Why pro-free-enterprise people support Donald Trump is difficult to fathom. Of all the nonsensical, neo-socialist ideas he has already tried to foist on the American public, this is the most asinine and counter-productive; an attempt to direct Defense contractors in running their businesses, limiting executive pay and forcing investment in new / modernized production capacity.
In my personal opinion, a more productive course would be to investigate and clean up corruption in defense contract bidding and awards. That might save billions of dollars a year in grift and payoffs which are factored into the price of Defense Dept. purchases.
Source: Nerd-19958
3 Comments
Trump’s EO (Jan 7, 2026) is more than a pay cap; it is a fundamental restructuring of the defense margin profile. Capping CEO pay at $5M when the average was $18M+ is one thing, but the buyback and dividend bans for underperforming contractors are the real teeth. We are moving from cost-plus comfort to a performance-based survival of the fittest. Defense primes need to modernize or face a liquidity crunch.
Sounds like he used the discombobulator on them.
Trump is just doing whatever someone sells him to. He has no idea why these companies do buybacks.