Forget Holiday Sales -- Struggling Retailers May Turn to Defense Contracts to Keep From Going Under

By Nick Turse, Tomdispatch.com. Posted December 16, 2008.

In 2001, National Presto decided to get back into the arms game. Months before 9/11, the company's chairman Melvin Cohen expressed fears that a future war might mean ruin for the company's kitchen appliance business. As a result, Presto purchased munitions manufacturer Amtec. In the years since, according to Securities and Exchange Commission filings, Presto has also "made other complementary acquisitions in the defense industry." These have included Amron, a manufacturer of medium caliber ammunition (20-40mm) cartridge cases and Spectra Technologies, which is "engaged in the manufacture, distribution, and delivery of munitions and ordnance-related products for the DOD and DOD prime contractors." Such types of ammunition are extremely versatile and are fired from ground vehicles, naval ships, and various types of aircraft -- both helicopters and fixed-wing models.

Additionally, in the months after 9/11, National Presto entered the diapers trade, setting up that business in its old munitions plant. In 2004, with Melvin Cohen's daughter MaryJo now at the helm, the company further expanded into the business of adult-incontinence products. "I spent a couple of days wearing them," the younger Cohen told the Milwaukee Journal Sentinel at the time. "They're very comfortable."

In 2005, Presto's Amtec was awarded a five-year deal by the Pentagon for its 40mm family of ammunition rounds. By the end of last year, it had already received $454 million and was expecting the sum to top out, at contract's end, above $550 million.

Just as 105mm shells of the sort produced by Presto were a nightmare for the people of Vietnam, so too has 40mm ammunition spelled doom for civilians in Iraq and Afghanistan. Earlier this year, the BBC reported on a typical joint U.S./U.K. attack on a home in Iraq in which insurgents had taken shelter. After exchanging ground fire, coalition forces called in an airstrike. According to the BBC, "The aircraft fired 40mm cannon rounds at the two houses, finally dropping a bomb on one of them. It collapsed. The other house was set on fire. The two insurgents in the house were buried but so were a number of women and children." Similarly, in August, news reports tell us, U.S. troops called in an airstrike by an AC-130 -- which packs 40mm cannons -- that helped kill approximately 90 civilians in the village of Azizabad in Afghanistan, according to investigations by the Afghan government and the United Nations.

As in the past, war time has been a boom-time for Presto. In 2000, before the start of the Global War on Terror, National Presto's annual sales clocked in at $116.6 million. In 2007, they totaled $420.7 million, with more than 50% of that coming from arms manufacturing. Earlier this year, Presto nabbed another 40mm ammunition contract (a $97.5 million supplemental award) set to be delivered in 2009 and 2010. According to official DoD figures, from 2001 through 2008 National Presto received more than $531 million, while Amtec has taken home another $171 million-plus. Their combined grand total, while hardly putting Presto in the top tier of Pentagon weapons contractors, is still a relatively staggering $702.8 million -- not bad for a company known for slicing and dicing vegetables.

Death is Our Business and Business is Good

These days, most civilian defense contractors aren't like Presto. General Tire and Rubber Company, for example, once lorded it over a business empire that produced not only car tires, but antipersonnel mines and deadly cluster bombs. Today, the company seems to have left its days of supplying the U.S. military with lethal technologies behind.

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Nick Turse is the associate editor and research director of Tomdispatch.com. His first book, The Complex: How the Military Invades Our Everyday Lives, an exploration of the new military-corporate complex in America, was recently published by Metropolitan Books. His website is Nick Turse.com.

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