Given that dividends and stock buy-backs have been recurring subjects of discussion on this board, I wonder if people have thoughts about President Trump's recent declaration that defense contractors should be banned from either practice. My interest is in the business and investment logic of what is being proposed.

My non-expert view is that the elimination of dividends might make defense contractors less attractive to investors; an effect that might be offset by the dramatic expansion of defense spending that has been proposed--or not. I actually have no idea. Whereas limiting or banning buybacks reflects a reasonable expectation that if a defense contractor cannot use its capital to innovate, it should be replaced by one that can.

Setting aside the politics of the thing (please), would it make sense for a country like the United States to declare that its defense should be founded on industrial enterprises run, basically, like BRK: no dividends, limited buybacks, and a pay cap for the capital allocator?

Baltassar