The "Last Supper" that Stoller mentions -- I had heard of it before, and I have never been able to make any sense of it. Why in the hell would the Pentagon advocate consolidation among its suppliers, let alone would it pay for the mergers? I want to give benefit of the doubt to the brass here, but I've heard zero plausible arguments for how any of this could have been good for the United States. So what am I looking at? Abject stupidity? Barely-disguised corruption? It's just never made any sense to me.
While the sentiment is directionally correct, there are a few inaccuracies.
L3 is not part of Lockheed. L3 and Harris merged to become L3Harris, a huge defense contractor.
It's "Cessna" not "Cesna". They are part of Textron now, now General Dynamics, though they were once.
There are a TON of defense contractors still. Super small ones and some bigger ones (Booz Allen is suspiciously missing; they are huge.) Smaller firms might need to go through one of the big five (or at least someone bigger or more well-entrenched) to win a RFP bid, but that's not exclusive to public sector contracting at all.
Finally, this consolidation is happening in private sector consulting too. So so SO many master services agreements (MSAs) are drawn up by the big four (McKinsey, BCG, Bain, Deloitte) and services firms (WITCH, Accenture) because their roots are planted deeply within all of the F500, but plenty of subs still win the work. They also acquire firms all of the time to enter verticals they couldn't (or wouldn't) enter themselves (McKinsey buying Candid Partners to become McKinsey Cloud comes to mind.)
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[ 3.1 ms ] story [ 25.0 ms ] threadCan anybody steelman the case for this?
L3 is not part of Lockheed. L3 and Harris merged to become L3Harris, a huge defense contractor.
It's "Cessna" not "Cesna". They are part of Textron now, now General Dynamics, though they were once.
There are a TON of defense contractors still. Super small ones and some bigger ones (Booz Allen is suspiciously missing; they are huge.) Smaller firms might need to go through one of the big five (or at least someone bigger or more well-entrenched) to win a RFP bid, but that's not exclusive to public sector contracting at all.
Finally, this consolidation is happening in private sector consulting too. So so SO many master services agreements (MSAs) are drawn up by the big four (McKinsey, BCG, Bain, Deloitte) and services firms (WITCH, Accenture) because their roots are planted deeply within all of the F500, but plenty of subs still win the work. They also acquire firms all of the time to enter verticals they couldn't (or wouldn't) enter themselves (McKinsey buying Candid Partners to become McKinsey Cloud comes to mind.)