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Path: utzoo!linus!philabs!prls!amdimage!amdcad!cae780!leadsv!chris
From: chris@leadsv.UUCP (Chris Salander)
Newsgroups: net.misc
Subject: Re: $1288 ashtrays
Message-ID: <537@leadsv.UUCP>
Date: Wed, 24-Jul-85 17:56:33 EDT
Article-I.D.: leadsv.537
Posted: Wed Jul 24 17:56:33 1985
Date-Received: Sun, 28-Jul-85 08:47:58 EDT
Organization: LMSC-LEADS, Sunnyvale, Ca.
Lines: 36
Summary: DoD shares the blame

In article <717@vortex.UUCP>, lauren@vortex.UUCP (Lauren Weinstein) writes:
> 
> Face it.  The defense contractors have been charging all that the market
> can bear, viewing the DoD budget as a bottomless pit into which they
> could throw invoices for everything and anything.
> 

	Before you get too worked up, you should know the cost breakdown
of the $1288 ashtray, or the cost of any other outrageously priced part. 
You will find that the Dept. of Defense is itself responsible for most of
the cost.  The paperwork for every part passes through at least FOUR agencies or
departments WITHIN DOD.  Each group makes estimates of costs, and puts that
down.  They then add an overhead charge to pay themselves for having done
the paperwork.  They include a percentage of the total cost and/or the cost
to them in material and labor.  So one agency will add a $50 charge for 
processing the paper for a $2 part IF THAT PART IS ORDERED IN A SINGLE ORDER.  

	The last agency is charging a percentage of a percentage of a ....
Our prices are easily doubled or tripled after going through this DoD maze,
and small items can have their prices increased tenfold.  Further, in the
case of webbing to hold a pilot's feet down in an ejection seat:  There
is a left webbing and a right webbing.  One got sidetracked as it worked
its way through DoD and passed through TWO MORE bureaus than its twin.
It ended up costing 30% more than the other.

	Most of the blame lies with the DoD.  They have NO incentive to
perform well and efficiently.  Many defense contractors, however, have
to also sell to foreign governments, other agencies, and sell commercial
versions of military products.  To accomplish this, the total product must
be cost effective for all customers, whether they are paying attention or
not.  Consider also that high costs are sometime deliberate, to discourage
changes after the product is finished and the contract completed.  People
who have worked on that product have gone on to other things and it is
very expensive to respond.

	Conclusion: Abolish the civil service system.