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.
The 155mm artillery shell shortage is actually ridiculous. The US is choosing to only manufacture a few thousand 155mm shells per month and keep the price per shell high due to the terrible economies of scale when operating a factory with the capacity for over a million 155mm shells per month at less than 2% capacity. The real question is why is the White House deciding to not order 155mm shell production to one million units per month. Why is the White House intentionally allowing artificial scarcity and terrible production efficiency juice the price General Dynamics is allowed to charge per 155mm shell? It’s literally the US government defrauding itself by creating conditions where it has to pay the maximum price per shell when it literally doesn’t have to.
To explain:
All US 155mm shell production happens at the Scranton Army Ammunition Plant in Pennsylvania. The plant is US government owned but staffed by defense contractors from General Dynamics. Even though it is a US government owned factory and the factory workers are paid by the government, the contrator General Dynamics is allowed to then sell the US government each 155mm shell the factory produces. By law this US government owned facility has over the years been steadily upgraded to ensure that it can maintain the ability to with only a few weeks notice ramp production back to its full capacity of a little over 1 million 155mm shells per month. The plant has been able to manufacture at this million 155mm shell capacity since the WW2 era and over the years due to upgrades like robotics similar to that used in automotive production if the US military asks for production to ramp to full capacity the factory only needs to hire 1/10th of the new employees it would have needed in the 1940s to maintain that scale of output.
Anyone with experience in how industrial processes work will find it comical that a facility with equipment spec’d for such large scale production is being intentionally run at around 2% capacity when ATM there is good reason to immediately ramp to full capacity. It is extremely inefficient and costly to run at such low capacity when a factory is tooled for a much higher production scale. At minimum capacity you are having to spend wasteful amounts of money to heat up massive furnaces and forges used to work raw steel feedstock into shells to only run a fraction of the material they are capable of handling through them.
Sounds like General Dynamics is getting maximized quarterly profits out of it being arranged that way. There may be nothing more to it than that.
The function of an advanced Neoliberal state is to maximally insulate corporations from the consequences of their own actions, consequences even up to and including imperiling the state and the empire on which the firm depends. A bare skeleton of contradiction emerges as the last morsels of vestigial regulation, from the time of Original Flavor Liberalism when the state was more serious about protecting capital from itself, are eaten away. The US has for some time been justifiably accused of being five weapons contractors in a trench coat.
The 155mm artillery shell shortage is actually ridiculous. The US is choosing to only manufacture a few thousand 155mm shells per month and keep the price per shell high due to the terrible economies of scale when operating a factory with the capacity for over a million 155mm shells per month at less than 2% capacity. The real question is why is the White House deciding to not order 155mm shell production to one million units per month. Why is the White House intentionally allowing artificial scarcity and terrible production efficiency juice the price General Dynamics is allowed to charge per 155mm shell? It’s literally the US government defrauding itself by creating conditions where it has to pay the maximum price per shell when it literally doesn’t have to.
To explain:
All US 155mm shell production happens at the Scranton Army Ammunition Plant in Pennsylvania. The plant is US government owned but staffed by defense contractors from General Dynamics. Even though it is a US government owned factory and the factory workers are paid by the government, the contrator General Dynamics is allowed to then sell the US government each 155mm shell the factory produces. By law this US government owned facility has over the years been steadily upgraded to ensure that it can maintain the ability to with only a few weeks notice ramp production back to its full capacity of a little over 1 million 155mm shells per month. The plant has been able to manufacture at this million 155mm shell capacity since the WW2 era and over the years due to upgrades like robotics similar to that used in automotive production if the US military asks for production to ramp to full capacity the factory only needs to hire 1/10th of the new employees it would have needed in the 1940s to maintain that scale of output.
Anyone with experience in how industrial processes work will find it comical that a facility with equipment spec’d for such large scale production is being intentionally run at around 2% capacity when ATM there is good reason to immediately ramp to full capacity. It is extremely inefficient and costly to run at such low capacity when a factory is tooled for a much higher production scale. At minimum capacity you are having to spend wasteful amounts of money to heat up massive furnaces and forges used to work raw steel feedstock into shells to only run a fraction of the material they are capable of handling through them.
Sounds like General Dynamics is getting maximized quarterly profits out of it being arranged that way. There may be nothing more to it than that.
The function of an advanced Neoliberal state is to maximally insulate corporations from the consequences of their own actions, consequences even up to and including imperiling the state and the empire on which the firm depends. A bare skeleton of contradiction emerges as the last morsels of vestigial regulation, from the time of Original Flavor Liberalism when the state was more serious about protecting capital from itself, are eaten away. The US has for some time been justifiably accused of being five weapons contractors in a trench coat.