Excess-Profits Tax On Defense Contractors During Wartime Is Long Overdue -- Washington Post
No one can safely predict what will happen in 2013, but here are a few things I would like to see occur when it comes to national security.
My most radical idea — and it should have been done 10 years ago — is for an excess-profits tax on defense contractors while we have troops fighting overseas. As I have often noted, Afghanistan and Iraq are the first U.S. wars in which taxes were not raised to pay for the fighting. Instead, the cost has been put on a credit card.
In World Wars I and II and the Korean War, Congress approved new taxes, including one directed at defense contractors. In introducing his request in 1940 for a “steeply graduated excess-profits tax,” President Franklin D. Roosevelt said the government should make sure that “a few do not gain from the sacrifices of many.”
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My Comment: I have always believed that America's defense industries are in sore need of some competition .... but because of the 'boom and bust' nature of the industry .... I must concede that my hopes for competition are (probably) a fantasy in view of the simple fact that only the majors can survive in such a business environment. Bottom line .... if the U.S. wants to remain a superpower it will need to pay the bill. Putting an excess-profits tax on defense contractors will only insure more companies bailing out of the defense industry and creating even lesser competition .... hence more costs and (what is worse) being limited to only one or two sources for your supplies and equipment.
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