Public Policy: McNamara's 97<£

The average net profit on defense jobs has dropped to less than 3¢ on every contract dollar. Even that ardent cutter of costs, Defense Secretary Robert S. McNamara, does not think that the profits of defense contractors can be cut further. In fact, he now hopes to save billions on his defense budget by offering higher profits to defense companies that can hold their costs down. "We mustn't expect the savings to come from the 3¢ profit the average defense contract now provides," says McNamara. "We must seek to cut the 97¢...

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