The Other McCain

"One should either write ruthlessly what one believes to be the truth, or else shut up." — Arthur Koestler

War in Ukraine = Jobs in America

Posted on | February 20, 2023 | Comments Off on War in Ukraine = Jobs in America

The beautiful thing about being “the arsenal of democracy” is that it’s very profitable. For the past year, Ukraine has been burning through the available supply of artillery ammunition at a much higher rate than Western nations can produce ordnance:

NATO Secretary-General Jens Stoltenberg warned [Feb. 13] that Ukraine is using up ammunition far faster than its allies can provide it and putting pressure on Western defense industries, just as Russia ramps up its military offensive.
“The war in Ukraine is consuming an enormous amount of munitions and depleting allied stockpiles,” Stoltenberg said. “The current rate of Ukraine’s ammunition expenditure is many times higher than our current rate of production. This puts our defense industries under strain.”
According to some estimates, Ukraine is firing up to 6,000-7,000 artillery shells each day, around a third of the daily amount that Russia is using almost one year into the war.
Speaking on the eve of a two-day meeting of NATO defense ministers, Stoltenberg said the waiting time for the supply of “large-caliber ammunition has increased from 12 to 28 months,” and that “orders placed today would only be delivered two-and-a-half years later.”

When the war began last year, the U.S. and its allies had stockpiles of ammunition, at least for Western weapons, although much of Ukraine’s weapons are Soviet-era Warsaw Pact equipment, for which we don’t have facilities to produce ammunition, and once Ukraine used up all the old Soviet stuff, that was it. So the U.S. and NATO countries have been resupplying Ukraine with Western-made artillery, thus increasing demand for shells. Ukraine’s current “burn rate” is around 200,000 shells a month, or 2.4 million shells a year, so you can see what this means — lucrative defense contracts:

The Army has selected General Dynamics Ordnance & Tactical Systems [GD] and American Ordnance to compete for orders to produce 155mm artillery rounds under a new $993.8 million contract.
Under the deal, officially awarded on Wednesday, the Army said it aims to expand manufacturing capacity of 155mm M795 projectiles to produce an additional 12,000 to 20,000 rounds per month.
GD OTS and American Ordnance were the only two firms to submit bids for the work, with the contract running through February 2028.
Doug Bush, the Army’s top acquisition official, has detailed the service’s focus on ramping up production of 155mm ammunition in the coming years and said he expects there will be “several big awards” in February and March related to replenishing stockpiles of critical munitions sent to Ukraine (Defense Daily, Jan. 26).
The final version of the fiscal year 2023 National Defense Authorization Act included a provision allowing the Pentagon to use multi-year contracts for select critical munitions procurements, to include M1113, M107 and M795 155mm artillery rounds.
In November, the Army awarded IMT Defense a $391 million contract to produce 155mm M795 projectile shell bodies and a separate task order to GD OTS to build a new 155mm artillery metal parts production line.
The Army said at the time both deals were accelerated contracting efforts to “significantly increase production capacity” for 155mm artillery shells, as the service looks to replenish stockpiles of munitions transferred in large numbers to help support Ukraine.
Late last month, the Army awarded $522.3 million with Ukraine Security Assistance Initiative funds to Northrop Grumman [NOC] and Global Military Products, a division of Global Ordnance, to produce 155mm artillery ammunition for Ukraine.

This means jobs! jobs! jobs! for American workers at defense plants:

Running full-tilt, as it was on a recent January morning, the Scranton Army Ammunition Plant churns out roughly 11,000 artillery shells a month. That may seem like a lot, but the Ukrainian military often fires that many shells over just a few days.
To meet that demand, the Scranton plant is undergoing a massive expansion, fueled by millions of dollars in new defense spending from the Pentagon. It’s investing in new high-tech machinery, hiring a few dozen additional workers and will eventually shift to a 24/7 schedule of constant production. . . .
The Army is planning a 500% increase in artillery shell production, from 15,000 a month to 70,000, according to Army acquisition chief Doug Bush. Much of that increase will be fulfilled by the Scranton plant, which makes a large share of the country’s supply of artillery shells.
Across the US, munitions factories are increasing production as fast as possible. A Lockheed Martin plant in Camden, Arkansas, is cranking out a series of rockets and missiles, including those used by the Army’s Patriot missile system – all of which are in high demand in Ukraine. Bush told reporters in January that the Army was standing up a new plant in Garland, Texas to make artillery shells, while an existing plant is being expanded in Middletown, Iowa that loads, packs and assembles 155 millimeter shells.

Pennsylvania, Arkansas, Texas, Iowa — these are just a few of the places where the demand for war matériel is translating to good-paying jobs in the defense industry for American workers. So while many people may be saddened by the death and destruction in Ukraine — a bloody stalemate with no end in sight — Americans with a more pragmatic worldview look at it and see dollar signs. Good times, my friends, good times!




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