreign countries as we can. In so far as we can provide economic value to the Chinese and gain a profit in return, we've taken a step towards accomplish a political objective. We would prefer to gain a profit without providing any economic value, but they are too wily to let us do that. On a company by company level, If profit can be squelched by a hostile and short-sighted political move, then do securing profit not also become a political objective?

[Werner]

There may be a component of that in US foreign policy, but to have a more complete appreciation of how policy is formed you ought to read some books, among them The March of Folly by Barbara Tuchman. Many components of foreign policy do not have a profit motive, and in fact may be self-destructive.

[Jack Ray]

There may be a component of that in US foreign policy, but to have a more complete appreciation of how policy is formed you ought to read some books, among them The March of Folly by Barbara Tuchman. Many components of foreign policy do not have a profit motive, and in fact may be self-destructive.

I second that. The March of Folly is excellent.

[chuck]

Many components of foreign policy do not have a profit motive, and in fact may be self-destructive.

It goes without saying that many of America's foreign policy is self-destructive for the United States since so many of American foreign policy are driven by groups whose ends it is to leverage the power of United States in the pursuit of their own narrow ends in the international areana, ends that are usually irrelevant, and often antithetical to the interests of the United States as a world power seeking to maximize the stability of its own position in the world. Examples would include the Israeli lobby's influence on Middle Eastern policy and the Cuban lobby's influence on Cuba policy. Many other elements of American foreign policy are not even driven by any group that has any cohesive objective as far as foreign policy goes, whether that be good for the United States or good for something else. Instead these groups simply tap veins of public fear or anxiety to increase their own profile and better enable them to pursue their own domestic political objectives. Examples of these would include those who magnify the China threat in order to position themselves as the only trust worthy guardians of American security interests.