It was Dwight D. Eisenhower, America’s only 5-star General President, who first warned us of the “military-industrial complex.” (Less well-known is the fact that in the draft of the address, Eisenhower initially used the term “military-industrial-congressional complex,” but struck the word “congressional” in order to pacify members of Congress. Too bad – Congressional meddling and jockeying to get more dollars in their district is the largest single factor in defense cost overruns.)
Still, even with Congressional posturing, jockeying and meddling, we manage to muddle through and support the best-trained and arguably the best-equipped fighting force in the world. I believe this is because true patriots occupy much of the military-industrial complex. Many, from security guards to the elder statesmen of the industry, are former military themselves.
They know what it is to have the best equipment and they know what it is to have to make do with less. They know what it is to have the best training and what it is to have to make do with less.
I’ve had a pretty extensive history with the defense business. Most of my first-hand experience has been in the special operations and intelligence arenas, but I still have respect for, have called for, and have said a silent “Thank You,” when that call is answered and a C-130 gunship, an A-10 Warthog, or a fast-burner shows up to remind me that we are all one team, each with our job to do.
Not all the aircraft above are made by the same company. But between the giants in the “hardware” side of the business, which includes Boeing (NYSE:BA), Lockheed Martin (NYSE:LMT), Northrop Grumman (NYSE:NOC), Raytheon (NYSE:RTN), General Dynamics (NYSE:GD), and L-3 Communications (NYSE:LLL), they keep our Soldiers, Sailors, Airmen and Marines well-equipped and well-supported.
Given how they are portrayed in the left-leaning media, as rapacious out-of-control behemoths, it’s interesting to note that none of them even crack the Top 100 on the Forbes Global 2000 list (which uses four metrics: sales, profit, assets and marketcap.) All fall well below at least 117 other firms, including Volkswagen(OTCQX:VLKAY), Bayer Group (OTCPK:BAYRY), Morgan Stanley (NYSE:MS), Comcast (NASDAQ:CMCSA), and CVS Pharmacy (NYSE:CVS). Thanks to its commercial airline business, Boeing finally makes an appearance at #119 globally -- sandwiched between #118 Abbot Labs (NYSE:ABT) and #120 Bank of Nova Scotia (NYSE:BNS).
But one thing this industry offers is the ultimate hi-tech hunting ground. On any given Sunday, two guys in their garage might invalidate billions of dollars of embedded equipment, training, tactics, or procedures. So much of what we take for granted today -- including the ability to send this publication over the “Internet” is possible because the Internet is one of thousands of hi-tech fallout commercial products or processes that came from defense applications, in this case the ARPANET, a communications network funded by the Advanced Research Projects Agency (ARPA) within the Department of Defense (DoD) to ensure that military networks could survive a nuclear strike and maintain control of nuclear arms for a counter-attack.
The defense of the nation is a cornerstone of our survival and success. We can’t do without it. If the nation cannot defend itself from enemies foreign and domestic all else is lost. I believe the defense firmament is undergoing a tectonic shift that may leave some of the biggest companies of today the dinosaurs of tomorrow.
Rather than blindly subscribe to the notion that bigger is better, I believe we need to answer the question, “What is our goal?” regularly. For instance, is our goal as a nation to field the best pilots in the world, flying the best aircraft, or is it to establish and maintain air supremacy? If we think the latter only flows from the former, we may end up reaching our goal, but losing the war.
I’ll use America’s Boeing (BA) as our first example of a company that is on the cutting edge -- more high tech than most of Silicon Valley – in protecting America via their platforms, projects and other offerings.
Boeing’s problems with commercial jets are well-reported-on. But Boeing is also a key player in military aircraft, satellites, missile defense, human space flight, and launch systems and services. Concentrating on the equipment side, BA’s global strike aircraft include the F-15E (Strike Eagle), one of two most flown racehorse/workhorses in the Air Force’s multirole fighter fleet. Since entering operational service, the F-15 has a perfect air combat record, with more than 100 victories and no losses.
Then there’s the new (March 2009) Silent Eagle (F-15SE), designed for our best allies, which combines low-observable technologies with the flexibility forlarge and diverse weapons payloads, including internal weapons carriage. It also features digital flight controls, reducing airframe weight, and an advanced electronic warfare system that integrates with Raytheon’s (RTN) Advanced Electronic Scanning Array radar.
The F/A-18E & F/A-18F Super Hornet is the combat-proven cornerstone of U.S. naval aviation. The “F/A” designation mean it performs both fighter (air-to-air) and attack (air-to-surface) missions. On more than occasion I’ve had the privilege of standing beside the Air Boss as F-18s were screaming away and being captured upon return. Proud as I am of my Air Force, I must say I’m glad Boeing makes aircraft like the Super Hornet, as well -- and that these carrier pilots are on the same team...
A variation of the ‘18 is the EA-18G Growler, which flies the airborne electronic attack mission. The first EA-18G aircraft joined the Navy's fleet just in June 2008, and reached initial operating capability earlier this year.
In addition to building, along with other US aerospace firms, the finest military jets in the world, Boeing also produces the Harpoon anti-ship missile with all-weather, over-the-horizon capability; the JDAM (Joint Direct Attack Munition), a relatively low-cost guidance kit that converts existing unguided free-fall bombs into near-precision-guided weapons; the Small Diameter Bomb (SDB), a near-precision-guided weapon launched from a fighter, bomber or unmanned aircraft that can destroy targets from a range of greater than 40 miles and penetrate more than three feet of steel-reinforced concrete; and the Standoff Land Attack Missile Expanded Response (SLAM-ER -- we love those acronyms in DoD!), a day/night, adverse weather, over-the-horizon, precision strike missile against moving and stationary land and ship targets.
Had enough? Like the Ronco ads used to say, “But wait! There’s more!” Boeing also makes the C-17 Globemaster III, replacement to the venerable C-141 and in most environments, the C-5. The C-17 is now the world's premier heavy airlift aircraft. They also provide the premier (airborne) Anti-Submarine Warfare (ASW) and Intelligence, Surveillance and Reconnaissance (ISR) systems with, for starters, the 737 Airborne Early Warning and Control (AEW&C) surveillance, communications and battle management airframe. It can track airborne and maritime targets simultaneously and includes a self-defense capability, an advanced open system architecture and an Identification Friend or Foe system, as well as the better-known AWACS aircraft, used for both airborne surveillance and command and control (C2) for tactical and air defense forces.
In ASW, Boeing’s P-8A Poseidon is a military derivative of the Boeing Next-Generation 737-800 designed to replace the U.S. Navy's fleet of current -- and equally venerable! -- P-3 Orions. And may I just mention in passing their AH-64D Apache Longbow multirole combat helicopter; CH/MH-47 Chinook medium-to-heavy-lift helicopter for intra-theater troop and cargo movement; V-22 Osprey tilt rotor that can take off and land like a helicopter, but once airborne, its engine nacelles can be rotated to convert the aircraft to a turboprop airplane capable of high-speed, high-altitude flight; and two Unmanned Aerial Vehicles (UAVs), the A160T Hummingbird, a long-range, long-endurance, rotorcraft, and the ScanEagle, a low-cost, long-endurance, unmanned air system with excellent loiter time that provides ISR and communications relay.
In the interest of space and time, and because I am using Boeing as an exemplar in the "hardware" sub-sector, I haven’t even discussed their huge training and support subsidiaries, or their cyber-security capabilities, missile defense systems, or Command, Control and Communications (C3) Networks. Suffice it to say these guys are serious players in America’s future security.
If the reader’s mind is not reeling from all these weapons systems, let me conclude with one that is not quite operational yet, but which the Pentagon has accelerated by three years because of its timeliness: the GBU-57A/B “super bunker buster”, also known as the Massive Ordnance Penetrator (MOP), a powerful new bomb capable of destroying the underground nuclear facilities of any crazed dictator or nut-case stupid enough to attempt to develop and nuclear weapons. A single MOP bomb weighs 31,862 pounds. It is so immense it can only be carried by either a B-52 or a B-2A stealth bomber. The weapon’s explosive power is 10 times greater than its predecessor – when tested recently in the US, the MOP set a record when it punched through 19 feet of a 330-ton, steel rod-reinforced concrete.
Inside a B-2…
No one hates war more than a soldier. Like most of you, I hope this nation never needs to unleash such awesome firepower. But it’s comforting to know that great American companies are out there on the leading edge making deterrent weapons that put our would-be enemies on notice: “Don’t Tread on Me…”
Author's Disclosure: Having owned it a number of opportune times in our lifetime, we currently own no shares of Boeing. Our last name isn’t Rockefeller; we can’t buy everything we like! But on any pullback to the low 50s, we’d sell something else to buy BA once again. This is a great company in an essential industry doing the nation’s work…
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