>but military contractors are known to have profit margins >30%.
Based on what data? Contract bidders must show all direct and indirect costs and are typically allowed to price in ~10% profit when submitting their proposal. In fact, you can look at historical financial data for LMT, NOC, GD, etc and see profit margin float around 7-10%. A proposal with 30% profit margin baked in would be laughed out of the selection committee.
I'm not sure about newer requirements but tricks I've heard of include exploding material costs after the fact, or exploiting some less tracked pressure relief in the contract that exists to eat up cost overruns.
Based on what data? Contract bidders must show all direct and indirect costs and are typically allowed to price in ~10% profit when submitting their proposal. In fact, you can look at historical financial data for LMT, NOC, GD, etc and see profit margin float around 7-10%. A proposal with 30% profit margin baked in would be laughed out of the selection committee.