Hacker News new | ask | show | jobs
by michaelt 1895 days ago
It's extremely easy for the government to accidentally create monopoly suppliers.

If Amazon signs a 5 year contract to get all their delivery trucks from Ford, GM isn't going to go out of business; and when they're re-negotiating the contract in 5 years time there'll still be a vibrant competitive market.

But if you make tanks or jet fighters or railroad rails, you might only have one customer. And if your only customer signs a 5 year deal with someone else, you're out of business.

1 comments

Most of the consolidation has happened though because of ever more expensive weapons programs. A B52 is a lot dumber than an F35 and costs way less.

Similar trends took place in commercial aviation. There aren’t successful entrants into this market despite a lot of state backing, because it is now very hard and expensive to create an aircraft that matches the performance and efficiency of the latest models of Boeing and Airbus.