I contracted with a branch of Lockheed. While I couldn't/shouldn't talk about any of the technology involved, I can attest to the culture I witnessed. I always assumed it was horrible because of the government affiliation. But I think that mostly affected their focus, in that most of the branch was dedicated to wasting money so they could ask for more money. However, the culture itself was stagnate by design. Most of the employees actively fought anything that would require them to learn or change. EVERYONE was counting the clock to retirement. Anyone who wasn't in the same boat left as soon as they got the big picture. It made me extremely pessimistic about taxes.
I worked at a similar large aerospace contractor just in the past couple years. I can attest 100% to what you've said.
They estimated they would need to replace 40% of their workforce within the next 10 years just to stay afloat. Recently at my old site they hired 1000 people. Within a year, 800 had quit. These are software engineers, mechanical engineers, etc. I watched people just play on their phones, keep their feet up, basically do nothing at all.
One guy showed up to work on the first day and was told by his manager : "I don't have an office, so you'll have to sit here for now". The manager then flew back to another state, and the guy did not see him ever again. For a year this guy played Candy Crush on an iPad and did nothing because no one else knew who he was or who he worked for. Eventually he got a new manager and his job was then unboxing computers...for a year...When I started working with him, he would go into a large empty lab and just lay down behind some boxes and nap for 2hrs a day.
He was hired to be some sort of cost accountant.
This was not uncommon, it was rampant. I still cannot believe workplaces like that exist.
Here's a story that I received secondhand, so I cannot verify its authenticity.
A man exited the Navy, and got a new job with a private Navy-supporting contractor. He reports for work, and his manager tells him what he'll be working on. So he gets right to it, sets up a cot, and hammers away for a few days, until the problem is completely fixed. As one does when trained by the Navy.
He then tells his manager that he's finished. Manager just goes berserk, and tells him to not show his face at the worksite again; just fill out the time card remotely, until instructed otherwise. So he toddles off, to go SCUBA diving every day, for about six months, until the work hours allocated to the project were finally used up. After that, he played the game correctly.
This story aligns perfectly with my anecdotal experience, though it is not uniform across all contractor companies, or even across different work groups within the same company. Even the estimates for the work required to pad the estimates are padded.
I understand why people laugh at the stories I tell from there, I laugh at it now that my time is over. But when you're in it, it's just disheartening. No one wants to tell their grandkids "I was in a lot of meetings, and I was the best at looking busy".
This is kind of why SpaceX is so efficient. That kind of dead wood doesn't really exist there, plus their actual aerospace/mechanical engineers are cream of the crop from the best universities.
I think it's that as well as the fact that they are a private company and don't do as much "contracting" in a sense. They aren't handed a gigantic set of legaleze requirements from the customer (the government).
Unless they do- I don't work there but it seems like they build their product, make sure it can lift X mass to orbit well, and if anyone needs shit lifted into orbit they just goto SpaceX. Far less bloat.
When one strongly encourages government doing business with contractors over hiring govt FTEs, it should lead to (1) all technical duties being offloaded to contractors, (2) loss of govt FTEs with technical expertise, (3) inability to hire replacement govt FTEs because of stigma and budget priorities, (4) govt FTEs taking on contract administration duties, effectively administering the production and maintenance of things they know nothing of and have no interest/investment in, who are working with (5) businesses (private corps) whose legal duty is to make profit, employing management, sales, and technical people (contractors' employees) whose primary priorities are their own careers.
(6) is a bonus. If you get to hire a technical govt FTE somehow, s/he will start identifying the inefficiencies and irregularities of the contractors' practices. That means his/her manager and colleagues will feel threatened or fear retribution (for contract mismanagement), pushing the new FTE out in one way (demotivation) or another (bureaucratic and/or political games).
No one is evil or lazy in this dynamic. It's more simply the unintended consequences of public policy choices, which have slowly became the basic tenets of the culture of societies implementing those choices and quickly creating very sturdy social structures and roles.
At the last place I worked, Fortune 50 systems integrator, you can find yourself in a program where risk is increasing and schedule is galloping to the right, yet people are getting shuffled to other projects in the classic matrix organization move to "save the budget". Maybe this is because higher management is gambling that another component of the program is going to be late and therefore there's no pressure anyhow, but this doesn't get communicated downward and there's jerky and inconsistent progress for reasons that don't otherwise make sense. After a time, people get tired of the idea that they are pawns in a financial game and whether they do good, mediocre or bad work isn't important or perhaps even relevant to company goals.
You hit the nail on the head with regards to the culture in this industry. This is my experience as well.
For an engineering oriented industry you have an alarming number of engineers with an aversion to learning anything new. As much as incoming / lower level software engineers complain about tools, management / senior engineers just go ahead and choose the shittiest IBM or Oracle product for the job because some vocal graybeard minority in a meeting will complain it's not Clearcase.
My conclusion is this: it's easy to say "well, because the government is picking winners and losers." And it's true. But let's assume government will always be here (anarcho-capitalists are generally imbeciles) and it will generally rely on big industry.
So it's not necessarily a market failure. The businesses have a steady stream of income they can rely on because, well, the government probably isn't going to change any time soon. Also, these businesses are experts at forming relationships with the state. It's probably what they do best.
So if government will always be there, and will always spend into the market, what's the solution here?
Limit business size. A progressive tax on the size of any company once it reaches some number like 1000 people (1% at 1000 up to 90% at 1M+). Putting downward pressure on company size does a lot of things: it eliminates a lot of bureaucracy, it creates more businesses (and competition), and it limits the power any one business has (political or economic).
If the government decided "wow Boeing's planes suck nowadays" they can shift their contract and not worry about ~150K people losing their jobs which is a political dumpster fire.
More competition, more choice, more ability to change. I'm sure there would be downsides, but I have trouble thinking of downsides that outweigh the upsides.
Of course, I'm not a dictator, and passing any kind of tax law like this after the fact is going to be a no-go.
In rockets, we have SpaceX. Commercial aviation has a higher regulatory barrier for entry, both in technical knowledge and facilities. You don't just spin up a gigantic, cavernous assembly line with thousands of technicians and billions of dollars in tooling overnight. I wouldn't be surprised if in 10-20 years though, someone backed by Google tried building a self-piloted, subsonic blended-wing-body 200-300 pax jetliner. Google right now has Kitty Hawk, but I think their ambitions are far greater.
I've worked on both excellent teams and dysfunctional teams doing contract work for the government. The distinction to be made is size and longevity of the programs involved. For various reasons, large long lasting programs have accumulated rules that prevent anyone from doing anything productive.
I've seen teams of people working on a flash app to produce a handful of reports for one general, who would look at it occasionally, or not at all. There are guys who work there entire careers to maintain this one small, outdated application.
