Why the US Military Costs so Much

Iceland sent a small contingent to Afghanistan with NATO. We had a culture day and they served fermented shark meat. A very powerful deterrent.

Fun fact: cost overruns below 150% are considered a great economic success among militaries all over the world.

I am one of the designers who worked on the Comanche at Boeing. The Government kept changing the specifications so often it required several complete redesigns of the air-frame. We spent lab time developing new ways of making composite structures had large shops to make mock ups and I wound up flying across the country on a biweekly basis. There was so much paralysis from the Pentagon on decision making that we often had to stop work of hundreds of skilled craftsman engineers, technicians, and other scientists and wait for a decision to be made. If we could have been given a specification and turned out a prototype, even if that prototype failed it would have been cheaper to do three or four iterations than the two prototypes built.

As someone who worked in acquisition while in the military, I can say I've seen multimillion dollar items sit in storage until they were completely obsolete and deemed trash without ever being used.

I used to be a manager at Disney World, if I wanted a sign that said stroller parking, I would have to contact Walt Disney Imagineering and make sure it goes through the process it would cost $15,000. If I called the Orlando sign shop, sent them the picture, and have them come install it (which is what Imagineering would do anyway) it would be like $250. Disney operates just like the military, massive amounts of wasted money.

Without doubt, this industry in the US needs MAJOR overhaul. The level of incentivized waste is staggering.

As someone who’s worked for one of the largest defense contractors in the world, I was happy with you bringing to light some of the biggest, most insidious, and most common problems with defense contracting practices; but I was also happy to hear you say that this was only scratching the surface of the insidiousness of these practices. It’s one of the big reasons why I had to leave the industry. Some of our bidding practices were just plain morally terrible that I could no longer let myself be a part of it.

The F-35 programme was a total success, albeit a very expensive and over budget one. The NGAD project is costing much less than estimated because of knowledge gained and infrastructure in place from the F35 development.

The US military faces 3 issues from my perspective: scope creep, lack of tier 1 contractor competition, and requirements based on unproven technologies.

I think there's a good argument to be made that the f35 is actually relatively successful now that the problems with it have been worked out. The unit price isn't bad at all and there's a ton of international buyers lining up for it. Combat capability wise, it also looks like a great platform.

Keep in mind back in 2014 (roughly, going from memory) France had to call in US support for logistical help to support less than 20 troops in Mali.

The F-35 isnt a good example, yes it went way over in development but has since dropped in per unit price to about 80 mil for the A unit which is cheaper than the new f-15 ex at 115 mil. Plus alot the new tech is being incorporated into new equipment.

I took a tour of an Independence class LCS once and the concept is a great idea when you see what it looks like in person, but the issues are pretty obvious as well. Aluminium is not as fire resistant as it's melting point is half of steel's melting point, so every inch of the interior of the hull has fire proofing blankets on it. As mentioned in the video it's also more brittle than steel, aluminium will not flex if impacted by a shell, just shatter and penetrate like paper. But one of the most embarassing parts I learned was the ability to change its armaments. There is the physical ability to carry cruise missiles in a vertial launch container, except the exhaust from the rockets will MELT THE ALUMINIUM AROUND IT. Such goofy design.

A key piece of context that missing is that US military spending as a share of overall government spending or GDP has fallen massively. During the Cold War highs of the 1960s, 9% of the US GDP went to military spending. Now it's 3%. Defense spending was 51% of overall federal spending in the 1960s. Now it's 14%.

B 24's broke in half. B29 engines overheated. B seventeen's had a poor payload and a poor range. P 51's started with the wrong engine. P47 couldn't taxi because of poor visibility. Sherman tank had a stabilization system that nobody used. M 16 had ammunition supply problem that caused malfunctions. However it's the greatest battle rifle ever created and 60 years later the army still uses it.

Thanks! I really enjoy the work and variety of topics! Keep going!!

3:00 "Take for example the USS Freedom" while showing multiple shots of the Independence class LCS instead of the Freedom Class

The obvious problem is that the defense contractors' job is not to make a warship that works. Their job is to make money. Whether or not they manage to make a functional warship, one thing is sure: they are making money.

Cost-plus contracts are often written with a Guaranteed Maximum Price (GMP) with split savings. It incentivizes accurate budgeting and scheduling. It's wild that defense contracts don't have a GMP.

The first ship of the FFG-7 class was built and tested before the contract was let for the rest of the class. People begged the Navy to replace them with ships of similar capabilities - a jack of all trades, capable of detached operations. The LCS program was daring, but a failure before the first ships came off the slipways. Now they are going back to a tested hull for the new Constellation class.