Is defense where tech and government mix?

For a model, look to Finland. For nearly six decades, the Finnish government has offered the National Defense Course, a quarterly boot camp for leaders from the armed forces, government, industry and civil society. “The beauty is that every sector of society is present,” explains retired Lt. Gen. Arto Räty, a former director of the National Defense Course. “Yes, the course is run by the armed forces, but it’s not a military course. It’s a national security course.”

Without the course, many of the participants would never cross paths. The course has allowed Finland to bridge the national-security gap between civil society and the armed forces that exists in most other developed countries.

Pointer from Arnold Kling, who said:

In the case of government and tech, I think that the highest potential for mixing is in applications related to the military and to security.

That had been the received wisdom in the post-WWII days. Yet when defense procurement has no features of a commercial marketplace, you can mix with all the civilians you want and it won’t really make a difference. It would be a doomed effort in the US. For years we’ve seen defense try to bring in disruptive new firms (e.g., DIUx) and seek commercial guidance (e.g., Defense Innovation Board), only for other parts of the bureaucracy to fight back with process and regulation. Plus, we’ve seen strong push-back from tech employees like at Google and Microsoft to the idea of supporting defense.

The most likely course of mixing tech and government is probably a roundabout way. For example, government funds basic research at places like DARPA, NIH, and so forth, which then stimulates commercial applications, which many years later will be demanded by defense planners from their incumbent contractors, who will then make a crash project to buy relevant firms or build the capabilities in house. I think machine learning/autonomy is a perfect example of this.

Defense firms simply do not succeed in commercial markets, besides perhaps the new entrant SpaceX and the old firm Boeing. I think the reason why defense firms fail to diversify is exactly the reason tech firms won’t mix well with government — the business of government is the business of erecting high barriers to entry to maintain a closed culture.

(Boeing, who has traditionally kept a bright line between defense and commercial business, has more recently been letting unproductive defense practices seep into the commercial side, or so I was told by a person who knows something about it. In my experience at the Pentagon, data from the commercial side for the KC-46A was pretty much off limits, and came in at price if anything.)