Pentagon budget authority for weapons procurement could fall by over $30 billion between fiscal 2012 and 2014. With weapons spending headed down, policymakers are looking for ways to preserve the defense industrial base, and promoting foreign arms sales is one approach they seem to favor. Such sales can make a big difference for particular plants or production lines, but there are multiple reasons why they are no panacea for preserving the industrial base. The scale of overseas demand is too modest and uneven, the composition of demand does not match joint-force needs, and the behavior of customers is too unpredictable. Beyond that, the U.S. limits what kinds of combat systems can be sold. Bottom line: when it comes to preserving a robust defense industrial base, there is no substitute for steady demand from the Pentagon customer. I have written a commentary for Forbes here.
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