“Something is going wrong on the assembly lines of America’s arsenal of democracy, and it’s happening at a moment of crisis. The White House, Pentagon and America’s overseas allies are all demanding that defense companies ramp up production to meet the needs of a dangerous geopolitical moment. America is running short of missiles, munitions and battleships. Allies are waiting years for deliveries. Even the Pentagon has to stand in line and wait for delayed shipments of major weapons, like Hellfire missiles, Javelin rocket launchers and sophisticated air defense interceptors. America is trying to surge its military capacity to produce more munitions, missiles and ships, but to do so, it must rely almost entirely on a group of five Fortune 500 defense companies. And none of these companies seem to be on war footing.
Instead of hiring more workers and paying workers more in an effort to retain them, these companies are far more focused on meeting the demands of Wall Street, trying to entice investors and boost their stock price by cutting costs, as well as using billions of dollars in revenue to pay handsome dividends and buy back shares of stock. Last year, for example, Lockheed Martin gave $6.8 billion in buybacks and dividends directly to its shareholders, which amounted to nearly 10 percent of the company’s total revenue and was larger than the $5.3 billion it kept in profits. The same year, RTX (formerly called Raytheon) paid $3.7 billion to shareholders, General Dynamics paid $3 billion and Northrop Grumman paid $3.7 billion. The billions of dollars they send back shareholders each year means that there is less money to go toward paying, hiring or retaining their employees.
As a result, jobs in defense manufacturing are becoming less and less attractive at a time when they need to be getting far more attractive. Many workers are leaving the field or declining to enter it. A survey by the job recruiting firm Acara found that annual turnover in the defense and aerospace industry hit 13 percent in 2023, compared to an average U.S. rate of 3.8 percent. And this is happening just as the need for those skills is rising. Demand for advanced manufacturing skills in the sector is outpacing the number of trained employees, and 75 percent of defense companies are struggling to find qualified employees, the survey found.
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During the 2000s, the big defense contractors worked relentlessly to expand their profit margins, make their production lines as lean as possible and boost their annual sales. Raytheon’s stock price nearly quintupled from 2001 to 2021 while Northrop Grumman’s rose nearly 700 percent. Lockheed Martin did exceptionally well between 2001 and 2022, when the company’s stock price rose more than tenfold from $34.68 to $389.13 a share. The profitability came, in part, because Lockheed was focused on keeping labor costs low and supply lines trim.
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Masters said in 2022 that many of his employees could barely afford apartments in the Orlando area, and one of his new hires was sleeping in her car. That year, an entry-level employee at the factory earned a minimum of $15.45 an hour, which was less than some service-sector jobs in the area. In 2025, a local Buc-ee’s gas station advertised wages for “restroom crews” starting at $20 an hour and car wash employees at $21 an hour.
A lot of people joined Lockheed because they thought it would provide a good long-term career path, but Masters said they found it difficult to live off the wages as they worked their way up the ladder.
“We cannot keep people!” Masters said. “They bring them in on the low end of the pay scale. … They want cheaper wages. They want to keep the wage down. We’re up against profit over anything else.”
This system delivered plenty of profits and munitions over 20 years of the War on Terror, but it seemed to hit a breaking point after Russian President Vladimir Putin invaded Ukraine in 2022. The following years of grinding trench warfare created a bottomless appetite for munitions that the United States was suddenly giving or selling by the thousands to its allies.
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Tensions had also already been rising with another near peer country, China, which fueled worries of future munitions shortfalls. This means that Lockheed and its peers had to focus on producing more missiles at a faster rate than it did during the War on Terror.
The companies, and the Pentagon, did not seem up to the task. Spending constraints since 2011, triggered by debate over the debt limit, have led Congress to issue budgets largely through annual continuing resolutions, which undercuts efforts to begin multi-year commitments and contracts necessary that would allow companies like Lockheed to boost missile production. The current wait time for a new Hellfire missile is between two and three years from the time it’s ordered, according to the Department of Defense. The wait for a Javelin missile is about three years.
All of this has saddled Lockheed Martin and other companies with two mandates that are in opposition: If it wanted to dramatically increase its missile output and speed up deliveries, the company would need to invest billions of dollars to boost supply chains and hire workers. But this would cut into free cash flow and could hurt its profits, making the company less attractive to investors. The company might be incentivized to boost production if the Pentagon paid all the upfront costs for expansion. But the Pentagon has not done that, nor has it resorted to using more radical measures like forcing increased production through authorities like the Defense Production Act. This has left companies like Lockheed to work with what they have, trying to satisfy both the Pentagon and its investors at the same time.”
https://www.politico.com/news/magazine/2025/10/27/lockheed-martin-strike-orlando-weapons-missiles-00514386?ceid=273413&emci=d03704a3-37b4-f011-8e61-6045bded8ba4&emdi=80e8776f-b6b4-f011-8e61-6045bded8ba4
Another reason investors deserve their income is that by having a system where corporations work toward the goal of increasing investor return, they have the incentive to be productive. So indirectly, by taking part in such a system, investors produce things with their money.
https://www.noahpinion.blog/p/why-do-people-get-paid-to-invest?r=1o36hf&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false
Trump administration eliminates the SEC crypto fraud unit, then Trump appears to make tons of money on illegal crypto schemes.
https://www.youtube.com/watch?v=ybTPyNwIFv0
“Federal Reserve Chair Jerome Powell said Wednesday that he expects President Donald Trump’s tariffs policy to cause higher inflation and slower economic growth, complicating potential central bank efforts to ease the fallout.”
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“”Markets are struggling with a lot of uncertainty and that means volatility,” Powell said on Wednesday. Still, he added, the volatility reflected the significance of the policy changes, rather than abnormal behavior in the markets.”
https://www.msn.com/en-us/money/markets/fed-chair-powell-sounds-alarm-on-tariffs-sending-stocks-lower/ar-AA1D3nX5?ocid=msedgntp&pc=NMTS&cvid=a623618c76614cedb4ce655c834e89c8&ei=10
China tends to make cheaper things than lots of Americans can buy. Americans tend to make more expensive things. The average Chinese person has less disposable income than the average American, so it doesn’t make sense for them to buy more from the U.S. than the U.S. from China.
https://www.youtube.com/watch?v=dBBDbz7mC8k
“As ugly as the stock market losses have been, the big hit from Trump’s tariffs probably haven’t even arrived yet. As always, the stock market is not the economy—it’s an aggregated indicator of what investors think the economy will look like in the future. Right now, they think it will be bad. Really bad.”
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“In addition to crashing Americans’ retirement accounts and wiping out huge amounts from American companies (Apple and Nike were among the biggest losers in Friday’s rout), Trump’s move will soon raise taxes, wreck supply chains, and make basic goods more expensive or difficult to obtain.
In other words, even if you aren’t affected by the stock market sell-off, you’ll feel the effects of the tariffs before long.
Take each of those things in order. First, the tax increase. Tariffs are a form of taxation. According to the Yale Budget Lab’s analysis, Trump’s tariffs will reduce the average household’s income by nearly $3,800 this year. That’s because lots of things will get more expensive. Tariffs could triple the cost of a new iPhone, for example.
Second, the supply chain chaos. Ryan Peterson is the CEO of Flexport, a tech platform that helps companies with global logistics. He reported last week that 28 percent of the companies in Flexport’s system are “pausing all ocean freight bookings from Asia until there’s more clarity on where tariffs will end up.”
That means that even if some American companies are willing to pay the tariffs to keep supply chains flowing, they may not be able to find importers and shipping services right now.
Finally, the tariffs (and the associated supply chain disruptions) will have an immediate impact on prices and the availability of goods.
“A trade war triggered by Trump’s chaotic tariffs is the same type of aggregate shock as the Covid crisis, but worse,” warns Ben Golub, a professor of economics at Northwestern. As the tariffs degrade the ability of modern international supply chains to function, he wrote on X, the results will be “supply shortages and price spikes.”
To give just one example, consider the morning cup of coffee you might still be nursing. Americans consumed 1.6 billion pounds of coffee last year, but the United States produces only about 11 million pounds annually (all of it in Hawaii).
America also exports a lot of coffee—more than $900 billion of it last year. That’s possible even though we don’t grow very much here, because America-based coffee companies can buy beans from other countries, roast them, and then export them abroad. What are those middle-of-the-supply-chain companies supposed to do? Coffee-drinkers are screwed and coffee exporting companies that employ American workers are doubly boned.
Now repeat that same process for every industry connected to global supply chains. It’s grim.”
https://reason.com/2025/04/07/trumps-tariffs-its-not-just-the-stock-market-thats-in-trouble/
The stock market fall and the inflation from tariffs damage retirements and show the importance of Social Security.
These tariffs aren’t part of a total strategy to bring key industries back to the United States. They are vindictive and nonsensical.
https://www.youtube.com/watch?v=IaAdYSrYQdk
Global Economy Goes into Meltdown
https://www.youtube.com/watch?v=lyEF-GwxxyU
“On the campaign trail, Trump pledged to put a tariff of between 10 percent and 20 percent on all imports to the United States, along with a 60 percent tariff on Chinese goods and a 25 percent import surcharge on Canadian and Mexican wares — at least, until our neighbors choke off the flow of all migrants and drugs across America’s northern and southern borders.
This protectionist agenda is far more radical than anything Trump attempted during his first term. It threatens to hamper American tech companies by increasing the cost of semiconductors, depress stock valuations by reducing economic growth and fueling a global trade war, and disrupt the US auto industry, whose supply chains were built around the presumption of duty-free trade with Mexico.
Thus, American investors, executives, and entrepreneurs watched Trump’s first day in office with bated breath: Would his inaugural address and initial executive orders prioritize corporate America’s financial interest in relatively free global exchange — or his own ideological fixation on trade deficits?
Trump’s Day 1 actions did not fully clarify his priorities on this front. In his inaugural speech, the president reiterated his broad commitment to protectionism. Meanwhile, his administration prepared to launch federal investigations into America’s trade deficit in general, as well as the trade practices of China, Mexico, and Canada in particular.
Nevertheless, Trump did not actually establish any new tariffs on his first day in office, as his administration’s arch-protectionists had hoped that he would.
Investors interpreted Trump’s caution as a sign that he would be heeding his advisers’ push for a more limited and incremental tariff policy; stocks rose Monday while the US dollar fell (stiff tariffs would increase the value of America’s currency).
Wall Street’s relief may be premature. Trump appears as ideologically perturbed by America’s trade deficit as ever.”
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“Imposing even a 10 percent tariff on all imported goods would not only harm various business interests, but would also likely increase costs for consumers. Thus, such a duty would harm both Trump’s donors and voters.
If Trump’s first term is any guide, his universal tariff would not even redound to the benefit of American manufacturers, who would be vulnerable to higher costs and retaliatory tariffs from foreign nations. Generally speaking, presidents seek to avoid enacting policies that harm the bulk of their coalition, to the benefit of a narrow band of ideologues. And this is what implementing Trump’s grandest visions for trade policy would likely entail.
Second, the imposition of a universal tariff would roil stock markets. During Trump’s first term in office, he monitored the markets’ performance obsessively, tweeting about it incessantly and suggesting that stock values were a barometer of sound policy, warning in 2018, “If Democrats take over Congress, the stock market will plummet.”
Finally, Trump has recently shown some sensitivity to the interests of his newfound friends in tech, even when those interests conflict with the tenets of rightwing nationalism. Over the holidays, Elon Musk feuded with their co-partisans over the desirability of high-skill immigration and the H-1B visa, which help American tech companies to hire foreign talent. Trump ultimately expressed support for Musk’s position.”
https://www.vox.com/politics/395829/trump-tariffs-executive-orders-inauguration-stocks-trade-policy