Mark Yost's Bookshelf review today covers Josh Dean's The Impossible Factory, a history of Lockheed's Skunk Works under engineer Kelly Johnson and the development of the U-2 and SR-71 reconnaissance aircraft. It's an investing piece dressed as military history.
The U-2 first flew over Soviet airspace on July 4, 1956. Kelly Johnson estimated that 95% of the U.S.'s hard intelligence on Soviet missile capabilities came from that plane. The cost? Less than $1 million each — about $12 million in today's dollars. The whole program ran outside the Pentagon procurement process, on what would today be called a black budget.
Then came the SR-71 Blackbird — faster, higher, farther. The challenge was that flying Mach 3 generated 600°F skin temperatures, which would burn off paint. The solution was titanium. The Soviet Union was the world's largest producer of titanium. So the CIA bought titanium from the Soviets through Third World shell companies, telling Moscow the metal was for "pizza ovens." That titanium then became the airframes that spied on them.
The General Leo Geary quote Yost lifts is what we keep coming back to: every Skunk Works project Kelly Johnson ran shared two traits. They were all eminently successful, and they were all done outside the system.
That's the dynamic playing out in U.S. defense procurement right now. Steve Feinberg, Trump's pick to lead the defense industrial base reform, is explicitly running PE turnaround tactics inside the Pentagon. The big primes — Lockheed Martin (LMT), Northrop Grumman (NOC), General Dynamics (GD), Raytheon (RTX) — are still going to get the bulk of contracts. But the tier-2 names with engineering-led, Skunk-Works-style cultures — Palantir (PLTR), Anduril (private), Kratos Defense (KTOS), AeroVironment (AVAV) — are positioned to take outsized share of new program starts where speed matters more than process.
The book is also a reminder of how cheap modern weapons feel relative to the political theater around them. A U-2 cost $12 million in today's dollars. An F-35 costs $80 million. A B-21 Raider is approaching $700 million. Some of that inflation is real engineering; a lot of it is procurement overhead that the Feinberg playbook is designed to remove.