America’s Monopoly Crisis Hits the Military
It's refreshing for me to see an article from a modern conservative outfit that actually seems to understand the adversarial relationship between the finance sector and the principles of economic conservatism. I particularly liked the section talking about historical precedents and bipartisan support for initiatives:<p>> Believe it or not, America has been here before. In the 1920s and 1930s, the American defense industrial base was being similarly manipulated by domestic financiers for their own purposes, retarding innovation and damaging the nation’s ability to defend itself. And American military readiness was ebbing in the midst of an increasingly dangerous world full of rising autocracies.<p>> Within the defense base itself, every example—from TransDigm to L3 to Chinese infiltration of American business—has drawn the attention of members of Congress. Representatives Ted Budd and Paul Cook are Republicans and Representatives Jackie Speier and Ro Khanna are Democrats. They are not alone. Democratic Senator Elizabeth Warren and Representative Tim Ryan have joined Khanna’s demand for a TransDigm investigation.<p>Outside of this article, the best writing I've seen on this topic of short-term incentives is from British economist John Kay's book "Other People's Money", for example when he compares the annual reports from chemical company ICI in 1987 and 1994.<p>1987: ICI aims to be the world's leading chemical company, servicing customers internationally through the innovative and responsible application of chemistry and related science...<p>1994: Our objective is to maximise value for our shareholders by focusing on businesses where we have market leadership, a technological edge and a world competitive cost base.<p>Kay goes on to explain how ICI, a leading British chemical company since its founding in the 1920s, attracted a short term flurry of investment activity but ultimately sold in 2007 just about a decade after their change of priorities.<p>Kay primarily blames an over-expansion of the finance sector and the revolving-door culture on Wall Street, fairly consistent with the premises of this article.