Reading "Prophets of War"
Title: Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex
Author: William D. Hartung
Publisher: Nation Books, 2010
ISBN-13: 978-1568584201, 304 pages
Review: Prophets of War
By Patrick Brigger, getAbstract
Muckraking author William Hartung delves into the military-industrial complex with a corporate profile of its largest, most successful beneficiary, Lockheed Martin. Lockheed has survived bankruptcy and lean financial times, and Hartung contends that it has thrived in part through questionable business practices, milking taxpayers of billions and abetting Pentagon malfeasance. Hartung weaves a tale of the interface of armaments and politics, and says alleged Pentagon incompetence benefited both Lockheed and individual states with pork-barrel military projects. This complex, well-told story states that Lockheed eventually garnered $25 billion annually in defense contracts and now plays an outsized role in affecting U.S. foreign policy. getAbstract recommends this book as important background reading about the corporate-military complex, the shadowy processes that may affect policy and the economic history of the U.S. defense industry.
Soaring in California
In 1916, shortly after Wilbur and Orville Wright's first flight, brothers Allan and Malcolm Loughead (pronounced "Lockheed") of Burbank, California, started the Loughead Aircraft Manufacturing Company.
The brothers--who had minimal educations--first became interested in aviation in 1905 at ages 16 and 18, when their half brother Victor took them to see gliders soaring over Santa Clara, California. Allan, who learned to fly a Curtiss biplane, became a county-fair pilot. When he crashed in 1911, he promised his wife that he would end his barnstorming career. Nonetheless, in 1913, at a cost of $4,000, Allan and Malcolm launched their first plane for a test flight over San Francisco Bay, reaching a top speed of 63 miles per hour. When the plane crashed, their main investor impounded it. By 1915, they were back in business, giving air rides at the Pacific-Panama Exposition. They made a profit, turned their attention to selling their "flying boat" to the U.S. Navy and launched their manufacturing company in 1916. Recognizing their limited staff and capital, they hired Jack Northrup, a self-taught engineer, who formalized their design process. By 1918, they received their first Navy contract: $90,000 to build two copies of a Curtiss design.
World War I launched the business of military aviation. Europeans produced more than 7,000 aircraft in 1918 alone; U.S. General Hap Arnold chastised government and industry for failing to produce any planes at all. After Congressional hearings, the U.S. adopted a cost-plus business model that reimbursed aviation firms' expenses and attached an automatic profit. But U.S. aviation slumped in 1919, so Malcolm went to Hollywood to rejoin the auto industry. Allan built a Northrup-designed "Sport Bi-Plane," but it never found a market, and the company closed. He recruited new investors, including Fred Keeler, who founded the Lockheed Aircraft Corporation in 1926. After building the successful Vega, the investors sold the firm to Detroit auto executives, who renamed it the Detroit Aircraft Corporation. Allan left and started two other airplane manufacturers in 1930 and 1937. The Detroit Aircraft Corporation went bankrupt in 1932.
A company called Stearman-Varney bought the firm's assets. Its main investor, Robert Gross, and other investors from US and foreign aviation firms and airlines bought the company for $40,000 and kept the Lockheed name. Gross, despite his distaste for the New Deal, accepted a $150,000 loan from the Federal Reconstruction Finance Corporation to build the M-10 Electra transport. He said the project would create jobs. Soon, Lockheed was building 148 styles of the Electra and selling it to the US military and 13 civilian airlines. Gross also sold to the Japanese and to Nazi Germany. With sales split between domestic and international buyers, Lockheed remained profitable during the Depression...
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