The US has 222 C-17 Aircraft. A single C-17 costs over $300 million.
If you ask Boeing for soap dispenser parts for these, what should they cost? Boeing charged $149,072 for the dispensers. That's $671 per plane. Is that too much?
If you had to make these dispensers, make sure they conform to rules for aircraft parts and Air Force parts, provide formal responses to bids, etc., how much could you make them for?
It seems high to me. The article says 8000%, which is less than $10 per plane. So while it seems high, it's definitely not 8000% high.
Can you imagine even being a one-man shop making 222 bespoke soap dispensers to some absurd spec AND jumping through all the documentation hoops that are required for only $150k? I wouldn't take that job. Sounds awful.
The first year you learn how hard it is, you spend 80% of your time on compliance documentation and 80% of your budget on tooling. You still don't have a satisfactory product or a mastery of filling out the forms. It drags on into the second year, you're living on ramen but eventually deliver it (if there's one thing the government procurement process is tolerant of, it's delays) and get paid.
The third year you take on a additional contract, for 200 toilet flushes or whatever. New manufacturing challenges, but at least you're getting the paperwork down.
After a few more jobs, you've cracked it. You start bidding for all the military's bathroom-related contracts. At five or six contracts a year, you have a million or two rolling in (and low manufacturing costs - remember, the spec is such that you can produce it for 80x lower) and you've hired five employees.
By year five, the only thing you care about improving is sales. You still have 5 machine shop staff, paid well but not enough to make them wealthy. You focus on hiring ex-military brass and making them sales reps and lobbyists. You're into tens of millions of revenue, that is, profit.
Year 8, you sell the thing to Northrop or to a private equity firm and go retire on an island.
I worked on a government software contractor that ended up growing from 10 people to 300 people in about 8 years and sold to Booz Allen Hamilton for around $50 million. You absolutely nailed it.
If you can pull it off as a worker-owned co-op (and don't ruin it in year 8, but keep on working at the scale you want), that's a really nice business.
Though you might want to also take on some non-government contracts, both to keep everyone busy in between government contract demands on their roles, and to reduce the risk of having "only one customer".
Yeah. People who haven't done manufacturing may laugh, but depending on how many custom parts there are you could easily spend most or all of that $150K just on the molds/tooling.
Now, like you said... the root cause here is probably some absurd spec that prevents them from using some existing commercial soap dispenser whose costs have already been amortized.
Then again, maybe the spec isn't absurd. The C-17 may need to fly in contested airspace. Maybe damage control is a concern. Maybe they can't use commercial soap dispensers because they're plastic and they don't want the plane to fill up with toxic fumes from burning plastic. That is a random guess. I have no idea.
You also can't just drill a couple of holes wherever to mount it and you don't want it turning to a missile if the plane has to do any aggressive maneuvering.
I wonder what's special enough for this to be different from certified aviation grade equipment? It'd be nice it they could either make a bunch of a design (usefully) for the military to fulfill mil-spec, or if they could take an existing design and just make it in a mil-spec compliant way.
Boeing could have specced some weird stuff on the dispenser, just to make it harder to get elsewhere. Things like impact resistance, yield strength in a fire, or counter-rotating threads to prevent it shaking out.
tbh the only solution to the problem is to spend the $250,000 it would probably cost in tooling etc and fill the Boeing ~1,000 order and sell another 99,000 to the public. At $10 each and without paying yourself anything you would probably just about break even.
I think that isolating their relationship to a single transaction like this is disingenuous. Our government pays this company many billions per year. They likely or should have had extra of these laying around for replacements. It’s not unreasonable to expect them to charge a reasonable amount for everything.
But for some reason Boeing continually gets away with being Boeing for some reason.
It’s $150k for 222 dispensers, not just one. At $671 it’s overpriced but depending on what custom spec they had, maybe not by a whole lot. I’m imagining the metal soap dispensers in airline bathrooms maybe with some additional military specs.
> What about designing the plane to use a common soap dispenser that doesnt cost $150k?
Which one? Whichever you pick you need to stock that exact same one for the next 50 to 100 years. By the time you finish exactly defining it, you are back where you started.
(Also it's not 150k each - that's the price for the entire fleet.)
I mean it doesn't cost $157K it costs $671. They ordered a couple hundred of them.
This one from CB2 is $40 and it doesn't conform to FAA rules and it's not MIL-SPEC. [1]
I suspect if I wanted a limited run of soap dispensers, I was only willing to buy 300 made-to-order, tested and conformant to niche military specifications and aviation specifications, I'd probably end up paying a decent chunk more than CB2.
How much does the entertainment system in your car cost vs an iPad? Is that a rip-off, or is it a niche, custom part that has to be made from automotive grade components?
How much does the soap dispenser cost in a 777 bathroom? That's the real point of comparison, not CB2.
> How much does the entertainment system in your car cost vs an iPad? Is that a rip-off, or is it a niche, custom part that has to be made from automotive grade components?
You can't say it's a niche part when the item is being manufactured in the hundreds of thousands or even millions. Car companies reuse components between models and sometimes even between brands.
And that's without mentioning that the average 7-8" screen or CPU in a car's entertainment system isn't a custom made part, they are bought at bulk from other manufacturers that produce (tens of) millions of units per year.
You can find entertainment system replacements for most cars that cost a fraction of what the car manufacturer charges consumers.
I struggle to see how a mass-produced, way more expensive (for the customer), lower-quality product isn't simply a rip-off.
I did, yes, lol. I mean the most expensive one on sale at CB2 which is kind of a mid-range home furnishings store. I'm confident I can find a soap dispenser that costs more than $671 for home use, though.
[edit] Here you go, just under $845. I present you the Labrazel Discus Brown Pump Dispenser available at Nieman's. Only $77 per month thanks to the magic of Affirm. Good news is thanks to Black Friday you get a $125 gift card. Still not MIL-SPEC though.
> The finest natural materials and the most exceptional quality of craftsmanship converge at Labrazel due to a singular focus—the design and creation of luxury accessories for the bath
> How much does the soap dispenser cost in a 777 bathroom
This might not be a fair comparison, since Boeing also makes the ones for commercial customers, and probably overcharges them also.
> This one from CB2 is $40 and it doesn't conform to FAA rules and it's not MIL-SPEC.
People talk about MIL-SPEC like its some unattainable gold-standard. I can buy a MIL-SPEC rated Thinkpad from Lenovo for less than $600. I mean, sure, it doesn't dispense soap...
MIL-SPEC is a very broad category. It just means it conforms to a military specification, which can be very simple and easy to meet in some cases. But when the MIL-SEC refers to safety-critical and flight-critical specifications it's a whole other story, and does become an extremely costly and difficult to meet set of standards for good reason.
Compare the cost of a MIL-SPEC ThinkPad with that of an actual flight control computer designed to be an integral part of an aircraft's avionics.
Sure, and there are useful points in the rest of this conversation about whether you need something that special for a soap dispenser and what might be driving up costs, and whether a commercial off the shelf alternative really was an option.
I wasn't trying to cover all that, I was just pointing out that MIL-SPEC is a very wide category and therefore effectively meaningless unless you're pointing out what type of application it is.
Here is the original report and the press release with pictures [1,2]
> The DoD OIG found that overpayment occurred because the Air Force did not:
> Validate the accuracy of data used for contract negotiation.
> Conduct contract surveillance to identify price increases during contract execution.
> Review invoices to determine fair and reasonable prices before payment.
> In addition, the DoD OIG found that the DoD did not require the contracting officer to verify the accuracy of the bill of materials before negotiation or to review invoices for allowable, allocable, and reasonable costs before payment.
This does not sound like expensive MilSpec. Wouldn’t it be fair to assume that the DoD Inspector General is aware of these before making such accusations?
They apparently aren't really any different from the sort you see in public restrooms and those are so cheap the supply companies give them to you for free when you buy a case of soap.
Here's an idea: what if the US military just had in-house manufacturing capability and could build soap dispensers (or anything else) to specification at basically the cost of the materials? The factory, the staff, and everything else would be a built-in sunk cost, because they're already in operation.
The analogy here would be hiring a software consulting firm to make every little one-line-of-code change to your website, instead of just having a full-time in-house developer who could make small one-time changes and maintenance at no additional cost.
People complain about government employees, and continually insist that private industry can do it better.
It would almost certainly be cheaper and more effective to do it in house. But instead, in-house capabilities are continually decreasing. The actual government agencies are reduced to supervisory roles.
Stories like this usually result in even more hatred for government employees and more outsourcing.
The issue is the outmoded and excessively specific system of procurement used by the US Military - one more or less mandated by congress.
We can chose to alter how we procure, but there are good reasons why the system is as it is, so a careful effort to understand why it is like it is before we reform must be undertaken.
Congress does not stop the US military from "keeping a database of historical prices, obtaining supplier quotes or identifying commercially similar parts."
Those procedures do not happen because generals retire into cushy barely-show jobs at defense contractors
Congress does not dare force the US military to do any of the above because the US military is a giant pork barrel welfare program for red states, especially the midwestern ones, feeding them endless useless manufacturing work and keeping all their unskilled-labor high school graduates out of unemployment - sending them into the military where they learn some semblance of how to be an adult and some skills
> "We are reviewing the report, which appears to be based on an inapt comparison of the prices paid for parts that meet aircraft and contract specifications and designs versus basic commercial items that would not be qualified or approved for use on the C-17," the Boeing spokesperson sought to explain in a statement.
I was thinking that it would make sense in future contracts to try to define a class of parts that are allowed to be 'unapproved' by the manufacturer and still be used, but then I tried to think of what all those parts would be and it doesn't seem like it would be that large of a list of items. I wonder if the juice isn't worth the squeeze to try to prevent this. What a strange world.
> “The Air Force needs to establish and implement more effective internal controls to help prevent overpaying for spare parts for the remainder of this contract, which continues through 2031,” said Inspector General Robert Storch.
I wonder if these egregious examples of expenses are due to lack of controls or intentional corruption.
I had assumed that they were there to hide costs for things that would not bear scrutiny but that still needed to be paid for. Not just speaking expenses for ex generals, but also supplies provided for operations that many of us would be horrified to find out about.
Considering the things the US funds in the open, even when doing so directly violates US human rights law, I shudder to think what would be covered up.
Well the thing to note here is that "grift" is a count noun. (Their definitions as verbs is not what's relevant here!) You can't say "grift is occurring here"; you can say "a grift is occuring here". Meanwhile, "graft", in the sense of the abuse of an office for personal gain, is a mass noun. Perhaps the commenter's mistake was leaving out an article rather than using the wrong word? The latter seems more likely to me, however.
The term you're looking for here is "mass noun" or "uncountable noun", and... well I was going to say "no, it can't", but searching does turn up some uses, so, uh, I guess people are saying that now and I was wrong? It must be pretty new; I'm not seeing it in dictionaries.
(Note that just because "crime" can be used as both a count noun and a mass noun doesn't mean "grift" can be! Most nouns are just one or the other, not both. Like Wiktionary has "crime" as both but "grift" as count only. But it seems like this new uncountable sense of "grift" is out there now, so people will have to update the dictionaries...)
No, it's not. "Grift" is a count noun. You can't say "grift is occurring here"; you can say "a grift is occuring here", or "grifts are occurring here", but not just "grift is occurring here". Meanwhile, "graft", in the sense of the abuse of an office for personal gain, is a mass noun and can be used this way. Perhaps the commenter's mistake was leaving out an article rather than using the wrong word? The latter seems more likely to me, however.
Would like to know the numbers built and how different from a regular airline soap dispenser. If you ask any manufacturer to build something custom made with unusual specs and you buy only 5 pieces, you will get pretty steep quotes vs the nearest approximation on amazon.
Running my own business I soon learned that aerospace companies were too onerous to deal with. I remember one in particular where they wanted me to accept their seventy pages of terms and conditions before I would accept a $99 order.
Based on the ole' joke about outfitting custom planes, "If you want to do anything to a plane... /anything/..., it's 250. New coffee machine? 250k. Rotate the sofa? 250k." -- $149,072 for a soap dispenser might well be a screaming deal.
> „The US military the mightiest fighting force at the time fell in one swoop when the president and command staff all died dud to the unwashed hands of a marine preparing the burgers on Airforce One.“
- Encylopedia Galactica 2424
One can make ridiculous arguments about both values and costs if one goes to extremes. It is instructive to study actual modern warfare. Sophisticated weapons only matter if there is a sufficient number. Meat attacks only work if weapons are of sufficient quality. Neither is one of the extremes.
"The Inspector General also noted it could not determine if the Air Force paid a fair price on $22 million of spare parts because the service did not keep a database of historical prices, obtain supplier quotes or identify commercially similar parts."
There's no excuse for this. There should be a watchdog group in the federal government, staffed with people who make .01% commission on every dollar of waste they find and eliminate on shit like this.
There are watchdog groups. The DoD Inspector General mentioned in this story is one of them, but the main one in government is the Government Accountability Office (https://www.gao.gov/). Famously, the GAO saves the federal government between $70 and $200 a year for each dollar spent on its budget.
There are also various levels of auditors within the organisation, some of whose reports are used as inputs for the IG and GAO.
Pretty much, yes. Broadly speaking, the US federal government's financial controls are good and prevent a ton of corruption and waste. At this scale no system can be perfect though, and there will always be some.
However, there are diminishing returns at some point. If you want to go after, let's say, the 99th percentile within which things like soap dispensers might fall, you may have to spend more in admin costs than you get back in savings.
This applies to both needing more staff and needing to add more paperwork, which also in turn can slow down projects.
This DoD IG report, for instance, faults the US Air Force for not having built a database that tracked historical prices and tracked equivalent COTS part prices on various commercial marketplaces. That means either having staff or (more usually) paying some third party contractor to maintain a database and constantly update it to track all of these commercially available products. At some level you can end up spending more than you save.
That's why in corporate audits there's always a threshold floor below which external auditors don't bother to check further. It's considered an acceptable risk.
With regard to historical pricing, I agree. I suspect that's more an admin oversight than the lack of a system though. But in terms of the equivalent product price comparison database, would that really normally be in place? I would think the space of aircraft parts that could potentially be replaced with COTS parts is not a very large one, and probably not something optimised for at first. Instead, focus would first be on tracking/monitoring military parts, then of separately tracking clearly COTS parts.
Also, there's a human aspect here. Doubt any air force officer wants to be the one to approve a COTS replacement for something like this only to have something go wrong on a flight because of some or other unexpected failure.
I thought the deal with all these things is that the unit prices on items don't mean anything, and that they tend to be a negotiated total price (for whatever DoD is buying --- not "soap dispensers" but like "the entire C-17 program for FY2024") that's just weirdly spread over everything, so you end up spending like $15/screw, but everyone knows the actual game.
It's interesting that this says "Boeing overcharged" and not "USAF overpaid".
I know who I blame for wasting the tax dollars, and it isn't the organisation whose raison d'être is making a profit on selling goods. I don't blame the lion for eating the gazelle either.
(Admittedly the actual article has a more balanced tone).
Percentage values in the range of thousands are somewhat pointless. A usual factor, not normalized to 1/100, would be a better fit, but would probably not make such a catchy headline.
$600+ is excessive if you are not familiar with the cost of airplane parts and accessories. Add to that cost of compliance (done by humans, the most expensive aviation accessory) and you get that number.
"an inapt comparison of the prices paid for parts that meet military specifications and designs versus basic commercial items that would not be qualified or approved for use on the C-17"
This is the problem--the government heavily regulates (which the big contractors encourage) all the parts and suppliers until Boeing becomes the sole-source supplier and can charge arbitrary prices. There is a reason for it at times, i.e. to answer does someone die if this part fails or can we just stock a few spares? But obviously many many things being vastly over-specced most of the time.
> But obviously many many things being vastly over-specced most of the time.
And sometimes they are appropriately specced.... for 1951, and no-one bothered to update the spec. They just ask for more of part 46-18432, please, and since the spec becomes more and more outdated, it becomes harder and more expensive to provide a part to that spec.
It's fraud. Both on the part of Boeing and on the part of whoever in government approved that.
800x markup doesn't just happen. You can sneak 10% or 20% surcharge but 800x is so obvious that it's only possible because everyone involved is in on the grift.
It's not a surprise to anyone at the Air Force, they just been getting away with this for so long that they don't even care to hide it. The corruption has been normalized.
Which is why Democrat's obsession with rising taxes and the "pay your fair share" rhetoric pisses me off so much.
Let's start by eliminating 800x waste, 100x waste, 20x waste, 10x waste, 5x waste, 2x waste from government spending and then let's how much money we need to run government. I suspect it would be much less than what US currently takes in taxes.
Yes, but how are you going to get that cushy job in the industry once you retire from your government position if you start acting "tough" on too-big-to-fail companies?
Them revolving doors need to keep turning to line your own bank account.
It is strange how much apologia there is for Boeing in this thread. Why does it have to be somehow the government’s fault or somehow reflective of the actual cost to make the dispensers? Why should Boeing get the benefit of the doubt, especially given their complete failures on their fixed price contracts (Starliner, Air Force One, KC-46 tanker)? They’re so unable to control costs they’re talking about never taking fixed price contracts ever again. Given those failures, it seems safe to assume they’re screwing taxpayers on their cost plus contracts.
Though I don't disagree principally. My experience with government contracts echos the much higher costs you have to make to get 'simple' things through. You end up jumping through so many hoops to get something cheap through that you spend much more on the process than the part could ever cost.
Granted 8000% is still absurd, but 1000% wouldn't necessarily be unrealistic.
> complete failures on their fixed price contracts
In fact, Boeing has stated they will no longer bid for fixed price contracts at all. They are institutionally incapable of making money by simply selling a product to the government for a price agreed to up front. Other companies can, but Boeing cannot. It's a rotten company.
Cost-plus contracts should be emergency measures for wartime only. They should be illegal otherwise. They hurt our country, not just by getting the government scammed by greedy corporations, but also by ruining companies like Boeing that should otherwise be competent and valuable assets to the country.
The government is a ridiculous customer. The military especially so. Folks rotate every 18 months or so, each one coming in looking to “prove” themselves. Invariably they create rework and delays while they come up to speed, and by the time they come full circle and realize how much waste they’ve created, they’re off to the next gig, leaving their mess behind for the next person to eventually discover.
Having someone who goes through a list and cross-references the price of every screw and soap dispenser against the market rate to ensure they're not being scammed incurs a huge cost. Especially since the US government is buying billions of various supplies every year.
A better solution than hiring people to watch for literal scams is to simply not scam people and hold them liable when they're found to have done so.
Your logic is the same as thieves who say, "It's not my fault that I stole their wallet. They should've put it in a slash-proof backpack and locked it with a combination lock that isn't easily picked." Sure, some degree of security and caution is good. But not defending criminal behavior is better.
20 years ago, Boeing had a good reputation. Now it's known as a company that'll pick your pockets and kill you. Quite a downfall.
Fair enough, but I was referencing people taking a Boeing exec’s claim that somehow regulations cause military soap dispensers to cost that much at face value.
> I assume you talk about the government here?
No. Read the whole sentence. I’m referencing Boeing and the tens of billions Boeing has lost on fixed price contracts.
When someone gets tricked in a shell game, is it fine because they voluntarily bought into it? Would you legalize such schemes? Of course any scam (short of outright extortion and robbery) relies on the victim to voluntarily hand over money. We could take a social Darwinist approach to business and say any way you gain an advantage is legitimate as long as it's not by physical force. But obviously something nefarious is going on here, because no one would knowingly overpay by that much for no apparent benefit. It's likely kickbacks were involved. This is fraud, they're stealing taxpayer funds.
> "Whoops I made $600 from something that cost me $10"
I've written about this here some time ago - you don't pay for the soap dispenser or trash bin itself, you pay for the paperwork showing that it is safe to install this trash bin, soap dispenser or whatnot into this specific model of aircraft or spacecraft, and you pay for the paperwork that details the entire life of every tiny little piece used to manufacture that component. For flight-critical parts, IIRC that goes as far as to documenting the specific lot of the iron ore that was used to make the metal sheets, so in the event of something cropping up where something got fucked up in the mine or the smelter, you can recall every single part that could be affected. And there's lots of testing (and associated waste) at each part of the step.
Anything that goes into an airplane or spacecraft has ridiculous rules attached to it... rules that were literally written in blood. Aerospace is amongst the safest ways of transportation because of decades of crashes and learning from each and every single one.
Your average Home Depot soap dispenser has none of that, if it breaks it breaks.
Shouldn't risk factor into the equation? If your soap dispenser breaks, yeah that sucks and it's maybe a little gross, but you can just replace it with you land. I struggle to imagine what rule about soap dispensers was written in blood.
Surely there's a more cost-effective happy medium somewhere between "just buy the Home Depot 2-for-1 special" and "we ran a background check on the guy who mined the metal"
Mmmm, this ignores the cause of Boeing's recent failings.
If a piece of military hardware or software fails, one or two or a dozen people die... if they can't eject.
If a piece of civilian hardware or software fails, hundreds of people die. Witness the 737 Max.
The breakdown of the barrier between the military and commercial sides of Boeing has resulted in a catastrophic reduction in quality on the civilian side. So overcharging for soap dispensers on the military side is far more egregious than overcharging for them on the civilian side, because the stakes are actually lower.
I'd actually disagree there. The stakes for military aircraft are higher - assume Russia or China sends a nuclear bomb equipped squad on their merry way to Alaska.
If even one of the US planes has an issue taking it out of the fight, the Russian bomber squad may succeed, dropping a nuke and killing tens of thousands of people.
> If your soap dispenser breaks, yeah that sucks and it's maybe a little gross, but you can just replace it with you land. I struggle to imagine what rule about soap dispensers was written in blood.
The very second you start making an exception because "a soap dispenser is trivial", other stuff will get labeled as exempt (or treated as such), eventually there will be no one knowing what is exempt and what is not, and someone will treat something as exempt that clearly shouldn't have been exempt, causing an incident.
In aircraft and spacecraft design and manufacture, the rule is "safety by design". Treating everything as "needs to be certified by default" is fail-safe, it eliminates entire classes of incident causes.
>The very second you start making an exception because "a soap dispenser is trivial", other stuff will get labeled as exempt
As we've seen from the slight "windows falling off planes mid flight" problem which they furiously tried to cover up, Boeing has a bit of a problem with making exceptions where it actually matters.
A far more likely explanation here isn't that Boeing is being too strict and disciplined over all things up to and including a soap dispenser, but that a bunch of people have their noses in the trough and have figured out a hack to drain money out of the federal government budget.
For a soap dispenser I don't think there are any rules written in blood.
The idea that Boeing of all organizations is too consistent about adhering to rules written in blood given the 737 MAX debacle and the "whistleblowers falling out of windows" issue is also darkly comical.
If there is to be any continuity to the process of aircraft saftey,that adheres to the pricipals learner from aircraft accident investigation, then there must be a lesson learned from the debaucle of $600 soap dispensers,and a way to do better.I think it quite likely that said dispenser and many other components can be
3D printed in metalurgicaly perfect titainium and then subject to NDT ,while saving weight and money.
One of ? the most important lesson learned in aviation to date, is that weight is the enemy, the other is simplicity, : if its not there, it costs nothing, and cant break.
To sum up, simplicate and add lightness.
Any resistance to that is indicative of other problems.
> I think it quite likely that said dispenser and many other components can be 3D printed in metalurgicaly perfect titainium and then subject to NDT ,while saving weight and money.
You'd still need to pay for the certification and audit trail paperwork, and in addition you'd take a part that has already been certified and replace it by a new one that would need to undergo the same certification requirement.
> weight is the enemy, the other is simplicity, : if its not there, it costs nothing, and cant break
Indeed but then you get crews taking their own soaps because they (think they) need to have soap aboard, store them wherever it is convenient for them, and the soap bar then gets loose and flies during the cockpit during a mission because no one thought about securing the soap as it isn't on any checklist.
That is also the reason why even brand new airplanes rolling off the factory line still have ashtrays in lavatories despite smoking being banned for decades now. They account for some dumbass thinking they do need to smoke and better they drop the cigarette in the ashtray (because that's what people do naturally) when the fire alarm goes off, than they dump it in the trash bin, causing the cigarette to set the trash alight and causing a bigger issue.
That is "fail-safe by design". Even if it adds 100 grams per plane to have that ashtray and a bit of work for the attendants to check if it needs to be cleaned out and for the pilots and maintenance crew a bit of work in the MEL check, it is still worth it over losing an aircraft due to a trash bin fire (and yes, that still happens, see the source for this quote!):
> As with just about everything on a plane, it's about safety. "They're there so if someone were to break the rules, they would dispose of the cigarette in the ashtray as opposed to, say, a trash bin full of flammables," says Robert Antolin, chief operating officer at App in the Air. [1]
These dispensers are specifically called out along with "26% of spare parts" in a DoD audit. I assume the auditors know what they are doing, are well aware of the fact that qualification and traceability costs money, and factor this into their findings that these in particular are overpriced. And anyway, the audit doesn't call out Boeing, it calls out the Air Force for not checking invoices or getting justification for price increases.
This is a soap dispenser though. That's not a safety critical component, the soap dispenser breaking isn't going to cause a plane to fall out of the sky, or the weapons system to accidentally go off, it's just a thing for dispensing soap.
> That's not a safety critical component, the soap dispenser breaking isn't going to cause a plane to fall out of the sky
Depends on the failure mode. Assume the screws with which the soap dispenser is installed are spec'd to wrong torque and the installation causes stress fractures as a result that end up propagating through the aircraft...
Yes it sounds far-fetched, but aircrafts have crashed due to microfractures caused by improper torques on other components...
If what you're saying were the real reason, that soap dispensers from Boeing cost more because of paperwork, then Boeing should be able to calculate what it will cost to do all the paperwork and offer a fixed price up-front that allows them to make a reasonable profit after all that paperwork is paid for. In fact, they cannot. Or they refuse to. Either one, Boeing is rotten.
>I've written about this here some time ago - you don't pay for the soap dispenser or trash bin itself, you pay for the paperwork showing that it is safe to install this trash bin
What really makes me livid is that the same people who are in here now screeching about Boeing's misdeeds with no thought given to mitigating facts would instantly grasp the concept of paying for a paper trail and happily use it as justification to crucify some puddle jumping airline operator in Alaska who sourced unapproved stuff.
Feeling entitled to engage in cognitive dissonance like that when it benefits you plays a key role of so many problems in society these days, including shoddy work and overpriced soap dispensers at Boeing
That said, I still think $600 is absurd. The .mil probably already has a soap dispenser thats sufficient that Boeing could have made a mount for.
If you say “cost overrun” 3 times in a row, Elon Musk will appear to install the soap dispenser from Home Depo himself, insult some people and then only charge half what Boeing did. The first time it is used in flight it will explode because as it wasn’t rated for pressure, blinding the pilot and leading to the loss of the aircraft. Musk insults trans people before losing interest in the whole thing, and trump assigns RFK Jr to dismantle “big hygiene”.
Yeah nah, paperwork doesn't cost 8000%. Not to mention Boeing is the one (via massive bribes paid to FAA bosses who are usually "ex"-employees) who gets those regulations written to ensure no other party can bid for $600 soap dispensers.
The international man of mystery would like a word. Those tactical soap dispensers can be a great defense against tactical shoes. Can’t put a price on that.
In the same country where Pentagon paid 10$ for a paperclip. (cannot find a source right now, ddg and startpage are both braindead when it comes to searching)
It was screws, maybe? According to the U.S. attorney, the company “grossly inflated prices intentionally”, although according to mschuster91 people just don't understand the level of paperwork needed to create these $37 screws and $600 toilet seats.
Excuse the potential tin-foil hat but this be "cooking the books" to mask other purchases that are not suppose to be public eg. secret/top secret projects? 8000% seems obscene even for government billing...
The US has 222 C-17 Aircraft. A single C-17 costs over $300 million.
If you ask Boeing for soap dispenser parts for these, what should they cost? Boeing charged $149,072 for the dispensers. That's $671 per plane. Is that too much?
If you had to make these dispensers, make sure they conform to rules for aircraft parts and Air Force parts, provide formal responses to bids, etc., how much could you make them for?
It seems high to me. The article says 8000%, which is less than $10 per plane. So while it seems high, it's definitely not 8000% high.
Can you imagine even being a one-man shop making 222 bespoke soap dispensers to some absurd spec AND jumping through all the documentation hoops that are required for only $150k? I wouldn't take that job. Sounds awful.
Sounds interesting!
The first year you learn how hard it is, you spend 80% of your time on compliance documentation and 80% of your budget on tooling. You still don't have a satisfactory product or a mastery of filling out the forms. It drags on into the second year, you're living on ramen but eventually deliver it (if there's one thing the government procurement process is tolerant of, it's delays) and get paid.
The third year you take on a additional contract, for 200 toilet flushes or whatever. New manufacturing challenges, but at least you're getting the paperwork down.
After a few more jobs, you've cracked it. You start bidding for all the military's bathroom-related contracts. At five or six contracts a year, you have a million or two rolling in (and low manufacturing costs - remember, the spec is such that you can produce it for 80x lower) and you've hired five employees.
By year five, the only thing you care about improving is sales. You still have 5 machine shop staff, paid well but not enough to make them wealthy. You focus on hiring ex-military brass and making them sales reps and lobbyists. You're into tens of millions of revenue, that is, profit.
Year 8, you sell the thing to Northrop or to a private equity firm and go retire on an island.
I worked on a government software contractor that ended up growing from 10 people to 300 people in about 8 years and sold to Booz Allen Hamilton for around $50 million. You absolutely nailed it.
Sadly I didn't get much of a payday out of it.
Any thought what you should have done differently, with the information available at the time?
If you can pull it off as a worker-owned co-op (and don't ruin it in year 8, but keep on working at the scale you want), that's a really nice business.
Though you might want to also take on some non-government contracts, both to keep everyone busy in between government contract demands on their roles, and to reduce the risk of having "only one customer".
Yeah. People who haven't done manufacturing may laugh, but depending on how many custom parts there are you could easily spend most or all of that $150K just on the molds/tooling.
Now, like you said... the root cause here is probably some absurd spec that prevents them from using some existing commercial soap dispenser whose costs have already been amortized.
Then again, maybe the spec isn't absurd. The C-17 may need to fly in contested airspace. Maybe damage control is a concern. Maybe they can't use commercial soap dispensers because they're plastic and they don't want the plane to fill up with toxic fumes from burning plastic. That is a random guess. I have no idea.
I couldn't find pictures of the soap dispenser, but here's apparently a urinal from some version of the Globemaster. I get the feeling these parts are kinda custom... https://www.flickr.com/photos/morganone/122375474/in/photost...
Also, every material that goes into them needs to be tracked (with paperwork) since it was mined/smelted.
You probably also really don't want slippery floors at a critical (or any) time.
You also can't just drill a couple of holes wherever to mount it and you don't want it turning to a missile if the plane has to do any aggressive maneuvering.
You also need to provide exact replacement parts for 50 years so you should probably make 666 of them just to be safe.
But you also get paid for those
I wonder what's special enough for this to be different from certified aviation grade equipment? It'd be nice it they could either make a bunch of a design (usefully) for the military to fulfill mil-spec, or if they could take an existing design and just make it in a mil-spec compliant way.
Boeing could have specced some weird stuff on the dispenser, just to make it harder to get elsewhere. Things like impact resistance, yield strength in a fire, or counter-rotating threads to prevent it shaking out.
the article believes they should cost $10 though
They probably would if they were made in china, and sold in Walmart by the millions.
tbh the only solution to the problem is to spend the $250,000 it would probably cost in tooling etc and fill the Boeing ~1,000 order and sell another 99,000 to the public. At $10 each and without paying yourself anything you would probably just about break even.
I think that isolating their relationship to a single transaction like this is disingenuous. Our government pays this company many billions per year. They likely or should have had extra of these laying around for replacements. It’s not unreasonable to expect them to charge a reasonable amount for everything.
But for some reason Boeing continually gets away with being Boeing for some reason.
Whoever wrote the article has never had to replace a cup holder in their car.
What about designing the plane to use a common soap dispenser that doesnt cost $150k?
Why not just use existing solutions like a soap dispenser that is found on common commercial passenger planes that Boeing already has and makes?
There is no world where a simple soap dispenser is $150k.
They seemingly design them like this so they can bilk the US government aka tax payers with these absurd prices for simple objects.
It’s $150k for 222 dispensers, not just one. At $671 it’s overpriced but depending on what custom spec they had, maybe not by a whole lot. I’m imagining the metal soap dispensers in airline bathrooms maybe with some additional military specs.
> What about designing the plane to use a common soap dispenser that doesnt cost $150k?
Which one? Whichever you pick you need to stock that exact same one for the next 50 to 100 years. By the time you finish exactly defining it, you are back where you started.
(Also it's not 150k each - that's the price for the entire fleet.)
I mean it doesn't cost $157K it costs $671. They ordered a couple hundred of them.
This one from CB2 is $40 and it doesn't conform to FAA rules and it's not MIL-SPEC. [1]
I suspect if I wanted a limited run of soap dispensers, I was only willing to buy 300 made-to-order, tested and conformant to niche military specifications and aviation specifications, I'd probably end up paying a decent chunk more than CB2.
How much does the entertainment system in your car cost vs an iPad? Is that a rip-off, or is it a niche, custom part that has to be made from automotive grade components?
How much does the soap dispenser cost in a 777 bathroom? That's the real point of comparison, not CB2.
[1] https://www.cb2.com/ramsey-calacatta-gold-marble-soap-pump/s...
> How much does the entertainment system in your car cost vs an iPad? Is that a rip-off, or is it a niche, custom part that has to be made from automotive grade components?
You can't say it's a niche part when the item is being manufactured in the hundreds of thousands or even millions. Car companies reuse components between models and sometimes even between brands.
And that's without mentioning that the average 7-8" screen or CPU in a car's entertainment system isn't a custom made part, they are bought at bulk from other manufacturers that produce (tens of) millions of units per year.
You can find entertainment system replacements for most cars that cost a fraction of what the car manufacturer charges consumers.
I struggle to see how a mass-produced, way more expensive (for the customer), lower-quality product isn't simply a rip-off.
Your example is a marble soap dispenser. Did you go on Google and search for the most expensive one you could find?
I did, yes, lol. I mean the most expensive one on sale at CB2 which is kind of a mid-range home furnishings store. I'm confident I can find a soap dispenser that costs more than $671 for home use, though.
[edit] Here you go, just under $845. I present you the Labrazel Discus Brown Pump Dispenser available at Nieman's. Only $77 per month thanks to the magic of Affirm. Good news is thanks to Black Friday you get a $125 gift card. Still not MIL-SPEC though.
https://www.neimanmarcus.com/p/labrazel-discus-brown-pump-di...
> The finest natural materials and the most exceptional quality of craftsmanship converge at Labrazel due to a singular focus—the design and creation of luxury accessories for the bath
Maybe the Pentagon should check these guys out.
> How much does the soap dispenser cost in a 777 bathroom
This might not be a fair comparison, since Boeing also makes the ones for commercial customers, and probably overcharges them also.
> This one from CB2 is $40 and it doesn't conform to FAA rules and it's not MIL-SPEC.
People talk about MIL-SPEC like its some unattainable gold-standard. I can buy a MIL-SPEC rated Thinkpad from Lenovo for less than $600. I mean, sure, it doesn't dispense soap...
MIL-SPEC is a very broad category. It just means it conforms to a military specification, which can be very simple and easy to meet in some cases. But when the MIL-SEC refers to safety-critical and flight-critical specifications it's a whole other story, and does become an extremely costly and difficult to meet set of standards for good reason.
Compare the cost of a MIL-SPEC ThinkPad with that of an actual flight control computer designed to be an integral part of an aircraft's avionics.
Yes, but this is for soap.
Sure, and there are useful points in the rest of this conversation about whether you need something that special for a soap dispenser and what might be driving up costs, and whether a commercial off the shelf alternative really was an option.
I wasn't trying to cover all that, I was just pointing out that MIL-SPEC is a very wide category and therefore effectively meaningless unless you're pointing out what type of application it is.
Also I assume they are still using regular soap refills for these things or are they?
I’m sure the Boeing Soap is $50K per liter.
Here is the original report and the press release with pictures [1,2]
> The DoD OIG found that overpayment occurred because the Air Force did not:
> Validate the accuracy of data used for contract negotiation.
> Conduct contract surveillance to identify price increases during contract execution.
> Review invoices to determine fair and reasonable prices before payment.
> In addition, the DoD OIG found that the DoD did not require the contracting officer to verify the accuracy of the bill of materials before negotiation or to review invoices for allowable, allocable, and reasonable costs before payment.
This does not sound like expensive MilSpec. Wouldn’t it be fair to assume that the DoD Inspector General is aware of these before making such accusations?
[1] https://www.dodig.mil/reports.html/Article/3948601/audit-of-...
[2] https://www.dodig.mil/In-the-Spotlight/Article/3948604/press...
They apparently aren't really any different from the sort you see in public restrooms and those are so cheap the supply companies give them to you for free when you buy a case of soap.
Here's an idea: what if the US military just had in-house manufacturing capability and could build soap dispensers (or anything else) to specification at basically the cost of the materials? The factory, the staff, and everything else would be a built-in sunk cost, because they're already in operation.
The analogy here would be hiring a software consulting firm to make every little one-line-of-code change to your website, instead of just having a full-time in-house developer who could make small one-time changes and maintenance at no additional cost.
People complain about government employees, and continually insist that private industry can do it better.
It would almost certainly be cheaper and more effective to do it in house. But instead, in-house capabilities are continually decreasing. The actual government agencies are reduced to supervisory roles.
Stories like this usually result in even more hatred for government employees and more outsourcing.
The issue is the outmoded and excessively specific system of procurement used by the US Military - one more or less mandated by congress.
We can chose to alter how we procure, but there are good reasons why the system is as it is, so a careful effort to understand why it is like it is before we reform must be undertaken.
Chesterton's Fence applies here for sure.
Congress does not stop the US military from "keeping a database of historical prices, obtaining supplier quotes or identifying commercially similar parts."
Those procedures do not happen because generals retire into cushy barely-show jobs at defense contractors
Congress does not dare force the US military to do any of the above because the US military is a giant pork barrel welfare program for red states, especially the midwestern ones, feeding them endless useless manufacturing work and keeping all their unskilled-labor high school graduates out of unemployment - sending them into the military where they learn some semblance of how to be an adult and some skills
You’ve got that backwards, at least in some instances. The military pretty regularly tells Congress it doesn’t want something and Congress keeps buying it to keep constituents happy: https://www.military.com/daily-news/2014/12/18/congress-agai...
You also wrong about where the money goes. It mostly goes to coastal states (and DC). The Midwest gets less money from those contracts than most states: https://www.pewtrusts.org/en/research-and-analysis/articles/...
The only free curriculum in a right wing world. Army or prison.
From https://www.cbsnews.com/news/air-force-overpaid-8000-percent...
> "We are reviewing the report, which appears to be based on an inapt comparison of the prices paid for parts that meet aircraft and contract specifications and designs versus basic commercial items that would not be qualified or approved for use on the C-17," the Boeing spokesperson sought to explain in a statement.
I was thinking that it would make sense in future contracts to try to define a class of parts that are allowed to be 'unapproved' by the manufacturer and still be used, but then I tried to think of what all those parts would be and it doesn't seem like it would be that large of a list of items. I wonder if the juice isn't worth the squeeze to try to prevent this. What a strange world.
Also in a military context it's probably worthwhile to heavily scrutinize your supply chains and nog just install soap dispensers from Amazon.
Only a few months ago we saw an example of a intelligence agency implanting and blowing up bombs in equipment
> “The Air Force needs to establish and implement more effective internal controls to help prevent overpaying for spare parts for the remainder of this contract, which continues through 2031,” said Inspector General Robert Storch.
I wonder if these egregious examples of expenses are due to lack of controls or intentional corruption.
A fourth option would be "we want to keep Boeing in business, but can't offer direct subsidies per trade agreements"
I had assumed that they were there to hide costs for things that would not bear scrutiny but that still needed to be paid for. Not just speaking expenses for ex generals, but also supplies provided for operations that many of us would be horrified to find out about.
No the black budget is a line item in the overall budget. Very few things go into it: even advanced weapons will be separated line items outside it.
Considering the things the US funds in the open, even when doing so directly violates US human rights law, I shudder to think what would be covered up.
"I'm shocked--shocked!--that grift is occurring in this establishment!"
I have to point out here, I think the word you're looking for is "graft".
Both potentially apply, but it can be hard to prove which:
Well the thing to note here is that "grift" is a count noun. (Their definitions as verbs is not what's relevant here!) You can't say "grift is occurring here"; you can say "a grift is occuring here". Meanwhile, "graft", in the sense of the abuse of an office for personal gain, is a mass noun. Perhaps the commenter's mistake was leaving out an article rather than using the wrong word? The latter seems more likely to me, however.
> You can't say "grift is occurring here"
Sure you can; "grift" can be used as an abstract noun, much like "crime", e.g., "Crime is occurring here" vs. "A crime is occurring here".
The term you're looking for here is "mass noun" or "uncountable noun", and... well I was going to say "no, it can't", but searching does turn up some uses, so, uh, I guess people are saying that now and I was wrong? It must be pretty new; I'm not seeing it in dictionaries.
(Note that just because "crime" can be used as both a count noun and a mass noun doesn't mean "grift" can be! Most nouns are just one or the other, not both. Like Wiktionary has "crime" as both but "grift" as count only. But it seems like this new uncountable sense of "grift" is out there now, so people will have to update the dictionaries...)
Additional note: I'd still bet that the commenter was conflating the two words, however.
No, it’s “grift”: https://www.wordnik.com/words/grift
No, it's not. "Grift" is a count noun. You can't say "grift is occurring here"; you can say "a grift is occuring here", or "grifts are occurring here", but not just "grift is occurring here". Meanwhile, "graft", in the sense of the abuse of an office for personal gain, is a mass noun and can be used this way. Perhaps the commenter's mistake was leaving out an article rather than using the wrong word? The latter seems more likely to me, however.
Would like to know the numbers built and how different from a regular airline soap dispenser. If you ask any manufacturer to build something custom made with unusual specs and you buy only 5 pieces, you will get pretty steep quotes vs the nearest approximation on amazon.
They just need to break down the invoice.
People love those stories.Filling out paperwork would be the line item that balloons costs.
Running my own business I soon learned that aerospace companies were too onerous to deal with. I remember one in particular where they wanted me to accept their seventy pages of terms and conditions before I would accept a $99 order.
Pumping up their dividends would be the line item that balloons costs.
Based on the ole' joke about outfitting custom planes, "If you want to do anything to a plane... /anything/..., it's 250. New coffee machine? 250k. Rotate the sofa? 250k." -- $149,072 for a soap dispenser might well be a screaming deal.
> „The US military the mightiest fighting force at the time fell in one swoop when the president and command staff all died dud to the unwashed hands of a marine preparing the burgers on Airforce One.“ - Encylopedia Galactica 2424
One can make ridiculous arguments about both values and costs if one goes to extremes. It is instructive to study actual modern warfare. Sophisticated weapons only matter if there is a sufficient number. Meat attacks only work if weapons are of sufficient quality. Neither is one of the extremes.
"The Inspector General also noted it could not determine if the Air Force paid a fair price on $22 million of spare parts because the service did not keep a database of historical prices, obtain supplier quotes or identify commercially similar parts."
There's no excuse for this. There should be a watchdog group in the federal government, staffed with people who make .01% commission on every dollar of waste they find and eliminate on shit like this.
There are watchdog groups. The DoD Inspector General mentioned in this story is one of them, but the main one in government is the Government Accountability Office (https://www.gao.gov/). Famously, the GAO saves the federal government between $70 and $200 a year for each dollar spent on its budget.
There are also various levels of auditors within the organisation, some of whose reports are used as inputs for the IG and GAO.
Well, if they're generally effective (oh yeah, that's a pun), so be it. Not surprising that we mostly hear about the egregious failures.
Pretty much, yes. Broadly speaking, the US federal government's financial controls are good and prevent a ton of corruption and waste. At this scale no system can be perfect though, and there will always be some.
However, there are diminishing returns at some point. If you want to go after, let's say, the 99th percentile within which things like soap dispensers might fall, you may have to spend more in admin costs than you get back in savings.
This applies to both needing more staff and needing to add more paperwork, which also in turn can slow down projects.
This DoD IG report, for instance, faults the US Air Force for not having built a database that tracked historical prices and tracked equivalent COTS part prices on various commercial marketplaces. That means either having staff or (more usually) paying some third party contractor to maintain a database and constantly update it to track all of these commercially available products. At some level you can end up spending more than you save.
That's why in corporate audits there's always a threshold floor below which external auditors don't bother to check further. It's considered an acceptable risk.
Well, one could argue that a competent procurement system would have been tracking that stuff by default.
But, having worked for a Big-6 firm in aerospace and defense software... yeah.
With regard to historical pricing, I agree. I suspect that's more an admin oversight than the lack of a system though. But in terms of the equivalent product price comparison database, would that really normally be in place? I would think the space of aircraft parts that could potentially be replaced with COTS parts is not a very large one, and probably not something optimised for at first. Instead, focus would first be on tracking/monitoring military parts, then of separately tracking clearly COTS parts.
Also, there's a human aspect here. Doubt any air force officer wants to be the one to approve a COTS replacement for something like this only to have something go wrong on a flight because of some or other unexpected failure.
I thought the deal with all these things is that the unit prices on items don't mean anything, and that they tend to be a negotiated total price (for whatever DoD is buying --- not "soap dispensers" but like "the entire C-17 program for FY2024") that's just weirdly spread over everything, so you end up spending like $15/screw, but everyone knows the actual game.
Is that not what's happening here?
It's interesting that this says "Boeing overcharged" and not "USAF overpaid".
I know who I blame for wasting the tax dollars, and it isn't the organisation whose raison d'être is making a profit on selling goods. I don't blame the lion for eating the gazelle either.
(Admittedly the actual article has a more balanced tone).
Looks like the buyer didn't shop around and just went with the first crazy offer.
Why blame Boeing for this? They just made an offer and someone took it.
Percentage values in the range of thousands are somewhat pointless. A usual factor, not normalized to 1/100, would be a better fit, but would probably not make such a catchy headline.
It all goes into the GDP I guess
Maybe they are special dispensers that keep working in sudden and unplanned low pressure conditions?
And they stop working in high-pressure situations?
Not as much as Musk companies are going to overcharge, the government agencies he now manages...
$600+ is excessive if you are not familiar with the cost of airplane parts and accessories. Add to that cost of compliance (done by humans, the most expensive aviation accessory) and you get that number.
I hope their stock price goes "boing". Arrogant company, endangering air traffic, leaving astronauts in space...
"an inapt comparison of the prices paid for parts that meet military specifications and designs versus basic commercial items that would not be qualified or approved for use on the C-17"
This is the problem--the government heavily regulates (which the big contractors encourage) all the parts and suppliers until Boeing becomes the sole-source supplier and can charge arbitrary prices. There is a reason for it at times, i.e. to answer does someone die if this part fails or can we just stock a few spares? But obviously many many things being vastly over-specced most of the time.
> But obviously many many things being vastly over-specced most of the time.
And sometimes they are appropriately specced.... for 1951, and no-one bothered to update the spec. They just ask for more of part 46-18432, please, and since the spec becomes more and more outdated, it becomes harder and more expensive to provide a part to that spec.
How much is the “overcharging” in the pharmaceutical and healthcare industries?
"overcharged" is such an euphemism.
It's fraud. Both on the part of Boeing and on the part of whoever in government approved that.
800x markup doesn't just happen. You can sneak 10% or 20% surcharge but 800x is so obvious that it's only possible because everyone involved is in on the grift.
It's not a surprise to anyone at the Air Force, they just been getting away with this for so long that they don't even care to hide it. The corruption has been normalized.
Which is why Democrat's obsession with rising taxes and the "pay your fair share" rhetoric pisses me off so much.
Let's start by eliminating 800x waste, 100x waste, 20x waste, 10x waste, 5x waste, 2x waste from government spending and then let's how much money we need to run government. I suspect it would be much less than what US currently takes in taxes.
For clarity, a 8000% markup is 80x more expensive, not 800x.
Not denying that that still should be unacceptable on the buyer side, if you want to have any semblance of a functioning market.
Yes, but how are you going to get that cushy job in the industry once you retire from your government position if you start acting "tough" on too-big-to-fail companies?
Them revolving doors need to keep turning to line your own bank account.
> 800x markup doesn't just happen
Isn't it 80x? Title says 8000%
Well yeah, tactical soap dispensers do cost 8000% more than soap dispensers because they have tactical in the name
I mean.. they are really nice soap dispensers.
Pix? I don't think Boeing ones are luxury branded ones, but I might be wrong.
https://www.cbsnews.com/news/air-force-overpaid-8000-percent... has a picture and it's a pretty standard run of the mill pump dispenser.
That's interesting cause this reddit album[1] has this picture: https://www.reddit.com/media?url=https%3A%2F%2Fpreview.redd....
[1] https://www.reddit.com/gallery/1al24h7 (images #9 and #10)
That looks like it might be a hand sanitizer that was added due to covid? My work has those command strip stuck all over the building.
It's possible the soap dispenser is to the left of the sink and just hidden by the angle.
"Dismantle Boeing and the Air Force, immediately"
It is strange how much apologia there is for Boeing in this thread. Why does it have to be somehow the government’s fault or somehow reflective of the actual cost to make the dispensers? Why should Boeing get the benefit of the doubt, especially given their complete failures on their fixed price contracts (Starliner, Air Force One, KC-46 tanker)? They’re so unable to control costs they’re talking about never taking fixed price contracts ever again. Given those failures, it seems safe to assume they’re screwing taxpayers on their cost plus contracts.
Though I don't disagree principally. My experience with government contracts echos the much higher costs you have to make to get 'simple' things through. You end up jumping through so many hoops to get something cheap through that you spend much more on the process than the part could ever cost.
Granted 8000% is still absurd, but 1000% wouldn't necessarily be unrealistic.
It’s always really frustrating when the facts of a specific situation don’t conform to our preconceived notions and biases.
> complete failures on their fixed price contracts
In fact, Boeing has stated they will no longer bid for fixed price contracts at all. They are institutionally incapable of making money by simply selling a product to the government for a price agreed to up front. Other companies can, but Boeing cannot. It's a rotten company.
https://arstechnica.com/space/2023/10/boeing-says-it-cant-ma...
Cost-plus contracts should be emergency measures for wartime only. They should be illegal otherwise. They hurt our country, not just by getting the government scammed by greedy corporations, but also by ruining companies like Boeing that should otherwise be competent and valuable assets to the country.
The government is a ridiculous customer. The military especially so. Folks rotate every 18 months or so, each one coming in looking to “prove” themselves. Invariably they create rework and delays while they come up to speed, and by the time they come full circle and realize how much waste they’ve created, they’re off to the next gig, leaving their mess behind for the next person to eventually discover.
> Why does it have to be somehow the government’s fault
Because they bought it.
> They’re so unable to control costs
I assume you talk about the government here?
Having someone who goes through a list and cross-references the price of every screw and soap dispenser against the market rate to ensure they're not being scammed incurs a huge cost. Especially since the US government is buying billions of various supplies every year.
A better solution than hiring people to watch for literal scams is to simply not scam people and hold them liable when they're found to have done so.
Your logic is the same as thieves who say, "It's not my fault that I stole their wallet. They should've put it in a slash-proof backpack and locked it with a combination lock that isn't easily picked." Sure, some degree of security and caution is good. But not defending criminal behavior is better.
20 years ago, Boeing had a good reputation. Now it's known as a company that'll pick your pockets and kill you. Quite a downfall.
> Because they bought it.
Fair enough, but I was referencing people taking a Boeing exec’s claim that somehow regulations cause military soap dispensers to cost that much at face value.
> I assume you talk about the government here?
No. Read the whole sentence. I’m referencing Boeing and the tens of billions Boeing has lost on fixed price contracts.
> somehow regulations cause military soap dispensers to cost that much at face value
MILSPEC is a thing - but unless the soap dispenser involves electronics, I don't think that applies here.
(If someone had bought an IoT enabled soap dispenser for a military plane, that would have been their own stupidity.)
>Because they bought it.
When someone gets tricked in a shell game, is it fine because they voluntarily bought into it? Would you legalize such schemes? Of course any scam (short of outright extortion and robbery) relies on the victim to voluntarily hand over money. We could take a social Darwinist approach to business and say any way you gain an advantage is legitimate as long as it's not by physical force. But obviously something nefarious is going on here, because no one would knowingly overpay by that much for no apparent benefit. It's likely kickbacks were involved. This is fraud, they're stealing taxpayer funds.
It's strange how much some people are assuming this is as a result of a mistake or incompetence instead of simple corruption.
"Whoops I made $600 from something that cost me $10"
> "Whoops I made $600 from something that cost me $10"
I've written about this here some time ago - you don't pay for the soap dispenser or trash bin itself, you pay for the paperwork showing that it is safe to install this trash bin, soap dispenser or whatnot into this specific model of aircraft or spacecraft, and you pay for the paperwork that details the entire life of every tiny little piece used to manufacture that component. For flight-critical parts, IIRC that goes as far as to documenting the specific lot of the iron ore that was used to make the metal sheets, so in the event of something cropping up where something got fucked up in the mine or the smelter, you can recall every single part that could be affected. And there's lots of testing (and associated waste) at each part of the step.
Anything that goes into an airplane or spacecraft has ridiculous rules attached to it... rules that were literally written in blood. Aerospace is amongst the safest ways of transportation because of decades of crashes and learning from each and every single one.
Your average Home Depot soap dispenser has none of that, if it breaks it breaks.
Shouldn't risk factor into the equation? If your soap dispenser breaks, yeah that sucks and it's maybe a little gross, but you can just replace it with you land. I struggle to imagine what rule about soap dispensers was written in blood.
Surely there's a more cost-effective happy medium somewhere between "just buy the Home Depot 2-for-1 special" and "we ran a background check on the guy who mined the metal"
Mmmm, this ignores the cause of Boeing's recent failings.
If a piece of military hardware or software fails, one or two or a dozen people die... if they can't eject.
If a piece of civilian hardware or software fails, hundreds of people die. Witness the 737 Max.
The breakdown of the barrier between the military and commercial sides of Boeing has resulted in a catastrophic reduction in quality on the civilian side. So overcharging for soap dispensers on the military side is far more egregious than overcharging for them on the civilian side, because the stakes are actually lower.
> because the stakes are actually lower.
I'd actually disagree there. The stakes for military aircraft are higher - assume Russia or China sends a nuclear bomb equipped squad on their merry way to Alaska.
If even one of the US planes has an issue taking it out of the fight, the Russian bomber squad may succeed, dropping a nuke and killing tens of thousands of people.
Your argument makes sense if we ignore the topic of the thread. I don't think nuclear war readiness capabilities boil down to having good soap.
The idea that Boeing of all organizations is consistent about adhering to rules written in blood is also darkly comical.
"Whoops sometimes our windows fall off mid flight but trust me bro, this soap dispenser is a fucking disaster waiting to happen"
Occam's razor says this is corruption.
> If your soap dispenser breaks, yeah that sucks and it's maybe a little gross, but you can just replace it with you land. I struggle to imagine what rule about soap dispensers was written in blood.
The very second you start making an exception because "a soap dispenser is trivial", other stuff will get labeled as exempt (or treated as such), eventually there will be no one knowing what is exempt and what is not, and someone will treat something as exempt that clearly shouldn't have been exempt, causing an incident.
In aircraft and spacecraft design and manufacture, the rule is "safety by design". Treating everything as "needs to be certified by default" is fail-safe, it eliminates entire classes of incident causes.
>The very second you start making an exception because "a soap dispenser is trivial", other stuff will get labeled as exempt
As we've seen from the slight "windows falling off planes mid flight" problem which they furiously tried to cover up, Boeing has a bit of a problem with making exceptions where it actually matters.
A far more likely explanation here isn't that Boeing is being too strict and disciplined over all things up to and including a soap dispenser, but that a bunch of people have their noses in the trough and have figured out a hack to drain money out of the federal government budget.
How to tell a "real honest paperwork" apart from a money laundering scheme pretending to be justified by some opaque rules in a monopolized domain?
For a soap dispenser I don't think there are any rules written in blood.
The idea that Boeing of all organizations is too consistent about adhering to rules written in blood given the 737 MAX debacle and the "whistleblowers falling out of windows" issue is also darkly comical.
If there is to be any continuity to the process of aircraft saftey,that adheres to the pricipals learner from aircraft accident investigation, then there must be a lesson learned from the debaucle of $600 soap dispensers,and a way to do better.I think it quite likely that said dispenser and many other components can be 3D printed in metalurgicaly perfect titainium and then subject to NDT ,while saving weight and money. One of ? the most important lesson learned in aviation to date, is that weight is the enemy, the other is simplicity, : if its not there, it costs nothing, and cant break. To sum up, simplicate and add lightness. Any resistance to that is indicative of other problems.
> I think it quite likely that said dispenser and many other components can be 3D printed in metalurgicaly perfect titainium and then subject to NDT ,while saving weight and money.
You'd still need to pay for the certification and audit trail paperwork, and in addition you'd take a part that has already been certified and replace it by a new one that would need to undergo the same certification requirement.
> weight is the enemy, the other is simplicity, : if its not there, it costs nothing, and cant break
Indeed but then you get crews taking their own soaps because they (think they) need to have soap aboard, store them wherever it is convenient for them, and the soap bar then gets loose and flies during the cockpit during a mission because no one thought about securing the soap as it isn't on any checklist.
That is also the reason why even brand new airplanes rolling off the factory line still have ashtrays in lavatories despite smoking being banned for decades now. They account for some dumbass thinking they do need to smoke and better they drop the cigarette in the ashtray (because that's what people do naturally) when the fire alarm goes off, than they dump it in the trash bin, causing the cigarette to set the trash alight and causing a bigger issue.
That is "fail-safe by design". Even if it adds 100 grams per plane to have that ashtray and a bit of work for the attendants to check if it needs to be cleaned out and for the pilots and maintenance crew a bit of work in the MEL check, it is still worth it over losing an aircraft due to a trash bin fire (and yes, that still happens, see the source for this quote!):
> As with just about everything on a plane, it's about safety. "They're there so if someone were to break the rules, they would dispose of the cigarette in the ashtray as opposed to, say, a trash bin full of flammables," says Robert Antolin, chief operating officer at App in the Air. [1]
[1] https://www.travelandleisure.com/why-airplanes-have-ashtrays...
These dispensers are specifically called out along with "26% of spare parts" in a DoD audit. I assume the auditors know what they are doing, are well aware of the fact that qualification and traceability costs money, and factor this into their findings that these in particular are overpriced. And anyway, the audit doesn't call out Boeing, it calls out the Air Force for not checking invoices or getting justification for price increases.
This is a soap dispenser though. That's not a safety critical component, the soap dispenser breaking isn't going to cause a plane to fall out of the sky, or the weapons system to accidentally go off, it's just a thing for dispensing soap.
> That's not a safety critical component, the soap dispenser breaking isn't going to cause a plane to fall out of the sky
Depends on the failure mode. Assume the screws with which the soap dispenser is installed are spec'd to wrong torque and the installation causes stress fractures as a result that end up propagating through the aircraft...
Yes it sounds far-fetched, but aircrafts have crashed due to microfractures caused by improper torques on other components...
If what you're saying were the real reason, that soap dispensers from Boeing cost more because of paperwork, then Boeing should be able to calculate what it will cost to do all the paperwork and offer a fixed price up-front that allows them to make a reasonable profit after all that paperwork is paid for. In fact, they cannot. Or they refuse to. Either one, Boeing is rotten.
> literally written in blood
Where can we see this literal blood writings?
>I've written about this here some time ago - you don't pay for the soap dispenser or trash bin itself, you pay for the paperwork showing that it is safe to install this trash bin
What really makes me livid is that the same people who are in here now screeching about Boeing's misdeeds with no thought given to mitigating facts would instantly grasp the concept of paying for a paper trail and happily use it as justification to crucify some puddle jumping airline operator in Alaska who sourced unapproved stuff.
Feeling entitled to engage in cognitive dissonance like that when it benefits you plays a key role of so many problems in society these days, including shoddy work and overpriced soap dispensers at Boeing
That said, I still think $600 is absurd. The .mil probably already has a soap dispenser thats sufficient that Boeing could have made a mount for.
>rules that were literally written in blood.
Literally?
If you say “cost overrun” 3 times in a row, Elon Musk will appear to install the soap dispenser from Home Depo himself, insult some people and then only charge half what Boeing did. The first time it is used in flight it will explode because as it wasn’t rated for pressure, blinding the pilot and leading to the loss of the aircraft. Musk insults trans people before losing interest in the whole thing, and trump assigns RFK Jr to dismantle “big hygiene”.
Yeah nah, paperwork doesn't cost 8000%. Not to mention Boeing is the one (via massive bribes paid to FAA bosses who are usually "ex"-employees) who gets those regulations written to ensure no other party can bid for $600 soap dispensers.
True. That’s really a bridge too far for people who believe a Boeing executive who says tactical soap dispensers really do cost $700.
The international man of mystery would like a word. Those tactical soap dispensers can be a great defense against tactical shoes. Can’t put a price on that.
In the same country where Pentagon paid 10$ for a paperclip. (cannot find a source right now, ddg and startpage are both braindead when it comes to searching)
https://www.latimes.com/archives/la-xpm-1986-07-30-vw-18804-...
It was screws, maybe? According to the U.S. attorney, the company “grossly inflated prices intentionally”, although according to mschuster91 people just don't understand the level of paperwork needed to create these $37 screws and $600 toilet seats.
Hey those were „military grade soap dispensers” those pesky reporters always twist the truth /s.
Anyone knows is just fallout from other investigations, like „hey let’s double check everything from Boeing just in case”.
[dead]
Excuse the potential tin-foil hat but this be "cooking the books" to mask other purchases that are not suppose to be public eg. secret/top secret projects? 8000% seems obscene even for government billing...