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Two Indicators: Economics of the defense industry

Planet Money

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Exploring Price Discrepancies in Military Equipment and the Economics of Defense Industry

The military contracted with a company called Transdime for a half-inch drive pin, which Transdime priced at $4,361. The Pentagon argued that the pin should have cost $46. This extreme example highlights the issue of government overpaying for military equipment, potentially leading to buying fewer necessary items. This discrepancy raises questions about military spending and the economics of the defense industry, especially as the US continues sending weapons to countries like Ukraine and Israel. The podcast delves into the reasons behind the high costs of military equipment and explores whether cost-saving measures in manufacturing may leave the US vulnerable in times of crisis.

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