>>64155239
>How does this even happen
There are multiple layers of this:
1. The other side of potentially corrupt COST+ scheme what murricans are doing is the soviet approach of "we'll tell you ourselves how much we'll pay for your shit, and no you can't avoid this contract", i.e. the state can just pay less it would be needed for the whole business to be sustainable;
2. Usually the amount the state pays is based on what they count as cost of production with a very small margin on top, those margins are usually set by laws and such. Imagine the state calculates that cost is $100K per unit, and they pay you 1.5% on top of that (not a joke, these values are a thing), so $100,5K per unit. This would work in mass market consumer manufacturing where a) stuff would be made in million of units per year, but military contracts are not that, and b) they'd had a chance to cut costs by optimizing things;
3. But it's even more retarded, because the state is very dumb and commie in how it calculates cost, similarly to those online "an iPhone actually costs $199 to make" breakdowns, i.e. it doesn't have anything to do with reality, so they are delusional and calculate bullshit and you're tied to that. And the very least they undervalue the amount of labor to actually develop things, test things, assemble shit, do QA and QC parts, the transport, the warehousing, the need to overpay to suppliers to actually get shit on time or dodge sanctions, etc. Hence the only recourse is to try to inflate the costs with bullshit;
1/2
