Katherine Lambert is a University of Toronto student and AI researcher focused on critical systems. She is a former Palantir FDE intern.

The Dawn of a New Era

Before sunrise on March 1, 2026, Iranian Shahed drones struck two Amazon Web Services (AWS) data centers in the United Arab Emirates (UAE). Debris from a third strike damaged an AWS facility in Bahrain. By morning, two of three UAE availability zones were offline. This was enough to rupture the central architectural premise of cloud infrastructure, built on the assumption that zones fail one at a time.

The cascade was immediate. Leading financial institutions, such as the Abu Dhabi Commercial Bank and Emirates NBD, reported digital-service disruptions. The AI data platform company, Snowflake, experienced service errors, and the ride-hailing platform Careem declined rides to customers who had no idea that the failure came from a drone attack. The Islamic Revolutionary Guard Corps (IRGC) claimed responsibility and stated that AWS was hosting U.S. military AI, making it a legitimate target of war. Weeks later, Iran published a list of technology companies, including Amazon, Meta, Microsoft, Google, Nvidia, and Palantir, all of which it classified as valid military targets.

The IRGC strike was the first deliberate kinetic strike by a state on commercial cloud infrastructure in history.

The IRGC almost certainly didn’t know whether U.S. military workloads were actually running on those specific servers. Nor did the engineers who built the servers imagine that it would matter if they were used for military operations. Amazon selected the UAE for its cheap land, fiber connectivity, and reliable power. Those features would harden the facilities against the threats most engineers worry about, like periodic outages, software failures, and cyberattacks. Instead, the data centers were hit by drones. With the IRGC strikes, the United States distributed some war risk onto companies unequipped to carry it.

Every dominant era of military power has been governed by an enabling layer: the infrastructure without which all else fails, which defeats strategy before movement can even begin, and which no general can conjure up by issuing an order. Coal and steam in the nineteenth century. Oil from 1912 onward. And now, electricity.

The shift to AI as the dominant technology of warfare has already occurred. The Pentagon’s $9 billion Joint Warfighting Cloud Capability contract puts AWS, Microsoft Azure, Google Cloud, and Oracle at the center of how U.S.forces plan, target, and fight. Maven Smart System, a military AI operating system, is deeply integrated throughout the military. The Defense Logistics Agency, managing end-to-end supply for the military services, awarded Google a $48 million contract in 2025 to modernize its supply chain operations on an AI-ready cloud platform.

A growing share of critical military capability relies on data centers, which run on electricity, which in turn comes from a civilian grid. And that civilian grid is largely in private hands, with investor-owned utilities accounting for 80 percent of the U.S. transmission network. Strip away the software and AI and what remains is an unbroken line of dependency terminating in electricity. No power means no compute and no military AI, which translates to deficiency in modern warfighting capability.

A nation’s ability to project force, sustain operations, and deter adversaries has always been a function of its industrial base. And in the coming decades, the ability to assert sovereignty for any nation may be determined less by what it can build or buy, than by what it can reliably power.

The new arms race is measured in gigawatts.

The Constraint

U.S. data center power demand was projected by Goldman Sachs to more than double, from 31 GW in early 2025 to 66 GW by 2027. However, S&P Global reported that U.S. data-center demand had already reached 64.4 GW in late 2025, exceeding the earlier projected forecast. It now puts the 2030 number at 183.2 GW. Data centers will draw nearly 12 percent of all U.S. electricity, up from four percent just a few years ago, and from the same grid that powers hospitals, factories, and water treatment plants.

In parallel, more than 2.2 terawatts of generation and storage projects are sitting in interconnection queues, which is the formal regulatory process that new electricity projects must follow to connect to the grid. Today, the entire installed generating capacity of the United States is only around 1.2 terawatts.

Behind the demand figures sits a different problem entirely. The United States is not running short of electrons, but of time and institutional capacity to move electrons from decision to delivery.

The median wait time for a new power source to connect to the grid now exceeds five years. In the largest grid operator in the country, PJM, it can take up to eight. Further, around 75 percent of the capacity that entered interconnection queues from 2000 to 2020 had been withdrawn by the end of 2025, while only 13 percent was operating.

The power problem isn’t just quantity and wait time. Military AI workloads need a dispatchable, 24/7 base load system that works regardless of weather and can survive grid disruption from enemy strikes. The civilian grid strategy of adding solar and wind at scale to route around the problem works for average household demand, but it cannot guarantee 500 MW at 3 AM in December. This is why nuclear is back, why Microsoft signed a 20-year power purchase deal to restart the Three Mile Island nuclear plant, and why gas peakers are being signed at premium rates by companies whose press releases still say 100 percent renewable.

Energy capacity has decided wars before

In 1912, Winston Churchill faced a choice that looked like a bad trade: convert the Royal Navy from coal to oil at the peak of an arms race with Germany. Britain had abundant coal resources—the South Wales coalfields were among the richest in the world—and no domestic oil. Exchanging a secure state resource for a foreign dependency mid-competition was strategically illogical.

Churchill converted regardless, commissioning Admiral Fisher to find the oil and prove that it could be stored cheaply in peacetime and secured with certainty in wartime. From this came the Anglo-Persian Oil Company, in which the British government took a 51 percent controlling stake. Churchill then introduced the investment legislation in June 1914. Oil-powered ships ran faster and quieter than coal-powered ones, could refuel at sea, and needed far fewer crew members to operate. In a naval arms race measured in knots and range, that was decisive.

Forty years later, Hyman Rickover applied the same logic to submarine warfare, routing backward from required capability to the necessary resource to fuel it. Diesel-electric submarines were constrained by battery life and the need to surface. His approach was to eliminate the constraint at its source. USS Nautilus went to sea in 1955 powered by a reactor, and submarine endurance became effectively unlimited.

The German case study illustrates the failure mode.

Germany’s defeat in World War II traces back beyond military strategy. Beneath the operational failures lay an economic model that could not sustain the industrial demands of a prolonged war, with fuel being the sharpest expression of this. Lacking sufficient petroleum resources to power a modern military campaign, Germany built synthetic fuel plants that converted domestic coal into liquid fuels—a remarkable feat of industrial chemistry, papering over a fundamental scarcity. The Allies understood this exact constraint, and when the RAF and USAAF struck the Leuna and Pölitz plants in 1944, German aviation gasoline output from synthetic plants fell from 175,000 tons in April to just 5,000 in September.

The technology had been sophisticated, but it lacked a secure enabling layer underneath. It was capital-intensive, slow to repair, and geographically vulnerable. Once the Allies recognized that, the air war was effectively over.

The Institutional Gap

Churchill’s successful coal-to-oil transition had a structural advantage that is easy to overlook. The Royal Navy was the customer, the operator, and the policy-setter all housed within a single institution. When the decision was made to convert, Churchill could commission a study, take a controlling stake in an oil company, sign a twenty-year supply contract, and issue an order. The enabling layer was all within a single chain of command.

Meanwhile, the electricity infrastructure of the United States answers to no one in uniform.

Fractured across private utilities regulated by the Federal Energy Regulatory Commission (FERC), fifty state public utility commissions, regional transmission organizations, private sector-owned infrastructure, and dozens of local permitting authorities, the grid that powers the United States has no single owner or point of accountability. National security is not its primary concern. The Department of War can decide that it needs a 500 MW AI facility at Fort Bliss, but cannot by itself make 500 MW appear there. The chain—from site selection, interconnection request, queue position, environmental review, to transmission upgrade, construction, commissioning—runs through institutions that, individually, are doing what they were designed to do. Collectively, they cannot move at the speed a defense requirement demands.

As Dan Wang argued in Breakneck, the United States has become a lawyerly society, one in which physical infrastructure is the hardest component. Some fast energy projects have sought speed by leaving the grid queue and building on-site power instead, a process known as behind-the-meter. Enverus projects that behind-the-meter projects will account for roughly 40 percent of installed data center capacity by 2030, as developers try to escape grid interconnection timelines.

But this is not a solution for the Department of War. Self-contained, off-grid power installations measured in hundreds of megawatts cannot win a contest in the scale of hundreds of gigawatts. Concentrated, fixed, high-value installations (whether synthetic fuel plants in 1944 or availability zones in 2026) are also precisely the targets an adversary finds easiest to name.

When Churchill advanced Britain’s situation, he didn’t build a Navy-only refinery, but took a state position in an entire supply chain, rewiring national policy around it.

To degrade U.S. military AI capability, no adversary needs to strike the physical grid. The permitting system is already doing the job. The Department of Energy’s own projection—a hundredfold increase in grid outage risk by 2030—is a rational self-assessment. The front line of this arms race runs through FERC’s interconnection queue.

The Directive

Churchill’s model was not a policy mandate, but a directive with a specific institutional form, backed by an organization with the authority and continuity to execute it. The contemporary problem demands the same sequence: a mandate, then something with the authority and continuity to carry it out.

A credible response from Washington rests on four concrete pillars:

1. First, military compute demand needs to be forecast in megawatts, by site and by year. Industry, including grid operators and utility providers, can then bid to supply it. The government should offer accelerated permitting and tax incentives for companies to build capacity to serve the increased demand.

2. Second, interconnection queue position, transmission rights, and long-term firm capacity need to be held as defense assets. The strategic petroleum reserve exists because Washington decided oil supply was too important to leave entirely to markets. The same logic would apply here.

3. Third, Federal siting authority for defense-designated load needs to exist, as every downstream intervention (from financing, to construction and commissioning) runs on a schedule the DoW currently has no power to accelerate.

4. Fourth, the United States has distributed its war risk onto commercial companies that were never set up to carry it. If cloud infrastructure serves as a critical component in military infrastructure, then its physical defense is a military obligation.

The Will to Win

The arms race is measured in gigawatts. Wars, conflicts, and strategic competition have not historically been decided by the side which possesses the most resources, but by the country that has an effective strategy and the institutions to deploy it. Britain had less oil than its competitors but won because Churchill built the machine to secure it. Germany had world-leading chemistry and superior military strategy, yet lost because it couldn’t secure what that chemistry depended on. The United States has abundant electricity but is currently losing the institutional question, and not to a faster adversary but to a zoning board.

The engineering capability and capital exist. What remains is institutional architecture, and the will to reorganize policy around the problem. That will remains slow to arrive within Washington’s defense establishment. But as shown on the sunrise of March 1, 2026, unless Washington acts now, it will be forced to do so under fire.

Ukraine’s defense industrial base is powered by hundreds of startups—small manufacturers churning out drones in factories whose locations are closely guarded secrets.

This fragmented, decentralized production ecosystem is an advantage for Ukraine and a headache for Russian targeteers, but it presents a problem as the most successful of these startups try to scale and break into the increasingly crowded Western market.

Enter UFORCE, a Ukrainian startup and Ukraine’s first defense unicorn after it raised $50 million in funding in March of this year. UFORCE serves as a talent scout of sorts for Ukrainian defense tech companies. It acquires the companies that are making some of Ukraine’s most potent and novel capabilities and connects them to Western capital, management practices, and—soon it hopes—defense buyers.

UFORCE’s marquee products have earned their place on the battlefield. Chief among them is the MAGURA unmanned surface vessel (USV) that stalks Russia’s Black Sea Fleet and that has struck or sunk more than a dozen Russian naval vessels, including the Ivanovets, a guided-missile corvette. There is the Nemesis family of bomber drones, whose heaviest variant can carry a 22-pound payload 15 miles. And there is the Liut unmanned ground vehicle (UGV), a customizable platform capable of performing dangerous missions at the front that would otherwise fall on infantry.

UFORCE’s systems have operated in the highest-intensity combat zone on the planet. Now UFORCE faces a new challenge: the change-averse and incumbent-dominated defense acquisition bureaucracies of the Western world. Will it succeed?

First Breakfast’s Blake Seitz sat down with Oleg Rogynskyy, UFORCE’s co-founder and CEO, to discuss the company, Ukraine’s defense production success, and the lessons Western militaries should learn from Ukraine’s fight for sovereignty and survival.

Origins

FIRST BREAKFAST: Why don’t we start at the beginning. February 2022, what were you doing? And did you see yourself getting into defense tech at that time? Or was this a complete pivot for you?

OLEG ROGYNSKYY: I remember the exact moment when the war started. I was with my team at my first company called People.ai and we were coming out of a killer sales meeting. It was one of those meetings where you’re high-fiving each other in the parking lot afterward. And suddenly I look at my phone and have a thousand notifications: “Russia attacks Ukraine,” “Russia attacks Ukraine.” So I ran out right away and called my uncle, who was in Kharkiv. I ask if he’s OK and he says, “Can’t talk. We need to run.” And you could literally hear explosions in the background. I couldn’t sleep all night.

I flew to New Jersey the next day to meet with Verizon. And there’s one person at Verizon who completely changed everything for me. I’m sitting there at the lunch and he says, “You’re distracted, what’s going on?” I said, “I’m Ukrainian. My country’s on fire right now.” And he says, “You know what? Forget the agenda. Tell me how you feel.” And I told him.

Later he texts me a draft press release. And it says, “Verizon is about to make phone calls to and from Ukraine free.” I’m like, “Why are you doing this?” And he says, “You work with T-Mobile, AT&T, and all the others. Let them know before we do this.” So we did. And then suddenly everybody rushed to make calls to and from Ukraine free ahead of Verizon. He purposefully gave me the lever to create pressure on everybody else, and suddenly the friction of calling Ukraine disappeared globally within, like, six hours.

And I was like, “Wow. I actually know people who know how to move the needle.” That was the moment where it clicked for me.

Soon after, I go online and I see this blog post from someone I knew. It said, “Hey, Ukraine needs better eyes on the battlefield.” I start researching it and realize, obviously Ukraine needs that. Long story short, I put together a team of volunteers and we found donors to help Ukraine. And Ukraine then used it extremely effectively.

Two weeks later, I had a call with a few Ukrainians and they asked, “hey, do you know anything about Starlink?” Yeah, I do. I know the guy. They’re like, “well, we need Starlinks.” How many? “All of them. Yesterday.” And let me guess, you have no money. “Yep.” So the next thing that happens is a group of people come forward and pay for thousands of Starlinks.

Once you start doing that and crossing so many Rubicons, life can never be the same.

FIRST BREAKFAST: Fast forward a few years to UFORCE. What is UFORCE? And what is its origin story?

OLEG: So UFORCE is a result of that earlier work, in some way. As I was helping with connectivity and other support, there were a number of other grassroots groups inside and outside of Ukraine. What Ukraine did spectacularly in the first hours of the war was say, “We’re not going to exist unless all of you guys come together on this.” And they galvanized this community.

There is a very interesting article by Gillian Tett called “Inside Ukraine’s Open-Source War.” It’s a long read, but it’s spectacular. Her point is that in any society or culture, information travels up and down the hierarchy. But some places create this lateral exchange. Think of engineering cultures in some countries, or Burning Man, where different hierarchies learn to talk to each other laterally. And basically, that’s what you’re going to use when things start going wrong. Instead of waiting for hierarchies to produce outcomes, which is slow in politics, you activate all the lateral links. And I was one of the lateral links, and there were hundreds of other lateral links. And that’s what saved Ukraine.

To your question, there were other groups laterally that said, “We have Starlinks now. Well, there are Russian ships out there. Let’s build some drone boats.” Another group was like, “Well, we have some shrimp boats from before the war. It would be really easy to hire people to drive them around.” And then there were agriculture drones that had really good C2 and inertial guidance systems for precision agriculture. It turns out that if you combine those things, it creates the best weapons systems on the planet.

So the origin of UFORCE was when the drone guys started talking to each other. And it turned out that one of them, [Oleksiy Honcharuk, UFORCE chairman], was very business and politics savvy. So we said, we should probably do this together. And so the two teams came together and formed UFORCE in 2023 and it spread like wildfire from there.

FIRST BREAKFAST: So there are two ways that you could frame what UFORCE is. The first way to think of it is that this is an effort to bring Western capital, Western management practices, things like that to Ukrainian startups. What you’re describing seems like a much more bootstrapped, bottom-up effort by startups organizing themselves. Which version is correct? Or is it both?

OLEG: So it’s both. Initially it was this organic movement that created systems that were needed and then did 30,000 iterations to make them better with every cycle. They learned how to move fast. Someone wrote that it’s like the Cossacks, who served as a super decentralized quasi-government in 1600s Ukraine. They were extremely successful until they made the choice of siding with Russia against the Polish, which is probably one of the biggest mistakes Ukraine has ever made.

But then at some point, UFORCE was like, OK, we’re hitting the limit of what we can do organically. We need structure, we need capital, we need governance, we need all these things, and very few people in Ukraine had done that with Western investors. So I ended up being one of the two or three Ukrainian-origin CEOs who had raised a large amount of Western capital.

Ukraine’s Acquisition Advantage

FIRST BREAKFAST: Ukraine’s defense industrial base has scaled from making thousands of drones to making millions. What made that possible?

OLEG: Product–market fit. In Silicon Valley, you’re supposed to raise money, then you go and you talk to your users, and then you build exactly what they want, and then you iterate and iterate and iterate until you get a product that works. You know it works because they buy more, and you’ve got a growing list of customers and strong retention. That’s how Silicon Valley operates.

In defense, the traditional model is you win the budget five years out, and then you start working on something cost-plus where nobody is rewarded for speed.

Ukraine basically applied the Silicon Valley model to figure out product–market fit for weapons. Ask people what they want. Give it to them right now. Build it as cheap as possible. Get feedback. Get three percent better tomorrow. Rinse and repeat. So that really, really worked.

Then when they realized it was working, they built an acquisition system which they didn’t have before. One point we like to make is, in future wars there will never be a TRL [Technology Readiness Level] above 7. TRL 1 is an idea; TRL 9 is like an Abrams tank. TRL 7 is like, it kind of works, it gets the job done, it’s not sexy at all, there’s a lot of work to do. But the speed of iteration with which Ukrainian technology is changing is so fast that you’ll never have the time to get to TRL 8. Whatever gets to TRL 8 is already obsolete. And so that is the complete cultural shift that Western militaries are really not seeing—yet. Things are going to fly and they’re going to fail, so build in a way where you can use it and you can lose it.

FIRST BREAKFAST: You can’t afford exquisite when the Russians are knocking at the door.

OLEG: Exquisite is wrong, period.

FIRST BREAKFAST: Let’s talk about how Ukraine’s acquisition structure actually works. I’ve read about the Brave1 Market, which lets frontline users purchase equipment directly and determine what works for their specific situation. And then that distributed acquisition system drives the feedback loop. Talk about that.

OLEG: It gets way more interesting. So you get points, like Amex points, for verified results. And then, as the commander of a unit, you can go on the Brave1 Market and order things with your points. It’s like Amazon. There are user reviews. It tells you how many are in stock. You can pay extra points to have it delivered to you by tomorrow. All of that is built into a real-time supply chain.

Ukrainian government procurement is looking at all these reviews. They’re collecting the data and seeing, “oh wow, everybody wants to have this kind of drone, all the points are going there.” And they are making their supply-chain decisions and placing orders. So they are taking this experience and data of the best units and just projecting it with big orders while allowing companies like UFORCE to get to scale.

All of this is happening in real time. Contract to payment in Ukraine is incredibly fast because all the data is validated.

FIRST BREAKFAST: Is this innovative model one small share of the effort by Ukraine to move metal and equipment on the front? Or is this now how everything operates?

OLEG: Only part of it happens through points, and the rest is highly, highly informed acquisition based on user demand. You can’t go wrong buying a thing that everybody’s buying. And it’s not IBM. It’s things that might have been created yesterday.

FIRST BREAKFAST: Ukraine came into the war with its own equivalent of the primes or legacy manufacturers. Was there pushback to adopting this model from traditional industry?

OLEG: No. There was only one prime, a government prime, that was mega maxed out on capacity. And so this model was created to increase capacity, not to replace capacity. Prime, do your prime thing. We still need all of that and 10x more than you can do. We’re going to do this thing over here with all these drone hipsters. They’re not in your way. So that’s how it happened.

FIRST BREAKFAST: When people talk about distributed acquisition in the United States, they worry about duplication, waste, or delivering products to the front line that aren’t validated and can’t talk to each other. How do you respond to those sorts of criticisms?

OLEG: It was a mess in the beginning, but then you let the users vote. When a user review is like, “Oh, this thing works better with Palantir Maven and this one doesn’t,” if I use Palantir Maven I know what I’m going to buy in the next round. Ukraine purposely created a lot of competition, but then it uses data so that the riffraff gets cleaned out very quickly.

I think much of the inefficiency in the U.S. system comes from lack of data. Not from lack of money or desire or smart people. Ukraine said, “We’re going to do whatever creates data and then we’re going to listen to the data.”

FIRST BREAKFAST: What are the main differences between selling equipment to the Ukrainian Ministry of Defense versus selling it to the Pentagon or other Western militaries? And where are the big hurdles that you see to cracking the Western defense market?

OLEG: It’s much easier to sell to Ukraine, because Ukraine is absolutely a real meritocracy. If your equipment doesn’t work, it won’t exist.

Ukraine cares about ensuring that airstrikes don’t take out your production capacity. It’s a very different universe.

But the biggest difference is how Ukraine buys. The mindset has shifted from buying drones and buying kit to buying effects. So they’re not asking how many drones can I get for ten million dollars? They’re asking, what effect do I get for ten million dollars? It’s exactly what happened elsewhere in tech. You used to ask, how many servers do I get? Then, with cloud, the shift was to buying capacity. The Western world is buying tanks like we used to buy servers. Ukraine has, in this analogy, shifted to buying outcomes on the battlefield.

FIRST BREAKFAST: Digging into that, how does it work whenever the Ukrainian MOD says we want to buy an outcome. How do you stipulate that in a contract? How do you verify it? It is such a revolution in how we think about buying things.

OLEG: That comes from having validated data on what each system actually delivers in the field.

FIRST BREAKFAST: So basically the proliferation of electronics and cameras and everything else has made it possible for high command to verify the claims of all of its producers and tabulate it with this level of granularity.

OLEG: In real time. And it’s all validated.

That matters because a lot of Western vendors are saying, “Our stuff works.” But there’s a disconnect: investors don’t know how to get real data, so they believe the stories. And founders overselling is actually one of the most dangerous things happening in defense tech in the West right now, because combat is the only test that counts.

Building and Buying in the West

FIRST BREAKFAST: UFORCE wants to build hardware in the United States. Is it more challenging to build things in America than it is in Ukraine? Why or why not?

OLEG: It’s not more challenging to get started in the U.S. We don’t have a full profile of the costs yet, but you don’t get airstrikes in the U.S. You don’t get blackouts in the U.S.

But what’s harder in the U.S. is the demand side, obviously, because you have to explain to the U.S. why they need it. And then there is a lot of noise from people speaking from imagination rather than experience. But building in the U.S. is not much harder.

FIRST BREAKFAST: China is obviously the world heavyweight champion of manufacturing. Everybody is focused on securing their supply chains, trying to have ex-China supply chains. How much thought is UFORCE giving to creating a supply chain that’s independent of China? What are the challenges involved in that?

OLEG: We started on that early. We did it before we engaged with the United States. And we keep at it, because it’s never a one-off.

FIRST BREAKFAST: So the Maguras, everything else—there’s no Shenzhen in there?

OLEG: Correct. We are testing all the second and third-tier suppliers. If we ever find something, we replace it. We started doing this years ago for different reasons. China has been threatening to cut off Ukraine’s supply for many years now. And so we knew this was coming, whether we worked for the U.S. or not. And so the smart business decision a year and a half ago was to wean off China.

FIRST BREAKFAST: How challenging was it? What were the most difficult choke points that you had to get through?

OLEG: The challenging part was quantities. Because unlike programs built around small batches, we make units at combat scale, every day. And the things that make your average American defense tech company look good don’t even scratch the itch for our size. Most suppliers just don’t have the volume. And I haven’t even mentioned price.

FIRST BREAKFAST: Shipbuilding is a huge focus in D.C. The statistic everyone brings up is that China makes 200 times more ships than the U.S. You are fundamentally a shipbuilder, although it’s on a different scale than building a destroyer or an aircraft carrier. If you were advising the Navy about the future of shipbuilding, what would you tell them?

OLEG: Don’t.

FIRST BREAKFAST: Go small? Go robotic?

OLEG: Yeah. But realistically, it also depends on the maritime problem that you’re trying to solve. The U.S. needs big ships for various reasons. But for a lot of allied navies, think of small unmanned boats as an unmanned remote aircraft carrier, and you can have a lot of them for very little money. You literally can produce them, drop them in the water, and they operate autonomously.

We are at the precipice where saturating large maritime areas with unmanned systems is very doable. I can see a kill grid—which is like a grid of autonomous boat swarms—hanging out and holding the whole body of water against Shaheds, submarines, and manned craft autonomously. The only thing that’s missing is the gas stations. The boats will need to go back, refuel, and come back out. The Tesla charging network is missing. But the Tesla is already here.

FIRST BREAKFAST: That’s a good line. But do you think that applies on the other side of the world where distances are as vast as the Pacific?

OLEG: There are 27,000 islands in the Pacific. You can put a lot of gas stations there.

FIRST BREAKFAST: Parting thoughts. What message do you think that Americans and Westerners need to hear about what is happening in Ukraine?

OLEG: I’m shocked that up until recently, nobody asked the question, “Wow, Ukraine doesn’t have Tomahawks and they’re still managing to strike deep behind combat lines. What are they doing, throwing rocks or something?” Nobody in the West had been paying real attention to how you create the same effects, using duct tape and bubble gum, in some cases—but then the duct tape and bubble gum became actual, real weapons that took a completely different architectural engineering route. Nobody here was paying attention.

And now people are like, “How did they do that? Oh, they have boats and launch drones from the beach, and that’s how they hit hugely expensive targets for a fraction of the cost.”

I’m glad that learning is happening and acceleration is happening on the U.S. side. And actually, I want to give a compliment to the U.S. side: the learning I’ve seen since March is incredible. The country is moving. I really hope it doesn’t slow down. I wish others would realize it and start moving like the U.S. But it’s a shame we only started thinking this way so late.

FIRST BREAKFAST: It’s better to have a wake-up call now than against a peer adversary. So perhaps that’s the one positive aspect.

OLEG: Yeah. And let’s hope it’s not too late. China has been learning since February 24, 2022.

DAN MADDEN is national security principal at Squadra Ventures. He served in the U.S. Marine Corps, as Congressional staff, and at the RAND Corporation.

DOM VENTIMIGLIA is network principal at Squadra Ventures. He retired from the U.S. Army as a Chief Warrant Officer 5, having served most of his career in 10th Special Forces Group.

We reach the Unmanned Systems Forces (USF) operations center after a long drive in a blacked-out vehicle. We left our electronics behind and have little idea where we are. On entry, we pass through a hall lined with the names of the unit’s fallen. Both friendly and adversary drones hang from the ceiling. Contemporary Ukrainian art hangs from the walls.

Robert “Magyar” Brovdi is the commander of Ukraine’s Unmanned Systems Forces. Before the 2022 invasion he was a grain trader and collector of Carpathian fine art. He enlisted, starting as a rifle platoon commander in the Territorial Defence Forces. When his unit was sent to the Kherson region in the spring of 2022 he founded the Birds of Magyar unmanned systems unit to conduct reconnaissance and strike missions. The unit ultimately pioneered the large-scale integration of reconnaissance drones, FPV strike drones, electronic warfare, signals intelligence, and battlefield analytics into a single combat system. In Brovdi’s underground bunker, we sit beside his goldfish tank and he makes us tea while he shares his vision for Ukraine’s Unmanned Systems Forces in the current war and beyond.

The rise of Ukraine’s USF as an independent military service has provided Ukraine with a strategic advantage on the battlefield. It has enabled the rapid organization, training, and equipping of USF to lethal effect. With fewer than 3% of Ukraine’s military personnel, the USF achieves 33% of its effects. The typical unmanned systems team in the USF is five times as lethal as a comparable team in the conventional forces. Magyar’s Birds’ teams are fifteen times as lethal.

USF’s overperformance isn’t limited to Russian adversaries. As part of the training exercise Combined Resolve in Hohenfels, Germany this spring, the U.S. 1st Cavalry Division’s 3rd Armored Brigade Combat Team went up against a small unit from the Ukrainian 412th Unmanned Systems Brigade. U.S. armored units were destroyed so rapidly they had to be “re-spawned” to continue the exercise. This is typical of NATO exercises that Ukrainian small units participate in, both on land and at sea (e.g., Hedgehog 2025, REPMUS 2025, Aurora 2026).

The results of these exercises expose a larger problem for the United States. The U.S. has been treating our clear gap in unmanned systems primarily as a procurement and supply chain challenge. This is as if in 2007 the U.S. responded to the insurgency in Iraq with more MRAPs, without changes in doctrine and campaign design. The most important military lesson from Ukraine is not that unmanned systems are important. It is that militaries that learn how to organize, train, and equip for their employment will have a decisive advantage over those that do not. The U.S. focuses on adding unmanned systems into the existing force, rather than revisiting what a force designed for the employment of unmanned systems should look like. This is a force development problem, not just a procurement one.

The recently announced Autonomous Warfare Command is an extraordinary opportunity to solve for the biggest gap in how the U.S. has been approaching the adoption of unmanned systems. Not coincidentally, the effort to establish the command—Project Agincourt—is named for a battle dominated by the English longbow, resulting in a massive reordering of the combined arms mix of the era.

Pentagon leaders should carefully consider the Ukrainian experience as they pave the way for the Autonomous Warfare Command. Ukrainian USF are not simply conventional forces armed with unmanned systems. They have evolved an organizational design and culture to optimize the employment of such systems at the tactical, operational, and strategic levels. This includes not only traditional staff functions, but also intensive operations research and direct, real-time coordination with industry to enhance capabilities used today and shape the ones for tomorrow. Tactics, techniques, and procedures have become increasingly sophisticated, multi-domain, and adaptive to techno-economic competition.

To unpack the significance of Ukrainian organizational innovations we describe their influence on operational art, industrial relations, implications for the global security environment, and U.S. force development.

Operational Art Redux

After destroying more than 10,000 Russian armored combat vehicles, Ukrainians are skeptical of the opportunity for decisive maneuver on the battlefield. The battlefield today has similarities with World War I trench warfare, but distributed across a 30-kilometer-deep kill zone. The front is transparent. Small tactical units seek to gain marginal, positional advantage. For the moment, defense has a structural advantage over offense.

Though maneuver has been limited, operational art is evolving. In 2023, the development of unmanned systems seemed reactive—genuinely a substitute for the scarcity of more exquisite capabilities. Now we see unmanned systems employed and developed to achieve operational effects, not simply to scale capacity for attrition warfare.

In late winter 2026, both government and industry shared that Ukraine would be scaling deep and mid-strike drones. When we came back in the spring the Ukrainian military was using mid-strike drones to isolate the front, isolate Crimea, strike Shahed staging areas, and attrit key Russian air defense assets. The Ukrainian military destroyed Russian air defense assets to open routes for deep strikes on strategic targets, with the ultimate goal of crushing Russia’s will to fight.

This strike campaign illustrates Oleksiy Honcharuk’s analysis of Ukrainian and Russian cycles of adaptation and counter-adaptation in technology and tactics, which he calls the “time domain.” Creating and exploiting sometimes ephemeral advantages was a key motivation for establishing the USF as an independent military service.

Resilience in Depth

It is not just the frontline that has become transparent. Whether through remote observation or other sources of intelligence, Ukrainian military forces and the defense industry are held at threat throughout the country. Though CUAS defenses are quite good, outside of the U.S. PAC-3 interceptor nothing in the near-term can defend a Ukrainian target against a Russian ballistic missile capable of reaching 20 times the speed of sound. Both Ukrainian military forces and industry have increasingly dispersed, concealed, and hardened their operating locations and established redundant supply chains (including hoarding critical components).

The shift to unmanned systems has decentralized the employment and production of combat power. Small teams can launch UAS that can travel 200 kilometers without the concentration of forces (and vulnerability) of a cannon artillery battery. Similarly the industrial base for the production of UAS can be much more dispersed than the manufacturing requirements for exquisite capabilities like an ATACMS.

Economics of War

The war in Ukraine has renewed American, allied, and industry appreciation of the cost imposition strategy and cost-exchange ratios. During the Cold War, Andy Marshall highlighted the importance of U.S. investment in long-range strategic bombers, not only for deterrence and tactical advantage but to drive the Soviet Union to divert funding from offensive capabilities into even more costly air defenses. In Ukraine, commanders direct operations research to determine which units and capabilities are most effective and efficient at imposing costs on their adversary. Units also have uniformed software and hardware engineers on staff to coordinate with industry based on that analysis to refine current and shape future capabilities.

Perhaps the most striking example is how Ukraine verifies kills and awards units for successful strikes. When a mission is executed, battle damage assessment (“pics or it didn’t happen”) supports the assignment of “ePoints” to the mission unit. Units can then use ePoints to acquire preferred capabilities through the Brave1 Market. Unit commanders make choices with full visibility of the battlefield performance of the different platforms available. This serves as a feedback loop for capability employment and development. This feedback loop is greatly strengthened by the ubiquity of technical talent that Ukraine drew from the private sector after the war began. Commanders can also use the feedback loop to generate outcomes by changing the value of different targets to better align with changing theater priorities.

This is an innovative approach, but the risk it that it can result in commands optimizing behavior around metrics that are tactically urgent, but no more than the sum of their parts. The single-minded pursuit of points at lower levels could distract from more ambitious maneuver objectives, or even coordination with adjacent units.

EPoints are only one mechanism for resourcing combat units. Many units conduct their own fundraising efforts to supplement the standard budget cycle, collaborating with non-profits to access donors, both domestic and international. This places a premium on commanders’ communications skills, since the combat power available to their unit depends upon it.

Unit commanders that are especially adept at accessing funding leverage those resources to directly shape industrial base support to their units. In some cases this extends to operational units conducting their own prototyping and even full-scale production near the front; Wild Hornets’ Sting interceptor is a well-known example. At times the boundary between uniformed military and industry becomes ambiguous. Call it military-civil fusion with Ukrainian characteristics.

The Coming Proliferation

Foreign observers have already begun adapting their force development plans based on the war. North Korea has deployed thousands of troops to support Russia’s war in Ukraine. Latin American cartels reportedly have sought drone training by sending volunteers to join Ukraine’s foreign legion. U.S. operations in Iran are likely accelerating this trend.

Ukraine’s foreign policy will also accelerate proliferation among partners and allies. Ukraine’s government is seeking to strengthen its international standing by turning it into a net exporter of security. The “Drone Deals” allowing Ukraine’s defense tech industry to export capabilities are a major expression of this security policy. This export initiative is clearly secondary to the successful execution of the current war with Russia. Our expectation is that it will accelerate when the war ends.

Ukrainian security force assistance will export the Ukrainian way of war and the expertise required to organize, train and equip unmanned forces. The remarkable lethality of Ukraine’s USF relative to its own conventional forces indicates how significant this era of proliferation could become for the international security landscape—and the importance of getting U.S. force development right.

Adapting and Adopting Unmanned Forces

The Department of War has been laying the foundations for scaling production of unmanned systems. DRPM Unmanned Systems is unifying requirements, resourcing, and acquisition. The Office of Strategic Capital has been aggressively deploying capital to increase industrial base capacity to produce systems, components, and critical minerals. A comparable level of effort is required in developing America’s unmanned forces.

When unmanned systems became responsible for 70% of lethal effects on the Ukrainian battlefield, many senior U.S. military leaders observed that those were the only systems available to Ukraine. Ukraine lacked the exquisite capabilities and training of U.S. forces. We’d fight a similar war completely differently. This is both true and irrelevant.

The cancellation of the 173rd Airborne Brigade’s tactical unmanned systems battalion is symptomatic of the conservative attitude, as is the apparent lack of preparation for Iranian Shaheds in the U.S. war with Iran. Unmanned systems are a new component of the modern combined arms mix. Any military ignoring this will face disaster tactically and strategically.

Unmanned forces aren’t conventional forces with unmanned systems. Simply buying drones and sourcing them to our existing formations will be inadequate, just as the provision of “penny packets” of armor to infantry divisions early in WWII was inadequate to realizing armor’s promise.

Likewise, simply copying Ukrainian practices is not a viable solution. The U.S. has different strategic priorities, competitive advantages, and operational challenges. That’s why U.S. and NATO leaders should be applauded for embracing realistic training in exercises like Combined Resolve. In Operation Epic Fury, the integration of AI into operational workflows through Maven Smart Systems increased targeting speeds by two orders of magnitude, an exciting sign of what’s possible.

Autonomous Warfare Command will play a massive role in shaping the U.S. military’s adaptation and adoption of unmanned forces, but the services will remain central to realizing the vision. SOCOM is a vital combatant command, but it is still the military services that build special operators. The Army’s Transformation in Contact, Navy’s Hedge Strategy, and Marine Corps’ Force Design 2030 are examples of important work being done in the U.S. military services today. The current moment calls for a doctrinal transformation on the scale of AirLand Battle during the Cold War. Deferring transformation for readiness for the wrong kind of war would be strategic malpractice.

GLENN NYE heads the Center for the Study of the Presidency & Congress. He recently returned from a trip to Ukraine.

Ukrainian defenders have earned their reputation as the world’s most skilled drone and counter drone force. More than four years into Russia’s full-scale invasion, Ukrainian military units have developed an incredibly fast innovation loop, responding tactically to lessons learned against a determined adversary and constantly updating their methods to stay one step ahead. The result is evidenced in their ability to hold back a much larger force while also developing the capability to strike deep into enemy supply lines and strategic industrial targets that support the continued Russian assault. Ukraine’s success owes as much to the domestic defense production ecosystem as to the brave defenders who hold the lines.

The Frozen Front Line as Live Laboratory

The front line between Russian invaders and Ukrainian defenders is a brutal environment, in ways more reminiscent of World War I trench dynamics than World War II-style maneuver warfare. Within 20 kilometers on each side, movement in large vehicles is nearly impossible due to constantly patrolling first person view (FPV) attack drones. Soldiers carry on foot what cannot be transported with small aerial (UAV) or ground (UGV) drones. Many soldiers remain in trench conditions for over 100 days at a time.

The front line is also a world-class defense innovation lab, serving as a large and active range for real-time testing of defense technology. By necessity, Ukrainian units methodically improve the capability of their drones and the mechanics of countering Russian tech, while the adversary races to gain advantage. Adaptation takes many forms:

• Transportation of troops and supplies is shifting from armored vehicles to smaller, nimble SUVs

• Packaging of drones is more efficient to make each treacherous delivery of containers carry more units

• Drones are constantly redesigned to change radio frequencies for guidance

• Fiber optic cables are deployed to avoid jamming (some forests are literally covered in cables)

• Increased modularity so accessories can be quickly swapped out and upgraded

• Repositioned or reshaped antennae, increased battery life, and improved thermal imagery, sensor mapping, and propeller design

Some of these adaptations take place near the front, as forward deployed soldiers 3D print newly designed parts for immediate use. Some are supported by an array of private citizens, such as Ukrainians who hand make or print drone parts at small scale in their apartments for delivery to collection points. Great credit goes to the larger array of professional domestic manufacturers who respond in real time to demand signal from units in the field as they collect data on what works in practice and who adapt rapidly to meet the ever-changing supply needs. They make up a dynamic and decisive part of Ukraine’s industrial base.

Competition on Both Sides of the Market

Ukraine benefits from a citizenry dedicated to victory in the defense of their country and a high degree of technical education and talent. It also benefits from some wise procurement policies. Ukraine’s domestic arms production base—largely focused on drones but also engaged in production of electronic warfare and communications systems, charging stations, and heavy weapons components—is a marvel of distribution. By necessity of war, Ukraine’s defense production is spread across a wide array of relatively small production and R&D locations. It cannot have its defense production centralized in larger facilities that would be easy for Russian forces to locate and strike.

Visits made by guests to these facilities often involve meeting up at an ambiguous predetermined map coordinate before being spirited away to the actual physical location for operational security. Numerous small companies exist to supply military units with weapons systems, many of which are now made with 90 percent Ukrainian-sourced components.

Even more interesting, Ukrainian military brigades have a significant degree of budget autonomy to select what types of drones, electronics, and other equipment they want to buy from the marketplace. Thousands of vendors compete to rapidly respond to conditions that units communicate from the field, while units compete to select and field the best products, rather than wait for the Ministry of Defense to select a one-size-fits-all capability. Units are rewarded with additional budget when they successfully field their selected products. Producers are rewarded with additional sales when their products create effects on the battlefield, and they do not have to wait to win a centralized government tender to offer many products to units.

The Ukrainian government-created online marketplace, Brave1, serves as a matching entity between brigades and industry, with little red tape. The entire marketplace thus reacts to battlefield feedback in real time. What the industrial base lacks in economy of scale from large, centralized production, it makes up in rapidly adaptive production that is constantly fitted to the warfighter need. The collective result is product adaptation loops that close and innovate on drone technology in weeks rather than months or years. This loop is keeping Ukraine in the fight on the front line, while also domestically producing long-range strike drones that are increasingly capable of evading intercept and navigating to strike refineries and logistics locations deep inside Russia.

To be sure, Ukraine remains partially reliant on assistance from partner countries and private and NGO supporters for weapons and technology. For example, Starlink provides a critical support capability to Ukrainian drone guidance and communications, and Western interceptors are currently vital for the defense of Ukrainian cities against incoming ballistic missiles. Even with perfect execution and efficient allocation of national resources to the fight, Ukraine would still need (and deserve) assistance from Western partners, who also stand to benefit from access to real-time feedback on defense capabilities and methods. Ukraine’s imperative to efficiently deploy productive capacity, however, does offer some valuable insights.

Takeaways for American Defense Production

It would be difficult for the U.S. to match one condition driving the Ukrainian innovation loop: the immediate existential urgency of war. Ukraine cannot afford to attempt to defeat this invasion by training and deploying soldiers in greater numbers than Russia. It simply must win the perpetual tech production and innovation contest. Not only must it rapidly produce technological innovations that give its forces an edge on the front, but it must also automate the battle space quickly to save precious and scarce human resources from a war of human attrition. It must do this with an economy a fraction the size of ours, and with an industrial base that was not previously primed for war.

Not all of Ukraine’s lessons would readily apply to the U.S. defense base and our particular advantages. But the nimble application of competition between suppliers on one side of the market and between military brigades on the other side provides a useful conceptual lesson. Ukraine is building product for a war it is fighting now. The U.S. is largely preparing to deter future conflict (while also learning lessons about munitions production and readiness in the Persian Gulf). Still, for many products, we can introduce greater service- and unit-level autonomy to deploy budget against the full American marketplace of large and small companies to field and test more efficient ways to rapidly build a nimble and deterrent force.

Adopting Ukraine’s best drone technology today would be interesting but soon obsolete. Adopting some of the speed with which their industrial base systemically adapts to the changing nature of war would prime the American defense ecosystem for success in any future conflict.

HUNTER MOREY is a machinist mate nuclear chief petty officer in the U.S. Navy.

America is reindustrializing, and the biggest bottleneck is not capital, technology, or policy. It is talent.

Every manufacturer, and really every industry that deals with complex technical systems, should build its own version of the U.S. Navy’s Naval Nuclear Propulsion training pipeline. Under Admiral Hyman G. Rickover’s leadership, the nuclear navy has proven it can take 18-year-olds, college dropouts, and people from all backgrounds and turn them into elite operators with serious technical knowledge and real-world competence. If it works there, it can work anywhere.

This is not abstract theory, it is a battle-tested system built on high-stakes training, uncompromising standards, and hands-on responsibility that has produced one of the safest technical programs in history. Any industry can adapt it to address the skilled workforce shortages hitting manufacturing, advanced nuclear energy, energy infrastructure, and beyond.

The Problem: We Are Not Producing Enough People Who Can Actually Do the Work

Modern industry is dealing with a massive and growing skills gap. Deloitte and the Manufacturing Institute project that 3.8 million new manufacturing employees will be needed by 2033, with unfilled jobs costing the economy up to $1 trillion by 2030. Today, 77 percent of manufacturers report difficulty finding workers, and nearly a quarter of the current workforce is aged 55 and older. Whether it is advanced manufacturing, power generation, semiconductor fabrication, or data-center construction, we need operators and technicians who understand the “why” behind every valve, circuit, and procedure, not just people who can follow steps.

The usual route, college degrees followed by on-the-job learning, is slow, expensive, and frequently disconnected from real equipment and real consequences. The trades pipeline has been neglected for decades, leaving entire industries scrambling to fill critical roles.

The Naval Nuclear Model: Rigorous, Comprehensive, and Effective

The Navy nuclear program stands as one of the toughest training pipelines anywhere, all shaped by Rickover’s core principles of total responsibility, constantly rising standards, and relentless focus on real competence. It starts with intensive academics at the Naval Nuclear Power Training Command (NNPTC) in Goose Creek, South Carolina, then moves into hands-on prototype training.

At NNPTC (Naval Nuclear Power Training Command, AKA the Schoolhouse), students tackle material in mathematics, physics, reactor theory, thermodynamics, electrical and mechanical systems, chemistry, radiological controls, and more at the high school and college level (and often beyond). The roughly six-month program is packed with exams and labs. All the exams are short-answer or essay style—no multiple choice or true false. Rickover pushed this format because it forces real understanding, not just surface-level recognition. Students must explain concepts, work through problems, and prove mastery.

Grading runs on a strict 4.0 scale, with none of the grade inflation that is endemic in modern higher education. Students need at least a 2.5 to pass, a 2.8 once they get to the fleet, and a 3.2 minimum to come back as staff or an instructor. There is also a massive end-of-course Power School Comp, a full essay-based exam covering everything.

At NPTU (Nuclear Power Training Unit / Prototype), the next roughly six months shift to real operating naval nuclear plants (moored training ships or land-based prototypes). Students complete detailed system instruction, then face knowledge checkouts—tough oral exams with qualified staff. They stand training watches and evaluated watches until they are fully qualified. This is where theory becomes muscle memory and sharp decision-making under real plant conditions.

High Standards + Real Responsibility = Extraordinary Results

What makes this whole system work is the culture of uncompromising standards. There is almost no room for good enough. Students quickly learn that real competence comes from hard study, repetition, and owning your performance.

A big part of building that mindset is the expectation of extra hours. People regularly put in work outside the normal day, including weekends, to get up to speed. This teaches an important lesson early: reaching the standard means putting in effort beyond the regular schedule. That expectation builds discipline, ownership, and the understanding that excellence is not a nine-to-five thing.

We also place a very high priority on our Master Training Specialists (MTS). These are the elite instructors and mentors who live and breathe teaching complex technical material. Their expertise in breaking down hard concepts and developing people is highly respected throughout the program.

Rickover captured the spirit of this training perfectly when he said: “Responsibility is a unique concept; it may only reside and inhere in a single individual. You may share it with others, but your portion is not diminished. You may delegate it, but it is still with you. If responsibility is rightfully yours, no evasion, ignorance, or passing the blame can shift the burden to someone else.” He also said: “You must have a rising standard of quality over time, and well beyond what is required by any minimum standard.” And: “Happiness comes from the full use of one’s power to achieve excellence.”

The combination of rigorous training, real responsibility, extra personal effort, and high standards turns ordinary people into extraordinary performers. The nuclear Navy’s unmatched safety record proves it.

Ongoing Training, Continuous Evaluation, and Root Cause Improvement

Qualification is just the beginning. The program builds a lifelong culture of staying sharp through monthly Continuous Training Exams (CTEs), weekly training sessions, and clear short-range and long-range training objectives.

In the fleet, this continues with major exam cycles for reactor safety. Senior teams come aboard every 12 to 15 months and audit everything: maintenance, training records, drills, you name it. They watch casualty drills closely and grade both the drill team and the watchstanders. To prepare, we run multiple mock audits (usually at least three) ahead of time.

On deployment, we drill every single day on all kinds of scenarios. When something goes wrong, we do not just patch it. We hold thorough critiques, fix the issues, and keep asking why until we reach the real root cause. That Rickover-inspired habit of digging deeper prevents problems from coming back.

Addressing the Counterarguments: Time, Contracts, HR, and the Fear of Losing Trained Talent

The most common pushback to replicating this model is that the military can essentially take your time. Servicemembers sign multi-year contracts and can be required to put in long hours and full commitment during training. This is a fair point—the military does have structural advantages civilian employers lack. But time is not the only thing that matters. The core concept of building homegrown talent pipelines is still very viable in the private sector. The key is making the time you invest far more effective and pairing it with incentives that encourage people to stay and put in the effort that is required to excel.

Many civilian companies already run successful structured training programs without military-style control. Registered apprenticeships in manufacturing, energy, and tech often deliver deep competence through a mix of classroom instruction, hands-on work, and on-the-job mentoring, usually over two to four years. Department of Labor data shows completion and retention rates of 90 to 93 percent for apprentices who finish these programs with their sponsoring employer. Companies like Siemens, Volkswagen in Tennessee, and Lockheed Martin have built strong pipelines this way. They do not own the employee full-time, but they create real value and loyalty.

The data-center boom offers another compelling example. With a construction labor shortage estimated at nearly 500,000 workers, companies are investing heavily in homegrown training. BlackRock launched a $100 million “Future Builders” initiative to train 50,000 trades workers over five years. Micron Technology has built apprenticeship programs blending on-the-job training with community college instruction. Advanced manufacturers like Hadrian hire inexperienced technicians and train them from scratch.

The German dual education model shows how companies can invest significant training time smartly by combining paid work with targeted learning, achieving high retention because the training is practical and tied to clear career growth.

Another fear is that companies will invest only to lose people to competitors, but good program design flips this. When training is paid from day one, clearly linked to better pay and promotions, and tailored to your specific systems, people stay, and much of the knowledge has limited value to competitors.

Another challenge is where to find the instructors. Technically proficient people who are also gifted teachers are rare. The Navy solves this by identifying its best operators and investing heavily in developing their teaching skills through the MTS program. In the private sector, companies must be equally intentional: identifying top performers early, providing dedicated instructor development, and compensating teaching roles competitively. Technology like simulation platforms and adaptive learning software can multiply an instructor’s reach, but ultimately a company must want the outcomes badly enough to devote resources to building skilled trainers.

Practical ways to make this work in industry without government-level authority over time:

• Design focused, high-quality training that maximizes every hour instead of dragging things out. Short, intense modules combined with on-the-job application can deliver strong results faster than scattered learning.

• Offer competitive pay and benefits during training so people are not financially stressed and can focus fully.

• Build clear career ladders with raises and promotions tied to training milestones. Give them a visible future worth staying for.

• Foster a strong culture with real mentorship from dedicated trainers like our MTS. Pride and belonging keep people around more than contracts do.

• Use tools like training repayment agreements for early departures or thoughtful non-compete clauses when appropriate. These are standard in many fields.

• Select people carefully upfront for work ethic and fit. The right individuals will put in the extra effort voluntarily when they see the opportunity.

Time absolutely matters, but how you use it matters more. Civilian companies can achieve outcomes similar to the nuclear Navy by being smart about time, investing strategically, and creating real reasons for people to stay and grow. Many already do. We do not need to copy the military exactly—we just need to adapt the principles.

A Call for Industry Naval Nuclear Pipelines

Every manufacturer should create its own internal naval nuclear pipeline with lots of instruction, labs, training, exams, and on-the-job experience. Building homegrown, highly skilled operators and technicians is the way forward. This model is self-contained and repeatable.

Companies do not have to wait for outside schools to deliver the perfect talent. They can grow it themselves using the same intensity Rickover built: rigorous fundamentals, hands-on practice, high and role-adjusted minimum standards, frequent evaluations, watchstanding-style qualification, formal audits, daily drills, extra training hours when needed, and a deep emphasis on strong instructors and mentors like our MTS, all wrapped in smart retention incentives that make sense for the private sector.

But companies should not have to do this alone. Government should expand tax incentives for employer-sponsored training, streamline apprenticeship registration, and reform federal education funding to give technical pathways equal footing with four-year degrees. States could create training grants for industries facing critical workforce shortages in sectors like energy, defense manufacturing, and semiconductors. Beyond government, companies in the same sector could form consortia to create shared training academies and standardized qualification programs—similar to Joint Apprenticeship and Training Committees in the electrical trades. Pooling resources would spread costs, create portable credentials, and build a larger shared talent pool that benefits workers and employers alike.

If more industries adopted this approach, we could tackle retention issues, grow the overall pool of capable technical professionals, and strengthen America’s industrial base. Rickover warned long ago about the dangers of settling for mediocrity. His legacy shows that investing seriously in people through rigorous standards delivers huge returns in safety, innovation, and national strength.

The Time Is Now

The future will not build itself. It is time to raise a generation that can actually do the work, using the same principles Rickover instilled in the nuclear Navy.

The Naval Nuclear Propulsion Program has already proven what is possible when you combine rigorous standards, comprehensive training, real responsibility, and outstanding instructors. Industry just needs to take the blueprint, adapt it to civilian realities, and put it to work.

Kingsport, Tennessee would be an unremarkable Appalachian town but for one thing: it’s the home of the Holston Army Ammunition Plant, America’s sole source of certain critical explosives—“energetics” is the industry term—used in nearly every bomb, missile, and artillery shell in the U.S. arsenal. Holston was built from scratch in just 18 months during World War II. This feat feels more impressive—and almost ironic—when you consider that much of our munitions industrial base today is still dependent on this single factory built more than eight decades ago.

The aging Holston is a glaring vulnerability. One industrial accident, like a fire, and America would lose the ability to domestically produce RDX and HMX, two chemical compounds used in most warheads. Worse still, our adversaries have a ripe target for industrial sabotage that could easily be made to look accidental.

The wars in Ukraine and Iran have alerted even casual observers to the manufacturing limitations of America’s most effective weapons. Headlines often focus on production numbers and replacement rates of Patriot and Tomahawk missiles. The energetics bottleneck upstream has received less attention. That’s backwards, because as retired Brigadier General John McGuiness put it in a congressional hearing after Russia invaded Ukraine, “without propellant and explosive, there is nothing else.”

One Texas startup, Critical Materials Group (CMG), is on a mission to commercially manufacture military-grade explosives. CMG just raised a $10 million seed round led by Overmatch Ventures. I spoke with CEO and co-founder Kevin Capozzoli about why a private sector approach is finally viable and what it means for American manufacturing, sovereignty, and prosperity.

***

In startup land, where founders are more likely to be 25 years old than have 25 years of experience, Kevin stands out for his humility and maturity. It’s not a false modesty, but rather the reserved affect of someone who accepts he is leading his team on a challenging mission few others would sign up for. His demeanor makes sense when you learn that Kevin spent 25 years in the Army as an infantry officer, with 17 of those years in special operations.

Kevin’s father served in the Army in Vietnam, but Kevin was not an Army brat—he was an Aramco brat. Kevin lived in Saudi Arabia while his father worked for the oil and gas behemoth. It was the 1980s, and young Kevin flew in and out of the Middle East during the Iran-Iraq War, amidst a slew of plane hijackings perpetrated by Palestinian militant groups. War and terrorism were in the air.

Kevin lived outside the bubble of soccer matches and orange slices most American youth are fortunate enough to experience. It made him realize that good ways of life require defending (a perceptive observation for a middle schooler). ROTC and then an Army career were a natural fit.

It was only after Kevin left the service that he learned about the energetics shortage he’d been insulated from while in uniform. Kevin would keep defending America’s interests. But this time, he’d do it as a founder.

***

Before we go deeper on CMG, it’s worth taking a step back to answer a basic question. What, specifically, are energetics? At the highest level, they are chemical compounds that store energy and release it rapidly. They fall into three categories.

The first is propellant: things that move things. Propellant burns, and that burn creates thrust. The prime example is the solid rocket motor (SRM), which powers most of the U.S. missile inventory. SRMs have long been a vulnerability in the industrial base. For years, Northrop Grumman and L3Harris enjoyed a duopoly in SRM production, yet capacity remained far below demand. Now new entrants like Anduril, Ursa Major, Castelion, and many others are on the scene. SRM capacity is not a solved problem, but talent and money are pouring into the sector.

The second category is pyrotechnics, which burn slowly to create light and heat effects—think flares and smoke grenades. Pyrotechnics manufacturing is not without vulnerabilities, but the category is a second-tier concern.

The third category—CMG’s focus—is high-energy explosives. These are the chemical compounds that detonate to cause destruction. RDX, HMX, and TNT are the workhorse explosives used in U.S. munitions. Like the physical Holston plant, high-energy explosives are stuck in the 1940s. Research Department Explosive (RDX), while discovered in 1898, did not become mass manufacturable until World War II. It was quickly put to work destroying U-boats. High Melting Explosive (HMX) was discovered soon after as a byproduct of RDX manufacturing. Both RDX and HMX share a similar nitrogen-rich molecular structure, distinct from TNT. That structure gives them a much higher melting point and greater destructive power; RDX and HMX generate roughly 1.7 and 1.9 times the detonation pressure of TNT, respectively.

Since World War II, high-energy explosives research has mostly been a story of stagnation. Although scientists at California’s famed Naval Air Weapons Systems China Lake discovered the eponymous China Lake Compound #20 in the 1980s, the United States did not integrate CL-20 into weapons for largely bureaucratic reasons related to acquisition incentives and risk management. CL-20 is considered the breakthrough explosives formulation of the last fifty years. It has a more energetic molecular structure and is estimated to increase the range of existing weapons by 20 percent. Across the Pacific, China has moved ahead with scaling production of CL-20 while the country that invented it has put it on the shelf.

There are over 300 single points of failure in the supply chain for the munitions industrial base. When Russia invaded Ukraine, America painfully learned what happens when a single point of failure atrophies into a lost capability. The military wanted to surge production of 155mm shells to support Ukraine, but there was a problem: the U.S. no longer produced TNT to fill the shells. America had abandoned domestic production in the 1980s for a familiar mix of cost and environmental reasons, sacrificing sovereignty in the process (and yes, we even became reliant on China as a source for TNT). Today, Poland’s Nitro-Chem is effectively the only Western TNT producer.

The Department of War isn’t blind to these vulnerabilities. In 2024, the Army announced it was bringing back TNT production with a new, contractor-operated facility in Kentucky. The factory will start production in 2029 (In an eyebrow-raising choice, the winning contractor is Repkon USA, the American subsidiary of the Turkish firm Repkon, whose parent company’s equipment was used in the recent 155mm shell production scandal in Mesquite). In July, the Army broke ground on a new ammunition plant in Iowa to replace the state’s World War II-era site. The Army is also standing up a research site in Kentucky to provide an additional site to synthesize RDX and HMX beginning in 2031.

These are critical efforts, but they are years away. Notably, they all focus on extending the government’s empire for energetics—an empire that clearly is insufficient for our military and allies today. While some of today’s ammunition factories are operated by contractors, the sites are owned and financed by the government (an arrangement known as Government Owned, Contractor Operated, or GOCO). The private sector does not take independent bets on energetics—at least, until now.

***

I attended an event not long ago with a high-ranking official from the Department of War. Behind closed doors, he expressed frustration that more companies were not interested in the dirty work of energetics manufacturing because it’s perceived as a lower-margin business compared to just about anything else companies could produce for the department. A prominent defense founder and CEO responded that his firm had seriously looked into manufacturing its own energetics, as it would enable better vertical integration of its product. Ultimately, they’d concluded it was a regulatory impossibility to bring a greenfield energetics site online in the United States in 2026.

Neither of these challenges—energetics being historically low margin or the Goliath of the regulatory state—were enough to dissuade CMG from tackling one of the very last defense capabilities that has not been privatized. Far from it. If you ask Kevin, we are in the SpaceX moment for commercially manufactured explosives.

Much like SpaceX proved commercial launch could be a high-performing, profitable alternative to a government-sanctioned monopoly, so Kevin believes privately funded and privately operated commercial factories for energetics make good business and national security sense. Kevin believes CMG can provide capacity and redundancy to mitigate the risks from today’s single points of failure.

Demand for RDX exceeds what Holston alone can supply. Current efforts are focused on increasing America’s production of RDX from eight to 15 million pounds per year. Recent reporting by the WSJ reveals these efforts are delayed by eight years and that production remains at 2017 levels. For reference, during the Vietnam War the U.S. produced 15 million pounds of RDX per month, and during World War II, Holston manufactured over one million pounds of RDX per day. Kevin estimates demand is so great that the market could absorb at least two to three times what the United States currently produces.

CMG’s first product is C-4, a demolition explosive made of RDX and plasticizer. By the end of the year, C-4 will be rolling off the production line at the startup’s first factory in the small town of Ballinger, Texas. (In response to increased demand, the Army recently restarted a C-4 line in Crane, Indiana that’s been mothballed for some 15 years). By 2027, CMG plans to have vertically integrated factories that synthesize the chemical precursors used to produce RDX.

***

To understand why a commercial approach to energetics could work, it’s useful to understand what the objections to such an approach have been in the past. An article in the Armed Forces Comptroller authored by a trio of active duty personnel in 2018 spells it out:

“Private firms have no incentive for investing in new infrastructure that would be available past the date of their current contract. GOCO facilities currently have over one billion dollars of deferred maintenance. The health of the munitions infrastructure is a national security imperative that requires more government involvement, not less.”

The reason firms have had no incentive to invest in new infrastructure is that government demand for energetics has been uneven, creating a feast or famine cycle. Work has been low margin not because of factors inherent to the products but because firms are operating government-owned, World War II-era infrastructure.

The Ukraine war and the ongoing conflicts in the Middle East have generated incredible demand for RDX and HMX at home and abroad. Even in the unlikely scenario that world peace emerges tomorrow, the United States and her allies need to rearm and stockpile where necessary. The lesson of the last five years is that industrial power is combat power, which means sustained production is critical to deterrence. There is also real commercial demand for explosives in oil and gas and mining, which further smooths out the demand curve.

Margins have been slim because plants are not tooled for the latest advances in manufacturing and automation. While lack of investment is often blamed on industry, it’s clear that money is only part of the problem. These plants are burdened with accumulated environmental regulations and reviews that dissuade modernization or cost an insane amount to remediate. The government awarded BAE Systems an $8.8 billion contract in 2023 to operate and modernize Holston over the next decade. For example, one of the bottlenecks to expanded production is doubling water throughput capacity from 55 million to 100 million gallons of water per day. Renovations get expensive quick.

But what if you could design a greenfield factory from scratch, one free from decisions made 83 years ago? For Kevin and CMG, deriving the true unit economics from first principles is central to the business case. You may picture explosives manufacturing as immune to technological disruption—a primitive process where workers mix chemicals in vats. In reality, there is an opportunity to transition away from today’s legacy batch processing and toward increased automation.

CMG’s facilities are designed around modular, continuous-flow manufacturing, which has the promise of higher throughput and smaller in-process hazardous inventories. Further, incorporating the latest recycling technologies means environmental limitations don’t have as much leverage over production: less fresh water is required for intake, producing less wastewater on the backend.

CMG’s north star is repeatable, scalable processes because Kevin’s dream is to build CMG factories all over America. Yet another lesson from the last few years of warfare is that traditional assumptions for securing critical infrastructure are broken. The 1940 War Department Site Committee mandated that any ammunition sites be located far enough inland to protect them from naval bombardment or amphibious attacks. That requirement is moot in the age of drone warfare. Ukraine’s Operation Spider’s Web used drones to destroy many of Russia’s long-range bombers, some located as far inland as Siberia. More recently, Ukraine has successfully used drones to target remote Russian oil refineries. Holston increasingly looks like a sitting duck. The solution? Create a distributed network of many factories that will be harder to target, which is CMG’s vision.

There’s one last variable that makes commercial energetics attractive: sovereignty. Today, sovereignty is the watch word, and with good reason. Shipping our supply chain to the cheapest overseas producer has introduced unwanted vulnerabilities and dependencies. A 2020 report on the defense industrial base concluded “A third of DoD’s energetic material is produced overseas, and many materials have direct dependencies on China.” The Department of War is finally attempting to reverse this trend by supporting domestic capabilities. In July, President Trump signed an executive order restricting the use of waivers for defense equipment and materials with components made by adversaries.

Shoring up American sovereignty was a core motivation for Kevin. “I started to dive very, very deep because it was one of those moments where it’s like, man, surely somebody solved this [energetics]. This can’t be this glaring of a strategic vulnerability. And I never found that reassuring, ‘oh, it’s good.’ Like this program that you didn’t know about solves all this.” Hence the creation of CMG.

There are many such cases where founders realize there is no master plan and that if they don’t build, no one else will. In learning about CMG, I’m reminded of the origin story of uranium enrichment startup General Matter. Founders Scott Nolan and Lee Robinson initially assumed the government had a grand plan to enrich uranium. After much investigation, they realized it did not; someone else had to show up, so they did. And it’s easy to forget that were it not for SpaceX, the United States would have been reliant on Russia for crewed launch services to the International Space Station at the outset of the Ukraine war.

Can we afford to rely on Russia to enrich our uranium or China to fill our warheads?

***

CMG isn’t the only company pursuing a commercial approach to energetics. Regulus Group, D&M Holding, and Hanwha Defense all have plans for propellant factories in Arkansas. Right now, it doesn’t appear that CMG or these other companies are in real competition with the government. The Department of War is too starved of capacity to turn away any credible producers of energetics. But those conditions could change. If commercial companies successfully produce energetics at higher margins and higher volume than government sites, it will force hard conversations about what responsibilities should remain in the government’s remit.

For decades, the consensus view was that companies would not invest in new infrastructure past the date of their contract. That view proved incorrect. The combination of venture capital and talented founders has produced defense companies that are pouring money into products before they have even a contract in hand. Call it what you will—“venture capital exuberance” or a “defense tech bubble”—but companies have showed up, they’re delivering novel capabilities, and many of them are winning, bigly.

To be fair to the Pentagon, it’s true that many legacy industrial processes have not been attractive private sector investments. But that is due in large part to self-defeating government policies and regulations that are fixable with the right effort. If we can align the profit motive and the national interest, America will achieve outcomes far superior to either force acting independently. CMG is betting on it.

GREG LITTLE is a senior counselor at Palantir Technologies.

IAN CRONE is a member of the technical staff at Palantir Technologies.

In 1980, Detroit was in a fight for its life. Two oil shocks had pushed American buyers toward fuel-efficient Japanese imports, Chrysler had just been rescued by federal loan guarantees, and the Big Three were watching their market share erode year after year. Executives no longer dismissed Toyota as a maker of inexpensive economy cars in a different category; they acknowledged Japan as a serious competitor to their core business. What they did not acknowledge—what few of them even perceived—was the Toyota Production System. Detroit believed it was losing on fuel economy, labor costs, and exchange rates: problems that better products and better terms could presumably fix. To some extent that was true, but Toyota understood that the real competition was system against system.

For years, American automakers focused on horsepower, styling, dealer networks, and consumer preference. Toyota was building something more consequential: a production system that connected workers, suppliers, engineers, logistics, quality control, and leadership into a continuously learning enterprise.

The Toyota Production System was more than a collection of efficiency techniques. Its two pillars—just-in-time production and jidoka, or “automation with a human touch”—established a fundamentally different way of seeing and managing the enterprise.

Jidoka is the more remarkable of the two principles because it hard-wired human-like judgment into the machines themselves. The idea predates the automobile business entirely: Sakichi Toyoda, the company’s founder, invented an automatic loom that stopped instantly if a warp or weft thread snapped. Because the machine could distinguish normal from abnormal conditions, defects were identified and the process stopped before they turned into expensive mistakes. In Toyota’s plants, any worker could stop the production line upon discovering a quality problem—and so could the machines.

The Toyota Production System extended beyond the factory floor. Suppliers became integrated partners rather than transactional vendors, while data was used to prevent tomorrow’s defects rather than merely explain yesterday’s failures. Every production run generated feedback, every problem became an opportunity to improve, and every improvement strengthened the broader system.

By the time Detroit understood what was happening, Toyota’s advantage was bigger than any individual vehicle or factory. It was embedded in the relationships, processes, information flows, management practices, and learning loops that connected the enterprise. American manufacturers eventually adopted many of Toyota’s methods, but they spent decades trying to catch up to a system that had evolved under the surface while they remained focused on the product.

Something similar is happening today with America’s defense industrial base, a system that is fragmented, expensive, and slow to learn during a period of rapid change. America cannot solve the problems with this system merely by routing more money through the same fragmented processes. Just as Detroit could not defeat Toyota by adding another shift to an inferior production system, the Department of War cannot create a twenty-first-century arsenal by applying more funding, oversight, and reporting requirements to a twentieth-century operating model. What it needs is a cutting-edge industrial operating system that gets better and smarter over time.

Going to War With the System You Have

Toyota’s lesson is fundamentally about how to win an industrial competition, and the lesson applies to more than cars. Wars are also decided by industrial systems.

America’s logistical and production juggernaut—what we now nostalgically call “the Arsenal of Democracy”—won World War II. In the present day, Ukraine is holding its own against Russia with a highly adaptive industrial system capable of developing and scaling production of drones to counter the latest threats encountered on the front line. Now Epic Fury has exposed shortcomings in America’s industrial system, which must be able not only to enter a fight with overwhelming force but to sustain the fight over the long term.

The lessons of these conflicts are vital to the United States’s competition with China, a challenge with far higher stakes than the Japanese auto industry’s challenge to Detroit in the 20th century. Much of the debate focuses on visible measures of military power: ships launched, aircraft delivered, missiles fielded, budgets approved. Those measures are important, but they are the outputs of an industrial system. More important than simply counting missiles is whether the system producing them can learn, adapt, scale, repair, and replenish faster than its competitor.

China brings a formidable industrial system to the fight. This system is neither perfectly coordinated nor perfectly efficient, but it is well suited for its strategic goals. It only needs to convert its advantages in commercial manufacturing, shipbuilding, electronics, critical materials, infrastructure, and state-supported investment into military capability faster than the United States can overcome its own fragmentation. Its military-civil fusion approach has intentionally reduced barriers between commercial and national-security industries, and its dual-use shipbuilding ecosystem demonstrates the strategic value created when commercial orders sustain the infrastructure, suppliers, workers, and engineering capabilities that also support naval construction and repair. Analyses of China’s naval buildup and dominance of global shipbuilding demonstrate why industrial scale, supplier depth, workforce, and production experience matter as much as the design of any individual vessel.

It should be no surprise that Chinese EVs are taking the world by storm just like Japanese autos did a half-century ago: China is operating an industrial system that is large, well coordinated, adaptive, and inherently dual use. The West is contending with the China Production System—and we need to overhaul our own system, incorporating our own strengths and values, to prevail.

The United States still possesses extraordinary advantages: exceptionally capable submarines, aircraft, missile defenses, satellites, sensors, and software; world-class engineers; deep capital markets; leading research institutions; innovative commercial companies; and an unparalleled network of allies. The problem is that these strengths are treated as a collection of programs and discrete things rather than as a system that adapts and improves over time.

The Pentagon’s first National Defense Industrial Strategy recognized the importance of resilient supply chains, workforce readiness, flexible acquisition, and economic deterrence, and its subsequent implementation plan assigned responsibilities, resources, and metrics to those priorities. The 2026 National Defense Strategy similarly calls for rebuilding America’s defense industry and restoring its role as the world’s premier arsenal. The strategic direction is becoming clear; turning strategy into coordinated execution remains the harder task.

Program offices optimize individual acquisitions. Prime contractors optimize contractual performance. Suppliers optimize production schedules. Logistics organizations optimize sustainment. Each institution may perform its assigned mission well while the ecosystem as a whole underperforms. A recent Government Accountability Office assessment found the Department’s supply-chain visibility initiatives uncoordinated, limited in scope, and unable to provide sufficient insight into lower-tier suppliers, raw materials, and components.

Consider a missile program that receives billions of dollars in additional funding. Beyond a certain point, money alone will not create more interceptors. The program may depend on a rocket-motor supplier that also supports several other weapons, a sub-tier manufacturer producing specialized insulation or nozzles, a limited testing facility, or a workforce that takes years to develop. The government’s recent investments to expand solid-rocket-motor component production illustrate how a single sub-tier component can constrain an entire portfolio of weapons, and previous assessments of competition within the defense industrial base have documented significant supplier consolidation in exactly these areas. Additional funding may simply send more demand toward the same bottleneck without increasing output—and few leaders can see the shared constraint across the portfolio.

Assembling the War Machine

That example reveals the central problem: leaders lack the information needed to determine which constraint to address first, which supplier to expand, which alternative source to qualify, or which program should receive scarce capacity. They cannot consistently see how a disruption in energetics, semiconductors, castings, critical minerals, test infrastructure, or skilled labor will ripple across multiple weapons over time.

For decades, the Department of War has invested in command-and-control systems that help leaders understand the battlefield: commanders can see the location and status of ships, aircraft, formations, sensors, and threats, and integrate that information to accelerate decisions across domains. Yet the industrial ecosystem that produces, repairs, sustains, and replenishes those forces is still managed through fragmented data, disconnected workflows, periodic reports, and lengthy coordination processes.

The comparison with automobile manufacturing has limits. Defense systems involve classified requirements, low production volumes, exacting standards, specialized materials, congressional funding rules, and threats that evolve during development. The lesson is not necessarily that missiles should be built like Corollas; it is that both enterprises depend on supplier integration, quality, visibility, flow, feedback, and continuous learning—and the more complex the product, the more consequential the operating system behind it.

Artificial intelligence and modern software now offer the United States an opportunity to create that operating system across the defense ecosystem. Research on AI as a general-purpose military technology argues that its most profound strategic effects may emerge from broad productivity gains and spillovers across an industrial base rather than any particular tool or weapon. This is jidoka at national scale: the human-like judgment Sakichi Toyoda built into a single loom can now be imbued into thousands of machines, workflows, and decisions across the enterprise—sensing abnormality, stopping defects before they propagate, and forcing problems into the open where they can be fixed. Program leaders, suppliers, manufacturers, depots, combatant commands, and policymakers could operate from a continuously updated picture connecting operational demand with inventory, production capacity, supplier risk, workforce, and delivery timelines. AI could identify constraints before schedules slip, expose shared dependencies across programs, and establish faster learning loops between operators, engineers, factories, and suppliers. The objective is not to automate every decision, but to give human leaders a more complete understanding of the choices, dependencies, and consequences before them.

This is the idea behind what we call War Machine. The concept should not be confused with another dashboard, database, or acquisition program. It is the recognition that industrial power has become a command-and-control problem. What Toyota accomplished across its production enterprise, the United States must now accomplish across a far larger and more complicated network of government organizations, defense primes, commercial companies, suppliers, depots, shipyards, laboratories, and operational commands.

War Machine is valuable not merely because it shows leaders the industrial base, but because it enables better decisions across programs, suppliers, money, time, and risk: which bottleneck to attack first, which supplier requires intervention, where additional capacity will matter most, when consumption may exceed replenishment, and which investment will produce the greatest combat effect per dollar and per month. The objective is coordinated action from the factory to the foxhole.

The United States must connect operational demand to industrial capacity, manage constraints across portfolios rather than within individual programs, and establish a shared operating picture across government and industry. It must build learning loops that carry information from operations to engineers, factories, and suppliers, and back to the force—and it must measure success through production, delivery, readiness, and operational outcomes, not money obligated, contracts awarded, or activities completed.

Detroit’s mistake in the last century was believing it was competing car against car when it was actually competing system against system. America must not make the same mistake in national security. The competition with China is more than a race to design the best weapons; it is a race to build the best system for producing, adapting, repairing, replenishing, and sustaining them.

THOMAS DAY is the executive director of Frontier Mission Network, a business consortium dedicated to serving the Chicago region’s national security and defense technology sector. He is also a lecturer in tech-based economic development at the Harris School of Public Policy at the University of Chicago.

Last month, the White House Office of Science and Technology Policy (OSTP) released Science: A New Golden Age, a detailed roadmap for overhauling American science. It summons the legacy of Vannevar Bush’s Science: The Endless Frontier, a document issued in 1945 that laid the foundation for the American innovation engine, and argues that the model now needs to be updated.

Researchers, founders, capital investors, and regional policymakers should read and reflect on OSTP’s proposed reforms, then think about how to respond. There is much in the document that warrants serious attention and transcends partisan politics. As left-of-center blogger and economist Noah Smith puts it: “If Democrats take back the White House in 2028, they need to pick up this plan, slap a little token partisan gloss on it, maybe have Claude rewrite the language a little, and fully fund it.”

Indeed, the OSTP recommendations, if enacted, funded by Congress, and put into action locally, could revive American R&D and chart a long-term roadmap as the American economy navigates the age of AI. Rather than fight to defend the status quo, regional innovation economies should recognize that many of the OSTP’s proposed reforms are sensible and respond with collaborative action.

It Starts With Problems

In his introduction, White House Office of Science and Technology Policy Director Michael Kratsios notes that the “greatest technical achievements of the last century came about because leaders in government identified national priorities and marshaled the resources to accomplish them.” In doing so, Kratsios echoes the words of Bush in the opening chapter of Science: The Endless Frontier, similarly drawing a line connecting American science to national problems: “(W)ithout scientific progress no amount of achievement in other directions can insure our health, prosperity, and security as a nation in the modern world.”

If the federal government is going to mobilize science in response to national problems, regions should be asking how they can respond, organizing their own institutions and resources around the problems the federal government has identified. This was a point made by retired Col. Peter Newell, former director of the Army’s Rapid Equipping Force, in a podcast interview I did with him earlier this year. I asked how we could grow our organization, Frontier Mission Network, into one that actively creates value for the national security community and the broader U.S. economy.

Newell’s response: “It starts with problems.” This is the opposite of starting with a technology or an idea for a business you think might solve a problem. To create value, understand the national problems first and mobilize, he told me.

Regions can point to local research assets and to new R&D funding awards, but if the science being done in their regions is not solving national challenges, its economic and national strategic value is unlikely to be realized—and certainly will not be under the OSTP’s new framework.

Build Around Scientists With Long-Term and Flexible Funding

Vannevar Bush’s model for mission-driven science channeled federal funding through universities, enabling researchers to conduct research in place. The OSTP report argues that we need to fundamentally rethink this central role universities play in the American innovation engine.

Its criticisms of universities focus on cumbersome bureaucracies—“Universities … extract significant overhead from researchers, which funds a mix of legitimate shared infrastructure and growing administrative bloat”—and misaligned incentives. PhD candidates are at universities for relatively short periods, the OSTP report notes, undermining long-term knowledge retention. “[N]o technology company would entrust its core R&D to a workforce composed primarily of temporary trainees, yet this is the standard model in academic research.” The report also calls into question the professional incentives placed on PhD candidates and professors to publish and accumulate citations.

No doubt many inside universities will react negatively to the OSTP’s criticisms. Many others have known for some time that without fundamental reforms around citation incentives, this will be the result, put graphically:

To support breakthrough science, the OSTP report calls for a fundamentally new approach to grantmaking. It advocates directing more funds directly to scientists and empowering recipients to take their awards with them if they move to a new employer—including a startup—without losing federal funding. If enacted, this reform would expand portable grant programs like the National Science Foundation’s Graduate Research Fellowship Program. “The (NSF Graduate Research) fellowship provides three years of support with full portability across institutions, freeing recipients to follow intellectual opportunity,” the report notes. “The results speak for themselves: more than forty GRFP alumni have gone on to become Nobel laureates.”

The OSTP also calls for longer-term awards, moving away from project-based awards that yield safer research proposals. “[W]hen investigators receive longer-horizon support with tolerance for early failure, they produce portfolios with both more hits and more misses, the signature of genuine exploration.”

Finally, the OSTP calls for expanding portfolio-based approaches to funding science, empowering program managers closest to technological frontiers to make bold, multi-million-dollar bets, an approach championed for decades by the Defense Advanced Research Projects Agency.

If enacted, these reforms could mark the most fundamental change in American science in 80 years—moving immeasurable amounts of power and funding away from universities and into the hands of researchers. Some will protest, but with the ranks of college administrators skyrocketing in recent years, let’s not confuse enhanced competition for talent with undermining American science. I certainly won’t be going on a hunger strike to protect privileged institutions while they revel in single-digit undergraduate admissions rates.

Regions should prepare now by proactively identifying their best scientists and thinking through how to directly engage and retain researchers rather than assuming universities will anchor them locally.

Imagining New Models for Public-Private R&D

In 1997, Intel, Motorola, and other companies, with support from the U.S. Department of Energy, formed the Extreme Ultraviolet Limited Liability Company, a consortium established to advance EUV technologies that would later accelerate advanced chip production (more on that in a bit). EUV LLC was built to solve a problem—design the next generation of tools that could make the most advanced semiconductors imaginable—and then shut down. The photolithography methods EUV LLC developed helped make the modern chip industry possible.

Perhaps the legacy of EUV LLC is as much about the public-private partnership model they pioneered as the technology it produced. To fund research into EUV lithography, private backers purchased shares of the company in exchange for the right of first refusal of what it produced.

This model is just one that OSTP report argues should be supported and replicated.

The OSTP report also calls for new nonprofit-focused research organizations, or FROs, that hire researchers within a time-bounded vehicle focused on a specific technical milestone that, if successful, would produce public intellectual property. You might think of FROs as a mini national laboratory model that could be infinitely replicated to pursue defined objectives. “The time-limited nature (of FROs) also gives scientists who complete the project a chance to return to academia, or to spin off a startup and raise venture capital,” the OSTP report notes.

Another idea: In July, the National Science Foundation announced a $47 million pilot program to jointly fund PhD students with university and industry partners. Funded Ph.D. candidates do their first few years in an academic setting and complete their final year with a tech company.

Regions should think about responding proactively by building new, mission-focused institutions that reflect the role of profit motives in advancing science. Such an approach would require departing from assumptions about who should support basic research—assumptions I, too, have long held.

For eight years, I have taught a class in regional tech-based economic development at the University of Chicago’s Harris School of Public Policy. One point I make midway through the course is that the growing share of business-funded R&D is drawing too much focus toward profit motives and away from knowledge creation, historically done at national and university laboratories.

The OSTP report counters that this framework is outdated, pointing to a greater share of science acting in “Pasteur’s Quadrant,” or use-inspired basic research. It also points to the role of private capital in enabling research efforts to scale. “Venture capital mobilizes private resources toward high-impact technologies….Ph.D. students and professors can now raise hundreds of millions of dollars to found companies that pursue fundamental breakthroughs.”

Whatever the right balance of public and private R&D, it is indisputable that both forms can lead to genuine breakthroughs and innovation. To cite just two examples, the potential for nuclear fusion to generate more energy than it expends was demonstrated at Lawrence Livermore National Laboratory, while a private company (DeepMind) discovered the 3D shape of proteins.

Point is, let’s not get too ideological about the role of federal research labs and universities in supporting research. The OSTP report argues that industry consortia like EUV LLC should play a more central role in advancing basic research and the broader American innovation economy. For regions that spent much of the 2010s building coworking spaces and business incubators, the OSTP report might mark a moment where civic efforts are instead directed at building similar, mission-focused, time-bound consortia to solve national problems.

Facilitate Testing

In the 1950s, as Cold War tensions heated up, Area 51, a plot of land in Southern Nevada, served as a classified testing ground for programs like the U2 spy plane.

Around that time, entrepreneurs and hobbyists began testing rocket designs at a testing site in the Mojave Desert in California. The Mojave testing site has since expanded geometrically, and the OSTP report notes, “[m]ultiple rocket companies have emerged from this cluster of cheap leases, federal licenses, and shared test infrastructure to win NASA prizes, raise substantial venture capital, and reshape the commercial launch industry.”

Innovation needs a testing ground. “Test infrastructure, whether for rockets, advanced manufacturing, autonomous systems, or any frontier technology, is an enabling resource that determines whether the next great American company starts in a desert lot or dies on the vine in a student’s garage,” the OSTP report notes.

Dr. Jerry Hendrix, now the associate director of shipbuilding programs at the White House Office of Management and Budget, has championed the idea of an “Area 52” in his home state of Indiana along Lake Michigan for unmanned, autonomous naval systems.

Similarly, First Breakfast’s Shyam Sankar and Madeline Hart have highlighted a proposal for a network of technology proving grounds, hosted at unused federal lands and military installations. Perhaps someone in the Pentagon was reading. Earlier this month, the U.S. Army established new testing grounds for commercial technologies on federal lands in Utah, Michigan, and Mississippi.

Regional leaders should recognize technology testing as a critical element of the value-creation process and assess where technologies can be tested in their back yards.

Build Production Near Science

The next step after the scientific breakthrough is ensuring it translates to production and the broader economy.

The consortium I discussed earlier provides a cautionary tale: EUV LLC served to design cutting-edge lithography equipment that used waves of light to engrave transistors onto wafers. That breakthrough was commercialized not by an American sponsor but by ASML, a Dutch company that maintains a supply-chain chokehold on the world’s most advanced lithography equipment to this day. ASML was permitted to purchase EUV LLC’s IP rights in exchange for promises to source components from the United States—promises that were not kept or enforced.

EUV LLC is thus yet another story of American deindustrialization, where we invent but do not build breakthrough technologies. It also illustrates the need to build supplier networks that put research and production in proximity.

To capture the economic benefits of science—which is necessary so long as American taxpayers fund American science—the OSTP report argues we need to follow breakthrough science with process knowledge retention. Think of programs to allow community college students to work alongside PhDs and receive industry credentials that they can take to manufacture technologies produced by American research. This would serve not just local workforce development, but the advancement of science, the OSTP argues.

“[A]cademic publications alone remain insufficient to transmit the craft of science…Our true competitive advantage lies in the process knowledge embodied by America’s talent. Without skilled practitioners who pass their craft to those who follow, the engine stalls…Without local manufacturing capacity, the marriage of science and craft weakens. Scientists lose access to the practical problems that inspire new lines of inquiry and improve research quality, while industry loses the research ecosystem that sustains technological leadership.”

One Final Note…

I don’t agree with every word in the OSTP’s report, yet it is a critical, potentially massive step torward mobilizing the American economy to meet peer threats.

The OSTP’s critics cannot simply respond to these proposals with grievance. If you object to the report, what’s your plan? The status quo of America’s innovation base is a world where the gap between China and the United States grows smaller while the gap between San Francisco and the non-superstar cities grows larger. The trendlines are not positive. So what’s your plan?

Director Kratsios and OSTP have offered theirs. It deserves our serious attention and hopefully will spark a substantive debate.

It’s no secret that America has a weapons production problem.

On August 5, Deputy Secretary of War Steve Feinberg lit a fire under industry to solve this problem. He sent a memo to industry leaders giving them 21 days to submit plans to “drive significantly faster, more aggressive delivery schedules and/or increased production for critical capabilities. . . .Years-long development cycles are not acceptable. We must dramatically accelerate our program schedules and expand our production capacity now.”

Here at First Breakfast, we put the question to some of our favorite doers in the industry: If you had free reign to fix America’s munitions bottleneck, what would you propose?

It’s been three weeks, and we’re sharing the best—and most creative—proposals we received.

Dear DepSecWar: may you find additional inspiration in these hot takes. 🫡

Open the Magazine: Compulsory Licensing for Mass Production

Shyam Sankar, Chief Technology Officer, Palantir Technologies

The problem is not that we lack designs. We have exquisite weapons that work. We lack the ability to build them at rate, because the technical data package is a monopoly asset and the monopolist’s incentive is margin per unit, not units per month.

Fix the incentive.

Mandate that every prime and every supplier license the complete Technical Data Package (TDP) for any weapon in production or sustainment whose R&D was all taxpayer funded: drawings, materials, process specs, source code, test procedures. The price: a royalty at last year’s realized cost-plus margin per unit produced. The prime keeps the economics. It loses the exclusivity it did not earn given taxpayer-funded development.

Any firm that puts a $100M balance sheet behind the work may take the license. Capitalization is the credibility test, not past performance narratives or a facility clearance dating to the Cold War.

The licensee’s job is to optimize the weapon for manufacturing. Substitute materials. Delete features. Loosen the tolerances physics does not require. Then test the variant to characterize what it actually does and publish those numbers as the new spec. A missile at 70 percent of the original range that can be built in a tenth of the time at a third of the cost is not a degraded weapon. It is a different weapon, and it is the one that wins.

Award on one metric: qualified units per month per dollar, delivered from a line that is instrumented, automated, and designed to surge. The time for artisanal cells and high-touch labor as a business model has passed.

Congress should treat the TDP the way it treats spectrum: a public asset licensed for public use, not a private toll booth on national survival.

We are one contingency away from learning our magazine depth the hard way. The designs already exist. Free them.

The Real Munitions Bottleneck Is Qualification, Not Capacity

Kevin Capozzoli, CEO, Critical Materials Group

America’s munitions shortfall is usually framed as a capacity problem. But much of the delay is administrative (Qualification and Permitting) rather than physical. The same explosive material is qualified from scratch program after program, and even proven material waits months for a Department of Transportation EX number classification to simply move the material. The EX-number is required the first time a material is manufactured, but if the production method changes, another EX number is required.

Federal IT once faced the same problem. The FedRAMP 20x reform replaced from-scratch review with control inheritance, raising cloud authorizations from under 50 per year to more than 100 in six months.

Energetics can adopt the same model: qualify a material once, authorize a formulation once, and let end articles inherit their constituent authorization, assessing only the integration delta. Fold EX-number classification into that package, fast-track process improvements without full recertification, and create a second-source equivalence pathway that certifies conformance to an approved reference rather than re-qualifying from zero.

Stop Lighting Money on Fire

Mike Gallagher, Head of Defense, Palantir Technologies

The Pentagon is rightly rushing to spend every single one of its Congressionally appropriated dollars before the end of the fiscal year. If it succeeds, it will avoid a self-inflicted problem that has had a disastrous impact on our deterrent posture.

In the last decade, the Pentagon has lost more than $125 billion because of an outdated budgeting process that requires any unspent, Congressionally appropriated dollars to be returned to the Treasury. In other words, billions of budgeted dollars have been allowed to simply vanish instead of being used to replenish munitions stockpiles, procure new technology, or invest into our defense industrial base.

The FIRES Act I introduced as a member of Congress fixes that.

Rather than let this appropriated but unspent money disappear, the FIRES Act puts these dollars into a special fund that the Secretary of War could use to fund Congressionally mandated priorities. This could go a long way toward supporting priorities that may prove decisive in a Pacific conflict. The first of these: Deputy Secretary Feinberg’s efforts to ramp munitions production via multi-year purchases. The second: scaling the manufacturing and deployment of autonomous capabilities that can turn China’s coastal waters into a hellscape. The third: funding advanced energetics such as CL-20 in existing systems to extend both their range and destructive power.

The Pentagon has rightly identified munitions production and autonomy as key to preventing or winning war in the Pacific. But funding it sufficiently and in time remains a challenge. The FIRES Act gives the Secretary of War the flexibility and authority needed to fund enduring priorities at the speed of relevance, making us safer without budgeting another dime of taxpayer dollars.

Let ‘Em Build

Will Thibeau, Founder, Escoreal Solutions

Aggressive, stimulating industrial policy is necessary to harness the capacity of small and medium sized machine shops so they can build enough components for large-scale munition production. These shops run manual sales and operations processes disconnected from Prime customers. The Pentagon should extend an existing software platform to any component supplier with even the smallest production record for free.

The government must also radically accelerate the process by which suppliers become qualified to build and sell solid rocket motors, the critical bottleneck of the munitions industrial base. Long, cumbersome processes exist for validating safety and earning the right to sell explosives. The ATF and DOW should near-recklessly streamline a vendor’s ability to earn any of the multiple licenses (FFL, AS9100, etc.) required for participation in this market.

Relatedly, the government should move to a generic supplier qualification threshold. Instead of mandating suppliers validate components for each munition, there should only be a single regulatory gate for entry into the market. Allow program offices to ensure proper integration at the end-item level.

We do not lack machines, machinists, or money, but instead lack the will to let them build, and that is the one shortage no appropriation can fix.

It’s Not Easy, But It’s Not Rocket Science

Nadia Schadlow, Senior Fellow, Hudson Institute

In the category of “kind of simple” (recognizing that simple and the Pentagon are something of an oxymoron), there are some basic steps that could help avoid repeating past mistakes. Start by taking stock of recent efforts to support new entrants and expand capacity in the energetics space: What was funded? What actually got built? What new capacity came online? What worked, what didn’t, and why? This is not a “gotcha” exercise. It is a way to learn from recent investments and inform the next round.

For example, in 2024 the Department of Defense awarded $192.5 million to seven companies under the Defense Production Act to expand domestic production of 22 chemicals used in defense systems, including critical energetic precursors and other materials such as oxidizers and magnesium. What resulted? Which projects delivered the capacity they promised? Which did not? And why?

We Need a Materials Manhattan Project

Jake Chapman, Managing Director, Marque Ventures

America’s munitions shortage is real, but we’re in danger of solving the wrong problem.

Expanding production capacity, signing multi-year procurement contracts, licensing production to allies, and accelerating acquisition are all necessary if conflict comes tomorrow, but these are surge measures, not long-term national security investment strategy. They help us build more of today’s weapons tomorrow instead of fundamentally better and cheaper ones.

The defense-tech ecosystem has demonstrated that Group 1-3 drones and low-cost cruise missiles can be fielded faster and at lower cost than traditional programs. That is an important step forward. But even these companies remain constrained by the same physics and many of the same supply chains. Whether a missile is built by Lockheed Martin, a neo-prime, or a startup, it still depends on the performance of its rocket motor, energetics, turbine materials, structural composites, semiconductors, and manufacturing inputs. Better business models alone cannot overcome physical limits.

TLAMs are expensive partially because of who builds them and how they’re built but also partially because they deliver singular range, precision, and punch. If America wants to solve its munitions crisis without sacrificing capability, we must invest in changing the physical constraints our engineers design around.

Imagine rocket motors with significantly greater energy density, airframes built from lighter and stronger materials, turbine blades capable of operating at higher temperatures, manufacturing processes that eliminate complex machining, and energetics that deliver more kill per kilogram. Every improvement in these dimensions compounds offering greater range, larger payloads, lower cost, reduced logistics, and faster production. Rather than accepting today’s tradeoffs, we should be working to eliminate them.

The Department of War should launch a modern “Materials Manhattan Project” focused on advanced energetics, propulsion, structural materials, manufacturing processes, and metallurgy for munitions. America should not aspire to build more 1980s missiles with 2020s factories. We must invent the 2045 missile; one that flies farther, hits harder, costs less, and can be produced in overwhelming numbers.

Outlaw the Obvious

Rosie the Riveter

Bad incentives by the monopsony have produced bad business practices at the defense primes. Here are five proposals that should already be law:

• Every prime should be working five days a week (nope, not the case today) and should be limited to one offsite a year. The carpet people work four days a week and go to leadership offsites every month, while the steel-toe rank and file work to build more weapons on the factory floor.

• Primes shouldn’t be allowed to design fancy custom tape if duct tape will do the job, but today they get away with doing just that. FASA—the 1994 law requiring the government to prefer commercial technology—extends to prime contractors choosing whether to buy or build capabilities for a given government contract, even after contract award. But there is neither an enforcement mechanism nor an incentive with cost plus contracting to follow the law. What we get instead is primes expending enormous resources—much of it taxpayer money—rebuilding commercial capabilities that already exist. It’s time to end the self-dealing that rewards primes for prioritizing internal development at the expense of literally everything else.

• Force primes to cut their consulting budget by 90 percent and invest the money into training programs for technicians and manufacturing engineers. Why are you asking the DoW for $20 million for McKinsey when you won’t spend that amount of money on improving your operations on the floor? If you won’t invest in your business operations, you should at least invest in the country’s future workforce. No more carpet people!

• For every one month late a prime is on a program delivery, the DoW should get five percent ownership of that program’s intellectual property. You shouldn’t own both the critical IP and also refuse to get it made. Delay long enough, and the government gets an ownership stake it can license to whoever has a better production plan.

• Require remedial tech training for the legal counsel of every prime so they can understand what “the cloud” is and why it’s OK to use it.

Form the Army Munitions Production Corps

The Angry Hobbit

The blueprint to fix the munitions production crisis exists, and we have done it before. In WWII we leveraged the Army Corps of Engineers to build multiple munitions plants. Many of those plants are still operational and operate under the government owned, contractor operated model.

We should use the corps of engineers to build out new weapons plants for guided munitions, interceptors, and missiles instead of awarding more money to primes that know how to play the game for more money.

We should then form the Army Munitions Production Corps to surge production and staff these plants to make up for the gap in contractors operating these plants. The production corps should be either a new MOS within the Army, or an adjacent formation that can take volunteers or individuals that wish to serve but cannot pass military physical requirements and train them to be critical factory workers that can be assigned to production facilities at the needs of the government.

Running these plants as primarily government owned and government operated is expensive, but does not have to be permanent. After the initial surge of soldiers/production corps personnel, their income and taxes will boost the local economy at these rural factory locations and enable these towns to support future contractor/DA Civilian jobs and recruiting.

In peace time, these programs can be used to train reservists and guardsmen with the skills to operate factory machinery and assembly lines to boost civilian industry with skilled labor and allow for mobilization to surge production at these munitions plants in times of need.

Earning by Doing

Chase Dalton, Federal Deployment Lead, Cognition

Congress should pass a War Prize Act, creating a system of commissioned military enterprises to enable a capitalist market for wartime military effects. This would parallel traditional procurement channels. During authorized conflicts, the government would maintain continuously updated price schedules for military effects: enemy soldiers killed, aircraft destroyed, ships sunk, infrastructure disabled, equipment captured, or other strategically valuable outcomes.

This proposal carries obvious second-order risks, but the hour is late and worth the gamble. As the monopsonist, the Pentagon decides what to buy, how, and from whom, then bears the development and execution risk. This has not produced the munitions we need to defeat China or Iran.

Before war, the DoW should publish non-binding indicative schedules so investors know which outcomes will command premiums. Imagine a billion dollar prize for destroying the Fujian, China’s newest carrier, within 48 hours of hostilities over Taiwan. Private capital would finance competing solutions. China would have to worry about the known U.S. order of battle and privately financed capabilities. Lower-intensity conflicts could serve as proving grounds, refining capabilities, incentives, and capital structures before a peer war.

The government would dynamically set the commission envelope of authorized and prohibited targets, preclearance strike rules, geographic limits, legal constraints, and prize values. Commissioned firms would control the financing, development, production, inventory, force structure, operational planning, and execution within that envelope.

Prize claims should be transferable and financeable. Firms could raise equity, borrow against expected payouts, form prize funds and consortia, syndicate risk, insure campaigns, and build portfolios across military objectives.

Accountability must be severe. Commissioned firms would post insurable bonds, maintain auditable records, and face prize forfeiture, commission revocation, civil liability, and criminal prosecution for violations.

Forge the (Allied) Arsenal of Democracy

Daryl Wieland, Senior Director of Partnerships, Palantir

The United States and her closest allies should create a single, treaty-backed industrial utility called the Allied Arsenal Corporation that collaborates on defense industrial production.

While that may be provocative and require a lot of trust, the question we need to ask ourselves is can the United States and its allies create a system where innovation is rewarded, production is fungible, capacity is visible, and no single owner, factory, country, or appropriation cycle becomes the limiting factor.

That system would be a licensed, modular built-to-print production network. Original design owners would retain economic upside through transparent IP licenses, per-unit royalties, and payments for engineering support and continuous improvement.

Such an arrangement wouldn’t be entirely unprecedented. Just this week, the UK announced it will share blueprints of its Storm Shadow cruise missiles with Ukraine. In July, France similarly provided the Ukrainians with production rights for the Scalp missile. America may not be too far behind. President Trump initially announced the United States would grant the Ukrainians license to produce the Patriot missile, although he has since walked back the commitment. Trump’s stated reason was “it’s a hard thing to give away, that kind of technology.”

But that’s where the Allied Arsenal could be most effective. It would standardize the process for sharing technology via approved manufacturers, secure data standards, and clear agreements about access. Specialization would turn national strengths into allied capacity, much as markets coordinate dispersed knowledge and incentives.

The result would be more than a larger arsenal. It would be an adaptive industrial base: competitive enough to reward invention, coordinated enough to survive crisis, and distributed enough that no bottleneck can decide the future of security.

RYAN MUSTO is a venture capitalist leading investments in deep tech and defense tech with a focus on maritime systems, critical materials, and advanced manufacturing.

Every generation or so, a new theater of geopolitical competition takes shape before most people realize it’s a theater at all. The Arctic. Cyberspace. Low Earth orbit. Each time, a window opens, early movers stake their claims, and latecomers spend decades trying to claw back ground that could have been secured upfront for a fraction of the cost and effort.

The deep Pacific seafloor is the latest iteration of this story. And America is already behind. There is a telling asymmetry in how Washington thinks about the deep Pacific. The United States Navy has spent decades and hundreds of billions of dollars perfecting its ability to operate beneath those waters—tracking submarines, projecting deterrence, and mapping choke points. Washington has spent far less energy thinking about the resources that are sitting on the floor.

While Washington debates tariff regimes and domestic stockpiling strategies for land-based critical minerals, China has spent the better part of a decade quietly securing the most mineral-rich real estate on Earth. The window for the United States to compete is closing faster than anyone in the reindustrialization debate seems to realize.

The Treasure Map

Scattered across the Clarion-Clipperton Zone (CCZ)—a stretch of deep Pacific seafloor roughly half the size of the continental United States—lie trillions of polymetallic nodules packed with cobalt, nickel, manganese, and rare earths. By most serious estimates, this single geological formation contains more cobalt, nickel, and manganese than all known land-based reserves combined. These materials are needed to build electric vehicle batteries, advanced semiconductors, military hardware, and the full stack of next-generation American industrial technology. As American policymakers debate how to secure access to these resources from sources on land, vast troves are sitting on the ocean floor, largely untouched.

China is moving to exploit these resources. While the United States cycled through regulatory debates and permitting battles that kept American companies on the sideline, China’s state-owned enterprises accumulated five of the International Seabed Authority’s (ISA) roughly thirty exploration licenses—more than any other nation. American companies hold none—the United States never ratified the United Nations Convention on the Law of the Sea (UNCLOS), the treaty that governs ISA membership, effectively barring them from the process.

The ISA, the United Nations body with sole authority to grant exclusive rights to survey and eventually mine the international seabed, has been deadlocked for years finalizing the commercial mining code that regulates extraction. China’s strategy was to secure exploration licenses early, knowing they would confer priority extraction rights the moment the code was eventually settled. The ISA does not move at venture speed; China’s state capital does.

China didn’t stumble into this. It was the result of a deliberate, state-directed, decade-long strategy to corner the most important mineralogical frontier of the twenty-first century before the rest of the world fully understood what they were doing.

The United States is behind the curve in the deep Pacific, but that wasn’t always the case. In the 1970s, U.S. intelligence and naval programs secretly surveyed vast stretches of the deep Pacific seabed. The primary mission was building a classified hydrophone network to track Soviet submarines moving through Pacific choke points. But those same surveys mapped the seabed’s mineral wealth in remarkable detail. In one of history’s better ironies, the Central Intelligence Agency’s 1974 Project Azorian, which partially recovered a sunken Soviet submarine from the Pacific floor, used commercial manganese nodule mining as its cover story. The U.S. government quite literally invented the fiction of deep-sea mining to hide an intelligence operation.

The strategic intelligence gathered was extraordinary; however, the government quietly allowed it to atrophy in the decades that followed. As the Cold War wound down, the sense of urgency faded, and the institutional knowledge that America had painstakingly built simply was not maintained. It is one of the more underappreciated strategic own-goals of the late twentieth century.

The counterfactual isn’t hard to imagine: American companies were already surveying the CCZ, and Congress passed the Deep Seabed Hard Mineral Resources Act (DSHMRA) in 1980. The window was open, yet we walked away from it.

China is running the equivalent program today, openly, at scale, and supported by state-backed capital that no American startup can match. The China Ocean Mineral Resource Research and Development Association (COMRA) isn’t a scholarly curiosity shop, as its name might suggest; it’s a flag-planting operation dressed in academic clothing. Founded in 1990 with an explicit state mandate to acquire deep-sea mineral rights, COMRA registered as a pioneer investor with the precursor to the ISA in 1991 and secured its first CCZ exploration contract by 2001. Since then, it has built a dedicated fleet of research vessels and deep-sea submersibles, including its Jiaolong, which dove to 7,000 meters in the Mariana Trench in 2012. China’s 14th Five-Year Plan allocated roughly $2.4 billion to COMRA and associated deep-sea programs. In November 2024, Xi Jinping personally announced the successful sea trial of China’s first domestically produced deep-ocean drilling vessel. By 2025, Chinese state-owned corporations were conducting active commercial mining trials, with the Kaituo 2 crawler successfully harvesting nodules at depths exceeding 4,000 meters. China’s efforts have moved beyond research to a full industrial buildout. And unlike our 1970s mapping operations, it is unlikely to be quietly shelved when the political winds shift.

America missed its opportunity to take the lead in the undersea domain. That is the uncomfortable truth. But discomfort, at least, is actionable. Denial isn’t.

We can’t afford to be wrong again. This time, the tools exist to mine the seabed. The commercial and technological moment to capitalize on the subsea has materialized. The Cold War-era seabed intelligence never had a ready industrial base to capitalize on it. Today’s deep-sea mining does.

The Jurisdictional Opportunity

The opportunity here is enormous. CCZ nodules would give the United States a domestic (or at minimum friendly-waters) alternative for three minerals it currently imports almost entirely at China’s discretion: cobalt (73 percent of global demand now goes to batteries, with aerospace and defense superalloys accounting for most of what remains), nickel (essential to next-generation battery chemistries), and manganese (critical to both steel production and battery cathodes). Reducing dependence on Chinese-controlled supply chains for these inputs directly reduces the leverage Beijing holds over American defense production, EV manufacturing, and the broader reindustrialization movement.

Unlike rare-earth mining on land—which is politically toxic, environmentally contested, and takes years to permit under the best of circumstances—deep-sea mining in international waters sits in a jurisdictional gray zone. A determined administration could move the ball quickly and get projects permitted and capitalized faster than in almost any other critical minerals context. The April 2025 executive order directing the National Oceanic and Atmospheric Administration (NOAA) to accelerate deep-sea mining licensing under existing authority is proof of concept: more than ten applications arrived almost immediately. In terms of law and regulation, we could move fast here—at least by typical Washington standards.

The technology required to do this is being built right now. A handful of American startups are genuinely close to changing the minerals map by developing Remotely Operated Vehicle (ROV) systems, nodule collection platforms, processing vessels, and subsea robotics. Not in a “five years away, trust us” kind of way. In a “one committed investor cohort away from demonstrating proof of concept at commercial scale” kind of way.

American industry is at the deployment capital stage—the exact moment where focused private capital has historically created the durable national advantages that government programs alone could never build. Think of it as the maritime analog to what happened in commercial space: SpaceX didn’t invent rocketry. It took existing technology, added focused capital and urgency, and transformed what was once a government monopoly into a globally competitive American industry. The deep-sea mining ecosystem is asking for the same treatment. SpaceX is now responsible for more than 80 percent of all mass launched to orbit globally. Launch costs have fallen from roughly $65,000 per kilogram to under $1,500 (a 95 percent reduction). This is a price collapse that went beyond disrupting the existing launch market by creating entirely new ones: Starlink now has 5.4 million subscribers and generated $6.2 billion in satellite broadband revenue in 2024 alone, a market that barely existed before SpaceX made it economically viable.

The same dynamic is available in deep-sea mining: a technology-driven cost collapse that unlocks an entirely new critical minerals supply chain, with follow-on effects for EV manufacturing, defense procurement, and every downstream industry that currently sits at the mercy of Chinese mineral pricing.

The first-order problem is capital, but the second-order problem is political will. American deep-sea mining startups have been unable to raise the rounds they need in part because investors rightly perceive a policy environment that is uncertain at best and hostile at worst. The ISA’s multilateral framework, designed in a more cooperative era, was never built to move at venture speed. It moves on diplomat time.

The solution isn’t to abandon multilateralism wholesale. The machinery already exists. The DSHMRA gives NOAA the authority to issue exploration licenses and commercial recovery permits for deep-sea mining in international waters, and the April 2025 executive order has already activated it. What the administration needs isn’t new law—it’s the political will to see the process through. The DSHMRA represents a unilateral U.S. track, operating outside the ISA framework precisely because Washington never ratified UNCLOS. The current administration has chosen to proceed on that basis.

The intersection of defense relevance (dual-use seabed sensing, mapping, and ROV technology), strategic minerals independence, and a sector where private capital has already laid the groundwork is precisely the kind of inflection point the United States has historically been best positioned to exploit. Will we seize the opportunity?

The Bottom Line

The seabed doesn’t make headlines the way Taiwan does. It doesn’t generate the visceral policy urgency of a tariff war or a chip export ban. But mineral control is the upstream variable that determines the outcome of many important downstream fights. Whoever controls the inputs controls the supply chains. Whoever controls the supply chains controls the industrial base. And whoever controls the industrial base wins the long-run strategic competition.

China understood this years ago. The trillions of nodules sitting in the deep Pacific won’t wait for Washington to catch up—they will belong to the power that gets there first.

JOHN A. BURTKA is Director of Advancement and Outreach at the Coalition for a Prosperous America. He spent his career in manufacturing, automotive supply chains, industrial operations, and business turnarounds. He is a Lean Six Sigma Black Belt.

In this year’s military campaign against Iran, American forces proved they could strike almost anywhere with precision on short notice. Then the magazines ran low.

In the first month alone, U.S. forces expended more than 850 Tomahawk cruise missiles. By the time a ceasefire was reached, the total exceeded 1,000. America builds fewer than 200 Tomahawks a year. According to CSIS, Tomahawk stocks may not return to prewar levels until late 2030, while THAAD and Patriot inventories could take three or more years to rebuild.

Iran is not a peer. Against a true adversary like China, the gap between our ability to fire missiles and replace them will be the difference between deterrence and defeat. Adversaries count magazines and the ability to refill them, not just launchers. Industrial deterrence is the credible ability to keep producing after the first magazines are emptied. Rivals weigh that capacity before deciding whether a war is worth starting.

If war comes, winning turns not only on courage in the field but on factories, suppliers, machine tools, rocket motors, skilled workers, and our sovereign control of them before the shooting starts.

What Sovereignty Requires

We usually discuss sovereignty in the language of law and diplomacy: borders, treaties, and the freedom to set policy without another country’s permission.

Sovereignty also has a physical form. It is the capacity to act independently in the material world, to produce on one’s own soil the things that survival and freedom require: shipyards, smelters, refineries, pharmaceutical plants, munitions lines, power grids, and the skilled workforce that runs them. These are the material basis of independence.

A free people that cannot supply its own defense, energy, and medicine has handed part of its sovereignty to whoever can. A government can pass laws and project confidence, but without the ability to produce transformers, forgings, or artillery shells its authority is contingent. Political independence requires industrial capacity behind it, and that capacity has been eroding for half a century.

The Strategic Consequences of Efficiency

For two generations, America treated production as a private matter and consumption as the national interest. Make goods wherever they are cheapest. Hold minimal inventory. Offshore work when the numbers favor it. Treat production location as a cost question rather than a strategic question.

But these choices were themselves a strategy. They produced real abundance in ordinary times. Now they are being tested in extraordinary times. Efficiency optimizes for the average day. It strips out the slack and spare capacity a nation needs when conditions turn against it. A supply chain built for the lowest cost is, by design, a supply chain with no margin for crisis.

A nation can become richer on paper while becoming thinner in the things that make power real.

The original Arsenal of Democracy rested on a broad civilian manufacturing base already equipped with the skill, machinery, and workforce to convert to military production. Automakers built tanks because they already built engines and precision assemblies at scale. Machine shops, foundries, steel mills, and shipyards formed an ecosystem that could be redirected. And there was a dense network of suppliers, engineers, and production workers who made mobilization possible.

Over the last few decades, as America lost factories, we also lost conversion capacity. We grew comfortable as consumers and forgot that national power depends on makers.

The upstream base tells the same story. In 2025, the United States produced only 660,000 tons of primary aluminum against 5.7 million tons of apparent consumption, roughly 60 percent net import reliance, according to the U.S. Geological Survey. Copper is little better. USGS figures show 1 million tons of recoverable mine production, 790,000 tons of primary refined production, 1.7 million tons of refined imports, 57 percent net import reliance, and only two primary smelters.

These are just two examples, but I choose them for a reason. Metals are not luxuries. Aluminum and copper are in aircraft, vehicles, the power grid, motors, ships, and ammunition. Without them you cannot rebuild an arsenal. There are thousands of similar examples across the industrial base, each a real vulnerability. Trusted allies can help fill gaps, but allied final assembly that depends on Chinese upstream inputs is not allied capacity. It is Chinese capacity with better branding.

Capacity Must Exist Before Crisis

Walk the floor of a precision munitions plant and you stop thinking of a weapon as a single object. A guided missile is the visible end of a long chain: solid rocket motors, cast and forged parts, seeker electronics, rare-earth magnets, energetics, specialized fasteners, and the technicians who qualified the suppliers years earlier.

Remove any link and the weapon does not get built, or gets built too slowly to matter. The real constraint isn’t money. That would make this problem far easier. It is industrial capacity, including the permitting, capital, machines with long lead times, qualified suppliers, and trained workers. All of that takes years.

While the system optimized for cost, the base shrank. Manufacturing value-added fell from more than 21 percent of GDP in the late 1970s to 9.4 percent in late 2025, according to Bureau of Economic Analysis data. A country does not shed that much industrial mass without losing the suppliers, trades, and institutional knowledge that came with it.

Our nation has woken up to the fact that we cannot wait for war, blockade, pandemic, or energy shock and then decide to build what we need. The foundation of any serious industrial strategy is a set of principles applied with discipline before the crisis.

It begins with stable demand signals. Manufacturers invest when they see durable orders ahead instead of one-year appropriations that vanish with the next budget fight. Procurement must reward surge capacity and keep multiple capable suppliers alive, not just chase the lowest bid.

Critical inputs with no easy substitute need real domestic depth. Abundant affordable energy, faster permitting, patient capital, and a workforce strategy that treats skilled trades as a national asset are non-negotiable. Trusted allies can help where necessary, but irreplaceable capabilities must exist at home. Every serious industrial power understands that some capabilities are too important to leave to chance.

That does not mean America has to make everything. It does mean we have to decide what we cannot afford to lose.

Some capabilities are clearly essential. If losing one supplier can shut down a weapons line, the power grid, a hospital, or a large part of the economy, that capability is strategic. If it takes years to rebuild, depends on skills that are disappearing, or comes mostly from a country that may not supply us in a crisis, we need enough of it here to keep operating and to expand when necessary. That includes energy and grid equipment, primary metals and critical minerals, machine tools, castings and forgings, semiconductors, medicines and their active ingredients, shipbuilding and repair, munitions, rocket motors, and energetics.

Not every product has to be treated as a strategic capability. Goods with many dependable suppliers, ready substitutes, short lead times, and no serious effect on defense, health, energy, or the productive base can remain part of ordinary trade. Some products can come from trusted allies, especially while we rebuild capacity here. But we have to know where the critical inputs, equipment, and technology actually come from. Moving the last step of production to an allied country does not solve the problem if the supply chain still runs through China.

The middle class belongs in this calculation too. Factories do not run themselves. Skilled trades are built over generations through families, apprenticeships, technical schools, and companies willing to train people. When those jobs disappear, we do not just lose output. We lose the machinists, welders, electricians, toolmakers, engineers, and supervisors who know how to make difficult things at scale—and with them, the ability to expand production when the magazines run dry.

We also weaken the middle class that supports the economy and gives the country political stability. People who can support a family, buy a home, start a business, and believe their children have a future have a stake in the system. A country with great wealth at the top and permanent insecurity underneath will not remain economically strong or politically stable for long.

Rebuilding industrial sovereignty will require hard choices. We will have to decide what must be made here, what can safely come from trusted allies, and what can remain part of ordinary trade. Avoiding those choices is also a choice, and it is how we arrived here.

250 Years of Lessons

Two and a half centuries after independence, America needs to rebuild its industrial base, for reasons of necessity, not nostalgia. The men who declared independence understood that political freedom cannot be separated from the material capacity to sustain it. Independence was never only a matter of law and declaration. It had a physical form.

The case today rests on the same truth: industrial capacity is the material foundation of national independence, deterrence, and self-government. Free nations must act when conditions are hard, not only when they are easy, and that ability is physical before it is anything else.

America’s strikes against Iran showed a force capable of action. The years needed to refill the magazines showed the weakness behind it. The Arsenal of Democracy worked because civilian industry doubled as latent military capacity. That capacity must be built and maintained beforehand. A country that cannot produce enough aluminum, copper, machine tools, medicines, transformers, ships, and weapons is not fully sovereign in the real world. Neither is a country that allows the skilled middle class capable of producing and sustaining those things to disappear.

NADIA SCHADLOW is a Senior Fellow at the Hudson Institute.

MISLAV TOLUSIC is a Managing Partner at Marlinspike, a defense-oriented venture capital firm.

Congress is debating anew whether to add billions of dollars to next year’s defense budget. But just as important as how much to spend is what those additional dollars should buy.

For decades, the answer was ships, aircraft, tanks, and other platforms. The Pentagon has long measured success largely by developing and buying sophisticated weapons and platforms like F-35s, nuclear submarines, and aircraft carriers. But an F-35 that does not have a steady supply of munitions is hardly a capability. A submarine awaiting critical spare parts cannot go out to sea and deter. A Patriot battery without interceptor missiles cannot defend a city or an airbase.

What matters is not simply the advanced platforms, but fielding capabilities that can be sustained, replenished, and adapted in combat. The ability to surge, adapt, and manufacture at scale will increasingly determine military advantage. Achieving that capacity will require harnessing the private sector and commercial manufacturing facilities. We are in the midst of a fundamental realization: the factory is the product.

Consider Taiwan. Admiral Samuel Paparo has argued that in the event of a Chinese invasion of Taiwan, the United States intends to create a “hellscape” of thousands of autonomous systems to delay Chinese forces. It’s highly questionable, today, that we can deliver. Doing so requires an industrial base capable of producing enormous numbers of inexpensive systems—capabilities—at operational speed.

Recognizing this reality, Congress and the Pentagon are emphasizing the importance of delivering capabilities to meet these gaps. That’s a welcome shift that will reshape military planning and acquisitions and will impact the way that billions of defense dollars are likely to be spent. In his November 2025 acquisition reform announcement, Secretary of War Pete Hegseth called for incentives to stimulate private investment, expand production capacity, and create an industrial base capable of rapidly delivering new capabilities as operational requirements evolve.

This plan is consistent with the 2026 NDAA and current versions of the 2027 NDAA. Both have provisions related to increasing production capacity and supporting the ability to surge during conflict.

The FY2026 NDAA expanded the Defense Industrial Base Fund to support investments in machine tools, castings and forgings, production modernization, and related industrial infrastructure. It established the Civil Reserve Manufacturing Network (CRMN), which allows civilian firms to register their manufacturing capacity so that the Department of War (DoW) can inventory the country’s surge capacity. It also required the DoW to produce a report that identifies the obstacles to maintaining or investing in surge manufacturing capacity. This last measure is significant because it acknowledges that existing acquisition rules discourage firms from maintaining surge capacity. For example, the existing Federal Acquisition Regulation (FAR) treats the costs of maintaining surge capacity as an exception that requires special justification or a separate agreement—rather than as something valued as part of military capability.

Negotiations over the 2027 NDAA suggest the emphasis on industrial capacity will continue. The House Armed Services Committee report (H. Rept. 119-698) includes a discussion of “policy test labs” to evaluate proposals to incentivize investment in surge capabilities and capacities.

While certain authorities exist in Title III of the Defense Production Act and the Industrial Base Analysis and Sustainment (IBAS) program to invest directly in production capacity, tooling, and facilities, they essentially operate as exceptions or special programs as opposed to a normal logic of acquisition. These newer provisions reflect a growing recognition that the means of production, not just the weapons they produce, are themselves strategic assets.

The next step is to make that logic central to defense acquisition. If the factory is the product, the question is no longer simply what equipment the Pentagon should buy, but what manufacturing assets it should own or incentivize so that industry can produce capabilities at whatever scale future conflicts require. How should the Department attract private capital into reserve manufacturing capacity? How should it compensate companies for maintaining unused but strategically valuable production capacity?

One way to broaden this approach and to draw in needed private capital is through a Capacity-as-a-Service (CaaS) model. This would have a similar logic to Software as a Service (SaaS), which aims to deliver software capabilities at the speed of relevance. Because software changes so quickly, the SaaS approach recognizes that one-time software purchases do not work. By the time traditional processes produce a full replacement, the product is obsolete. A SaaS approach enables customers to receive a continuously improving capability.

A CaaS model would apply the same logic to manufacturing capacity. If the objective is to deliver continuously improving operational capabilities rather than a single platform, a CaaS model would reward industry for providing capability over time—not just a one-time production run of hardware. The goal is to treat industrial capacity as a service that can grow, adapt, and surge as operational requirements evolve.

An inventory management strategy could focus on increasing the availability of necessary equipment in theater and creating a strategic bridge until industrial production ramps up. Recent events have shown that the strategic bridge to industrial mobilization is not sufficient and would be challenged to support long term peer-on-peer conflict. Under CaaS, the DoW would pay contract manufacturers annual retainers to offer rapid production scaling—much like DoW pays commercial shippers to ensure adequate shipping capacity is available in case a contingency develops. Financing contract manufacturers should allow DoW to lower strategic inventory levels while introducing profit incentives to lower the cost of capacity scaling.

Such a shift has the benefit of attracting private capital. Many investors are reluctant to back companies whose primary customer is the Pentagon due to uncertain funding and arcane acquisition rules. But financing flexible manufacturing capacity presents a much broader investment opportunity. Facilities, tooling, and production systems can support both commercial and defense markets, reducing risk while creating stronger incentives for private investment. Rather than limiting competition to a small number of traditional defense contractors, this approach could unlock a much larger pool of manufacturers, investors, and new entrants into the defense industrial base.

It also changes the economics of defense production. Instead of financing short production runs, companies can invest in scalable manufacturing methods, advanced tooling, and automation that lower costs and increase production rates over time. Because the underlying manufacturing capability can be continually upgraded and reconfigured, the Department gains not just additional capacity but the ability to adapt rapidly as our adversaries’ systems change.

There are tradeoffs, of course. Optimizing for mass production rather than exquisite performance may require accepting designs that are “good enough” but can be produced in greater numbers and at lower cost. This approach will not apply to every capability. The United States will always need a force built around high-end platforms that deliver unique strategic effects.

But as Congress heads into recess asking what the next generation of defense spending should buy, the answer should not be just more platforms. Advantage will belong to the nation that can build factories as quickly as it builds weapons, continuously improve production, and translate commercial innovation into military capability. In this age of rapidly evolving warfare, factories are strategic assets.

KEVIN MCCARVILLE is a Forward Deployed Software Engineer at Palantir. He also serves as a Captain in the New Jersey National Guard, where he commands Charlie Troop, 102nd Cavalry, and is an Airborne Ranger. The views he expresses in this piece are his own.

My company was conducting reconnaissance fundamentals on a drill weekend in the field. As we reviewed concealed position setup and proper stalking techniques, one of my privates looked up at me with a question that was more profound than he knew: “Sir, what would we do if we’re lying here at night and a drone flies overhead with offensive capabilities? What if it picks up our heat signature?”

I answered him honestly: “In that scenario, you’re probably all going to die.”

His response was inevitable: “Then why are we doing this training?”

There was no easy answer to that question.

The future of warfare is no secret in the Pentagon. The widespread use of relatively inexpensive Iranian Shahed drones in Ukraine and the Middle East is headline news. Meanwhile, China and Russia are adeptly fielding various higher-end, more capable systems. The United States isn’t sitting on its hands. We have several counter-UAS systems from both the traditional prime contractors and new entrants. The capabilities are a mix of kinetic interceptors and directed energy weapons.

The problem is, Private Snuffy on the ground doesn’t even know these technologies exist, let alone how to use them or how they will be used to augment battlefield tactics.

The leadership at the top of our military understands that much of the doctrine we still teach at the bottom is obsolete. Yet battalion-level and below units continue running decades-old drills and consulting outdated field manuals, which lead to dissonant experiences like the one above. Doctrine takes far too long to travel from those who write it to the soldiers on the ground who must live and die by it. That lag will cost us dearly in dollars and in lives if we don’t reform and accelerate the way we train.

The Pentagon itself has acknowledged as much. Joint Interagency Task Force 401, the counter-drone task force established in 2025 to consolidate requirements, acquisition, and training under a single authority, opens its new handbook, Small Drones, Big Problems, with a telling admission: the hardest part of countering drones is not the technology, but having trained people and the right policies and processes in place. That message—and that training—has yet to reach the soldier at the bottom.

What We Are Facing

For much of 2024, I was deployed to the Kurdish territories spanning Syria and Iraq. There, the most consistent and lethal threat to my brigade came not from direct ground engagements but from drones. Iranian-backed separatist groups relied heavily on relatively primitive attack drones known as one-way unmanned aerial systems (OWUAS). We just called them “one ways”.

The primary variant at the time was the Iranian HESA Shahed-136. These delta-winged kamikaze drones are approximately 3.5 meters long with a 2.5-meter wingspan and weigh around 200 kg. Powered by a piston engine, they achieve speeds of about 185 km/h and can carry a 40–50 kg warhead. For reference, that is slow—newer jet-powered variants reach 500–600 km/h—and it makes them far easier to engage than other forms of indirect fire. The 40–50 kg payload is likewise middling: huge next to a 3 kg quadcopter, but a poor tradeoff for how clunky they maneuver.

Their range exceeds 2,000 km, making them ideal for standoff attacks with low radar signatures. They are preprogrammed with a grid and flight path, so there is no communication with the operator after they are launched—hence the term, “one way.” The downside to this technology is the drone will just fly into the side of a hill halfway to its destination if that’s what’s on the flight path. The upside is it’s cheap.

While the Shahed represents the lower end of the threat spectrum, Russia and China are fielding systems of an entirely different order. Russia’s Lancet-3 loitering munition has proven devastatingly effective in Ukraine, using optical and laser guidance to strike armored vehicles with a precision that earlier drone generations could not achieve. Then there’s the Orlan-10, which has been widely used for reconnaissance and artillery spotting, making it extremely difficult and often foolhardy to move forces undetected.

China’s threat is more concerning at the strategic level. The CH-4 and Wing Loong II are near-peers to American MQ-9 Reapers in capability. The larger, twin-engine Tengden TB-001 can carry up to 12 precision munitions with an endurance exceeding 35 hours—a heavier-lift class above the single-engine CH-4 and Wing Loong. More troubling is China’s investment in drone swarm technology, where hundreds of low-cost autonomous systems coordinate to overwhelm air defenses through sheer saturation. These are not primitive one-ways. They are precision instruments designed to defeat the exact layered defense systems we are currently building.

Current Capabilities

The systems we field today are competent but not comforting: good enough to defeat most of yesterday’s threats, but at costs and reaction times that will not survive tomorrow’s. Our primary counter-UAS systems overseas were the AN/TWQ-1 Avenger and Raytheon Coyote effectors. The Avenger is a mobile short-range air defense platform mounted on a Humvee chassis, giving it the mobility to reposition rapidly across a forward operating base. In practice, we rarely did this, as the lead time on drone detection to impact didn’t give us enough time to reposition effectively.

The Avenger integrates eight Stinger missiles enhanced with proximity fuzes specifically optimized for small UAVs, a .50 caliber M3P machine gun for close-in engagements (a lot less effective in the heat of the moment than one would expect, as accuracy is surprisingly poor and the .50 cal runs through a ton of ammo), Forward-Looking Infrared (FLIR) sensors, and a laser rangefinder. Its day-night capability and rapid engagement speed made it our first line of defense against incoming one-ways.

The Raytheon Coyote, part of the Army’s Low, Slow, Small Unmanned Aircraft Integrated Defeat System (LIDS), functions as a tube-launched expendable interceptor, essentially a drone built to kill drones. Block 2 variants use kinetic fragmentation warheads and engage threats at ranges of 10 to 15 km, typically paired with the KuRFS (Ku-band Radio Frequency System) radar for precision cueing. What made the Coyote particularly valuable was its ability to operate in a networked swarm, where multiple Coyotes can be directed at a single threat or dispersed against multiple targets simultaneously. For our purposes, multiple was never more than two. These systems proved effective in most engagements, but their expendable nature meant each engagement consumed a finite and costly asset. Further, reload and rearm times created windows of vulnerability that a determined adversary could exploit with mass attacks.

The most harrowing incident on our deployment occurred when a Shahed evaded interception and detonated just 45 meters from my bunker. The blast ignited key infrastructure, forcing a medical evacuation of several soldiers to a better-equipped base. Thankfully, all recovered and returned to duty, and every member of our unit made it home. But the event underscored a chilling reality: our defenses, while often successful, were far from infallible.

Evolving Countermeasures

Today, the U.S. military is investing in layered, multi-domain solutions to counter the growing drone threat. Kinetic interceptors remain the backbone of current counter-UAS efforts. The Coyote fleet is being expanded to thousands of units, and newer systems like AeroVironment’s Freedom Eagle-1 are being fielded to address longer-range threats that existing platforms cannot reliably engage. The Army is also exploring multi-missile salvos to handle saturation attacks, recognizing that a single interceptor per drone is not a sustainable model against swarm tactics.

Directed energy weapons represent the most promising long-term solution to the cost asymmetry problem. A Shahed-136 costs roughly $20,000 to produce; a Stinger missile costs over $38,000. High-power microwave systems and solid-state lasers can engage targets for a fraction of that cost per shot and do not require reloading in the traditional sense. The Army’s High Energy Laser Mobile Demonstrator (HEL MD) and related directed energy programs are advancing rapidly, though ruggedizing these systems for forward operating environments remains a significant engineering challenge and their effectiveness is often higher in theory than in practice.

Electronic warfare and AI-driven detection are becoming central to the counter-UAS kill chain. Rather than waiting to intercept a drone kinetically, new systems aim to detect, classify, and jam or spoof incoming threats before they reach their targets. AI is being integrated to reduce the sensor-to-shooter timeline, which in current systems can be dangerously long against fast-moving or maneuvering threats. Our enemies are quickly picking up on these tactics, though, and drone behavior in newer models is built to counteract these measures. For instance, some drones can convert from a one-way to a preplanned grid or just return home if its connection to its operator is severed by electronic warfare.

Non-kinetic defeat options, such as the Coyote Block 3, offer the ability to disable drones electromagnetically without physical destruction, preserving the ability to collect and exploit the wreckage for intelligence purposes. This is particularly valuable when dealing with adversaries who rapidly modify their systems in response to our countermeasures.

Another interesting new countermeasure is Merops, a low-cost fixed-wing interceptor refined through hard combat use in Ukraine before being adapted for our own fight (Merops is built by Perennial Autonomy, a company backed by former Google CEO Eric Schmidt). According to the Secretary of the Army, the service purchased roughly 13,000 Merops interceptors within about eight days of the opening of Operation Epic Fury, fielding them in the CENTCOM theater within two weeks of the first Iranian counter-strikes. At around $15,000 per drone against Shaheds costing two to three times that, solutions like Merops may finally have flipped the cost equation in the defender’s favor.

Solutions such as these indicate that, at the highest levels, at least, our military is absorbing hard-won lessons from Ukraine, where drones have transformed the battlefield into a transparent killing zone.

Lessons Learned

At the strategic level, I hold measured confidence that senior Army leadership recognizes the urgency of drone warfare. First-person view drones, loitering munitions, and fiber-optic guided systems have inflicted massive casualties, forced adaptations in concealment, movement, and combined arms tactics, and created a relentless cycle of innovation and counter-innovation. Electronic warfare (i.e. drone jamming) alone is insufficient; success demands integrated systems of sensors, effectors, deception, and rapid doctrinal evolution. Ukraine demonstrates that quantity, adaptability, and decentralized decision-making often matter as much as technological sophistication.

The Army is very much still figuring out how it fits into this dangerous new world. Tactics are being improvised across Ukraine and the Middle East in real time, and how our own technology will incorporate lessons learned remains undecided. We’ve made small adjustments—more dispersion on surveilled patrols, extra EW gear on reconnaissance—and we’re slowly realizing that the situations calling for Cavalry Scouts and recon platoons are dwindling. But we still refuse to say the hard part out loud: the doctrine we teach isn’t just obsolete. It’s actively getting in the way of winning the fight.

Recruitment priorities must evolve accordingly. We need greater emphasis on drone operator military occupational specialties (MOS), rather than traditional combat arms personnel. More critically, the enlisted ranks should aggressively target individuals with technical aptitudes: coders, engineers, tinkerers, and systems builders who can rapidly prototype, maintain, and innovate the tools our warfighters require. Most of the more technical MOSs and positions in the Army are obtained through credentials after enlisting and not at the point of entry. I think it’s time for a change so that we start the pipeline of tech-savvy junior enlisted soldiers at the top of the funnel. Anybody, inside or outside the military, looking at any of the conflicts recently, can plainly see that our next battles will be fought much more with keyboards than bayonets.

Boots on the Ground

Standing over that young private on the range, I cannot escape the truth in his question. In its current form, much of what we train feels not merely pointless, but actively detrimental. We instill false confidence in methods ill-suited to current conflicts we face. Our soldiers deserve better. They deserve a force-wide cultural shift, driven from the top but embraced at every level, that places technological fluency, rapid adaptation, and drone-integrated tactics at the center of our profession.

Wars will increasingly be won through superior technological investment, iterative learning, and the empowerment of technically skilled personnel. I read a while back that Navy and Air Force recruitment was having an interesting dilemma. They had no shortage of pilot applicants, they just knew they didn’t need them anymore. From fighter jets, to stealth bombers, to refuelers, the military across every branch is moving away from manned aircraft. I understand it’s not as sexy being the guy in Oklahoma with a controller and a screen as it is being Tom Cruise in Top Gun, but drones can be faster, more agile, and carry heavier payloads—all without risking human life. That’s where the military is heading.

Physical Training scores and marksmanship will still be hallmarks of a good soldier, but the tech-savvy 19-year-old will probably be contributing more to our military might in the long run than the PT stud. It is imperative we embrace that reality from the Pentagon all the way down to the private fresh out of basic. Or like many who have failed before us, we’ll keep fighting the last war.

DARYL WIELAND is Senior Director of Partnerships at Palantir and an Adjunct Professor of Finance at George Mason University.

The Proximity Fuze Moment

In the summer of 1942, the U.S. Navy had a problem it couldn’t shoot its way out of.

Japanese dive bombers were closing on U.S. ships at speeds that made conventional anti-aircraft gunnery ineffective. Hit rates were dismal.

Meanwhile, scientists at the Applied Physics Laboratory at Johns Hopkins were racing to field a technology that would change everything: the Variable Time (VT) proximity fuze. A tiny radar set crammed inside a shell casing, capable of detonating automatically when it sensed it was close enough to kill. It would raise the effectiveness of anti-aircraft fire by an order of magnitude.

But the proximity fuze wasn’t ready. Not in 1942. Not in useful quantities until late 1943. Not in mass production until 1944. Therefore, the Navy had to expand production of existing ammunition and fund the maturation of the proximity fuze at the same time.

The Bureau of Ordnance cranked the existing industrial base to maximum output while simultaneously pouring resources into maturing the fuze, scaling its production, and solving the manufacturing challenges that stood between prototype and deployment.

The proximity fuze didn’t save the fleet by itself. The decision to keep building while simultaneously investing in the future saved the fleet.

We are in our own version of a proximity fuze moment right now as the United States seeks cost-effective ways to counter the asymmetric threat posed by drones. Meeting the moment requires resupplying current capabilities while maturing next-gen technology.

Facing Reality

Surface-to-air missile interceptors are our proven and combat-tested tech. Workhorses like the PAC-3 and Standard Missile family underwrite deterrence today—but they are expensive and scarce.

Directed energy (DE) is our proximity fuze. High-energy lasers that can defeat cruise missile or drone salvos at a cost-per-shot measured in single digits have the potential to change the shape of naval warfare. Crucially, this technology could also free up precious space on ships currently devoted to defensive capabilities.

No one has made the case more forcefully than Chief of Naval Operations Adm. Daryl Caudle. In his May 14 posture statement to the House Armed Services Committee, Caudle laid down a marker: “The current paradigm, which forces a trade-off between defensive interceptors and offensive strike weapons within the limited space of the Vertical Launching System (VLS), is unsustainable.” Every VLS cell loaded with a defensive missile is a cell that can’t carry a Tomahawk or a long-range offensive strike weapon. The ultimate solution, Caudle believes, requires DE weapons because “…they offer a solution that increases the potential kill rate at a lower cost per engagement compared to traditional kinetic projectile munitions and missile interceptors, thereby increasing overall combat endurance.”

That is exactly the right diagnosis. But embedded in Caudle’s testimony is an uncomfortable truth that must be addressed: the laser fleet is not here yet, and the ships that can host it haven’t been built.

The Navy’s most modern surface combatants, the Flight III Arleigh Burke-class destroyers, simply cannot support the power demands of laser weapons at scale as their generators are already fully committed to the AN/SPY-6 radar. Caudle’s vision of a true laser-armed fleet is anchored in the Navy’s proposed nuclear-powered battleship and future surface combatants, platforms designed from the keel up with the power and cooling capacity for high-energy weapons. Battleship procurement isn’t planned until 2028, with delivery projected for the 2030s.

In this scenario, the worst thing we could do is the thing Washington is most naturally inclined to do: treat this as an either/or choice. Cut missile procurement to fund DE R&D or starve the DE portfolio because “lasers have been ten years away for thirty years.” Both instincts are wrong. Both get people killed. Rather, we need to fill the magazine and fund the beam.

Efficient Defense Enables Offense

If the proximity fuze analogy feels outdated, consider the data that just came back from the Middle East.

The Presidential Unit Citation that was recently awarded to the USS Gerald R. Ford Carrier Strike Group tells the story in cold numbers. Nine surface combatants fired 207 Tomahawk Land Attack Missiles at Iranian targets between late February and May. Assuming all were Arleigh Burke destroyers with 96 VLS cells apiece, that’s a potential combined ceiling of roughly 864 cells with those 207 Tomahawks representing roughly one offensive strike weapon for every four cells. The strike group spent the rest of its magazine “protecting vital sea lines of communication while under persistent threat from enemy missiles and one-way attack drones,” i.e. shooting down incoming fire.

This is Caudle’s unsustainable paradigm in action: the destroyers that prosecuted one of the most significant U.S. naval combat operations since World War II went into the fight with roughly three-quarters of their magazine committed to defense against an adversary not named China. When a single carrier strike group burns through 207 Tomahawks and even more interceptors in two months of regional operations against a middleweight power, the arithmetic for a Western Pacific contingency becomes terrifying to compute.

Crossing the Chasm

The traditional approach is not sufficient. We need a different tack. In Crossing the Chasm, author Geoffrey Moore describes the lethal gap between early adopters who embrace a disruptive technology on faith and the pragmatic majority who won’t touch it until it’s proven, integrated, and supported at scale. Most technologies die in that gap, not because the science is wrong, but because the institution loses patience, funding, or both while waiting for the customers to arrive.

DE is squarely in the chasm. The lab demos work, the generals nod approvingly at industry days. But the fleet commander and the brigade S3 will not plan around a weapon that can’t operate in rain, can’t sustain engagement tempo, and can’t be maintained by the maintenance crew at a forward operating base.

Caudle’s testimony reveals a Navy trying to manage the chasm rather than wish it away. His posture statement describes three DE tracks running in parallel. The first is near-term and modest: containerized, lower-power systems like the 30 kW LOCUST (which completed a successful live-fire test from the USS George H.W. Bush in October 2025) and the 60 kW HELIOS, deployable against the expanding drone threat. The second is transformational and distant: megawatt-class systems embedded in a nuclear-powered battleship a decade away.

The third attempts to thread the needle. The Joint Laser Weapon System (JLWS), a collaboration between the Army and Navy, is designed as a containerized system aiming for 150 kW with potential to scale to 300 kW, specifically for cruise missile defense. Combined R&D investment is mapped at $676 million through fiscal year 2031. The Pentagon’s FY2027 budget request contains $452 million in proposed R&D spending for DE weapons in support of Golden Dome alone, more than triple the $142 million enacted under the One Big Beautiful Bill Act. The exact relationship between this Golden Dome DE funding and the Army/Navy JLWS efforts remains unclear. If JLWS delivers, it represents a containerized laser powerful enough to engage the missile threats at the heart of Caudle’s VLS argument without a keel-up redesign.

The Pentagon wants to showcase battle-ready laser weapons by 2028, which creates a useful forcing function but also a credibility risk if engineering challenges (e.g., atmospheric effects, thermal management, forward maintainability) remain unsolved.

Caudle’s Containerized Capability Campaign (C³) is the institutional vehicle for this bridge by decoupling payloads from platforms so the Navy can deliver combat power, as he puts it, “at the speed of relevance, not the speed of platform-centric acquisition.”

The right instinct. But crossing the chasm requires the kind of sustained investment in manufacturing readiness, thermal engineering, and operational test that Washington historically is terrible at funding. The discipline required is to keep feeding the chasm-crossing effort while simultaneously building the conventional capability that keeps you alive during the crossing.

This Is Where BOND Matters

The Business Operators for National Defense (BOND) program, over a hundred elite private-sector executives embedded in the acquisition process, exists precisely for this kind of problem. The defense acquisition system was not built to run parallel investment strategies across different technology readiness levels. It was built to manage sequential programs on glacial timelines. Private-sector expertise is needed to thread the needle.

BOND operators understand portfolio management. Apple didn’t stop shipping iPhones while it developed Vision Pro. Ford didn’t shut down the F-150 line while it stood up the Lightning. The private sector manages this tension every quarter, and that muscle memory is exactly the institutional antibody the acquisition system needs.

Three priorities demand attention. First, demand signals for the missile industrial base. The solid rocket motor bottleneck is real. Multi-year contracts and second-source qualification efforts must signal to industry: we are buying at scale for the next decade. Private capital follows demand signals. The defense industrial base will invest in new production lines when they see contract commitments that justify the capex. Not before.

Second, software-enabled production visibility. Munitions Command Centers are the connective tissue between strategy and production. When a COCOM expends a salvo of Tomahawks, as nine destroyers just did, that expenditure cascades through the system: depleting theater magazines, drawing down global inventory, creating demand on a production line already at 80% capacity with a 24-month backlog. Today, no one sees that cascade in real time.

Third, a protected DE maturation pathway across all three tracks. The JLWS bridge deserves particular protection: its R&D pathway through FY2031 is exactly the kind of chasm-crossing investment that gets raided in POM fights. The CAPE and the Comptroller need budget structures that insulate DE maturation funding from the inevitable cycle where near-term readiness accounts cannibalize S&T. This is portfolio management: protecting the seed corn while harvesting the current crop.

The Lesson of 1942

The Navy solved the anti-aircraft problem in 1942 because it had the institutional discipline to pursue revolutionary technology without sacrificing the conventional capabilities it needed to survive long enough for that revolution to arrive.

Caudle’s testimony shows a CNO who understands both halves of this equation, who can articulate the transformational promise of DE while acknowledging that the fleet he commands today isn’t ready for it yet. The next step is institutional follow-through: build the missiles, fill the magazines, surge the industrial base. This must happen simultaneously, not sequentially, and not “after we solve the missile problem.” The DE capabilities we need to fight the drone and missile threat must mature across all three tracks with the patience and rigor the chasm demands.

1942 didn’t wait for the fuze. 2027 can’t wait for the beam.

SHANE ROCKETT is the Commercial Lead at Sable, a team of AI researchers and engineers dedicated to giving AI real-time computer use, vision, and voice capabilities. They are hiring world-class engineers. Inquiries can be sent to roles@withsable.com.

ABBY CARR works in Strategic Engagement at Palantir Technologies. She is a fellow at the Foundation for American Innovation.

On August 19, 1812, the frigate USS Constitution spotted HMS Guerrière southeast of Nova Scotia. Captain James Dacres of the Guerrière was eager to fight. The Royal Navy had not lost a single-ship frigate action to an equal opponent in over a decade, and Dacres had reportedly issued a challenge to any American frigate willing to accept. Constitution’s Captain Isaac Hull obliged.1

Captain Hull closed to within half a pistol shot before unleashing his first broadside. Within fifteen minutes, Guerrière’s mizzenmast was gone. Cannonballs struck Constitution’s hull and bounced off. A sailor watching them ricochet into the Atlantic reportedly shouted, “Huzzah, her sides are made of iron!”2

Guerrière eventually lost her mast and surrendered. The action lasted roughly thirty minutes, and it was the first of a streak. United States defeated Macedonian. Constitution came back and took Java. An infant navy, barely eighteen years old, was beating the greatest fleet in the world, ship for ship.3 George Canning told the House of Commons that the sacred spell of the Royal Navy’s invincibility had been broken.4

Why Dacres failed to account for his disadvantage is worth examining. Part of the answer lies in the fact that frigates of that day simply weren’t supposed to be as large or powerful as Constitution. She outmanned Guerrière’s crew 456 to 311, and her broadside outweighed her opponent’s by about fifty percent.5 Constitution and her sister ships broke the established model of a frigate. She was bigger, heavier, and hit harder. That advantage, however, raises a deeper question: how was it that only the new American frigates could carry so much armament?

Deep inside Constitution’s hull, six pairs of heavy timbers ran diagonally along the length of her sides. They never fired a shot, and no painting commemorates them, but these “diagonal riders” let Constitution and her sister ships carry an armament no other frigate could.

Diagonal riders appear across centuries and domains as a pattern: a constraint-breaking innovation that remains invisible during the deployment of a capability. Their impact, and the consequences of removing them, are understood only by the people who know they are there in the first place.

Below the Gun Deck

Joshua Humphreys, the man who built the original frigates of the U.S. Navy, has been covered by First Breakfast before.6 He had never seen a European ship of the line but he had worked on over 300 vessels since the age of twelve. His frigate designs were so novel that his guildsmen unanimously rejected them.7 What is less well known is the specific structural innovation that made his vision possible.

The infant U.S. Navy was not resourced to build a thousand ships; instead, Congress directed Humphreys to build a mere six frigates. Typical frigates of the era carried their guns on a single deck, favoring speed over firepower in a lean build. Humphreys’ plan was to break that mold; he would load his frigates with a much heavier armament than was the norm: bigger guns and more of them on a longer deck.

The physics were hostile to Humphreys’ concept. A hull long enough to carry that many guns bows under its own weight. The ends droop while the more buoyant middle rises, bending the keel, and destroying the ship in a process shipwrights call hogging. This was a well-documented failure mode that every shipwright in the Atlantic understood and accepted as a hard constraint on what a frigate could be.8

Other navies addressed hogging with short diagonal braces that functioned as local patches, but Humphreys took the idea further than anyone before him. His diagonal riders were thick planks of timber running in six pairs from the keel upward through the frame at steep angles, spanning much of the lower hull. The extended hull held under weights that should have broken it, allowing a significantly larger armament to fit aboard a frigate and fire upon Guerrière during her duel with Constitution.

Nobody on Guerrière’s deck thought, “We are being beaten by superior keel reinforcement.” Their attention, and most of the commentary since, has focused on Constitution’s armament. But it was the diagonal riders, unseen and uncredited, which made that armament possible.

The Lost Sixth Frigate

Not all six frigates got diagonal riders.

Humphreys’ British-trained assistant, Josiah Fox, had long disagreed with his boss’s approach. When Fox was given control of the sixth frigate, USS Chesapeake, he altered the design, scaling down the ship’s armament and changing the dimensions.9 Fox is known to have disagreed with Humphreys specifically on the diagonal riders, and historians conclude he almost certainly left them out.10 The logic of what follows is worth tracing carefully because it illustrates exactly how diagonal riders tend to disappear.

Without the diagonal riders, the Chesapeake’s hull could not carry the same armament as her sister ships, leaving her closer in firepower to a standard European frigate. While the other American frigates overpowered their opponents with a class of firepower never before seen on a frigate, Chesapeake fought on roughly equal terms.

Constitution could actively seek engagements because she outgunned any enemy frigate and could outsail anything that outgunned her. Chesapeake had no such margin, so every engagement she entered was a fair fight.

When HMS Shannon captured her off Boston in 1813—the only single-ship loss among the original six frigates—the engagement was decided in minutes by command and crew quality.11 Those variables only mattered because Chesapeake lacked the advantage that made her sister ships’ victories closer to foregone conclusions.

Humphreys drew his own conclusion. In 1827, when Fox was claiming credit for the frigate designs in newspaper interviews, Humphreys wrote of the Chesapeake: “She spoke his talents. Which I leave the Commanders of that ship to estimate by her qualifications.”12 Translation: if Fox wants credit, he can have the Chesapeake. The men who sailed her can judge whether that’s a credit worth claiming.

Humphreys himself framed it as a dispute over credit and craftsmanship, rather than internal bracing. The diagonal riders were invisible even in the argument between the two men who understood them best. Everyone saw an unlucky ship, yet no one asked what was missing from inside the hull.

In Search of Diagonal Riders

Diagonal riders did not disappear with the age of sail. Similar examples exist throughout history. The platforms and constraints change, but the pattern remains: hard limits overcome by hidden workarounds result in capabilities that tilt the balance in a conflict.

Leading up to the Battle of Britain, British Supermarine Spitfires were being outrun by German Messerschmitt Bf 109Es. The problem was “knock,” or the pre-detonation that occurred when the standard 87-octane fuel ignited in the engine. RAF pilots could only go so fast before their engines started to shake themselves apart.13

Three years earlier, Air Commodore Rod Banks had pushed for the adoption of 100-octane fuel, arguing that it could prove decisive in the early stages of a war. He was rejected because wartime supply could not be guaranteed from American refineries.14 But across the Atlantic, Jimmy Doolittle, the man later famous for his Tokyo raid, had convinced his colleagues at Shell Oil to invest in 100-octane refining at a scale no customer yet needed. Mocked as “Doolittle’s million-dollar blunder,” his bet helped make the fuel cheap and abundant by the time war broke out.15 Only months before the war, the first tanker of green-dyed British Air Ministry 100-octane (BAM 100) was shipped to England, where it was secretly stockpiled.

By the time the Battle of Britain began, the RAF had modified its fleet to handle the new fuel.16 Using BAM 100, the Spitfire gained a remarkable 25 mph at sea level and 34 mph at ten thousand feet.17 The Germans did not even realize the source of this change until they found fuel samples from a downed Spitfire in Belgium. Once they knew, they couldn’t exploit the knowledge; the Germans’ best fighter, the 109E, was not equipped to use this superior fuel.18 Due to its classification at the time, and the tendency to focus on platforms rather than supporting technologies, BAM 100 receives little attention in the popular version of the Battle of Britain.

Diagonal riders were present in the Cold War, as well. In the late 1950s, Kelly Johnson’s Skunk Works was designing an aircraft so fast that no interceptor or missile could touch it. At those speeds, a standard aluminum frame would heat up past the point of failure. Titanium, however, would not. Despite the abundance of titanium ore, aircraft-grade refined titanium was expensive and rare. It still is. The world’s largest exporter of refined titanium at the time? The Soviet Union.

Not ones to let the Cold War stymie a supply chain, the CIA set up shell companies and third-party intermediaries to purchase enough Soviet titanium to build the entire fleet of aircraft. The Soviets never learned who they were supplying.19 Sixty years later, the SR-71 Blackbird’s speed record still stands. The plane is iconic, but the titanium airframe that made it possible receives far less attention.

Diagonal riders continue to break constraints in modern platforms, as well. A fully loaded F-16 carries enough fuel for about 45 minutes of flight on combat ops. Adding external fuel tanks to the wings gains range, but only at the expense of payload and maneuverability. The constraint-breaker is a Boeing 707 with 200,000 pounds of jet fuel in its belly, known as a KC-135 Stratotanker. Since its first major usage in Vietnam, the Stratotanker has enabled every major American air campaign via mid-air refueling.

During Desert Storm, a typical strike package consisted of 75 aircraft.20 One in five was a flying gas station.21 In 43 days of Desert Storm, tanker crews made just under 46,000 refueling contacts, without missing a single rendezvous.22 These tankers are largely absent from the “video game war” version of Desert Storm that the public knows (laser-guided bombs threading ventilation shafts and night-vision footage on CNN). In Desert Storm, the F-16 was the weapon, but the tanker was the diagonal rider that let it reach its target.

In each of these examples, a constraint was accepted as given until someone broke it in almost total obscurity. The visible capability received all the attention while the constraint-breaker disappeared into the layers of the platform.

What a Diagonal Rider Is—And Isn’t

Not all foundational technologies are diagonal riders. Diagonal riders must be both constraint-breaking and invisible in the performance of a capability.

Aircraft carriers broke the constraint of dependence on land bases. But they are arguably the most visible symbols of American military power. Encryption and code-breaking technology might have started as a diagonal rider, but now Bletchley Park is a tourist destination and the subject of movies.

Other foundational technologies are invisible but optimize an existing capability, rather than truly breaking the constraints of a platform. Beginning in the 1760s, the Royal Navy clad warship bottoms with copper. “Coppered” ships maintained their speed over longer deployments and spent less time in dry dock, but copper was a performance improvement rather than a generational leap forward.23 A good test is “What would happen if this technology were removed?”

The defining threshold is the combination of necessity and invisibility. Necessary but visible technologies are known enablers. Invisible technologies that aren’t constraint-breaking are background details. A diagonal rider is both: required for the capability to exist and absent from the story told about that capability.

Why This Matters

Companies building visible end items may attract the most press and capital, but they risk converging toward parity because everyone can see and compete on visible capabilities. In an acquisition system built around requests for an end item (e.g., “I need a drone”, “I need a satellite”), companies building diagonal riders can be too easily overlooked.

Humphreys built a better frigate by asking what would have to be true to fit a ship of the line’s armament aboard one. Equivalent opportunities exist today. A founder who identifies an implicitly accepted constraint and breaks it is paving the way for visible capabilities to exist, and a healthy defense ecosystem must innovate at least as much on diagonal riders as on the visible platforms they enable.

The same logic applies in reverse. If successful allied capabilities have diagonal riders, so do adversaries’ capabilities. Those diagonal riders are often less protected than the platforms they support, because they are invisible even to the people who depend on them. A platform stripped of its diagonal rider reverts to the constrained state, the way Chesapeake reverted to just another frigate. Analyzing an adversary’s capabilities without identifying its diagonal riders is doing half the work.

Humphreys’ diagonal riders were invisible in the battle and largely invisible in the thirty-year argument over who deserved credit for the ships. They were also the reason the ships won duels. We need better language for this kind of technology. We offer: the diagonal rider.

America 250 is a chance to reflect on the men and women who built the country. Who they were. What they believed. How their example can guide us today.

Oceans of ink have been spilled on the subject, so we’ll just make one observation.

The Founders were builders.

For the past few weeks First Breakfast has profiled lesser-known heroes of the American Revolution. Their lives tell the story: A 25-year-old Boston bookseller who transformed into one of the world’s finest military logisticians and artillery commanders; a merchant who gambled his fortune to hold the Continental Army together (and who injected a healthy dose of capitalism into that army’s acquisition system).

The Revolution’s household names lived similar lives. Washington was America’s Cincinnatus, pulled from his expanding business empire at Mount Vernon to lead an army and then a new nation. Jefferson was not just a wordsmith but an architect, a farmer, and an inveterate tinkerer. Franklin was a serial inventor and scientist. The list goes on.

These were the men who built America. But it wasn’t just an exceptional few.

The colonies were teeming with Americans looking to make a name for themselves, to make their mark and their fortune (or at least a dignified, honest living), and to scratch a civilization out of the wilderness.

These Americans were restless, with a strong heretical streak. Always expanding, always hustling, always building. They caused massive headaches for the British government even in peace. They were nonconformists, in religion and habit. They settled where they weren’t supposed to. Traded with parties they weren’t supposed to (Loyalists complained that many of the most ardent Patriots, such as John Hancock, were smugglers—and they were right!). They were proud of their liberty and chafed at laws made by distant, unfeeling masters. Then they dumped East India Company tea into Boston Harbor, fired on the Redcoats at Lexington and Concord, and rebelled against a superpower.

That, in a nutshell, is the spirit of America. If you look at the broad sweep of American history you can see that spirit at work as our nation has expanded. Manifest Destiny. The Transcontinental Railroad. The telegraph. The Panama Canal. The Wright Flyer. The Model T. The Arsenal of Democracy. The microchip. The Moon. The Internet. Reusable rockets. Artificial Intelligence.

That’s just America’s first quarter millennium. We, the Americans living today, get decide what the next quarter millennium has in store.

America’s orientation has always been fixed: up and out. Our pioneers settled a continent, coast to coast. Our traders expanded our commerce around the globe. Our workers and engineers built cities to the heavens—and built flying machines to take us higher.

It’s easy and tempting to lower our gaze and fixate on our problems. They are real and deserve urgent attention. But Independence Day is our annual reminder of the virtues and spirit that are always necessary to solve problems, fight entropy, and ascend to a higher plane of civilization.

The Founders were builders. Build like them.

“My dear general, I can never do things in the small. I must be either a man or a mouse,” wrote Robert Morris in a 1793 letter to his friend and president, George Washington. The words were written amidst a land speculation bet that led to Morris’s financial and reputational ruin and consigned him to the margins of history. Yet it was the very audaciousness of this lesser-known Founding Father that would prove indispensable, time and again, to the fledgling republic.

Morris financed and supplied the Continental Army, famously extending his personal credit to do so. He created a privatized procurement system and advocated for fiscal responsibility in repaying the national debt at a time when both measures were unpopular. He was a free-market capitalist who believed financial policy should “be founded in the nature of man; not on ideal notions of excellence.” And he was one of only two men to sign the Declaration of Independence, the Articles of Confederation, and the Constitution (Roger Sherman of Connecticut was the other).

But first and foremost, Morris was a merchant. He was born not in the Colonies but in Liverpool in 1734. When Morris turned 13, he joined his father in Maryland. The senior Morris was a tobacco trader and soon sent his son away to Philadelphia to learn the trade. While he inherited a decent sum of money on his father’s death a few years later, the younger Morris was fast becoming a successful entrepreneur in his own right. At 21, he founded Willing & Morris with Thomas Willing, the young heir of the trading house where they both worked.

Morris’s biographer Charles Rappleye described Morris’s rise as “an unprecedented ascent for an outsider at a time when family connections were largely determinative.” Willing & Morris established itself as one of the most influential trading houses in the Colonies. Morris recounted how he dispatched a staggering “50 to 60 sail of stout ships” during the winter of 1774. He was eager to trade as much flour and wheat with the British Empire before hostilities forbade it. The aggressive trade expedition illustrates Morris’s opportunistic nature—a nature that would later be weaponized against him as evidence of corruption and avarice.

Morris was neither a zealot for independence nor a naive loyalist. He was an early opponent of the Stamp Act in 1765, yet he urged reconciliation with Britain for over a decade later. When Parliament enacted the Intolerable Acts in response to the Boston Tea Party, Morris understood the stakes had changed, even if he believed reconciliation was still possible. In 1774, he wrote “Poor America. This is the beginning of troubles, but its [sic] better to die bravely than be starved by pickpockets.” He would apply the full force of his abilities to the rebel cause.

Tell Me, Muse, of the Man of Many Jobs

The most proximate problem was how to arm the Continental Army. Washington’s gunpowder shortage was severe. At one point, the general resorted to mixing sawdust with powder. In response, in 1775 the Second Continental Congress formed the Secret Committee of Trade to secure arms and ammunition.

Morris’s status as the foremost colonial merchant was fundamental to overcoming the challenges facing the 13 colonies. The would-be nation was without a navy, a currency, a bank, or formal diplomatic channels. A successful merchant served as a sort of privatized expression of these functions.

Morris soon led the Secret Committee. The moderate Pennsylvania delegate operated a networks of spies, established clandestine supply lines in Europe and the West Indies, and administered contracts, often using false cargo registers and sailing orders to avoid detection. It was dangerous work—the sea swallowed ships as often as the Royal Navy did. Morris nonetheless secured the principal source of powder and saltpeter for the Continental Army. He may have been the most reluctant signer of the Declaration of Independence, but Congress could not have asked for a more creative and enthusiastic arms smuggler.

The Secret Committee of Trade was only the beginning. Within months he led the Marine Committee (charged with standing up the Continental Navy) and the Secret Committee of Correspondence (in essence, a nascent State Department). The country’s first warship was none other than Willing & Morris’s Black Prince. It was fitted out as a 24-gun frigate and renamed the Alfred. Morris supervised the construction of ships and commanded naval operations. These actions were complementary to the primary mission of the Correspondence Committee, namely, establishing diplomatic ties with potential European allies. He supplied diplomats with speedy packet boats to survive the contested passage littered with British cruisers.

Thus was Morris instrumental in opening up the critical supply lines with France. In September 1776, Morris, along with Secret Committee colleague Benjamin Franklin, learned that France would covertly supply America with major shipments of arms. The two determined “It is unnecessary to inform the Congress of this intelligence at present, because Mr. Morris belongs to all the committees that can be properly employed in receiving and importing the expected supplies.” Morris’s centrality to affairs could not be plainer.

Yet his resume continued to expand. In December 1776, as General William Howe’s troops prepared for a push into Pennsylvania, the delegates of the Continental Congress fled Philadelphia for Baltimore. Morris was one of three delegates to remain, where he operated under the express orders to “execute Continental business.” His modest responsibilities included running the Navy solo. Rappleye writes, “At this crucial juncture, he was essentially serving as chief executive of a beleaguered government facing its most severe trial.” Morris had an indefatigable work ethic and was not prone to self-pity. Still, a letter to John Jay conveys the intensity of the work: “The business of this committee engrosses my whole time & increases daily. I am now the veriest slave you ever saw.”

Morris would soon be lending more than just his time to the republic.

Monopoly Money

In a wartime economy, a country’s financial system is redirected toward financing a war. During World War II, the U.S. government issued war bonds to raise money while minimizing inflation. Such a redirection is, of course, contingent upon a country having a public financial system. Revolutionary America’s wartime economy was often just Robert Morris personally bankrolling the new nation.

Under the Articles of Confederation, the government lacked the ability to levy taxes. It could “requisition” (i.e. nicely ask) the states for revenue, but—unsurprisingly—the states often found they had little money to volunteer. Without guaranteed revenue, the government could not establish creditworthiness. It resorted to huge printing runs of the new national currency. Before long, the phrase “not worth a continental” was as commonplace as the refusal to accept the currency as a means of exchange.

And that is how the nation came to rely on so precarious a backstop as one highly levered merchant.

Throughout the war, Morris purchased all manner of supplies using his own credit. Hard currency was in such short supply that Morris lent Congress the entirety of his personal reserves. The icy winter of 1776 would have been even colder if not for Morris. He financed the purchase and directed the transportation of thousands of blankets and wool stockings that arrived in time for Washington to stage his attack on Trenton.

Nearly five years later, as Washington prepared for a long march south from New York to the Chesapeake, the absence of a functional paper currency threatened the entire campaign. Morris made the bold move of printing and circulating a new paper issue. These “Morris notes” were nominally associated with the government but were in fact backed by Morris’s personal credit; if Congress failed to provide funds, Morris himself was on the hook. Generals Washington and Rochambeau had provisions for Yorktown because of Morris. An otherwise reserved History of Government Contracting is effusive in its praise: “Without his financial connections, attention to detail, and superb administrative talents—and issue of over one million dollars of personal credit—the outcome of the battle, and possibly even the war itself, might have been different.”

In 1781 the Continental Congress unanimously elected Morris to be the Superintendent of Finance. It was one of four newly created executive departments. While the title brings to mind our modern Secretary of the Treasury, the position was functionally the chief executive of the government. George Washington was arguably the only individual more powerful than Morris.

One of Morris’s enduring contributions as Superintendent—both to the country and specifically our modern defense industry—was his implementation of a private contracting system. For most of the war, the procurement of supplies was an entirely public function. Commissaries bought, stored, and distributed goods to the Army. The incentive structure was deeply flawed. Agents were paid commissions as a percentage of what they spent, and fraud was rampant. States, meanwhile, were expected to supply the government with whatever they could spare via a a barter-like system known as “specific supplies.” When states managed to pony up beef or flour, the food often spoiled for lack of funds to transport it.

Morris considered the whole system “almost useless to the government.” He was forced to implore the states for supplies, warning that those who failed in their duties “will have to answer for it to their Country, to their Allies, to the present Generation, and to all posterity.” He detested making these moral appeals. Morris was a markets-oriented merchant who believed in the power of financial incentives.

The private contracting system he implemented appears straightforward today, but it was a dramatic departure for the time. Morris issued calls for supplies, and businesses responded with sealed bids. Contracts were awarded to the lowest bidder who could also provide the most generous payment terms to the impoverished government.

The system wasn’t perfect. There were reports of collusion among contractors and tainted goods. But Morris’s system was unquestionably more effective and cheaper than the commisary system, and it crucially did not depend on anything so fickle as the altruism of man. In 1783, Washington wrote, “I have...the satisfaction of seeing the troops better covered, better clothed, and better fed than they have ever been in any former Winter Quarters.” By dispensing with the romanticism of a voluntary call to arms, Morris was liberated to define a capitalist relationship between government and industry that persists today.

No Conflict, No Interest

Morris was an easy target for his enemies. Throughout his public service, he remained active in private business. His trading house Willing & Morris at times received half of all contract dollars that flowed through his committees. Other contracts for supplies frequently went to merchants in his network. A 1779 Congressional investigation accused Morris of using public office to enrich himself and award preferential contracts to his friends while leading the Secret Committee. He was never found guilty of wrongdoing, but the accusations stuck and contributed to his unjust legacy as America’s first war profiteer.

The Congressional investigation was ironic in light of the covert affairs Morris was leading. All actions of the Secret Committee were treason against the Crown. Morris could not exactly publicize a gunpowder smuggling contract in fair and open competition. It’s clear that Morris was valuable to the Revolution precisely because of his network of suppliers, international relationships, access to credit, and physical assets at his command. Further, some of the enmity directed toward Morris was more ideological than personal. Virginia delegate Richard Henry Lee, for instance, simply had an objection to capitalism, remarking “The spirit of commerce is the spirit of avarice.”

The negative attitudes toward businessmen leveraging their private networks in service of the war would foreshadow later criticisms of the “dollar-a-year men” during World War II. Wartime production czar William Knudsen was maligned for his connections to the automotive industry. But to limit wartime mobilization jobs to those without industry experience would be to limit the jobs to those who were definitionally unqualified. At no time was this more true than the American Revolution, when there was no federal infrastructure to mobilize.

The end of Morris’s tenure as the Superintendent of Finance was prolonged and painful. His March 1783 letter of resignation declared, “I never will be the Minister of Injustice.” Morris had grown too frustrated with Congress’s indifference to paying its debts and creating a creditworthy nation. It took him almost two years to extricate himself from the role because a fresh crisis had occurred: the soldiers hadn’t been paid in months and were threatening mutiny.

Their destitution was, in fact, an issue that had plagued Morris and Washington throughout the entire war. Now as Washington prepared to disband the army, he despaired over sending his men home “like a set of beggars.” Morris would be the nation’s piggy bank one last time. He issued notes redeemable in six months and backed by his personal credit. He then personally signed six thousand notes. In all, he issued some $1 million to feed and pay the troops. These were onerous financial obligations that exposed Morris to serious personal risk.

It was a mostly thankless job. Those who accused Morris of getting rich were perfectly happy to watch him overextend himself. Morris was not after plaudits, but he cared about his reputation. To defend his integrity, Morris published a 200-page Statement of Accounts shortly after leaving office. “The master should know what the servant has done,” began the report addressed to his “Fellow Citizens.” What followed were detailed actuarial tables and financial statements—from Morris’s public and private dealings—of revenues, expenses, and loans from his time in office. He printed 500 copies and distributed them to Congress.

Despite the rocky resignation, Morris was not finished with public service. He remained influential in Pennsylvania politics and was a natural choice to be one of the state’s inaugural senators. President Washington then approached Morris to be the nation’s first secretary of the treasury. Morris declined the role but astutely recommended Alexander Hamilton for the job.

In another example of Morris’s mangled legacy, his influence on the nation’s financial future is all but erased. Hamilton’s financial plan of 1790 was directly inspired by Morris’s ardent campaigns as superintendent of finance. The federal government would assume the states’ debt and fully fund the national debt. Creditors would be paid in full, restoring the public credit of the new government. And the whole funding scheme would be possible because there was finally a revenue foundation via national taxation.

Hamilton succeeded where Morris had failed because he had what Morris never did: the Constitution’s taxing power. Morris brought a knife to the fight, while Hamilton got to bring a gun.

Maybe someone should make a musical about Morris.

Icarus

Morris was an entrepreneur and a workhorse. After exiting public life, he relished the opportunity to dedicate the next chapter of his career fully to the private sector and create an empire. He used credit to buy up millions of acres of land in New York, Pennsylvania, and the District of Columbia. Morris’s big bet was that land prices would rise, European and American buyers would appear quickly, and credit would remain loose.

Those assumptions didn’t hold. Notes were issued against future land sales that did not materialize, and lawsuits, weak demand, and a tightening credit market put the squeeze on Morris. When it became clear he was headed towards financial ruin, he he did what gamblers do and doubled down. It didn’t help that his business partner and Pennsylvania comptroller, John Nicholson, was corrupt in ways Morris never was.

Morris and Nicholson had over $12 million in combined debt by 1796. Morris was arrested and spent three and a half years in a debtor’s jail in Philadelphia. His freedom was salvaged by the enactment of a personal bankruptcy law in 1801, but his finances and reputation were beyond recovery. He quietly spent the rest of his life with his steadfast wife Mary, the mother of his seven children. They subsisted on a small stipend from Morris’s longtime friend and fellow Founding Father, Gouverneur Morris (no relation). Robert Morris died in 1806.

Morris was a man of contradictions. He was skeptical of independence from Britain but worked doggedly to achieve that goal once it was set. He mastered the intricacies of monetary policy but was also comfortable chumming it with sailors on his ship decks. And he created the blueprint for America to pay her debts, only to die crushed by his.

Yet there is no contradiction where it mattered most: Morris consistently chose the republic over himself.

Further Reading

• Robert Morris: Financier of the American Revolution by Charles Rappleye (2010)

• A History of Government Contracting, Second Edition by James F. Nagle (1999)

The Patriots who gathered outside Boston to fight the British in 1775 were a motley crew, high in spirit but hardly an army at all. They had no standard flag, uniforms, equipment, or arms. No military discipline. They had barely enough powder to fire their weapons, much less to dislodge the Redcoats.

The situation was enough to drive as stoic a figure as General Washington to despair. As David McCullough recounts in 1776, when Washington first heard of the dire shortage of powder, he was so stunned he did not speak for half an hour.

Little wonder the British force under General Howe, with perfect military organization and the full firepower of the Royal Navy at their backs, dismissed their enemy as “the country people,” the “rabble in arms,” and even the “peasantry.” If past peasant revolts were a guide, this would be a brief campaign. The Patriot “army” would not survive its first winter.

Perhaps those predictions would have come true, if not for the timely arrival of 58 cannons and mortars in January 1776, which allowed the Patriots to seize the high ground around Boston and send the British packing.

That logistical feat was the work of a 25-year-old Boston bookseller named Henry Knox, Washington’s “indispensable man,” to quote his biographer Mark Puls, as well as the nation’s first secretary of war. More than any other man save Washington, it was Knox who bound together the Continental Army like one of the volumes in his shop. He did it through careful study, unceasing action, and boundless curiosity about the technology and training that a smaller, poorer force needed to take on a superpower.

250 years later, America’s military and defense industry are downstream of Knox and the institutions he built. As America relearns how to make the weapons we need to defend ourselves, we should learn from the man who did it first.

The Boston Bookseller

Henry Knox had a hard-knock upbringing. Abandoned by his father in 1759, the nine-year-old Henry withdrew from school and went to work to support his family. His mother wisely found him work at a bookshop so that Henry could continue his education on the job and meet the educated people who frequented such shops.

Henry took full advantage of the opportunity in his teenage years, reading anything he could get his hands on about politics and his burgeoning interest, military science. He also taught himself French under the then-widespread belief that the colonies would eventually rehash the French and Indian War. His language skills would eventually help him communicate with the French as allies instead of as enemies.

Knox knew the value of education but he was not the owlish type. Physically imposing and boisterous, he was a natural leader and man of action. He took an interest in the town’s affairs and joined a local artillery company, where he learned to drill and operate cannons. The militia, known as Paddock’s Train, was run by a local chairmaker, which must have planted in Henry’s mind the idea that citizens could make fine soldiers. Later, Henry used the proceeds from his own bookstore to co-found his own artillery company, which made him known to British authorities as a capable—possibly, a dangerous—man.

They were right to worry because Knox’s sympathies were with the Patriots. His bookstore stocked Patriot pamphlets (including pseudonymous works by a young college student named Alexander Hamilton). He was present at the Boston Massacre, where he tried to prevent the confrontation from escalating to violence. He later joined the Sons of Liberty and supported its boycotts of British goods, even though as a seller of mostly British books—his store was called Knox’s London Bookstore—it meant loss of business.

Knox had skin in the game in more ways than one. His wife Lucy was the daughter of a well-to-do Tory. Disturbed by her marriage to a merchant and Patriot, the concerned father tried to buy Henry’s loyalty with a commission in the army. Sticking to his guns, Henry declined.

When news of Lexington and Concord jolted Boston, British authorities forbade Henry and other men with military skills from leaving the city. He and Lucy fled in disguise, leaving behind their possessions, family, and hopes for a normal life. Lucy in particular paid a heavy price for her bravery. She was estranged from her family, who moved to England and never spoke to her again.

The future must have seemed forlorn when Henry arrived at the camp of liberty outside Boston. Ramshackle, stinking from open latrines, and disorganized, it was an unlikely setting for the Glorious Cause. The camp had desperate need for fortifications and other works but not a single engineer worthy of the name. Henry’s knowledge of military science, from book learning and service in the militia, was invaluable in an army with little practical experience. He immediately went to work fortifying the camp. He did so for free as a civilian, volunteering his services until the Continental Congress approved his commission many months later.

General Washington identified the young Mr. Knox as a rare talent and in the fall of 1775 promised him command of the Continental Army’s artillery. The command was more theoretical than real. As Puls writes, “[w]hen Washington informed Henry that he was to take over the army’s artillery, Knox teasingly asked where the artillery was. Washington admitted that there was almost none to speak of.”

Henry would have to bring the bang himself.

Knox’s ‘Noble Train’

An opportunity presented itself almost immediately. In May 1775, the Green Mountain Boys under the command of Ethan Allen and Benedict Arnold captured Fort Ticonderoga on the border of New York and Vermont. The Continental Congress helpfully decreed that the fort’s cannons should be sent to General Washington. The only question was how.

Knox, then still a civilian in his twenties, volunteered to lead the expedition. Many in Washington’s inner circle doubted it could be done and worried about a blow to morale if the venture failed, but Washington decided to gamble. Given the state of the army, he had little to lose.

It was undoubtedly a perilous undertaking. Three hundred miles of muddy roads, rivers, and mountain separated Boston from Fort Ticonderoga. Moving 60 tons of artillery along this route—some weighing as much as 5,000 pounds apiece—would require brute strength, force of will, and impeccable timing. With winter setting in, the success of the voyage hinged, first, on getting the cannons across Lake George before it froze and, second, on sledding the cannons across frozen ground and rivers once on land. Knox’s “noble train of artillery,” as he called it, would come by water and then by ice.

The expedition took three months and was beset by temperamental weather and other obstacles. The roughly 40-mile journey down Lake George took eight days of hard rowing, breaking ice along the way. Then a “cruel thaw” delayed the overland convoy of 42 sleds and 80 yoke of oxen. Eventually a blizzard descended, allowing the sleds to move but only in the most bitter conditions. The expedition crossed the frozen Hudson River (losing a cannon through the ice, which took a full day to retrieve), see-sawed through the snowy Berkshires, and finally arrived in the Patriot camp in late January. Washington’s—and Knox’s—gamble had paid off.

The expedition had strategic consequences insofar as it enabled the Continental Army to occupy the Dorchester Heights overlooking Boston. While Knox’s new cannons bombarded the city, thousands of workmen snuck onto the heights in dead of night to erect fortifications, dig trenches, prepare obstacles, and place cannons. When dawn broke, the British were astonished to find a rebel fortress overlooking the city. Their position untenable, they were forced to evacuate the city by sea shortly thereafter. Knox’s cannons won the Siege of Boston in an almost bloodless victory, buoying the Continental Army at a time when it might have disintegrated.

The three-month quest taught Knox a great deal about military logistics and artillery that he put to good use for the rest of the war. The Continental Army’s legendary crossing of the Delaware on Christmas 1776 was orchestrated by Knox, the master of perilous river crossings. He oversaw the movement of an incredible 350 tons of artillery, men, horses, and supplies on shallow-draft boats whose crews he had recruited. First-hand accounts of the crossing recall the confusion and darkness of the night, punctuated by Knox’s booming voice directing the traffic. He later crossed in the same boat as Washington. By the Siege of Yorktown five years later, Knox’s artillerymen and engineers were as professional a force as any in Europe, drawing praise from normally superior French officers. Knox’s cannons, often aimed by his hand, laid down a punishing fire at Yorktown that made resistance impossible and hastened Cornwallis’s surrender.

So vital was Knox to the American victory that Washington recommended his promotion to major general after Yorktown in defiance of a seniority system that said he had not reached the minimum age. Congress agreed, granting the promotion “on account of his special merit and particularly for his good conduct at the siege of Yorktown.” Knox was 31 years old.

An Army Worthy of a Free People

Knox’s achievements as an artillery commander are more than enough to qualify him as an American hero. The institutions he built during and after the war vault him into an even higher strata. America’s defense industrial base, professional military education system, and armed forces bear his fingerprints. Knox was not only a warrior but a builder.

The guns of Ticonderoga, like many of the arms the Patriots used, were cast by the French. Knox was only too happy to use foreign arms in a pinch, but he knew America needed the means to produce such weapons itself. If America could not make its own arms, the Patriot cause would be at the mercy of others. “Let us for a moment suppose a misfortune happen to the field Artillery we have in this army,” Knox mused to John Adams in August 1776. “Where shall we get immediately supplied—not in America.”

To address this problem, in December 1776 Knox penned “A Plan for the Establishment of a Corps of Continental Artillery, Magazines, [and] Laboratories.” The plan called for the creation of a defense ecosystem that could produce artillery, small arms, and munitions and train a cadre of skilled American craftsmen. The first priority, he wrote, was to build and mount 150 cannons. It was an audacious proposal at a time when the Continental Army was in headlong retreat and Congress was evacuating Philadelphia in expectation of a British invasion (around that time, Washington wrote to his brother that “the game is pretty near up”).

Yet Knox’s plan was prescient. The next year, after the crisis passed, Washington entrusted Knox with selecting the sites for American arsenals. One of the sites Knox selected was Springfield, Massachusetts, ideally situated on the Connecticut River as a source of power and means of transportation. Knox was intimately involved in the technical details of the site’s construction, stipulating the types of furnaces, mills, and other works that were needed, authorizing the recruitment of skilled laborers, and securing supplies of copper and tin for cannons. The Springfield Armory would produce weapons for the American military well into the Vietnam era. The surrounding Connecticut River Valley was America’s first true industrial cluster, pioneering mass production using interchangeable parts. It is little exaggeration to say that Knox’s sound judgement in wartime laid the foundation for America’s industrial boom in the nineteenth century.

Weapons factories were one thing, but Knox knew the American cause also needed factories for men. Like Washington, Knox was generally unimpressed by the quality of American officers. “There is a radical evil in our army—the lack of officers,” he wrote in 1776. “We ought to have men of merit in the most extensive and unlimited sense of the word.” Not everyone could be an autodidact like Knox, so the solution was an academy modeled on the European tradition that could teach promising Americans the science of war. “Military academies must be instituted at any expense,” Knox wrote to Adams. “We are fighting against a people well acquainted with the theory and practice of war—brave by discipline and habit furnish’d with every implement of war necessary for any enterprise. What do we oppose to these?”

In 1778, while the army wintered in Pluckemin, New Jersey, Knox founded such an academy. Again it was an unusual priority, as the Continental Army faced critical shortfalls of virtually every kind of supply, including food. Yet Knox knew training could not wait. The academy he built was at the center of camp and its tallest building. Knox developed the curriculum and was essentially the sole instructor, leading live demonstrations of the weapons in the Continental arsenal. He also used the academy to create a feedback loop between the factory and the frontline. As Puls writes, “[d]uring lulls of activity in the war front, artillery officers would be sent to the military laboratories to learn more about munitions manufacturing and gain knowledge that might be helpful in the field.”

The Pluckemin school was the first military academy in the Americas and a direct predecessor of the U.S. Military Academy at West Point—another Knox brainchild. In the immediate aftermath of the Revolution, Knox submitted a brief to Washington on the military institutions the new republic needed to defend itself. He identified the fort at West Point as the “key to America” and argued for co-locating a military academy with the existing arsenal. The students at the academy would get an education in theory and action, just as Knox had gotten in his youth. “All the scholars should be obliged to study the science of artillery and engineering,” he wrote. And they should learn by observing and mingling with the “artificers,” or factory workers, who operated the “manufactor[ies]” of small arms and cannons on site. In his final years, Knox had the satisfaction of learning that President Thomas Jefferson authorized the opening of a military academy at West Point along these lines.

When the Peace of Paris concluded in 1783, Major General Knox desired nothing more than to leave the military behind and reunite with Lucy and his children. Like Washington, however, his fellow citizens soon called him back to service. Briefly floated as Washington’s vice president, Knox accepted a more familiar post as America’s first secretary of war, where he prepared America’s military for a new challenge: preserving the Constitution and America’s independence.

Many Americans were skeptical of a standing army, viewing it as a threat to liberty from long and painful memory. Knox, who had smelled the powder and blood of the Boston Massacre, sympathized with their concern. But he knew a modern army was the only way Americans could remain free. The solution was to build a new kind of government and military that was worthy of a republic and, as he put it, “compatible with the interests of a free people.”

The brief he wrote to Washington in 1783 explains what was required to build such a military. First, the American people themselves would have to be trained and prepared to fight. “The people universally should be furnished with arms and know how to use them,” he wrote. The states should raise strong militias. And the national army should be capable and led by well-trained men of character, which required conscious efforts to “make the profession of arms honorable.”

The key to Knox’s vision for a republican army, from Pluckemin to West Point to the Office of the Secretary of War, was its emphasis on people. America needed strong institutions to create the leaders it needed to remain free; it needed strong leaders to steward those institutions and help America remain free.

Books and Battle

Henry Knox is not as well-known today as he deserves. He lacked the ambition and self-promoting tendency of equally brilliant men like Hamilton and Jefferson. His finances were always perilous and shoring them up preoccupied his later years. He also suffered repeated personal tragedies. Only three of his 13 children with Lucy survived to adulthood, shrinking what should have been an illustrious line. His surviving son, Henry Jackson Knox, ended up in a debtors prison.

Forgotten for too long, this year is the perfect time to burnish Knox’s legacy and reflect on the lessons of his life.

Knox reminds us that theoretical and practical knowledge go hand in hand. A young Henry learned to be a military engineer in Boston bookstores and bloody battlefields. Without the former, he would not have been useful on the latter—or at least, he would have faced a much steeper learning curve.

Knox also shows once again the primacy of people. He was an exceptional talent, used to his full potential by Washington. He multiplied his legacy by creating institutions to train future exceptional talents.

Our Armed Forces, our defense industry, and our freedom are downstream of Henry Knox: America’s first defense technologist.

BLAKE MCFALLS is a rising senior at Trinity Preparatory School of Florida.

Throughout 2025, China exploited its rare earths stranglehold in trade conflict with the United States. In April 2025, China temporarily halted exports of rare earths to the United States, shocking defense and commercial industries alike and prompting immediate action from the Trump administration. The principal focus of the administration has been investment in private mining and refining enterprises to grow a rare earth supply chain independent of China. While providing federal financing is important, the government also needs to focus on the most significant gap between China and the United States in this area: human capital, or the collection of experts, skilled workers, and knowledge required to produce rare earths domestically. Closing the human capital gap is the most critical move the Trump administration can currently take to rebuild a domestic rare earths manufacturing base.

The effort will require an extraordinary role reversal between the two countries. After the Second World War, the United States, principally through the Ames Laboratory at Iowa State University, pioneered the discovery and refining of rare earths. Dr. Frank Spedding led the effort, bringing his experience from the Manhattan Project to create the Ames Laboratory through federal government funding and state university support. Ames attracted dozens of chemists who pioneered the foundational methods for separating rare earths. Its efforts benefited both the federal government and private industry.

However, as federal government interest and support waned in the 1970s and 1980s, the human capital backbone in the United States collapsed. A generation of scientific pioneers retired and federal funding disappeared. The necessity of investing in rare earths innovation vanished, as American companies were able to outsource research burdens to China. The basic know-how of processing rare earths and building laboratory infrastructure was transferred to China on a one-way trip.

China was able to mirror early U.S. industrial policy in rare earths, overtly building off earlier U.S. contributions to the field. The father of Chinese rare earths, Xu Guangxian, received his PhD in chemistry from Columbia University in 1951. His thesis regarding Quantum Chemical Theory was a concept that would prove transformative to the study of rare earths worldwide. Xu returned to China and eventually established the Research Center of Rare Earth Chemistry in 1986, working in collaboration with Nankai University’s School of Materials Science and Engineering and the National Institute for Advanced Materials. The Chinese government continued this strategy by expanding upon its State Key Laboratory (SKL) System with the founding of the SKL Rare Earth Materials Chemistry and Applications in 1989. In essence, China used existing American human capital and the American model of leveraging universities to further innovate and build necessary infrastructure to dominate rare earth expertise.

At the very same time, the United States was losing its knowledge as support for domestic mining plummeted, university funding decreased, and the federal government dawdled. By 2010, a panel of experts, including one of the key members of the Ames Laboratory, warned Congress that the U.S. human capital foundation of the rare earth minerals field had disappeared, creating a key strategic vulnerability for the United States. Dr. Karl A. Gschneider testified that “some of [these] rare earth experts have moved on to other industries, others have retired, and others have died, basically leaving behind an intellectual vacuum.”

Though the federal government heard these warnings for years, it did not listen and took no action. The United States needs engineers to mine and process, scientists to continue doing the basic research, and educators to train the next generation of experts who will rebuild what the country lost. As a result, even if current initiatives to support processing succeed in terms of private investment — such as the Department of War’s investment in MP Materials — the United States does not have a critical mass of talent to sustain the scaling of an independent and innovative U.S. supply chain.

Rebuilding a Workforce

At the core of reviving U.S. rare earths capability is rebuilding a domestic workforce that can support growth to foster and scale long-term innovation. This includes engineers and skilled labor for extraction, midstream processing, and downstream manufacturing. The federal government needs to ensure and enhance the education and training of a new generation of engineers and workers, incentivize the lateral movement of talent from adjacent industries, and turn to skilled labor immigration where necessary.

A. Educating Engineers

Processing is the largest vulnerability in the rare earth value chain; a key reason for the lack of processing capacity is the difficulty of obtaining expertise. One of the most significant advantages China has over the United States is its knowledge on processing practices. Chinese IP strength would not matter if the United States had its own supply of rare earth specialists, but America is uniquely weak here. Upstream, the number of college engineering graduates entering the mining industry has declined by 39 percent since 2016. In mining itself, the differences are even more stark: China produces 3,000 mining graduates annually, while the United States only produces 162.

Similarly large gaps are present in midstream processing. In the United States, Europe, and Japan combined, there are only a few dozen processing specialists. China has thousands. Thus, the United States lacks knowledge on rare earth separation and refining techniques. The difference in human capital is reflected in recent patent data; 81 percent of all new rare earth patents are filed in China. Closing the gap over the long haul will require the federal government to work closely with universities and federal labs to offer training and employment to engineering and geoscience students.

The United States must also encourage the lateral movement of talent from adjacent industries, such as battery and solar manufacturing. This was how the United States government was able to develop the Cold War generation of computer scientists at a time when the country lacked a baseline workforce. In the 1950s, the U.S. government gave grants to RAND in order to train the workforce that would build SAGE, a supercomputer designed for nuclear deterrence. Although most hires did not understand supercomputing, RAND developed 800 specialists by scouting for exceptional STEM talent and training new hires for four months.

B. Lateral Movement and Training of Skilled Workers

After garnering baseline talent, the United States must create a mechanism for skilled workers to specialize in and enter the rare earth industry. The talent should be channeled into the following skillsets: process control engineering, lab expertise, and solvent extraction plant operation. Drawing from its aforementioned Cold War computing successes, the U.S. government should award grants to training institutions. To a small extent, the Department of Labor (DOL) has already done this. In May 2025, the DOL’s Apprenticeship Building America (ABA) Grant Program awarded a grant to ReElement Technologies Corporation (ReElement), an industrial processing firm with experience in rare earth processing, and Ivy Tech Community College of Indiana to partner on rare earth industrial training.

Focusing on apprenticeship, the initiative will lay the foundation for rare earth IP in Indiana, attempting to develop 300 rare earth specialists for ReElement’s main rare earth operations. The DOL should make the program more widespread, combining the few sources of IP in the private sector with vibrant intellectual communities in universities across the country. Expanding the program would have bipartisan support in Congress, as did similar programs in the CHIPS Act. The Department of Energy (DOE) intends to expand its use of Industrial Training and Assessment Center funding for the retraining and development of a critical minerals workforce; it is essential for these initiatives to be harmonized under one body. The Trump administration must consider whether the DOL or the DOE is better to handle rare earth workforce development, or else talent growing initiatives will be decentralized and less effective.

C. Friendshoring Engineering and Skilled Labor Where Necessary

If the administration wishes to develop domestic expertise, it must consider some selective policy redirection. There is an opportunity for the administration to be more welcoming to genuinely high-skill immigration in rare earth elements extraction and processing. There is a lack of such talent immediately available, and upskilling the domestic workforce will take time even under the most optimistic of timelines. The U.S. government should give more attention to the EB-2 specialized visa. The EB-2 visa, like the EB-1 visa, is reserved for top global talent in specific fields that the United States deems demanding extra expertise. However, EB-2 visas can be approved for more people than the EB-1 visa.

Friendshoring this talent from U.S. allies like Australia could focus principally on metallurgists, chemical process engineers, materials scientists, and logistics experts. While it would be ideal to pilfer Chinese talent in these areas, China’s restrictions on IP outflow present an obstacle. China not only finalized a ban on the export of rare earths processing technology in December 2023, but has also banned workers in the rare earths sector from revealing intellectual secrets. In 2024, China jailed a Chinese worker for 11 years for stealing state secrets on rare earth processing practices, suspecting the worker of exporting the information to other countries. A creative workaround for the United States would be a sort of Operation Paperclip, where the government would aggressively—and covertly—recruit China’s elite rare earths talent to move to America with their entire families.

Further catalyzing labor integration into rare earths, the Senate Select Committee on the Strategic Competition between the United States and the Chinese Communist Party should reintroduce an unchanged version of H.R. 10375, the Critical Minerals Workforce Enhancement Act. The bill died in 2024, not because it had low support, but because governmental attention on rare earths was low. Now, the rare earths industry is a key concern of the legislative and executive branches. If passed, the bill would allow workers in these fields looking to enter the U.S. rare earth industry to sign a National Interest Waiver (NIW), which would allow these workers to receive visas without navigating regulatory hurdles other applicants must face. Additionally, the U.S. can continue using private sector applications, such as NES Firecroft, that organize and track talent pools in specific fields across the world in order to further speed up the process.

D. Universities, Federal Labs and Hubs

Longer-term U.S. innovation and leadership will require a reinvestment in the university and federal lab programs that enabled the U.S. to pioneer and dominate the rare earths industry during the Cold War. The Ames Laboratory pioneered most of the separation processes that industry used, and it worked closely with companies in encouraging the diffusion of processes and associated technical knowledge. Longer-term support for basic research in critical minerals could also facilitate materials innovation that would make substitution for some rare earth elements feasible or more attractive.

Again, these are challenges that the U.S. government was able to overcome in the past. In the 1950s, for example, the Pentagon needed titanium for the development of next-generation fighter jets, but defense contractors like Lockheed Martin struggled to properly make titanium usable in the aerospace industry. The titanium industry required technology at the same stage of the value chain as rare earths do currently.

As with rare earths in the 1940s and 1950s, the government looked to the universities and federal research to kickstart innovation. Throughout the 1950s, the U.S. government directly supported the Bureau of Mines Physical Metallurgy Laboratory College Park at the University of Maryland, resulting in a 1957 research paper that detailed the invention of the modern titanium electrode melting technology, which was monumental for titanium processing. Through government support, the industry took off within a decade of commencement. The government provided the R&D and the private sector took on innovation management. Costs fell 23 percent every time production doubled.

The United States could similarly support labs in Houston, a promising city for rare earths processing. If human capital is agglomerated in Houston, the city will have the talent to develop rare earth processing technologies in local chemical material labs, such as the University of Houston and Rice University’s Jones Lab. The Colorado School of Mines is another logical focus for government investment in developing expertise and training of future engineers. And, coming full circle, the federal government could revive and enhance support for the Critical Minerals Innovation Hub at Iowa State University, which not only has its own expertise, but works with other national laboratories in exploring a variety of approaches to the critical minerals gap with China.

The administration has done an excellent job prioritizing investments in rare earths projects, but another hurdle must be overcome to develop a sustainable U.S. supply chain. Developing baseline expertise in rare earths processing would be instrumental in ensuring that America eliminates this Achilles’ heel in its trade and defense strategy. Workforce capabilities must be developed in conjunction with current federal investments instead of at a separate time. Ultimately, it is the miners, engineers, and scientists who will determine whether the United States succeeds.

DR. NADIA SCHADLOW is a Senior Fellow at the Hudson Institute.

The recently concluded U.S.–China summit highlighted that Beijing continues to double down on an economic model that is focused on dominating the industries it believes are strategically important. As U.S. officials return home and consider proposals for a board of trade and board of investment, which according to the White House could result in “increase[ed] Chinese investment into [U.S.] industries,” they should keep one principle in mind: Chinese capital and firms should remain outside of America’s advanced manufacturing buildout.

Modern manufacturing is no longer about building more factories. The emerging industrial ecosystem will fuse materials, chemicals, hardware, software, robotics, AI, and vast streams of data. Tomorrow’s factories will not merely produce goods. They will generate information, shape supply chains, and help determine future military and economic advantages. They are as much data systems as production systems.

The national security stakes are clear. Future military strength will depend heavily on commercial manufacturing. Many Department of War reforms center on producing weapon systems at scale through commercial industry. As Secretary of War Pete Hegseth has put it, the Department will “prioritize the purchase of industry-driven solutions, commercial solutions first.” Army leaders seeking to acquire tens of thousands of drones are emphasizing modular “plug-and-play” systems that can be rapidly upgraded as battlefield needs evolve. This shift is occurring across all the services. As one Army official explained, “if whatever they’re building isn’t modular with other industry partners … then I’m going to go with another industry partner.”

This trend makes the integrity of America’s industrial base even more important. Companies that build robotics, autonomous platforms, industrial software, and precision components may not have traditionally been viewed as defense firms, but many now sit at the core of the national security ecosystem.

Another national security concern is that modern factories generate enormous amounts of data about machine performance, materials behavior, and supply chains. The National Institute of Standards and Technology notes that manufacturing facilities produce vast and expanding streams of data every day. For instance, a major concept in advanced manufacturing is the “digital twin,” which is a virtual, data-driven model of a factory, machine, or production system that continuously updates based on real-world operational data. In the wrong hands, this data is industrial targeting information.

The track record for granting China access to sensitive sectors of the American economy is decidedly bad. China has repeatedly used commercial relationships, various types of business partnerships, predatory hiring, supply-chain access, and embedded corporate relationships to acquire technology and industrial know-how.

That pattern is well documented. In 2018, the U.S. Department of Justice secured a conviction against Sinovel Wind Group for stealing trade secrets from American Superconductor Corporation, including critical wind turbine source code that helped accelerate China’s wind industry while damaging the American firm. A year later, the DOJ alleged that Huawei used commercial partnerships and employee recruitment to obtain sensitive U.S. robotics and telecommunications technology. Similar allegations later emerged involving Micron Technology, GE Aerospace, and GE Power, where U.S. officials accused Chinese-linked actors of targeting advanced semiconductor and aerospace technologies through insider access, recruitment, and theft of trade secrets.

U.S. policymakers recognize these risks and have taken steps to mitigate them. The first Trump administration expanded national-security reviews of Chinese acquisitions amid concerns that Beijing was using investment to gain access to sensitive technologies and critical infrastructure. In 2018, Congress passed the Foreign Investment Risk Review Modernization Act (FIRRMA) because it understood that foreign ownership, joint ventures, and access to sensitive data can all create national-security risks. (Despite these more rigorous reviews, outcomes remain mixed, with China still acquiring U.S. industrial base companies.)

Chinese capital could also end up crowding out American investment. The Trump administration and Congress have spent significant time and political capital trying to channel U.S. government and private funding into manufacturing and industrial capacity. The objective is understandable, but it is not easy. Traditionally, because manufacturing generates lower margins than sectors such as software, it has been harder to attract private investment. Recent efforts to address this difficulty have ranged from the Department of War’s Office of Strategic Capital initiative to mobilize some $200 billion in financing to programs across the Departments of Commerce and Energy. These initiatives also aim to attract private capital, such as JPMorgan’s $1.5 trillion “Security Resilience” initiative to support “key sectors from critical minerals to frontier technologies.”

China, however, has demonstrated a willingness to tolerate lower returns in pursuit of strategic objectives. According to the Rhodium Group, Beijing has increasingly inserted “non-market considerations” into investment decisions, prioritizing strategic goals at the expense of profitability. That creates an uneven playing field for American capital, which still largely operates under market expectations for returns and efficiency. Competing against a state-backed system willing to absorb losses could make it more difficult to sustain private investment in U.S. manufacturing.

China knows advanced manufacturing will shape the next era of competition, and it has spent over a decade determined to dominate it. Today, China is the world’s largest market for industrial robots. Its most recent five year plan prioritizes advanced manufacturing as a way to increase productivity, calling for “new quality productive forces”—that is, productivity driven by robots, AI, and other smart manufacturing. Furthermore, its 2025 AI + Manufacturing initiative aims to integrate intelligent agents into production lines and supply chains as part of an overall integration of AI into 90% of the Chinese economy by 2030. China sees advanced manufacturing as a strategic asset, not just a commercial sector.

This does not mean America should wall itself off from foreign investment. The United States should deepen manufacturing ties with allies. South Korea recently pledged $150 billion to help modernize American shipbuilding. Japanese, Korean, European, and other allied firms can help rebuild critical supply chains. But China is different. It is the United States’s chief strategic competitor, a state-directed industrial rival, and a government that has repeatedly used commercial channels to advance its national aims.

Some might argue that allowing Chinese firms to build and operate factories in the United States could generate valuable spillovers for American workers and companies. For decades, China benefited from foreign firms that brought production expertise and other know-how into its economy. Couldn’t the United States do the same with leading Chinese manufacturers?

The purported benefits, however, would not likely outweigh the costs. Many Chinese companies would operate with lower overhead due to government subsidies, allowing them to sell their products at artificially low prices. Tariffs on Chinese imports allow us to level the playing field, so long as Chinese firms are kept out. The ultimate issue is that any market that includes China is neither free nor fair, and providing additional vectors into sensitive and strategic parts of the U.S. economy would be shortsighted.

Requiring Chinese companies in the United States to form joint ventures (JVs) with American companies to mitigate vulnerabilities and acquire technology could be counterproductive for similar reasons. Those who believe that the United States should or even could duplicate Beijing’s forced-JV strategy forget that the U.S. government is not the Chinese government. Unlike the Chinese government, American laws and courts enable businesses operating within U.S. jurisdictions to protect their proprietary knowledge from unauthorized transfers. Chinese companies, like all foreign companies, would be able to use such protections. As a result, American companies could simply be exposing themselves to deeper Chinese infiltration instead of gaining a true technological edge. Moreover, further tethering U.S. business operations to Chinese entities could exacerbate the industrial, technological, and economic dependencies that the Trump administration has been trying to unravel.

Others might assert that excluding China is merely a shield for uncompetitive American manufacturers and that they can only get stronger if forced to compete with Chinese firms. But American manufactures are not shielded from all competition. They already compete fiercely with companies from Japan, South Korea, and Germany, which have formidable manufacturing cultures and capabilities. In addition, as noted, competition with China is not on a level playing field.

The United States can’t afford to lose its edge at the increasingly important cross section of data, technology, and advanced manufacturing, especially since it is foundational to so many other competitive arenas, from defense to energy to AI. Rebuilding American manufacturing is urgent. But it should not involve inviting America’s principal rival into the systems on which future military and economic power will depend.