Police Militarization: How It's Happening, and Who Could Be Profiting

Events in Ferguson, Missouri highlight how militarized American law enforcement has become. How is it happening, and is anyone profiting from it?

Aug 19, 2014 at 8:38AM

Swat

SWAT team -- Oregon Department of Transportation, Wikimedia.

The recent civil unrest in Ferguson, Missouri has pushed police militarization into the national conversation. While Americans remain split on the issue, the line between law enforcement and unofficial martial law continues to blur. Earlier this year, the American Civil Liberties Union shed light on research that shows the frequency of SWAT raids has risen 15-fold since the 1980s. An estimated 80% of small towns now have SWAT teams, compared with 20% three decades ago.

This issue raises two obvious questions:

  1. How do police departments obtain military-grade equipment?
  2. Who profits as a result?

Hand-me-down militarization
Hand-me-downs from the U.S. government are the primary driver of police militarization. As the ACLU explains, three federal programs are responsible for the brunt of it: the Department of Defense's 1033-program, Department of Homeland Security grants, and Justice Assistance grants from the Department of Justice.

The DoD's initiative was created in the 1990s to give excess military equipment to state and local police, either for free or close to it. Its original purpose was to be used to combat the narcotics trade and domestic terrorism, but smaller agencies, far removed from either issue, have stocked up in recent years.

More than 2,000 police departments requested equipment through the 1033-program last year, up from 574 requests in 2009, USA Today estimates. Official statistics report the DoD has moved $4.3 billion in military goods during the program's life -- up from $1 million in 1990 to more than $400 million last year.

DHS and JAG grants, meanwhile, can be allocated to items like armored transports, weapons, and officer wages. The former sent $35 billion to police departments between 2002 and 2011, The Economist says.

Who could profit from police militarization?
Police militarization appears to be a boon to some defense contractors. While the government doesn't release transactional data, it's possible to connect the dots enough to determine the companies likely involved.

According to an application that asks law enforcement officials to fill out their equipment preferences, several types of aircraft are available. The helicopters listed are Textron's Bell OH-58, several Huey variants, and the Hughes OH-6. The fixed-wing models mentioned are the Beechcraft C-12, Cessna 172, and Cessna 182, all from Textron. Peers Lockheed Martin, Boeing, and Raytheon are not specifically listed, but each has taken in more than $5 billion from the DoD this year, AeroWeb reports.

The 1033-program also offers police departments a ground vehicle selection that includes AM General's Humvee and the Mine-Resistant Ambush Protected vehicle. The famed MRAP, as it's called, can cost as much as $600,000, and has been manufactured by Oshkosh, Navistar, General Dynamics, and BAE Systems in the past. A third vehicle, used by SWAT teams in particular, is the Lenco Industries BearCat, which can cost up to $300,000 apiece.

The DoD also discloses the M-16A2, M-14, and M-1911 pistol are available to police, though the breadth of gun makers involved with U.S. military operations makes it difficult to narrow this area down any further. It is clear, however, that BlackHawk's ThunderSledge is one battering-ram model used by militarized police, along with KDH Defense Systems' body armor, The Daily Beast reports.
 
What's next?
A third of all 1033-program equipment is new, according to the Defense Logistics Agency. So while an exact profit breakdown is not available, it's clear some contractors are coming out ahead from police militarization. As the ACLU remarks, "it appears [the federal government] can simply purchase property from an equipment or weapons manufacturer and transfer it to a local law enforcement." 
 
That alone should cause taxpayers to question the entire program. The situation in Ferguson only adds more uncertainty to the mix. Led by Congressman Hank Johnson and Senator Rand Paul, sentiment in Washington is swiftly moving in favor of demilitarization of police. Johnson will reportedly present the "Stop Militarizing Law Enforcement Act" to Congress in a few weeks.
 
Even if the stream of military-grade gear continues in the future, there are a few ways to control the flow. A stricter application process, for one, could limit equipment to the neediest, largest areas. There's no reason a police station in Justice, Illinois, a town of less than 13,000 people, needs a Mine-Resistant Ambush Protected vehicle, but it has one. It's also reasonable to instill a cap on each department -- one in Arizona has more than a dozen helicopters and armored transports.

If public sentiment continues to sour, defense contractors could also simply request that their equipment not be given to law enforcement. There are better ways for a company to promote its product than to have it plastered all over one of the most controversial social issues of the still-young 21st century.

How to get even more income during retirement
Social Security plays a key role in your financial security, but it's not the only way to boost your retirement income. In our brand-new free report, our retirement experts give their insight on a simple strategy to take advantage of a little-known IRS rule that can help ensure a more comfortable retirement for you and your family. Click here to get your copy today.

Jake Mann has no position in any stocks mentioned. The Motley Fool owns shares of General Dynamics, Lockheed Martin, Raytheon Company, and Textron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers