Defense & Aerospace Report Defense & Aerospace Air Power Podcast [Nov 20, 25] Season 3 E44: ChatAIA
Nov 20, 2025
Eric Fanning, the CEO of the Aerospace Industries Association and former U.S. Army Secretary, dives into the challenges facing the defense industry. He discusses the impact of uncertain budgets and acquisition reforms on the industrial base. Fanning highlights the need for transparency and bipartisan support to make reforms successful. He also addresses the lessons learned from Ukraine regarding capability integration. Concerns about government equity stakes in defense firms are raised, as well as the importance of creating space for new market entrants.
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Too Much Risk Mitigation Slows Progress
- Bureaucracies add processes after failures until mitigation outweighs the original risk and slows progress.
- Eric Fanning argues it's time to accept thoughtful risk so Pentagon and industry can move faster.
Fix Culture Through Training And Incentives
- Focus acquisition reform on leadership, incentives, and training for the government workforce.
- Change culture via Defense Acquisition University and tailored authorities to reduce default risk aversion, Eric Fanning advises.
The Industrial Base Is Multidimensional
- The defense industrial base is not a monolith but a multidimensional ecosystem with many players.
- That diversity creates pressure and opportunity to open the base to new entrants and capital, says Eric Fanning.