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Weapons contractors hitting Department of Defense with inflated prices for planes, submarines, missiles
Key Excerpts from Article on Website of CBS News
Posted: July 10th, 2023
https://www.cbsnews.com/news/weapons-contractors-price-gougi...
With the U.S. supplying billions-of-dollars of munitions to Ukraine and growing tensions in the Taiwan Strait, some Pentagon generals are sounding alarms about the dwindling supply of U.S. weapons ... at a time when the cost of replacing them is skyrocketing. A six-month investigation by 60 Minutes found it has less to do with foreign entanglements than domestic ones - what can only be described as price gouging by U.S. defense contractors. It wasn't always like this. The roots of the problem can be traced to 1993, when the Pentagon, looking to cut costs, urged defense companies to merge. Fifty one major contractors consolidated to five giants. The landscape has totally changed. In the '80s, there was intense competition amongst a number of companies. And so the government had choices. They had leverage. We have limited leverage now. The problem was compounded when the Pentagon, in another cost saving move, cut 130,000 employees whose jobs were to negotiate and oversee defense contracts. The Pentagon granted companies unprecedented leeway to monitor themselves. Instead of saving money ... the price of almost everything began to rise. In the competitive environment before the companies consolidated, a shoulder fired stinger missile cost $25,000 in 1991. With Raytheon now the sole supplier, it costs more than $400,000 to replace each missile sent to Ukraine ... even accounting for inflation and some improvements that's a seven-fold increase.
Note: Leading military contractors are hiking up prices of everyday products as well, costing US taxpayers more than $1.3 million in unnecessary markups. Explore how the Pentagon paid arms manufacturer Boeing over $200,000 for four trash cans used in surveillance planes (roughly $51,606 per unit). War profiteering happens on many levels, as articulated in a summary of War is a Racket by General Smedley D. Butler.
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