"On Wednesday night, President Donald Trump went to war with military contractors. The companies, he said, issued shareholder dividends and "massive" stock buybacks at the expense of using the funds to manufacture weapons and equipment for the US military. Trump said he would ban buybacks and dividends, and demanded that executive salaries be capped at $5 million until military equipmentmanufacturing improves. It appeared to be part of a broader push by the Trump administration to assert more government control over corporations."
"In the eleventh paragraph, the executive order explains how the Defense Department would enforce Trump's priorities: Through the enforcement of future contracts. The order requires Defense Secretary Pete Hegseth to ensure that, in future military contracts, the executive compensation for contractors isn't tied to "short-term financial metrics," but to increased production, delivery time, and other improvements "required to rapidly expand our United States stockpiles and capabilities.""
The executive order criticizes defense contractors for issuing dividends and conducting stock buybacks instead of prioritizing production of military equipment. The order instructs the Defense Secretary to use future defense contracts to enforce priorities, tying executive compensation to increased production, faster delivery, and other measures that expand U.S. stockpiles and capabilities. The order does not mirror a social media-proposed $5 million salary cap, but empowers the Defense Secretary to require caps on executive base salaries at existing levels if contractors fail to meet performance expectations. The order frames enforcement through contract terms rather than direct corporate mandates.
Read at Business Insider
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