The Pentagon's Misguided Deal with Automakers

Benjamin Giltner

This week, Pentagon officials approached auto manufacturing companies with the request that they produce weapons, mostly munitions. Decreasing munition stockpiles and low production rates motivated the Pentagon to make this plea to automakers. This deal would harm Americans and would do little to address America’s security needs.

Compared to businesses in the civilian sector, defense dollars contribute less to the national economy. Whereas domestic spending benefits multiple businesses and consumers, defense manufacturing benefits a small group. Most Americans don’t see economic returns from the millions of their tax dollars used to make missiles. 

Making matters worse is the inflationary pressure that this move will put on Americans. When the federal government pays automakers to divert funds and resources from manufacturing cars to pump out missiles, they put more money into the economy without increasing the supply of domestic products. Coupled with lowered taxes and President Trump’s desire to decrease interest rates, this creates a perfect storm for higher inflation. This couldn’t come at a worse time, when Americans face skyrocketing car prices and higher costs of living.

Finally, there’s the obvious question: What does the US government pay its current defense contractors billions of dollars each year to do? The answer should be to provide the US military with weapons and munitions. Yet, these companies produce a small amount of munitions, and the ones they do produce are overpriced. This results in the Pentagon procuring fewer munitions than defense contractors make. The Pentagon and Congress must confront this price gouging.

With munition production being low, the Trump administration should have avoided becoming involved in its war in Iran from the beginning. But even putting that fact aside, this move from the Pentagon avoids reform to the defense bureaucracy and overlooks the need for the United States to reduce its military commitments abroad. It also sidesteps the billions of dollars that the administration looks to waste on certain weapon systems, such as the new “Trump class” battleship. While not as flashy as a battleship, munitions are more important for American security.

The administration’s focus should be to make the Pentagon more efficient and transparent rather than expanding its role into civilian sectors.