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It doesn't matter that much that they're "PRIVATE sector contractors". Defense contractors do not operate like normal private-sector companies. In normal comp
by Arizhel 10y ago
It doesn't matter that much that they're "PRIVATE sector contractors". Defense contractors do not operate like normal private-sector companies. In normal companies, they try to keep costs limited, so that they can maximize profit. They can normally only charge so much money to customers, so the less they have to pay in costs, the more they keep as profit.
In defense companies these days, they usually do what are called "cost plus" contracts. That means the government pays them whatever it costs to do the job, plus a profit margin. So, the incentive is to bloat the project beyond all belief, because that increases the costs. Then the profit is multiplied, since the profit margin is fixed.
Splitting the project up among a ridiculous number of contractors to cover as many congressional districts as possible doesn't help the situation.
Basically, the F-35 is a huge make-work program for the US.