Defense Contractors Don’t Need Another Covid Bailout

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The inadequate response of both the federal and state governments to the Covid-19 pandemic has had a devastating impact on the United States, creating what could only be called a national security crisis. More than 190,000 Americans are dead, approximately half of them people of color. Yelp data show that more than 132,000 businesses have already closed and census data suggest that, thanks to lost wages, nearly 17 percent of Americans with children can’t afford to feed them enough food.

In this same period, a number of defense contractors have been doing remarkably well. Lockheed Martin, the Pentagon’s top contractor, reported that, compared to 2019, its earnings are actually up—yes, up! The company’s success led the financial magazine Barron’s to call it a “pandemic star.” And those profits are only likely to grow, given the Trump administration’s recent approval of a 10-year deal to sell $62 billion worth of its F-16s to Taiwan.

Lockheed Martin is far from the only such outfit. As Defense One reported, “It’s becoming abundantly clear that companies with heavy defense business have been able to endure the coronavirus pandemic much better” than, for instance, commercial aerospace firms. And so it was that, while other companies have cut or suspended dividends during the pandemic, Lockheed Martin, which had already raised its gift to shareholders in late 2019, continued to pay the same amount this March and September.

The spread of Covid-19 has created one of the most significant crises of our time, but it’s also provided far greater clarity about just how misplaced the priorities of Washington have been all these years. Americans—the Trump administration aside—are now trying to deal with the health impacts of the pandemic and struggling to figure out how to safely reopen schools. It’s none too soon, however, to start thinking as well about how best to rebuild a devastated economy and create new jobs to replace those that have been lost. In that process, one thing is crucial: resisting the calls—and count on it, they will come—to “rebuild” the war economy that had betrayed us long before the coronavirus arrived on our shores, leaving this country in a distinctly weakened state.

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