How to Rebuild the Defense Industrial Base
April 25, 2025
By: Jim Fein
A revival of the defense sector can only take place if Congress and the DOD reform the incentive structures governing defense production.
One of the many lessons learned from the ongoing war in Ukraine is the inadequacy of the U.S. defense industrial base to keep pace with high-intensity conflict.
In October 2023, the defense industrial base (DIB) could produce approximately 28,000 155mm artillery shells per month. During World War II, that would have been one artillery shell per artillery piece deployed by the Soviet Union at the Battle of Kursk in 1943.
While increasing access to mineral resources is a good step toward lessening the defense industrial base’s vulnerability, it won’t resolve the DIB’s inadequate output.
Fixing the defense industrial base isn’t a task that any single entity can accomplish. Rather, it will require a coordinated effort between the Department of Defense (DOD), Congress, and industry. As stated in a recent report from The Heritage Foundation, structural reforms will be required, not just policy tweaks.
Among the most pressing challenges facing the DIB is its financial structure, and inconsistent demand resulting from the year-by-year nature of the congressional appropriations process is a key part of the problem. This creates weak or conflicting demand signals for industry, deterring investments in new manufacturing capacity.
https://nationalinterest.org/feature/how-to-rebuild-the-defense-industrial-base
