What should be the primary goal of a publicly traded Defense Contractor? Maximize return to its stockholders OR ensure highest level of support to the Government.


Before any of you state it should do both, it cannot. One side or the other suffers or both do.


I've recently found myself on the wrong end of a new edict from upper management to achieve a profit margin that is ridiculously high. So much so that over the weekend, I came to the conclusion that the ONLY way to ensure the goals are achieved is at the potential expense of one or two people's jobs which will subsequently decrease the support I provide to the Government client.


After thinking about this most of the weekend, I came to the conclusion that Defense Contractors should be treated in such a way that profit is capped, say at 10%. That way, the corporation is still making money, albiet on a much more defined basis but it also helps focus the Defense Contractor's support BACK to the Government client.


Anyway, I'm sure this will make a lot of people's heads assplode, but after what has come down from upper management, I don't care.

 

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Their job is to work in the best interest of the stockholders. It is government job to insure they get the best bang for the buck. If you have a vender who do you think they are working for; to get the most for you or to get the most for themselves? Why would it be any different with Government?

Before you go off without thinking remember that putting out the very best product is in the best interest of the stockholders as well. This is true no matter who you are working for. The very rich have one thing in common. That is they are honest to the core. I know that Hollywood told you something different but I'm taking about the real world. The cheats and liars might profit in the short term but never in the long term. Remember that the ones with the biggest press are in jail.

 

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I've said this before, but defense contractors, especially R + D ones, should face a stark choice:

1) Retain cost-plus and forfeit all IP rights to their development

2) Eat the cost of R + D and retain IP Rights in the private market.

Right now, they get both. It's a pretty sweet deal.

 

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I knew it would just be a matter of time before the left started suggesting exactly how much profit a company can make.

 

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Arn't you one of those people who loves to complain about the salaries and benefits of public workers because the taxpayer pays for it?

Contractor gigs are truly ridiculous. If you want to see government waste at work it is the prime place to look.

Here is just one example:

http://www.whitehouse.gov/blog/2012/01/31/ending-overpayment-federal-contractor-executives

There shouldn't be publicly traded defense contractors.
All weapons and armaments R&D as well as production should be entirely under government management.

This eliminates the two largest negatives:
1. That our most sophisticated designs are not being taken away by a company and sold to the highest bidder.
2. Eliminating the biggest profit earners from conflict and war. There will always be someone in the food chain benefiting, but it will be greatly reduced.

 

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War profiteering used to be a crime. It's now an industry.

 

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Holy Communist Batman! I agree with everything you just said.

 

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More or less been a industry here, tho we're not dumb enough to pay for it ourselves.. We let you people do that.

 

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If you do that then you eliminate the benefits of dealing with a private company. You'd be better off just nationalizing the business. Which of course is worse than leaving them private with uncapped profit.

 

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