Why the US Military Costs so Much

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Key takeaways

- The US Navy's littoral combat ship program became an expensive failure despite early warnings. Ships expected to cost $150–225 million averaged approximately $500 million each; by 2023, the Navy had purchased 30 and was decommissioning or preparing to retire nine.

- The littoral combat ships failed to deliver the capabilities that justified buying them. The Independence class developed hull-cracking risks, the Freedom class suffered propulsion failures requiring contractor intervention, and unreliable submarine-detection and mine-clearing systems left the ships far less versatile and survivable than promised.

- Other ambitious American weapons programs suffered similarly costly setbacks. The Comanche helicopter consumed $7 billion but produced only two flying prototypes, the Zumwalt destroyer's guided ammunition cost roughly $800,000 per shell, and the F-35 program exceeded its initial cost projections by 89%.

- America's largest defense contractors can survive poor performance because the government depends on their specialized manufacturing capabilities. Lockheed Martin receives approximately 71% of its revenue, or $47.5 billion annually, from the US government, while preserving essential suppliers sometimes takes priority over their efficiency.

“profit off of their necessity rather than their effectiveness”

- Defense procurement can financially reward higher costs while offering little meaningful competition. Cost-plus contracts reimburse expenses and provide additional profit, while approximately two-thirds of major weapons-system contracts attract only one bidder.

“the more a project costs the more the contractor makes”

- Exaggerated Soviet threats helped generate American military contracts and political advantages during the Cold War. U-2 reconnaissance exposed the overstated Soviet bomber threat, while John F. Kennedy reportedly continued campaigning on an inflated Soviet missile advantage even after receiving contradictory evidence.

“it was just so useful politically”

- Defense contractors help influence which military threats receive public attention and political funding. The episode says most leading think tanks receive at least some defense-industry funding, while politicians and media organizations use their assessments to justify spending against emerging threats, including China's military expansion.

“no one gets punished when a threat does not materialize”

- American military research has lost much of its former global importance while development timelines have grown dramatically. Defense-related spending reportedly represented one-third of worldwide research and development funding in the 1960s versus approximately 3% more recently, while military aircraft development that once took several years now frequently takes decades.

- YouTube permanently removed a Wendover video over an accidentally visible passport, despite the possibility of fixing it with a blur. The creator said YouTube's policy-strike process prevented correction, whereas Nebula allowed the video to remain available by replacing its original file.

“a little button on our back end that allows the Creator to swap files on a video”

All points

4061 words

- Most militaries are designed primarily to defend their own territory. Their forces are organized around threats to their homeland rather than maintaining the ability to fight wars anywhere in the world.

- Iceland illustrates how limited a national military can be. Its defensive capabilities are described as four ships, one airplane, three helicopters, and four radar stations, all operated by the Coast Guard.

- Iceland has almost no ability to conduct military operations abroad. Beyond a small volunteer paramilitary peacekeeping unit, it lacks expeditionary forces. The narrator also states that Iceland's constitution provides no mechanism for declaring war.

- Expeditionary warfare is fundamentally more expensive than domestic defense. A military operating abroad must temporarily transport and sustain everything from missile systems to kitchens, whereas domestic military infrastructure can remain permanently stationed.

- Only relatively wealthy, well-equipped militaries can sustain significant overseas operations. France, Mexico, and Canada are cited as examples of countries with expeditionary capabilities beyond basic homeland defense.

- The United States follows a military strategy fundamentally different from most countries. Rather than concentrating on regional threats, it seeks the ability to conduct nearly any kind of military operation, anywhere in the world, at almost any moment.

- America's global military presence effectively treats foreign territory as an extension of its operational homeland. This requires worldwide bases, personnel, equipment, supplies, transportation, and systems capable of supporting multiple kinds of conflict.

- An American military base in southeastern Turkey illustrates the logistical costs of global deployment. The United States operates a grocery store supplying thousands of stationed service members, including specially produced chicken products transported through its military supply system.

- The Turkish installation is also described as storing approximately 50 American nuclear warheads. Their location supports potential American military operations involving Europe, Africa, the Middle East, and surrounding regions.

- The military has paid professional sports organizations to stage patriotic ceremonies honoring service members. These activities are presented as part of the broader effort to recruit sufficient personnel for America's extensive military commitments.

- The Department of Defense has invested in humanoid robots for potential military use. The intended advantage is to transfer dull, dirty, and dangerous work from human personnel to machines.

- America's military costs extend beyond maintaining today's forces. The Pentagon must anticipate future threats, develop technologies years in advance, and position appropriate personnel and equipment before conflicts arise.

- The USS Freedom represents the enormous resources committed to predicting future warfare. Commissioned in 2008, the approximately 400-foot, or 120-meter, littoral combat ship emerged from roughly two decades of planning, research, development, contracting, and construction.

- The littoral combat ship program began with a major change in American naval strategy after the Cold War. The Navy possessed a fleet designed largely for combat against powerful adversaries on the open ocean, but the Soviet Union's collapse left the United States without a comparable naval rival.

- American naval planners increasingly expected threats from pirates, terrorists, and weapons smugglers operating near coastlines. These smaller, faster opponents presented different challenges from traditional naval warfare between large surface fleets.

- The Navy considered two approaches to coastal warfare. One was DD21, a larger warship intended to operate effectively near shore. The other was the Streetfighter, a smaller, faster, and potentially cheaper vessel.

- The Streetfighter concept initially appeared more attractive because it promised lower operating costs and greater flexibility. Smaller crews, stealth, rapid movement, and the ability to surprise opponents were central to the proposed design.

- The Navy wanted the smaller vessel to combine extraordinary speed with substantial range and payload. New hull technology was expected to support speeds approaching 45 knots while retaining the ability to cross oceans and carry meaningful military equipment.

- Modularity was supposed to make the ships adaptable to several missions. Crews would change weapons and equipment packages to shift between surface combat, submarine hunting, and mine clearance without needing separate specialized ships.

- By 2000, the Streetfighter remained a concept that the Navy had struggled to develop internally. The project was transferred to private contractors after the Navy failed to turn its ambitions into a workable design.

- General Dynamics and Lockheed Martin received contracts to develop competing littoral combat ship designs. Each company was initially assigned two ships, with the expectation that competition for later orders would produce an effective new naval platform.

- The Navy initially expected each littoral combat ship to cost between $150 million and $225 million. Affordability was an essential part of the concept because the Navy expected to purchase a large fleet.

- By 2009, only two vessels had been delivered instead of the four originally contracted. Both designs experienced such severe cost overruns that the Navy canceled the second ship ordered from each contractor.

- Construction costs approximately doubled the original expectations. A vessel intended to cost no more than roughly $225 million had already become a substantially more expensive procurement.

- The Navy continued planning a large littoral combat ship fleet despite those early problems. Different force-structure projections called for 56, 82, 63, 55, and eventually 52 ships, reflecting changing estimates of future naval requirements.

- The planned fleet was intended to replace aging minesweepers and frigates. The Navy's broader modernization strategy depended on these new ships fulfilling missions previously handled by established classes of warships.

- Instead of choosing one winning design, the Navy proposed buying both versions. Its dual-award strategy would give General Dynamics and Lockheed Martin contracts for ten ships each over five years.

- The dual-award strategy increased the Navy's commitment before fundamental design problems had been resolved. The Navy sought congressional approval for 20 more vessels in 2010 even as limitations in the existing ships were becoming apparent.

- The ships attempted to overcome a basic naval engineering trade-off. Warships can emphasize speed, long range, or heavy payload, but combining all three requires difficult compromises.

- Both littoral combat ship designs achieved approximately 44 knots. That made them roughly 10–15 knots faster than typical American Navy vessels, but attaining that performance required unusual engineering decisions.

- General Dynamics developed the Independence class around an aluminum trimaran hull. The unconventional three-hulled design helped achieve high speeds while producing structural problems not associated with conventional steel warships.

- The Independence class faced concerns about hull cracking. According to the episode, its aluminum construction could develop cracks when traveling faster than approximately 15 knots or operating in rough seas, greatly reducing the practical usefulness of its advertised speed.

- Lockheed Martin's Freedom class used a more conventional steel monohull but an unusually complicated propulsion system. Its combining gear connected diesel engines and gas turbines to deliver the required performance.

- The Freedom class propulsion system proved difficult to maintain and unreliable. Critical components were buried deep inside the ship, making them difficult for Navy maintenance personnel to reach.

- Propulsion failures created dependence on Lockheed Martin engineers. When the combining gear malfunctioned, Navy personnel often needed company specialists to diagnose problems and develop repairs, limiting the military's ability to maintain its own vessels independently.

- The ships failed to achieve their intended survivability standard. They were supposed to meet Level 1 survivability, described in the episode as the ability to continue operating after an underwater explosive attack.

- In 2010, the Navy acknowledged that existing littoral combat ships had not met Level 1 survivability requirements. This admission came while the service was pursuing authorization to purchase another 20 vessels.

- The Navy rushed ships into production without establishing that their interchangeable mission packages worked. The modules were central to the entire concept, yet their operational effectiveness had not been adequately demonstrated before major procurement decisions.

- The anti-submarine warfare package suffered from the ships' own acoustic signature. The vessels generated so much noise that their towed sonar equipment struggled to distinguish submarine sounds from the ship's background noise.

- The mine countermeasures package experienced extensive technical problems. Its sensors and unmanned influence-sweeping equipment were affected by delays, equipment failures, and false alarms.

- The promised multipurpose vessel became far less versatile than intended. With submarine-hunting and mine-clearing systems underperforming, the ships were effectively reduced to limited surface-combat platforms with questionable survivability.

- The Navy had purchased 30 littoral combat ships by 2023. Their average construction cost was approximately $500 million each, more than twice the upper end of the original target.

- The fleet experienced numerous operational embarrassments. Ships broke down at sea, struck the walls of the Panama Canal, and spent a winter trapped in an ice-covered section of the St. Lawrence River.

- The ships completed relatively few substantial operational missions despite their cost. Their limited record contrasted sharply with the expectations that they would become a major component of America's future naval fleet.

- The Navy began abandoning portions of the program earlier than originally anticipated. By the episode's account, nine vessels had already been decommissioned or were moving toward decommissioning.

- The littoral combat ship program illustrates how a plausible strategic concept can fail during execution. The Navy correctly recognized changing maritime threats but committed enormous resources to designs whose technical capabilities, survivability, and operating costs did not match expectations.

- The Boeing-Sikorsky Comanche helicopter program suffered a comparable failure. The companies received the development contract in 1991, but after approximately a decade and $7 billion in spending, only two prototypes had flown.

- The Zumwalt-class destroyer was another ambitious naval project that failed to meet important expectations. The stealth destroyer's gun system had not demonstrated its promised range, while its missile systems were described as inconsistent in hitting intended targets.

- The Zumwalt's specialized guided ammunition was prohibitively expensive. Individual shells were estimated at approximately $800,000, undermining the economic practicality of its planned weapons system.

- The Zumwalt program was reduced to three ships. Its original ambitions for a more extensive new generation of warships were curtailed as costs and technical limitations became evident.

- The F-35 Joint Strike Fighter encountered repeated technical failures and budget overruns over approximately two decades. Designed as an adaptable, advanced multirole aircraft, the program's costs reportedly rose to 89% above initial projections.

- Some defense-development failures are unavoidable because militaries attempt to invent technologies that do not yet exist. The episode acknowledges that experimental weapons programs inherently involve uncertainty but argues that American failures have grown more expensive and more frequent.

- Five companies dominate major American defense contracting. Lockheed Martin, Raytheon, Northrop Grumman, Boeing, and General Dynamics are identified as the principal manufacturers the Department of Defense turns to for major weapons systems.

- Four of the five major contractors derive most of their revenue from American or allied military business. Boeing is identified as the exception, reflecting its substantial commercial aviation operations.

- American government approval influences even foreign military sales involving these contractors. Their dependence extends beyond direct Pentagon purchasing to allied defense contracts subject to United States oversight.

- Lockheed Martin receives approximately 71% of its revenue from the United States government. The episode estimates that relationship at $47.5 billion annually, illustrating the company's extraordinary dependence on public military spending.

- Lockheed Martin receives more annual funding from the American government than NASA. The episode argues that, measured by this government revenue, the company would rank approximately 24th among federal agencies if it were itself an agency.

- Lockheed Martin is described as earning nearly $1 billion in profit per month. Its profitability is presented as evidence of the financial rewards available to companies operating inside the American defense procurement system.

- The modern defense contracting industry grew from the military adoption of commercially developed aviation technology. During and after World War I, private aerospace companies began receiving relatively modest American military contracts, with annual production measured in dozens or hundreds of aircraft.

- World War II transformed the American aerospace industry. The United States and its allies urgently needed aircraft in unprecedented quantities, prompting the government to award enormous production contracts to private manufacturers.

- The wartime aircraft industry involved a much broader range of companies than today's concentrated defense sector. Manufacturers cited include Lockheed, Goodyear, McDonnell Douglas, Boeing, Hughes, Grumman, Northrop, and Convair.

- Many American aerospace manufacturers became major industrial enterprises because of World War II. Companies that had existed before the conflict expanded dramatically when military aircraft orders surged.

- McDonnell and Hughes experienced extraordinary wartime workforce expansion. The episode describes McDonnell's employment growing to approximately 5,000 people and Hughes expanding from four workers to about 80,000.

- American aircraft production increased from approximately 20,000 planes in the six years preceding World War II to 300,000 during the war. The expansion established an immense industrial manufacturing base supported by military demand.

- The end of World War II threatened the business model of American aircraft manufacturers. Military orders collapsed, forcing companies to search for alternatives to the extraordinary wartime production volumes.

- Aircraft manufacturers responded to postwar conditions by diversifying and consolidating. Some moved into civilian aviation, others focused on automobile manufacturing, and others merged with competitors.

- The American government also sought ways to preserve the industrial capacity developed during the war. Officials considered the aerospace sector strategically important because of its contribution to Allied victory and its potential usefulness in future conflicts.

- The Cold War quickly provided a new justification for large military contracts. Reports emerged that the Soviet Union had developed a massive fleet of long-range bombers capable of threatening the United States with nuclear attack.

- The perceived Soviet bomber advantage generated fear among American politicians, the media, and the public. The possibility of a devastating nuclear strike helped support calls for urgent military expansion.

- President Dwight Eisenhower responded by accelerating American bomber production. The decision provided additional business for aerospace manufacturers despite uncertainty about the true size of the Soviet threat.

- Eisenhower also approved Lockheed's proposal to develop the U-2 reconnaissance aircraft. The high-altitude surveillance plane was intended to fly over Soviet territory and establish the actual extent of the Soviet bomber fleet.

- Reconnaissance revealed that Soviet bomber capabilities had been greatly exaggerated. The Soviet inventory was only a fraction of what American observers had feared.

- Defense manufacturers benefited financially before the bomber threat was disproven. The episode emphasizes that procurement contracts had already been awarded, meaning the eventual discovery did not reverse the companies' earlier gains.

- The Soviet launch of Sputnik helped trigger another American military scare, this time involving missiles. Democrats argued that Eisenhower's Republican administration was allowing the United States to fall behind Soviet technological development.

- Inflated American intelligence estimates contributed to the perceived missile gap. The episode specifically describes exaggerated assessments of Soviet missile capabilities leaked from the Air Force.

- John F. Kennedy made the supposed missile gap a major argument during his 1960 presidential campaign. He accused his political opponents of failing to respond adequately to the Soviet threat.

- Kennedy reportedly continued emphasizing the missile gap even after receiving evidence contradicting it. The episode presents his continued use of the argument as politically advantageous despite doubts about its factual basis.

- The missile-gap controversy accelerated American missile development. The resulting contracts benefited aerospace manufacturers at a time when demand for large-scale aircraft development was weakening.

- Eisenhower warned about the military-industrial complex in his farewell address. The episode connects that warning to the political and commercial relationships exposed by the bomber and missile scares.

- The continuing Cold War sustained a long period of defense-industry expansion. Rising military expenditure created a dependable source of government revenue for aerospace and weapons manufacturers.

- The end of the Cold War initially threatened another major contraction in the defense industry. Following the fall of the Berlin Wall, the Department of Defense warned suppliers that substantial spending reductions were coming.

- The prospect of lower military budgets triggered extensive consolidation and acquisitions. Contractors merged and purchased competitors in anticipation of a prolonged period of weaker demand.

- The expected post-Cold War decline in defense spending proved relatively brief. The episode describes the reductions as modest compared with the longer historical trend.

- The September 11 attacks and subsequent wars restored large-scale American military expenditure. The wars that followed returned government defense procurement to a sustained pattern of high spending.

- China's expanding military capabilities became a major justification for contemporary American defense budgets. With earlier American wars largely winding down, the Chinese military emerged as a prominent argument for continued or increased expenditure.

- The episode does not claim that every foreign military threat is imaginary. It acknowledges that threats may be legitimate while questioning whether the public can accurately assess them when powerful financial and political interests influence the discussion.

- Defense contractors and their lobbyists play an important role in shaping public debate about national security. They have financial incentives to support perceptions of danger that create demand for new military spending.

- Many prominent policy think tanks receive funding from defense contractors. The episode argues that a large majority of leading think tanks receive at least some defense-industry support.

- Politicians and news organizations frequently use think-tank assessments to justify military expenditure. Contractor funding creates potential conflicts of interest when those organizations are presented as independent authorities on emerging threats.

- The episode argues that inflation-adjusted American military spending is approaching World War II levels. It contrasts contemporary expenditure with the absence, at the time described, of direct American involvement in a major war comparable to World War II.

- The justification for this level of military expenditure remains debatable. The episode distinguishes the question of whether threats warrant high spending from the separate question of how efficiently defense money is being used.

- Earlier American military research produced technologies with enormous civilian benefits. Nuclear technology, GPS, and the internet are identified as major innovations supported financially by military research and development.

- American defense research once represented an extraordinary share of worldwide innovation spending. During the 1960s, approximately one-third of global research and development funding reportedly came from American defense-related expenditure.

- The American defense sector's share of global research funding later declined to approximately 3%. The episode uses this change to show how the military's relative role in worldwide technological development has diminished.

- Civilian and military product-development timelines have moved in different directions. American automobile manufacturers have shortened the time needed to bring new vehicles to market, while commercial aircraft development has become only somewhat slower.

- American military aircraft development has become dramatically slower. Projects that once required approximately three, five, or seven years can now take decades.

- The episode identifies government procurement practices as a major source of defense-industry inefficiency. Bureaucratic processes that would ordinarily constrain public institutions have become embedded in private companies that earn revenue from fulfilling government contracts.

- The Department of Defense establishes detailed technical requirements before contractors develop new equipment. Unlike ordinary commercial markets, where manufacturers often create products and persuade customers to buy them, defense suppliers typically build to specifications established by a single dominant customer.

- Defense companies spend heavily on lobbying to influence those requirements. Many lobbyists previously worked for the Department of Defense, giving them experience and relationships useful in shaping future procurement decisions.

- Contractors can benefit when military requirements are written around technologies they already know how to produce. The episode argues that this encourages firms to minimize risky research and development rather than pursue genuinely new solutions.

- Cost-plus contracting weakens incentives to control expenses. Under these arrangements, the government reimburses allowable development or production costs and pays the contractor an additional profit calculated according to the contract's terms.

- Percentage-based cost-plus compensation can reward higher spending. When profit is tied to the cost base, more expensive projects can generate greater absolute returns for the contractor.

- Competition does not consistently correct these incentives. The episode states that approximately two-thirds of major weapons-system contracts attract only one bidder.

- Some defense contracts are awarded without competitive bidding at all. This further reduces the commercial pressure normally placed on suppliers to improve efficiency, reduce prices, or outperform rivals.

- The government sometimes supports struggling defense contractors to preserve their manufacturing capabilities. Allowing an ineffective supplier to collapse could eliminate specialized industrial capacity considered essential to national security.

- America's largest defense contractors possess capabilities that are difficult to replace. The government depends on a limited number of companies to manufacture advanced military technologies that help preserve American technological superiority.

- This dependence makes major defense contractors effectively too important to fail. The government's need to maintain a domestic weapons industry can protect companies from the financial consequences of poor performance.

- Contractors can therefore profit from their strategic necessity rather than their effectiveness. The episode argues that dependence, limited competition, and government support weaken the normal relationship between business performance and financial reward.

- Politicians can benefit from warning about threats that never materialize. When an anticipated danger fails to emerge, officials can claim that the military response they supported successfully prevented it.

- Defense contractors can benefit from the same dynamic. They receive contracts to address anticipated dangers, and the subsequent absence of conflict does not necessarily demonstrate that the original spending was unnecessary.

- The political cost of underestimating a real threat is greater than the cost of exaggerating one. Someone who dismisses a danger that later materializes can face severe criticism, whereas someone who warns of a danger that never appears may avoid comparable accountability.

- These unequal incentives favor the continued expansion of perceived security threats. Political leaders have reasons to emphasize possible dangers, while contractors have reasons to supply the expensive equipment proposed to address them.

- Fear is presented as a central economic and political driver of the military-industrial complex. The episode's argument is that the interaction of government incentives, contractor profits, and public anxiety can sustain spending independently of whether every predicted danger proves real.

- A previous Wendover Productions video was removed from YouTube because a passport appeared briefly on screen. The footage unintentionally exposed personally identifiable information.

- YouTube classified the passport exposure as a violation of its harassment and cyberbullying policy. The platform issued a policy strike and removed the video despite the disclosure being accidental.

- The creator acknowledged that the removal was consistent with the wording of YouTube's policy. The main objection concerned the inability to correct an accidental privacy violation after a policy strike.

- A simple blur could have concealed the passport information without changing the video's substance. However, the creator said YouTube's enforcement process did not allow that repair, leaving the video permanently unavailable on the platform.

- The removed video remained available on Nebula. Unlike YouTube's handling of that policy strike, Nebula allowed the creator to replace the original video file with a corrected version.

- Nebula was established by the narrator and other creators as an alternative video platform. Their aim was to preserve useful features of YouTube while addressing limitations they had experienced as creators.

- Nebula developed a backend feature allowing creators to replace uploaded video files. This permits corrections, improvements, and privacy-related edits without permanently removing the original publication.

- Nebula had grown to more than 500,000 subscribers and hundreds of thousands of monthly active users. The platform had also received Streamy Award nominations, according to the narrator.

- Nebula's business model supports original productions with larger budgets. Subscription revenue is used to finance exclusive programming that may be more difficult to sustain through conventional advertising-supported distribution.

- A companion episode of The Logistics of X examines American weapons manufacturing and distribution. It explores the physical processes involved in producing military equipment and transporting it safely without the weapons causing accidental harm during distribution.

- The creator described additional original productions as being in development. These included a particularly ambitious, high-budget Wendover production that had entered preproduction.

- Nebula provides participating creators with recurring subscription revenue. When viewers subscribe through a creator's referral link, that creator receives a share of subscription revenue for as long as the customer remains subscribed.

- The recurring revenue arrangement is intended to make creators less dependent on advertising fluctuations. Subscription payments can provide more predictable income than advertising rates, which vary significantly over time.

- The episode offered a promotional discount on annual Nebula subscriptions. The advertised reduction was 40%, bringing the effective monthly cost of an annual subscription to less than $3.