technology

As I understand it these government contracts basically go out to companies who have a monopoly on duopoly on the thing they sell and with anything at all complex their supply chains basically stretch down tens of contractors and subcontractors each. Each subcontractor puts at least 20% profit margin in their intermediate product and that scales the costs with each step. It infuses so much basically free government money into the private economy, when pretty much all other type of manufacturing is impossible in the US, thanks to inflated living costs and cost of labor. It only happens when there is a high value added product with a monopoly OR when its subsidized by the buyer of last resort with infinitely deep pockets, that is the government and the military. Without these contracts many big corporation (not just pure MIC) would become totally unprofitable and US would lose even last of it's manufacturing and basically collapse and american economy with it. They literally have to let the taxpayer be ripped off and let them produce everything with massive profit margins or the whole house of cards topples down.