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Eisenhower versus the Spin-off Story: Did the Rise of the Military–Industrial Complex Hurt or Help America's Commercial Aircraft Industry?

Published online by Cambridge University Press:  18 February 2015

Eugene Gholz
Eugene Gholz*
Affiliation:
University of Texas at Austin, P.O. Box Y, Austin, TX 78713-8925. E-mail: [email protected]
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Abstract

In his Farewell Address, President Eisenhower warned that the military-industrial complex (MIC) threatened to dominate American research, crowding out commercial innovation. Ironically, a number of analysts point to spin-off benefits of the 1950s' military effort as a crucial source of American high-tech competitiveness, often citing the key example of the relationship between military jet aircraft and the Boeing's 707. But the huge military investment in jet aviation had both benefits and costs for the commercial industry. This article compares the development of the Boeing 707 and its relationship to military projects like the KC-135 tanker to the contemporary development of commercial jet aircraft by other companies that were also integral parts of the military-industrial complex (MIC), including Douglas Aircraft and its commercial DC-8 and Convair and its commercial 880 and 990. Using evidence from archives, interviews with retired company executives, contemporary trade press, and academic studies, the article concludes that membership in the MIC did not offer firms a leg up in commercial markets. President Eisenhower was generally right about the costs of the military effort, but military spending remained low enough to allow commercial industry to thrive in parallel to the defense industry.

Type
Introduction
Information
Enterprise & Society , Volume 12 , Issue 1 , March 2011 , pp. 46 - 95
Copyright
Copyright © The Author(s) 2011. Published by Cambridge University Press on behalf of the Business History Conference. All rights reserved.

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