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Author Topic: $200 Pentagon hammers...UL or fact?
superfett
The Red and the Green Stamps


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Okay, someone mentioned a government-purchased $750 toilet seat the other day, and it reminded me that for YEARS, people have just sort of accepted the "fact" that the government purchases everyday items at excessively amplified prices. It's showed up in stand-up routines, talk show monologues and everyday conversation. Where does this idea come from, and is there any truth to it?

Super "inflated" Fett


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Schnervel
The Red and the Green Stamps


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There are several reasons I can think of:

One, government accounting procedures are very complex - don't ask - they just are. Because of the size and scope of the government and especially the DoD, there is financial waste in areas of the budget. Therefore, in order to account for waste, there is a need to average unaccounted funds with accounted for funds. So even if the govt spent only $25 on a hammer and there was another $350 unnaccounted for, people could say that the govt spent $375 for a hammer.

Two, because there are covert projects in the DoD. There is a need to spread out costs for those projects on other projects so that the general public, and especially our enemies, do not know what we are doing or even how much we are spending to do whatever it is.

The govt does not actually spend that much money on simple items.

Schnervel


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Ursa Major
The Red and the Green Stamps


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Ah, but the Pentagon never buys simple, off-the-shelf items.

First, a research committee must spend years deciding on the specs of the hammers our troops are going to carry into combat. Why settle for a standard 16oz head when years of research has discovered that the optimum weight is 15.8oz?. Once the specs are completed, hundreds of hammer makers across the nation will present the Pentagon with their bids. But you can't just go with the lowest one. Price is the least of it. The winning bid must come from a contractor who has all the needed security clearances and preferably operates in a district or state represented by someone on a congressional Armed Services committee. Then the taxpayers need to pony up a huge advance so the contractor can afford to retool his whole operation for 15.8oz hammerheads.

Add all the manpower that goes into designing a hammer and selecting a maker to the cost of producing a custom made hammer and you probably come close to a cost of $200 per unit.


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Hutch
The Red and the Green Stamps


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There is a difference between a government part which is expensive because of requirements, and government part which is expensive because of fraud.

As I recall, the story that began the household quotes of expensive government parts was an $800 toilet seat for the Navy's P-3 Antisubmarine Warfare (ASW) aircraft. This part was expensive because of both requirements and fraud.

Of course, on this board recalling isn't enough, so I will see if I can dig up some evidence.

As a former sailor and current DOD contractor, I have seen many expensive military parts. For example, just the monitor for a computer workstation I used aboard an aircraft carrier was $100,000. This was because it was "ruggedized" for shipboard use. It used all proprietary hardware specifically designed for the navy. Since this hardware wasn't sold on the open market, it was very expensive.

This monitor was a green, monochrome, display. You could have pushed it off the Northern rim of the Grand Canyon and I doubt it would break. Although, it wasn't good for much when it did work.

Hutch

Postnote: Well, shoot, I sure found lots of references to expensive toilet seats and hammers, but not one reliable report. Sound familiar?...

[This message has been edited by Hutch (edited 10-16-2000).]


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pinqy
Ding Dong! Merrily on High Definition TV


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Other explanations: When you're dealing with a supply order of of tens or hundreds of thousands of dollars, you really don't itemize. When this topic was covered before, someone posted a good link and explained that in many cases, for accounting purposes, the total funds were simply divided among the items. If the items are in the same price range it doesn't make much difference, but when there's a big difference in price, it looks odd. e.g. $100 off of a tank doesn't look strange, but when that money is put onto the price of a hammer, it is.

pinqy


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noreen
We Three Blings


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quote:
Originally posted by superfett:
Okay, someone mentioned a government-purchased $750 toilet seat the other day, and it reminded me that for YEARS, people have just sort of accepted the "fact" that the government purchases everyday items at excessively amplified prices. It's showed up in stand-up routines, talk show monologues and everyday conversation. Where does this idea come from, and is there any truth to it?

Super "inflated" Fett


Most of these reports are 'sort of' true, thereby creating ULs. For instance, the '$7000 coffee pot' (feel free to correct, I'm doing this from memory) was not a coffee pot, it was an on-board canteen (what they use to serve that airline 'food' on a commercial flight). Yes, it was over priced, but by 50%, not 10,000%.

And to go off topic, those enlisted people on food stamps usually have family sizes of 6 or more. There might be a problem with pay/benefits, but it is not as simple as stated.


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Gale
Let There Be PCs on Earth


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I'm a buyer for a DoD-funded research department connected to a state university. I have *always* wondered how they got away with that $500 hammer if it were true. It was my understanding that this was a private company with a federal contract to produce planes or some such. Private companies have fewer internal regulations than state agencies. I get audited about 3 times a year from various federal and state agencies. While basic deliverable lists of items to the government don't mention every screw or resistor inside the finished product, I guaran-damn-tee you that every last screw and resistor can be accounted for cost-wise at the research or manufacturing facility. Every purchase over a certain dollar amount has to be cleared with a batch of initialed agencies that would flat boggle your mind.

I don't know where the idea came from that the government spends 10 times what the average consumer does for stuff. Actually, the costs are lower as I've discovered when I've gone computer part shopping for myself (sigh). The problem might be that the toilet seat in question has to withstand certain pressures (no, not fat sailors, but ocean depth)or fit in a certain space or something like that.

I did a quick check and our state supply schedule for a toilet seat is $5.88. GSA (government services administration) is ususally the same or lower as the state version, so I'll stick with my original assumption that either this was a special toilet seat for unusual conditions, the story is wrong, or some contractor lost his ass in a kick-back scam when this was uncovered.
Plus what Schnerval said about the covert shit. At the nuts and bolts level, not much is spent. If it was a special red hot-line connected toilet seat for the prez to call the premier as he's taking a crap in air force one, then that toilet seat is going to include the cost of r&d. And am I ever glad I don't work in THAT r&d facility!


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Silas Sparkhammer
I Saw V-Chips Come Sailing In


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My pen-pal in the R.A.F., whose military speciality is transporting explosive ordnance, suggests that the expensive tools are beryllium tools that don't -- um --
spark when you hammer with them.

(That's where my name came from!)

Silas Sparkhammer

------------------
"...With trembling heart and failing nerve, cried, 'I approve, without reserve!'"


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jareth
The Red and the Green Stamps


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quote:
Originally posted by Schnervel:
Two, because there are covert projects in the DoD. There is a need to spread out costs for those projects on other projects so that the general public, and especially our enemies, do not know what we are doing or even how much we are spending to do whatever it is.

Why, Schnervel, you almost manage to make it sound legitimate... though that method might also be quite effective in evading pesky congressional oversight also. :P

------------------
"I do not feel obliged to believe that the same God who endowed us with sense, reason, and intellect had intended for us to forego their use."
--Galileo


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Bobert
The Red and the Green Stamps


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I am a petty officer in the USCG and I think my story best shows the waste of our procurement system in the DoT (which is basically the same as the DoD). I tired to order a 15 dollar pocket-sized voltmeter for myself thru a commercial company. The storekeeper who's job it was to actually order the item said that he could not buy it comeercially because a pocket meter was available thru the government supply system. He showed my the written description and I said that it sounded ok. It costed about 45 dollars but according to the records it was available. Well, we waited for about 5 weeks before this meter arrived. It was the size of a very large paperback book. There was no way I could get this thing into my pocket, let alone carry it around everyday there. I showed the SK (storekeeper) my "pocket meter" and he said that they (thge people at the other end)had to subsitute the original meter for this one because the system did ot supply them any more. I was stuck with this Edsel of voltmeters. I went and bought my own.
Bobert

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manchild
The Red and the Green Stamps


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Wasen't this legand in Independence Day when the president wanted to know how Area 51 was built without his knowleage the sterotypicle jewish guys says 'you think they spent $2000 on a hammer , $$$$ on a toilet seat'.
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Bob McClenon
The Red and the Green Stamps


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quote:
Originally posted by superfett:
Okay, someone mentioned a government-purchased $750 toilet seat the other day, and it reminded me that for YEARS, people have just sort of accepted the "fact" that the government purchases everyday items at excessively amplified prices. It's showed up in stand-up routines, talk show monologues and everyday conversation. Where does this idea come from, and is there any truth to it?

Super "inflated" Fett


There have been several explanations. Here is another reason that applies in some cases.
It has to do with a simple but misleading method of allocating overhead costs. The toilet seat was presumably one item of cost of an airplane costing something like $10 million. The cost of the airplane was broken down into line items ranging from perhaps $25 for the toilet seat (made to specs for the airplane toilet) to perhaps $1 million for the airframe, with other line items including the computers, the jet engines (purchased from a jet engine producer), and each of the weapon systems. There was also a portion of the cost of the airplane which is not directly the result of any specific line item, such as management of the contract. There are two ways that that cost can be allocated, either by adding a percentage to the cost of each line item, or by adding a flat amount to the cost of each line item. If the method of adding a flat amount to the cost of each line item is used, and that flat amount is $725, then the cost of the toilet seat will be marked up from $25 to $750, and the cost of the airframe will be marked up from $1,000,000 to $1,000,725. The method of adding a flat amount to each line item is (or was) permitted on government contracts. It overstates the cost of small line items and understates the cost of large line items. This doesn't reflect actual waste or excess cost; it is just a simple but misleading way of breaking down the total cost. The real issue should not be the cost of the toilet seat, but the cost of the airplane.

That particular method of breaking down costs should be avoided, not because it costs the government money, but because it causes confusion and misunderstanding. Some other complaints about government costs represent similar methods. This particular method of breaking down costs was probably actually an attempt to track costs more closely in order to control them more effectively, but it did only caused misunderstanding of costs.

- - Bob McClenon


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jareth
The Red and the Green Stamps


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Why not do something sensible, such as add another line item that says:

Toilet seat..............$ 25
Airframe.................$1,000,000
Contract Management......$ 1,500

I guess I'm not sure why a nonphysical cost has to be connected with the physical components?

------------------
"I do not feel obliged to believe that the same God who endowed us with sense, reason, and intellect had intended for us to forego their use."
--Galileo


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robertbell
The Red and the Green Stamps


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I have bid on or written patent applications for Army Research Lab, Naval Underseas Weapons, and other branches of the military as well as non-military government agencies (DOC, NTIA, NOAA).

I charge "civilian" customers $10,000 or more for a patent application.

I can't win these government bids even if I go as low as $2000. Uncle Sam gets a great deal, at least on Patent Applications. They do prepare the materials better than my civilian customers, though, making the costs lower.

So the myth that Uncle Sam always gets a lousy deal is not always true.

Most MIL-SPEC equipment is incredibly overbuilt and ruggedized and is made in limited quantities. Quantity affects price as the cost of tooling for a 5,000 part production run is the same as a 500,000 part production run.

Misguided efforts to "save" costs by reducing the number of planes built, for example, actually increase the cost per plane. R&D and tooling have to be divided over the number of units sold.

The more B-2s we cancelled, the more expensive the remaining planes became (not that I am advocating the B-2, I am using it as an example). Anti-Pentagon folks then cite the "spiralling" cost of the airplane as more evidence of government waste. The plane may or may not be a waste, but that argument as proof of waste is flawed. When you reduce the number of planes, cost per plane goes up accordingly. Boeing ain't running a charity.

Also, there is a lot of exaggeration and mis-representation in these "$200" toilet seat claims - and for very political reasons. Most of the claimants are trying to use these arguments to get elected or attack their opponents, Republican or Democrat.

I recall one instance, the "$500 step ladder" or something like that. It turned out to be a custom-made welded aluminum ladder which was used by the Air Force to allow pilots to get in and out of jet fighters (F-14s or something like that). Custom fit to the side of the plane. Hardly something you could buy at Home Depot.

I used to do FMEA (Failure Mode Effects Analysis) for commercial electrical equipment using MIL-SPEC 217D. For many military electrical components, the "burn-in" times are so long that the service life of the component is severely shortened. Also "burn-in" is an incredibly expensive process. You basically activate the device for X number of hours (per spec, and usually in a high temperature oven) to insure that any electrical component which would have died due to "infant mortality", dies on the test stand, and not in service. It is a very labor-intensive task and results in a high scrappage of product.

Most electrical components are like light bulbs - they either fail right away or fail at the end of a long service life. Burn-in weeds out the early failure units, but it is a costly process.

Manufacturers of commercial products find it cheaper to use shorter burn-in times and provide warrenty service to catch the rest. Which is why extended warrenties on electrical equipment can be a waste of money. If it doesn't fail in the first few hundred hours of use, it probably won't fail until the end of its design life.

For military products, warrently claims won't cut it. You want that missle to fire NOW and reliably.

--Bob.


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Hutch
The Red and the Green Stamps


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quote:
For military products, warrently claims won't cut it. You want that missle to fire NOW and reliably.

Hey, that reminds me; I recently heard a story about the last volley of Tomahawk missiles the US lobbed over Afghanastan. Several people have told me many of the missiles were "duds", as in they didn't launch. Supposedly, Lockheed Martin had to reimburse the US Navy multiple millions for this SNAFU.

True story?

Hutch


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DrFraud
We Three Blings


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quote:
Originally posted by superfett:
Okay, someone mentioned a government-purchased $750 toilet seat the other day, and it reminded me that for YEARS, people have just sort of accepted the "fact" that the government purchases everyday items at excessively amplified prices. It's showed up in stand-up routines, talk show monologues and everyday conversation. Where does this idea come from, and is there any truth to it?

Super "inflated" Fett


My stepfather and I were talking about that at dinner about a week ago. He said that one of his business profs at ASU West (a branch of Arizona State U) told him that in the case of the toilet seats, what happened was that they were building a battleship or something and crew quarters were installed last. When they finally got around to the bathrooms, they discovered that the toilet stalls were the wrong size. Since they really didn't wanna rebuild the ship, they paid somebody to make seats that were three inches narrower than the run-of-the-mill toity seat.


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