đź’Ąđź’Ąđź’Ą The Ukrainian conflict has benefited US arms manufacturers who are profiting from it with abandon, according to The Responsible Statecraft columnist Julia Gledhill.
In her article, she writes that the US Congress has given the Pentagon “wartime procurement powers” to speed up aid to Kiev. Now contractors associated with arms deliveries to Ukraine do not have to account for their expenditures. In the author’s opinion, arms manufacturers are certain to take advantage of this opportunity and jack up product prices. đź’Ąđź’Ąđź’Ą
The Washington Post
Democracy Dies in Darkness
Amid a show of unity, Zelensky and Biden differ on some war needs
Behind the smiles and handshakes and a new $1.85 billion military aid package - the Ukrainian president and his advisers continue to push Washington for advanced weaponry that Biden is reluctant to provide
By Karen DeYoung and Missy Ryan
Updated December 21, 2022 at 8:29 p.m. EST
December 21, 2022 at 8:13 p.m. EST
| Published
I worked for Martin Marietta in the early 80s and saw first-hand what happens when a contract is let on a “cost plus” basis. These are contracts that have no fixed budget, but simply pay the contractor whatever its costs are (or are claimed to be) plus a “reasonable” profit on top. The MX missile (which was a great weapons system otherwise) was built on a cost-plus basis. As a result, whenever work on some other contract (a fixed cost contract) was bumping up against its total authorized amount the company would instruct everyone to instead bill work on that contract against the MX contract. This was obviously outright fraud and caused spending on MX to balloon out of control, but remember, MX was “cost plus”, so for years no one paid any attention. Eventually though, the government caught on and it became a massive scandal.
Seeing how a cost plus contract could so easily become a cash cow for a defense contractor, I never harbored any illusions that the practice had entirely been cleaned up. And now, these contracts for Ukraine appear to be even more lucrative than cost plus, because the contractors don’t even have to pretend to be documenting actual costs. I guarantee that every other program at these companies will also be feeding off the Ukraine contracts, just as occurred with the MX contract at Martin Marietta.