Innumerate Citizenry/Legislators—End of a

https://mattstoller.substack.com/p/nancy-pelosi-china-and-th…
an obscure military bureaucrat named Cameron Holt

Holt is the head of acquisitions for the Air Force, which means he oversees the buying of everything from drones to nuclear missiles. And in a fascinating and spicy speech, he said that if the U.S. doesn’t get better at buying weapons, America will lose in a future conflict to China. “It’s simply math,” he argued.

The reason is that China is better at procurement. China is getting weapons “five to six times” more rapidly than the United States. “In purchasing power parity,” he said, “they spend about one dollar to our 20 dollars to get to the same capability.” This problem is directly related to market power in the U.S. Holt went over the business strategy of U.S. defense contractors, noting their goal is to lowball contracts but keep control of intellectual property. Then, he said, they create vendor lock-in, and raise prices later. In other words, they underprice upfront so they can eventually exploit pricing power over the Pentagon. Chinese acquisition strategies are more efficient and less brittle, which means over time their military will overtake ours.

Defense is just one sector in which value & cost is out of wack. Health care & higher education are two other broken systems. Defense, health care & and a university education are bloated wasteful systems.

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The US is lucky that “mutually assured destruction” alleviates the problem of our defense procurement inefficiencies and corruption.

intercst

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I see my title was too long. Should read “End of a Nation”.

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A few things. The “nation” by that I suppose you mean “The People” are too “innumerate” to prevent this. The People cannot be that well versed in these details and police them, They have lives that involved many other things and cannot keep their finger on this pulse and every other pulse they recurringly are accused of not keeping a finger on.

Now, the government, and that means Legislators along with the companies they are procuring from know exactly what they are doing. This is not trickery or treachery. It’s “business.” That’s why it happens. They are not “innumerate.” They have all kinds of experts working for them who see this s…tuff. They are not in the dark. It’s the product of the free market. The problem being presented is not the problem in fact.

As far as Chinese stuff. How do we know they are getting the same capability for 1/20th the cost? We’ve seen this hyperbole and misstatements and myth many times in the past. The hardware is likely crap. The Germans in WWII weren’t that good. We know (and knew at the time) that the Russians weren’t that good during the Cold War. Their stuff was crap and even they didn’t trust its performance. Or the performance of their own people. It was those things at least as much as “MAD” that kept The Big One from breaking out. But we needed a Grand Evil Other. It’s good for business. The Japanese were not all that great as businessmen, either.

Inflammatory statements misdirecting the discussion. Probably at the behest of the people charging 20 times more than the Chinese are paying.

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Chinese acquisition strategies are more efficient and less brittle, which means over time their military will overtake ours.

I don’t see how this can possibly change without nationalizing the military industrial complex. China is not the least bit concerned about letting the free market develop their weapon systems - which is both why they often lack the same level of innovation as the US and that they can, through the power of central control, make/buy things cheaper. Many of their military manufacturers are state-owned.

I am not sure many US citizens would prefer the alternative; that say, Lockeed Martin become state-owned to reduce corporate profits/expenses.

Health care & higher education are two other broken systems.

Much like the above, I doubt such can change when they operate in broken free market systems.

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“As far as Chinese stuff. How do we know they are getting the same capability for 1/20th the cost? We’ve seen this hyperbole and misstatements and myth many times in the past. The hardware is likely crap. The Germans in WWII weren’t that good. We know (and knew at the time) that the Russians weren’t that good during the Cold War. Their stuff was crap and even they didn’t trust its performance. Or the performance of their own people. It was those things at least as much as “MAD” that kept The Big One from breaking out. But we needed a Grand Evil Other. It’s good for business. The Japanese were not all that great as businessmen, either.”

Maybe not 1/20th but likely 1/5 to 1/3rd the cost.

the Chinese have put men in orbit and plan to land on the moon soon. You can’t do that with crap hardware. They have hypersonic missiles we have yet to duplicate. THey make and sell commercial airlines and have the best trains in the world.

The Germans in WW2 were ‘too good’. Too much precision manufacturing and time spent building good guns, rifles, etc. Not so good at tanks that took too many resources and were too complicated.

The Russians have decent equipment but poor training and years of neglect for spare parts. Got behind in the cold war trying to keep up, but remember they still have the heaviest launch vehicles and an incredible reliable record of launches. Half the US satellites went up on Russian rockets. Half the ISS is Russian.

The US has its military hardware problems too…every other month the F-35s are grounded for this or that reason.

90% of your tech stuff is manufactured in China…

t.

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Maybe not 1/20th but likely 1/5 to 1/3rd the cost.

Doesn’t apply to everything, but it is always much cheaper to borrow/steal technology than to build it from scratch.

Mike

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