In the future, the American defense establishment’s engagement with the private sector will vary with the mission. The arms-length procurement requirements of a dedicated industrial base for big-ticket weapon systems are different from the requirements of frenetically paced software development through co-investment. In turn, sovereign “joint venturing” abroad through private enterprise can help solve thorny security issues or facilitate diplomatic openings. However, such relationships nevertheless morph because private and public-sector interests differ, especially when it comes to allocating risks and rewards.
Part One of this series explored the idea of governments seeking to ride the “coattails” of private investment to tap that sector for customized commercial solutions to security problems. Part Two examines ways in which these public-private partnerships can go wrong. Historically, governments have grabbed private coattails for too long, failed to recognize they were there for the grabbing, or left them twisting in the wind. This article draws lessons from disparate case studies ranging from Pakistani fertilizer sales, to bunkering facilities in Aden, to insurance payments to the North Korea government. Examining how failure triumphed in the face of opportunity in each case helps those contemplating a closer sovereign-private security relationship to better understand when and how to embrace these ties.READ MORE