Lawfare Daily: America's Defense Industrial Base

[Intro]

Seth Jones: There's this question also about how do you stop commercial companies that are producing this material from getting into the hands of adversary state, or potentially even non-state actors?

I think it's going to be very difficult to police that, especially when you're talking about countries and companies across the globe.

Daniel Byman: It's the Lawfare Podcast. I'm Daniel Byman, the foreign policy editor of Lawfare, and I'm speaking today with Seth Jones, who is the president of the Defense and Security Department of the Center for Strategic and International Studies.

Seth Jones: And I think that's the problem that we have generally seen right now, is recent––is, in the last few decades, certainly since the end of the Cold War, presidents have not wanted to spend political capital trying to break the logjams in acquisitions and contracting.

[Main episode]

Daniel Byman: Today we're talking about the CSIS new book, the American Edge, which is about the defense industrial base of the United States, China, Russia, and other great powers.

Let me ask what I actually think is a fairly hard question, which is: what is the defense industrial base? How would you define it, and where do you think it begins and ends?

Seth Jones: Dan, I would define the defense industrial base as the ecosystem of government agencies––not just the Department of Defense, but also the Department of State, Commerce, and others, the legislative branch––that deals with defense.

So the Armed Services Committees, the Appropriations and others, plus industry, that sort of brings together the different elements of the development––the research development and the production, and then frankly even the export of defense systems.

So it is a broad ecosystem of government entities and the private sector.

Daniel Byman: Let me ask you, just so our listeners really get a sense of the range. You know, gimme an example of kind of one company that's big, you think most people probably know, but then one that's small yet illustrates kind of the range of the industrial base.

Seth Jones: So one big company that has been around for a long time in various forms is Lockheed.

It's what we call a prime. It produces everything from the F-35 fifth generation aircraft to the long-range anti-surface missile, the LRASM, that is involved in, you know, long-range precision strikes.

So lots of the weapon systems that it provides are expensive to build. Large company.

On the other hand, we see some small and then mid-tier companies. I mean, you know, one interesting company has been General Atomics. General Atomics produces largely drones, and drones like the Predator and Reaper that were involved in the intelligence, surveillance, reconnaissance, and strike in Afghanistan and Iraq.

Does not have anywhere near the revenue of a Lockheed or a Northrop Grumman or a Boeing; is still an influential player, much smaller in the defense industrial base.

Daniel Byman: So one thing I really like about your book is you go through a lot of history and show the development of the U.S. industrial base. But I want to focus a lot of this podcast on the more modern era. And somewhat arbitrarily, I'm going to begin that, based on your book, with the immediate aftermath of the Cold War.

And you talk about the Last Supper, or the so-called Last Supper, in your book, in 1993.

Tell us what this was and why it's so important for understanding where we are today.

Seth Jones: So, not surprisingly, Dan, at the end of the Cold War with the collapse of the Soviet Union, the reality is the U.S.'s largest adversary, the Soviet Union, is gone.

It's collapsed. And then a range of its republics become independent states. There's a big question about what to do with the defense budget.

And while he was running for office, Bill Clinton is pretty straightforward that he would like to focus on economic growth. And one of the things he'd like to do is to cut the defense budget. And frankly, you know, understandable.

So as part of that effort, what Secretary of Defense Les Aspin and Deputy Secretary of Defense William Perry do is they convene a dinner in 1993. It's called The Last Supper. I'll get to in a moment why it was called that.

But at the dinner, one of the important components is what's briefed to CEOs. These are the CEOs of a range of U.S. defense companies. And there's a slide that's briefed at the dinner. It's actually after the dinner in one of the conference rooms, and there are sort of five big blocks of types of weapons system.

There's aircraft, and within aircraft there are bombers, fighters, helicopters. There's also space. There's ship building. There's track vehicles. And there are missiles.

And what the chart shows is when within each of the sort of subcategories, like bombers, for example, there were at the time, so 1993, three companies that produced bombers.

What the Pentagon indicated in a separate column was they wanted to go down to one with helicopters. There were, at the time, four companies that produced helicopters. They slide noted they wanted to go. To two. And that same pattern cuts across all of these areas, shipyards, eight to four tactical missiles, eight companies to four.

And so the basic message that comes out of the dinner is the Pentagon says, this is where we want to get to. You––industry, CEOs––figure out how you're gonna get there.

It can be mergers and acquisitions, it can be some companies just shut down their defense lines and walk away from the defense business. And so a few days after the meeting that dinner, a newspaper reporter asks Norm Augustine, who's the CEO of Martin Marietta, for a comment about that mysterious dinner that CEOs had gone to in the Pentagon, and he said it was the Last Supper. And so the name stuck.

Daniel Byman: Let's fast forward a little bit.

Because of the Last Supper, where do we end up in say, in, you know, I'll say 2010? So not quite where we are today, but where there's been almost a generation where a lot has changed?

Seth Jones: So Dan, you go from a large number of companies that are in the defense business to a half dozen or so big primes.

So you've got Lockheed Martin, which comes about because of a merger. Boeing, which continues to produce a lot of aircraft. Raytheon. Northrop Grumman. General Dynamics.

And then what you see is a lot of companies that had been involved in various elements of defense get out or get bought. So Boeing buys Rockwell's aerospace and defense units and then merges with McDonnell Douglas. Texas Instruments defense business is gobbled up by Raytheon.

So there's a lot of that stuff that's happening. So the big implication by the time you mentioned, Dan, is that there's just massive consolidation of the defense industrial base to a small number of very large primes. They're not the only ones, but that's the majority of the companies that are in the defense business.

Daniel Byman: So let me argue, just, you know, for the sake of putting it out there, you know, maybe this is a good thing, right? You have some big companies. They can achieve significant economies of scale. You concentrate expertise.

Like, what's the downside of what resulted from the Last Supper?

Seth Jones: Well, I actually think there was a lot of benefit to consolidation of the industrial base.

It was, look, the U.S. defense budget dropped dramatically. So the U.S. Department of Defense did not need large numbers of companies that were producing systems that were not needed anymore.

So I think there was a strong rationale for massive consolidation. I think the problem was, though, that really, the loss of a lot of medium-sized companies meant that there was not sufficient––there weren't sufficient competition in the industrial base.

So you know, the result in that case, when you don't have a lot of competition, is that prices can rise. One can see an increase in almost monopolies of the production of certain systems.

You get inefficiencies. Shipyards, for example––which we can talk about as we get closer to the modern era––shipyards go down to just a very small number of companies, like Huntington Ingalls and General Dynamics Electric Boat that are building U.S. ships.

And, you know, it was a far cry, particularly from what the U.S. produced during the, in the Kaiser Shipyards during World War II.

And I think, as we'll probably talk about in a moment, it had a huge impact on what the U.S. could produce, and its broader maritime industrial base.

Daniel Byman: So, want to get to the, kind of, today fairly quickly, but let me ask one question as a kind of bridge.

So in the 2010s, you talk about another significant change. And it's not in the traditional defense industrial base, but rather it's the rise of private equity and venture capital.

Can you explain why this is at least potentially such an important development when we think about the defense industrial base?

Seth Jones: So historically, Dan, during the Cold War, a lot of the defense funding came largely from organizations like DARPA within the US Department of Defense. They funded a fair amount of research and development for companies.

DARPA's budget drops notably in the post-war era. And one of the things that gets that's interesting is there's this, the shift that begins to happen with companies that become interested in defense.

So there was a period, for example, with Google where Google was involved early on in Project Maven. It was an effort to build software that could take information and data coming from drones, for example, and use it poten––and other intelligence surveillance and reconnaissance platforms––and potentially use that information for future targeting, including strikes against terrorists on the ground.

Well, there are a number of folks within Google that did not appreciate being involved in what they considered, you know, war activities. And so there was a lot of pushback. Google, a range of Google employees wrote a letter to the CEO at the time, and Google backed off on its involvement in project Maven.

Well, by the mid to end of the 2010s, I think what investment companies––so, so both actually venture capital firms as well as private equity firms start to see that there's money, there's more money involved in the commercial side of space, for example, or unmanned or uncrewed systems, or intelligence surveillance and reconnaissance or aircraft, you know, various types of aircraft, and see a possibility for profit down the road, including the research and analysis and development of artificial intelligence, quantum, biotechnology.

So what you see is this a dramatic shift on venture capital investments, for example, deal values of just over like $5 billion in 2015, upwards of over $40 billion by 2021.

So it's a dramatic increase. And the, that same story is true in private equity as well. Big uptick in private equity investments in the defense sector.

And Dan, one of the more interesting organizations that gets involved is the CIA's, I'm gonna call it venture capital firm In-Q-Tel, which CIA establishes around 9/11.

And it is involved in funding a number of––with some venture capital as well involved––some sort of cutting edge, both technology like Palantir as well as some hardware as well.

Daniel Byman: Let's kind of take this shift in financing, and I want you to explain to our listeners how China is approaching its industrial base.

And in particular you are arguing in the book that China is, really has a wartime mentality when it comes to its defense industrial base, in contrast to the United States.

So, can you explain kind of how the Chinese system is different from the American system, and from there explain why China may be on wartime footing and what that should mean?

Seth Jones: Yeah, and by wartime footing, what I mean by that is that China is producing weapon systems and other hardware and software to deter adversaries or competitors, including the United States.

And if deterrence fails, to fight and win a war, including a great power war. So it doesn't necessarily mean that there is that the Chinese are hoping for a war. I think actually quite the opposite. But they're building capabilities, at the very least, to deter. And then again, if deterrence fails, to fight and win a major power war.

So one of the more interesting developments is China actually goes, has this fundamental shift in defense companies. So by 2024, for example, five of the world's top largest defense companies, as measured in combined defense and non-defense revenue, are Chinese enterprises.

I mean, that's a stunning development. The top two, Aviation Industry Corporation of China and China State Shipbuilding Corporation Ltd. are the two largest companies in the world that combine defense and non-defense. A

nd the reason it's a shocking development is a decade earlier there were no Chinese companies––zero––in the entire list of top 100 defense companies.

So what China does over that 10-year period––and again, this is essentially from the time Xi Jinping becomes the leader during his first term in China––it starts pouring money into state-owned enterprises.

So yeah, companies like aviation industry, we see it in China North Industries, they're pouring money into the production of land systems.

So, made battle tanks, for example, infantry fighting vehicles. Aircraft, fourth and fifth generation aircraft missiles. Range of naval ships. That's a good example of an area where China really has a significant advantage over the U.S. China's shipbuilding industry has the capacity by this time to build 23 million tons of vessels, both commercial and military, compared to less than a 100,000 thousand tons.

So lemme say that one more time. 23 million tons of vessels, China has the capacity to build. Hundred thousand tons in U.S. shipyards run by General Dynamics, Huntington Ingalls, and other companies.

So in all of these areas, we see the Chinese producing massive amounts. And then I'd also add the nuclear category, nuclear missiles, as well as space-based, counterspace and then cyber systems.

So massive amounts that it's focused on that.

Daniel Byman: So reading your book, just comparing the United States and China, I get pretty depressed, frankly, just thinking about the rather staggering levels of Chinese production, but what would you say are some areas of Chinese weakness and conversely of U.S. strength?

So obviously you have this massive production capability on the Chinese side, but what else should we be thinking about when we are comparing the defense industrial basis?

Seth Jones: Well, I think, you know, there are a couple of things that are worth noting. One is that China has largely relied on massive state-owned enterprises for the vast majority of production.

There are companies involved in artificial intelligence, quantum, and other kinds of emerging technologies like Huawei that are not state-owned enterprises. So a little bit more innovative, and, you know, producing lots more innovative software, but some hardware as well.

Still, the bulk of Chinese activities in state owned enterprises. So they're massive, sprawling organizational structures. Not––generally not efficient, not competitive, and also not particularly innovative.

So they can produce at massive scale, but they are, you know, the quality of the material that they're putting out is questionable in quality. There's also bound to be significant corruption, which plagues Chinese defense industrial base.

There are a range of Chinese defense executives that are jailed for corruption scandal.

Now, one has to be a little bit careful in China about corruption, which can be sometimes a loyalty issue rather than pure corruption. But it does appear in a, in at least a number of cases, there was massive corruption going on and the pocketing of money.

So fraud, in addition to waste and abuse going on. A third vulnerability and weakness in China's industrial base is also, its supply chain. I mean, like most––any other country, China historically had to rely on engines, for example, from Russia, China. Much like the U.S. but in different areas has some vulnerabilities in rare earth metals and critical minerals.

So iron and ferroalloy metals like niobium, cobalt and chromium, China is dependent on it from some overseas locations that are not necessarily allies and partners. And the same in some other categories like precious metals.

So there are areas where the Chinese are weak and vulnerable. And then fourth, and just very briefly, certainly there are some challenges with demographics coming down the road and aging population, low birth rates I think which poses some big workforce questions for China, both today and then down the road.

So sure, China can build a lot, but there are some questions, both today and down the road, that you know, on efficiency, corruption, and a range of other factors.

Daniel Byman: In addition to having a lot of good history, your book has a lot of good stories. I want to talk about Ukraine for a little bit.

And I have some kind of ‘where we're going with Ukraine’ sort of questions or how to think about Ukraine's lessons, but can you talk about the role of the U.S. in Ukrainian private sectors, in Ukraine, after the Russian invasion, full-scale invasion in 2022 and how that in, at least in my case, I'll say really kind of surprised people at the level of production and the amount of capacity that was brought in the war on Ukraine side.

Seth Jones: Yeah, so Dan, one could talk about a lot of types of companies.

I mean, there are companies providing software like Palantir. There are companies that are providing hardware, including various types of drones. And of course, there are a lot of U.S. companies that are exporting Javelins and Stingers and 155 millimeter rounds.

But I, I found one interesting example of this is in the cyber dimension. And it's one that's not often recognized as being part of the defense industrial base, but the cyber domain is a key part of the industrial base. And there, we actually saw in Ukraine the first––the first, really, aspect of the war actually came, it was a few hours before ground forces cross over the Russian and Belarusian borders into Ukraine.

The first actors are cyber actors from the GRU, the main intelligence director of Russia. They launch a cyber weapon called Fox Blade, which is a Trojan horse wiper malware. And I'll just sort of fast forward, but what happens is companies like Microsoft become significantly involved.

And it's Microsoft's threat intelligence center based out of Redmond, Washington, provides massive help to Ukraine in identifying malware in Ukrainian government agencies and critical infrastructure as well as helping wipe it out of the system.

So, I mean, there's a big cyber defense effort that U.S. companies are involved in. And one of the more other interesting cases is Elon Musk's Starlink, which is with offensive Russian cyber operations, taking down, part of the Ukrainian command and control structure and grids.

Starlink becomes a critical element for the Ukrainian military to communicate with itself, but also over time actually to conduct precision strikes, including with drones. So Starlink is another interesting example of an American company in addition to just providing hardware and software that's sort of new to warfare.

Daniel Byman: So let's take the Starlink example and think about it both in the Ukraine context, but also in U.S.-China context. In a way, Starlink was a savior for Ukrainian forces. It played a critical role in multiple cases for preserving communications. But at the same time, there are reports that Starlink was restricted by the company when Ukraine wanted to do say, operations in Crimea among others.

You know, first of all, is that accurate? How would you describe that? But then that's a pretty big role for a company, right? I mean, it's effectively a company having a foreign policy and saying, you know, here's where its capability should be used, and here's where they shouldn't.

That may not align with what the United States wants.

Seth Jones: So, you know, interestingly, the reality is SpaceX sent network terminals. They sent dish antennas. They sent battery kits. They sent other types of equipment to Ukraine, which provided Ukrainians, including the military, with satellite-based internet connectivity.

But as you noted, there were locations, including around the Black Sea, where Starlink was not available to Ukraine. And there's an interesting discussion with Elon Musk and Russian officials coming in apart from the Kremlin and Vladimir Putin, which is concern about the possibility of escalation, including to nuclear war, if the Ukrainians were to conduct strikes against targets like Crimea.

I mean, it is interesting that in some ways SpaceX and Starlink in particular become an integral part of a war as a company. Which raises some very interesting questions about, you know, treating companies as a combatant, you know, giving companies significant power in providing not just information, but targetable information to countries engaged in war.

So I think there are definitely some ethical considerations, in addition to just providing information and knowhow.

Daniel Byman: So one concern that comes up when we think about a possible U.S.-China confrontation is that many of the companies involved will have business interests directly or indirectly in China.

And, you know, given the limited but quite real sorts of problems we saw in Russia, you know, China is a much bigger deal, right? It's a much more massive market. It's a massive investment power.

Is it fair to say that one of the downsides of a significant private sector role is this risk? Is that the companies themselves may have very different calculations about where they should be involved than the U.S. government or allied governments?

Seth Jones: Yeah. So, you know, business interests are, can get very interesting in how they could play out.

So in, let's take the Taiwan case. Because of Elon Musk's investments in China, for example, Taiwanese officials have expressed concern about using Starlink because there's a potential conflict of interest.

So instead, you know, some of the companies that they have spoken to include Amazon and Amazon's Kuiper for access to satellites in low earth orbit.

Now here's the challenge, Dan, and I think this is where I think it's going to be very interesting to migrate and watch how things unfold over the next several years.

Space is, to a great extent, commercialized now. So that is just a reality. Cyber is to a great extent––certainly defensive cyber is to a great extent––commercialized. Unmanned or uncrewed systems. And not just air, but also potentially surface, subsea, and even land-based, there's a huge commercial sector for them.

So I mean there, there's this question also about, how do you stop commercial companies that are producing this material from getting into the hands of adversary state or potentially even non-state actors? I think it's going to be very difficult to police that, especially when you're talking about countries and companies across the globe.

You know, it'd be one thing regulating in Europe if the Europeans want to do it, or in the United States. But I think that becomes very difficult to do outside, especially if there is a for-profit motive from companies who are willing to sell their products.

And it act––it doesn't have to be hardware. It could be software as well, which is, can be quite innovative and quite useful for military operations. That can be very hard to police.

Daniel Byman: Let me ask that, you know, should a conflict occur or should, you know tension increase dramatically with China, how much can the U.S. rely on ramping up commercial capability and shifting it over to military output?

You know, your book, one of the kinda more heroic stories, in my view, is your discussion in your book about the U.S. industry in World War II. Which, an incredibly rapid, you know, in period of months goes from, you know, building cars to building tanks, right?

It's remarkable. And as a result, U.S. production World War II, you know, by the end, is greater than everyone. Is that possible in today's world? Like when we think about China with its production and the difficulty of kind of converting things for modern systems, how do we think about, I'll say, latent military capacity in the form of current commercial capacity?

Seth Jones: Well, Dan, I think the complexity of a range of high-end platforms, I think it'd be pretty tough to shift from commercial sector––so like building automobiles–to quickly shifting over and producing fifth or sixth generation aircraft.

It's probably easier in areas that aren't as complex now. So, you know, the market may be––there may be opportunities for newer entrants in the uncrewed or unmanned systems.

I mean, I certainly think with big technology companies that have a lot of internal research and development that they're spending on artificial intelligence or quantum, there are opportunities for technology companies to focus their efforts on defense-related activity.

But I don't think the shift that the U.S. did during World War II, when companies like General Motors and Ford and Chrysler shifted pretty dramatically and relatively quickly over from commercial to military, I just don't think that's likely.

And I think it'd be hard, it'd be hard pressed to do anyway in a situation where there actually wasn't a shooting war going on. So, you know, unless World War III happened, I think it's highly unlikely.

I actually think the bigger challenge, Dan, is getting companies that are already producing some of these things to ramp up on production. And the challenge there are the timelines. So if the U.S. government, if the Pentagon wants to increase its long-range strike, for example, and companies like Lockheed or Boeing or RTX have to build more factories, that takes time.

If you want to ramp up production just of the missiles themselves, it takes time.

I mean, most of the air defense systems and medium- and long-range strike, like the long-range anti-ship missile, LRASM, the prism Tomahawk, including Block 5, take two years to produce.

If you want a lot more of them, and there are factories, then that gets complicated in the U.S. Companies have to sometimes purchase the land, get insurance for it, build it. It has to be a certain distance from the local population.

All this stuff takes time. So I actually think the biggest problem is the timelines that it would take. And as part of that, also the money that would be required over several years to do.

And that's a bit of the challenge that the U.S. faces right now, is as a percentage of gross domestic product, the U.S. defense budget actually hasn't gone up at all.

It's smaller than at any point during the Cold War.

Daniel Byman: Let me ask you about a couple other challenges you discuss in your book. One is, you know, the problem with contracting and having, I'll say agile contracting and rapid contracting.

You and I have both been Washington for probably too many years. And I think if we had this conversation 10 years ago or 20 years ago, it would sound pretty similar, right?

So why can't we fix this? Right? It's not as if you know, this is a new problem. Or, it's not as if lots of smart people haven't thought about this issue for many years.

Seth Jones: Well, Dan, I think the way I'd probably start off in answering the question is, it was even difficult during World War II.

So there, you know, the U.S. generally did not have a defense industry before World War II. Sporadically, companies would produce systems during wars, including World War I. These didn't have a defense industry that stuck around. So what President Roosevelt does, starting in 1940, is he pulls together key individuals within manufacturing––so people like William Knudsen, who's the president of General Motors, who's becomes one of the members of what Franklin Roosevelt calls the National Defense Advisory Commission, or NDAC.

And it eventually becomes the War Production Board. And the job of individuals like Knudsen that work for Roosevelt––and that, that becomes important because there's the entire strength of the White House behind this, is essentially to break the regulations, the red tape that is going on within industry.

All the acquisitions of contracting problems that you noted earlier. There are also additional problems in exporting technology, including sensitive technology to allies and partners or foreign military sales.

So there's this huge effort to break the logjam from acquisition folks within agencies. And it really takes massive political power.

And I think that's the problem that we have generally seen right now, is recent––is, in the last few decades, certainly since the end of the Cold War, presidents have not wanted to spend political capital trying to break the logjams in acquisitions and contracting.

It's frankly, it's a bigger issue than just a secretary of defense or secretary of war, partly 'cause it's, Commerce gets involved. State. There's a legislative component to it.

There has been some progress that we've seen in the last couple of years. We've seen, for example, with the collaborative combat aircraft, the U.S. Air Force made a decision, gave it to two companies.

Neither of them were primes, or at least the traditional primes. One was Anduril. The other was General Atomics. This is one of the smaller companies, Dan, that I mentioned earlier.

And within one year, General Atomics went from basically a limited research and development to a prototype. That's a stunning––that's a stunningly fast development.

So, I think there are some hopeful examples that, with acquisition reforms that are starting to happen, and a deputy secretary of defense that's gotten very serious about streamlining in some areas, there will be progress.

But I would––I'm just going to be skeptical, unless there's the full weight of the Oval Office, that it's going to be hard––and a kind of a massive reindustrialization the way Roosevelt or Eisenhower or even Reagan, by the 1980s, focused on the industrial base.

Without that kind of national focus, I think there'll be sort of bits and pieces of progress.

Daniel Byman: Let me ask about another problem that, that you identify in your book, which is the workforce. That you can't simply say, okay, we're going to throw money at this problem, and you know, businesses say yes. That you actually need people to produce things.

Talk a little bit about the problems with the workforce, but also if you have some suggestions for how that these might be overcome.

Seth Jones: Yeah. So I'll try to give a couple of concrete examples.

You know, I have been to a range of the big shipyards. Pascagoula, which is on the Gulf Coast, but also in Connecticut, in Groton, they build submarines. For example, the Virginia and Columbia class. And then up at Bath Ironworks, they build destroyers, or Arleigh Burke-class destroyers, or DDGs.

So if we take the Bath Ironworks as an example, that area, which is just north of Portland, Maine, not far from the Maine coast, is extremely expensive now.

And housing prices are high. Anybody that's been up to that area of Maine knows that it's a summer resort area now. And so, housing prices have skyrocketed.

So if you're a welder or an electrician or an engineer, pipe fitter, ship fitter, metalworker that's a really tough place to find relatively cheap housing because of big price increases.

So––and in some cases, pay may be equal to, you know, your local Walmart, for example. So there's this big challenge with people not wanting to do these jobs. And having recruitment problems, but also retention problems at shipyards.

And so part of what we have––what I've suggested in the book, and there's been more discussion of this recently, is looking for opportunities to assist companies with upskilling and reskilling workers by offering more financial incentives.

And, you know, some of that may include a focus on education. So high schools, vocational schools, colleges and universities providing funding to build programs that train people to do things like welding, engineering, and electrician work for the defense industrial base.

And so part of it is that. There are also some ways I think that that the Pentagon could use Defense Production Act Title III to incentivize the expansion of sources when the supply chain, for example, to help fix some of the supply chain problems.

And then start, to start investing in rebuilding the shipyards. So investing money, but it's just going to be hard to do if you're not spending more money on investing, particularly in education for the workforce.

Daniel Byman: Let me ask you a last question, which is about the role of U.S. allies and partners.

Given how massive this effort is, and how much industry is involved and so on, are there things the United States simply shouldn't do? That it should say, ‘hey, we have very capable allies and partners, and when we're trying to, you know, expand certain forces or certain capabilities, you know, sometimes they do things better than us’?

How would you think about a division of labor when it comes to friends who might be helping us with common tasks?

Seth Jones: Dan, I think one of the clearest examples for me is in the maritime industrial base. The U.S. produces less than 1% of commercial and military ships around the globe. The Chinese produce over 50%. But the two biggest allies that actually produce pretty good surface ships are the Japanese and the South Koreans.

So, you know, I understand with some very sensitive ships, some types of submarines including nuclear submarines, nuclear-powered submarines, as well as maybe aircraft carriers, there may be an understandable desire and a sensitivity to having foreign company produce those kinds of assets.

But I think for the vast majority of frigates, I think destroyers and other types, many other types of ships––and frankly, even probably some of the UUVs, underwater unmanned or uncrewed vehicles––I think there's a strong rationale for working much more closely with foreign companies––again, Japanese and South Koreans––to do it.

Now, some of this is political. There's, there are ‘Buy America’ provisions that Congress is going to have to change. There are U.S. laws that prohibit ships that are home-ported in the U.S. or Guam from being overhauled or repaired or maintained in a foreign shipyard. So I think there are some laws that have to be changed or moderated so that the U.S. can make much more use of some of its key allies.

And I think we've seen some progress also on having Hanwha, for example, buy Philly Shipyard––to have some foreign companies that are going to hire American workers producing some of that material in the United States.

But this is going to take time. And some of this––with shipyards, for example, is probably even more political, or just as much political as it is, you know, sort of rebuilding things.

Daniel Byman: I sincerely hope that people are going to read your book and that they're going to take action accordingly. Seth, thank you very much for joining us today,

Seth Jones: Dan, thanks as always. Really appreciate it.

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