Press Release

Open Markets Applauds Congress’s Crack Down on Defense Contractor Monopolists

House Armed Services Committee closes loophole allowing defense contractor monopolist Transdigm to gauge the Federal government.

Washington, D.C. — The Open Markets Institute applauds the House Armed Services Committee, Congressman Ro Khanna, and Congresswoman Jackie Speier, for passing amendments to crack down on defense contractor monopolists, as part of debate over the National Defense Authorization Act.

“Monopolization among defense contractors is bad for American national security, bad  for the economy, bad for the taxpayer, and bad for American soldiers,” said Open Markets Institute senior fellow Matt Stoller. “We encourage the Senate to incorporate these changes to law into this year’s defense authorization bill, and we encourage Congress to continue to address monopolization in the defense space.”

The Department of Defense IG recently found “excessive profits” by defense contractor Transdigm of up to 4,451% on 99 contracts reviewed. The corporation refused to provide contracts to the government the vast majority of times it was asked.

Khanna’s amendment would allow contracting officers in the Department of Defense to require certified cost information from contractors or subcontractors, regardless of the amount of the contract and regardless of whether that item is considered a military or commercial procurement item.

Speier’s amendment would allow the head of a contracting office to request cost data for certain commercial items. It would also make changes to contracting guidelines to enable officers to determine whether prices charged by contractors are reasonable.

“America spends over $700 billion our defense budget,” said Stoller. “That money should go to equipping soldiers with good equipment, not financiers with private jets.”

Press Contact: Stella Roque at Open Markets Institute, [email protected]