I too don't have a problem with this. We pay out the ass. Every defense contract needs to be gone over with (great) scrutiny. Along with all federal contracts. On Apr 11, 2016 2:34 PM, "plainolamerican" <[email protected]> wrote:
> fuck the defense industry and their thieves. > > On Monday, April 11, 2016 at 1:48:39 PM UTC-5, Travis wrote: >> >> >> >> >> >> >> >> >> >> >> >> >> >> >> http://www.politico.com/story/2016/04/defense-pentagon-spending-assad-221776 >> >> >> >> *Meet the most hated man in the Pentagon* >> >> Company executives accuse Shay Assad of pursuing a "personal vendetta" by >> hounding firms large and small to justify what they charge for weapons or >> services. >> >> By Ellen Mitchell <http://www.politico.com/staff/ellen-mitchell> >> >> 04/11/16 05:27 AM EDT >> >> Updated 04/10/16 12:16 PM EDT >> >> [image: Description: Shay Assad is pictured. | John Shinkle/POLITICO] >> >> Shay Assad, the Pentagon's director of pricing, has waged an all-out >> campaign for the last five years to reduce defense companies' profit >> margins, the industry contends. | John Shinkle/POLITICO >> >> Some of the nation’s leading defense companies are declaring war on a >> powerful enemy — an obscure Pentagon official named Shay Assad who has >> helped cut more than $500 million from military contracts with his >> aggressive scrutiny of their costs. >> >> The industry’s tactics include blanketing congressional committees with >> proposals that would make it harder for Assad and his contracting officers >> to get detailed breakdowns of the companies' expenses, according to >> documents obtained by POLITICO. But Assad, the Pentagon's pricing director >> for the past five years, refuses to back down, saying: "We are going to be >> relentless in pursuing getting the good deal for the taxpayers." >> >> Story Continued Below >> >> “That's the way it is,” said Assad, a 65-year-old Bostonian with the >> heavy accent to match. “If companies don't like it, people have an >> objection to it, we're not apologizing for it." >> >> The result is an unlikely, all-out campaign pitting giants like Boeing >> and Honeywell against a Pentagon official so little-known that even some >> top defense lawmakers say they're unfamiliar with his jousting with the >> industry*. * >> >> Company leaders accuse Assad — a former Raytheon executive who spent more >> than two decades in the defense industry — of pursuing a "personal >> vendetta" by hounding firms large and small to justify what they charge for >> weapons or services. But Assad says he learned a valuable lesson from his >> years at Raytheon, one of the Pentagon's largest contractors: "We generally >> overpay for almost everything we buy." >> >> The contractors, who are enjoying record stock prices, are actively >> trying to undermine him. In one proposal circulating on the Hill, they are >> seeking to erode contract officers’ ability to demand cost data from >> subcontractors — what companies view as an excessive grab of competitive >> information. >> >> The request would weaken the grip of Assad’s cost squeeze, as the >> Pentagon uses all the extra cost information to “manage” profit margins, >> according to a congressional staff member with purview over the Pentagon >> budget who was not authorized to speak publicly. Without that information, >> the staffer explained, the Pentagon can’t demand better deals. >> >> Assad seems as determined as ever to make sure industry hands over the >> data, citing the personal backing of his boss, Secretary of Defense Ash >> Carter, who created his position in 2011 when Carter was undersecretary for >> acquisition. >> >> His aggressive stance seems to be paying off. Pentagon spokesman Mark >> Wright said Assad recently led contract negotiations for multiyear deals on >> the Apache helicopter, C-17 transport plane and F/A18 fighter jet "that >> returned in excess of $500M to the taxpayers." >> >> Wright added that "it should be obvious what the Department thinks of Mr >> Assad. He was just awarded a 2015 Distinguished Presidential Rank Award." >> >> But Assad's role is little known outside the Pentagon, as some top >> lawmakers seem to be unaware of the tension between Assad and the industry, >> including House Armed Services Chairman Mac Thornberry (R-Texas) and >> Ohio Republican Rep. Mike Turner, the head of the Tactical Air and Land >> Forces Subcommittee. Though Assad oversees all DOD contracting actions >> above $500 million, Thornberry and Turner told POLITICO they hadn’t heard >> anything about him. >> >> Assad poses a unique threat to the biggest arms makers. He graduated from >> the U.S. Naval Academy in 1972 before spending 22 years as a senior >> executive at Raytheon, which last year was the Pentagon's third-largest >> contractor. As director of pricing, he is also member of the civil service >> who, unlike a political appointee, could be around for a good while. >> >> "It's just not true that we are negotiating profit rates that are lower >> than what we had been doing in the past," he said. "I know, because I was >> on the other side of the table. I'm very aware of what industry and major >> corporations were negotiating for profit rates versus what we presently >> do." >> >> Extracting and analyzing more cost data from the Pentagon's customers has >> become one of his primary focuses. >> >> A congressional source said Assad has recently directed contracting >> officers, via policy guidelines and memos, to go after this kind of >> information. While the Defense Department already asks for cost data from >> the larger defense players, this recent action seeks to "go lower down the >> food chain." >> >> "He has gone way above and beyond what is reasonable to extract pricing >> data," says one senior industry official. >> >> Assad fires back, asserting the Pentagon is simply doing what the law has >> long required but it has historically failed to do. >> >> Legally, all companies involved in a sole-source contract with the >> Defense Department are required to provide pricing data on any >> subcontractor that provides $750,000 or more in goods and services. For >> years, however, the Pentagon neglected to push companies on that rule. >> >> "The reality is it's data that they should have been providing us all >> along," Assad said, particularly for the countless subcontractors that >> defense giants rely on and whose costs get wrapped into the overall price >> of the prime contract. >> >> "What we're saying is, 'no, it is relevant,' and frankly, there's gold in >> them there hills at the subcontractor level," Assad said. "It is a >> challenge for the companies because they now have to deal with people who >> are well trained, who know what to ask for and who insist on it." >> >> The industry is now trying to head him off. >> >> In a legislative proposal sent to multiple defense committees, the IT >> Alliance for Public Sector, supported by defense firms Boeing, Honeywell >> and Rockwell Collins, is seeking to limit contract officers' ability to >> reach down into subcontractor cost data — what they refer to as unnecessary >> "flow-down" requirements. >> >> All companies buy parts from the commercial world "that do not relate in >> any way to a particular contract, customer or customer requirements," the >> proposal says. Applying defense-unique rules to nearly all aspects of >> companies' supply chains creates a "problematic situation," as it >> potentially cuts into "efficiency of operations and production." >> >> Another proposal specifically asks Congress to widen the definition of a >> commercial item. If something is deemed commercial — rather than a uniquely >> military item — industry can withhold most price data on it in for the sake >> of staying a step ahead of its competition on the open market. The >> congressional source said Pentagon efforts to limit the definition of what >> is considered commercial allows the government wider access to cost >> information. >> >> IT Alliance Senior Vice President Trey Hodgkins, who helped form the >> proposals, said current Pentagon rules "erode" access to the defense >> market. "I think there's broad agreement in Congress that we have to find >> ways to lessen the burden and make this market more attractive,” he said. >> >> While none of the three companies would address their relationship with >> Assad or questions on industry profit margins, Honeywell told POLITICO that >> the proposals put forward "provide a clear path for the government to >> ensure they are buying commercial products at fair and reasonable prices.” >> >> Boeing would only allow that it was "broadly supportive of acquisitions >> reforms that ensure that our military — and the U.S. taxpayer — can take >> full advantage of the value provided by the commercial marketplace.” >> >> Meanwhile, Rockwell Collins said it was focused on limiting the "impact >> of military-unique acquisition terms which flow down to our commercial >> supply chain," saying there are numerous small businesses the industry >> relies on that "are adversely impacted" by current regulations. >> >> Assad said that in asking for price data on items that have both defense >> and commercial applications, the Pentagon simply wants to know if the price >> is "fair and reasonable." >> >> "What we're saying to the companies is 'nobody should know better than >> you why the price you're charging me is fair, so just tell me.'" he said. >> "The issue that we have is that … in many instances, when we've bought >> commercial items, we haven't done as good a job as we possibly could." >> >> Defense companies, however, want to be treated like any other commercial >> company — such as Apple or Samsung — when selling items to the Pentagon >> that are also sold on the free market. >> >> Just as consumers willingly pay Apple or Samsung $600 for a cell phone >> that costs a fraction of that price to make — provided the quality is good >> enough — industry maintains that the government shouldn't care about the >> true cost of defense equipment if the market had a hand in setting the >> price, said Mike O’Hanlon, a defense specialist at the left-leaning >> Brookings Institution and a longtime Pentagon adviser. >> >> The profit margin issue "is a big one where contractors and much of the >> DOD acquisition workforce part ways," O'Hanlon said. Tensions can also be >> pushed with the factor of the Pentagon "cost police" — its thousands of >> contracting officers who aggressively seek cost data on defense equipment. >> >> While these actions can protect the best interest of the taxpayers, "one >> would like to see exceptions and exemptions" when dealing with commercial >> items, O'Hanlon said. >> >> Tom Captain, the vice chairman and leader of the U.S. and global >> aerospace and defense sector at financial services firm Deloitte, backs his >> industry clients on this question. >> >> "You don’t ask the car dealer, the grocery store and pizza parlor for >> cost data — you buy based on your assessment of best price and fair value," >> Captain said. "The Pentagon can do the same for commercial sourced items." >> >> Asking for cost data for commercially available technology “is not only a >> waste of taxpayer money,” he said, it acts as a “disincentive to supply to >> the DOD for suppliers." >> >> Providing too many specifics of cost data, Captain argued, could also >> reveal to competitors how they managed to reduce the costs on a system a >> company sells to other customers outside the government. >> >> "You might as well run an ad, telling your competitors your prices," the >> industry official said, adding that companies routinely expressed "a >> complete lack of confidence" in the Pentagon's ability to keep pricing data >> secret. >> >> Despite all the criticism, Assad insists the Pentagon's practices are not >> harming the defense industry financially. >> >> Over the last five years, he contends, the top five defense companies' >> stock prices "have gone up anywhere from 67 percent to 180 percent for >> those five companies. Record cash flows, record profits, record return on >> invested capital." It is an assessment backed up by industry analysts. >> >> "We're not after their profitability, we're after paying less," Assad >> said. "And if we can pay less and they're doing well financially, what's >> wrong with that? If you look at what had been happening in the past, year >> over year, we always paid more. ... That doesn't happen anymore. Year over >> year we're paying less." >> >> >> >> Read more: >> http://www.politico.com/story/2016/04/defense-pentagon-spending-assad-221776#ixzz45XNEgEm1 >> Follow us: @politico on Twitter >> <http://ec.tynt.com/b/rw?id=bKDyiUp9mr3OhNab7jrHcU&u=politico> | Politico >> on Facebook >> <http://ec.tynt.com/b/rf?id=bKDyiUp9mr3OhNab7jrHcU&u=Politico> >> >> >> __._,_.___ >> ------------------------------ >> Posted by: "Beowulf" <[email protected]> >> ------------------------------ >> >> >> Visit Your Group >> <https://groups.yahoo.com/neo/groups/grendelreport/info;_ylc=X3oDMTJmYmVvdGU5BF9TAzk3MzU5NzE0BGdycElkAzIwMTk0ODA2BGdycHNwSWQDMTcwNTMyMzY2NwRzZWMDdnRsBHNsawN2Z2hwBHN0aW1lAzE0NjAzOTMyNjE-> >> >> >> [image: Yahoo! 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