🇺🇸 Why America Is Out of Ammunition

⬛️ Why can't the Pentagon get weapons firms to ramp up production? A new report shows the military doesn't track who owns its contractors, and has just two people looking at mergers in the defense base.

🔶️ “As stockpiles dwindle, there is now widespread agreement among policymakers that America must rebuild its capacity to arm itself and its allies. But according to a new government report, that’s mostly just talk.”

🔶️ “Unlike the mid-20th century defense-industrial base, today government cash goes increasingly to stock buybacks rather than actual armaments. And now, with a dramatic upsurge in need for everything from missiles to artillery shells to bullets, we’re starting to see cracks…”

🔶️ “The signs are unmistakable. In Ukraine, fighters are rationing shells. Taiwan can’t get weapons it ordered years ago. The Pentagon has put together a secret team to scour stockpiles.”

🔶️ “Surges due to wars aren’t new, and there’s always some time lag between the build-up and the delivery. But today, the lengths of time are weirdly long. long. For instance, the Army is awarding contracts to RTX and Lockheed Martin to build new Stinger missiles, which makes sense. But the process will take.. five years.”

🔶️ “The government can’t actually solicit bids from multiple players for most major weapons systems, because there’s just one or two possible bidders. So that means there’s little incentive for firms to expand output, even if there’s more spending. Why not just raise price?”

🔶️ “In 2022, the DOD reported that “that consolidation of the industrial base reduces competition for DOD contracts and leads DOD to rely on a more limited number of suppliers. This lack of competition may in turn increase the risk of supply chain gaps, price increases, reduced innovation, and other adverse effects.” And that’s why, more than a year into the Ukraine conflict, the ramp-up is still not where it needs to be.”

https://www.thebignewsletter.com/p/why-america-is-out-of-ammunition