Friday, March 04, 2011

The US Military-Industrial Complex

It is a long time since the structure of American Capitalism was labelled the "US Military-Industrial Complex." It was used by Dwight Eisenhower in his farewell speech as US President in 1961 saying;

we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex

General consensus is that "we" (meaning all of us - not just the US) failed.

The concept was further advanced by J. K. Galbraith in his The New Industrial State. Galbraith noted that the US was as much a planned economy as the USSR, just the planning was conducted by large corporations.

Yet another Huawei story shows this in operation. Here we have a US embassy official doing his bit to discredit a foreign competing firm.

What is the charge? That the supplier - Huawei - was less than brilliant in following through on a contract.

But let's roll the tape on Senator Conroy's quizzing Telstra at Senate estimates in 2006. He said, in part,

Perhaps I could read to you from a document, a Telstra document marked ‘Commercial-in-confidence’ entitled ‘Alcatel issues’. It is three-pager with an attachment. I will table it. It states:

Summary of Route Causes
In the last 10 years there have been a number of problems with Alcatel projects at Telstra ...
The systematic reasons behind these problems are listed below—

• Knowingly overselling capabilities and timeframes
• Short cuts taken to then deliver sub standard solutions
• Finding clauses in contracts and specifications to avoid obligations rather than delivering working solutions and / or what was sold in the first place.
• Alcatel overcharging Telstra whenever it had the opportunity
• Alcatel Australia inventing specials which then don’t fit in with worldwide Alcatel strategy
increasing the cost of the project and creating a risk Alcatel Australia would exit the project if Telstra did not continue to pay
• Poor software quality and testing—in particular poor exception handling consideration at the
design stage; poor quality processes ie peer review, configuration management and testing
• Poor system integration capability and problems managing projects requiring interfacing to
different components / vendors.

In some respects, issues such as Alcatel’s overselling of their capability in the late 90s were prevalent throughout the whole industry but Alcatel was on the leading edge of this trend.

(The actual document was tabled).

The claims about Huawei being a security threat all seem to be similarly trumped up charges motivated by Western vendors trying to exclude Huawei. To my list in itNews of transgressions by other nations, let's add Ericsson. Why should we trust a vendor from a country that many believe has trumped up charges against an Australian citizen (Julian Assange) to support the US?

Novae Meridianae Demetae Dexter delenda est

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