If the military orders appear, nothing further is required of the government. Only if the total market, including the military orders, falls short of the capacity of these plants will the government be required to buy the product, which then should be put into the strategic stockpile to be used only in a national emergency. Past experience with this device has been good. Many of the units created are still in existence, adding to the tax base. Such devices reduce the government1s supervision to a minimum and keep it out of the marketplace.
Industry assumes the responsibility at acceptable risks.
The normal profit motive remains the driving force. The government risks only major changes in programs and the industry risks that it will have created a facility for which there is not an immediate market after the contract has expired. Earlier in this report examples were given to show the disruptive nature of sudden shortages in the titanium industry. Experience has shown that, even in time of national emergency, allocation is only a last resort since it virtually destroys the intimate customer and supplier relationships of the free market. Suppliers are faced frequently with making temporary allocations and, in some cases, they have temporarily assumed government prerogatives.