Opening up the C-17 Globemaster Piñata April 23, 2010Posted by Matthew Leatherman in Analysis.
Tags: C-17 Globemaster, military-industrial complex, Secretary Gates
C-17 subcontractor data in this post is the product of original research by Robert Miller at the Institute for Policy Studies.
Parents, worn out by the chaos of their child’s carnival-esque birthday party, dread concluding with a piñata. It’s that much more mess to clean, and that much more intense of a sugar high for the kid.
Peering inside military hardware procurements is a similar experience for the American taxpayer. Sub-contractors distributed across the country, each a delicious ‘economic development’ nugget for some member of Congress, spill out seemingly without end. This stuffing is the root of our military-industrial complex – votes that Congress members can win and business that contracting firms can corner.
Map: Geographic Distribution of C-17 Subcontractors
One such example is the C-17 Globemaster. Unlike many other programs, taxpayers have a detailed glimpse into its supply chain, which now includes 268 firms spread across 219 cities in 36 states. The 10 aircraft included in the Pentagon’s FY10 budget will distribute $2.5 billion among these firms (pg. 16). Each is a valued part of some Congress member’s district and, seemingly not by coincidence, they are located our country’s most populous areas. Only 8% of Americans live in the 28% of states (14 out of 50) unrepresented in the C-17 supply chain (est. 07/2009).
We’ve come to expect patterns like this, but they are not immediately intuitive. Such a stunted supply chain wastes money and constrains profits. Private sector prime contractors wouldn’t tolerate these efficiency gaps.
On its face, neither should Pentagon prime contractors. Yet they have learned that this waste is more than compensated for by the new demand it generates. Specifically, demand for defense materiel originates from Congress as well as from the Pentagon. Investing in members’ districts is a cost of entry into the congressional market. Once inside, though, it’s a booming industry.
FY2010’s ten C-17’s help explain why. The Pentagon did not want these aircraft or their $2.5 billion cost. In fact, Congress forced them back into the Pentagon’s budget over Secretary Gates’ objection, and is poised for a repeat this year. The delicious political candy inside this piñata helped to generate demand that otherwise was wholly lacking.
We now have a win-win-tie situation. Congress members get votes and contractors get business. The Pentagon in this instance is forced to accept unwanted hardware but, just as often, it’s glad to receive additional kit without the hassle of public justification.
Everyone else loses, though. Congressionally-based demand is driven by politics and ideology rather than policy or strategy. Purchases such as these consequently miscommunicate and misdirect our policy and strategy, setting back American interests overseas. Adding insult to injury, the taxpayer is stuck with a $2.6 billion bill for this counterproductive behavior.
Unlike children’s parties, where parents’ joy outweighs dread of the piñata, public celebrations are not the norm when cracking open military hardware piñatas. Transparency brings the partiers only embarrassment in this case. Seeing into the C-17 supply line thus is a rare break for the taxpayer, evidence that can be valuably used to hold Congress to account for its fiscal indiscipline.