Tactics to Strengthen the U.S. Defense Industrial Base with Private Capital

Abstract

"Private capital is a major source of research and development and capital investment dollars in the U.S. defense industrial base (DIB). As a strained budget environment limits the Department of Defense’s (DoD) ability to capitalize defense supply chains, private capital is one resource available to help fill the gap. This paper provides a structured assessment of both well-established and emerging tactics the DoD uses to engage private capital—ranging from multi-year procurement to demand aggregation, credit enhancements, and catalytic co-investment. Drawing on interviews with more than 30 stakeholders across government and industry and incorporating detailed case studies, the paper illustrates how these tactics can be deployed individually or in combination to mobilize private capital and strengthen the DIB."