People, people, people.
I have several separate counterarguments.
1) I argue that the people who think that martial arts are weak in d20 Modern are looking solely at class abilities.
Guys, look at all the feats. Look at 'em. Look at how many feats you get in this game. Look at a guy who can tumble in close to an ogre, use Unbalance Opponent to deny that guy his Strength bonus to hit you, and engage him in Melee so that your Elusive Target feat kicks in and makes you nigh-impossible for ordinary people to hit. Tell me that he's weak. When I built my martial artist character, I concentrated mainly on offense, but these few feats alone made me a lot harder to hit. For offense, combining your excellent BAB with Power Attack and Streetfighting can push you over the average dude's damage threshold on a regular basis.
2) I argue that people ragging on martial arts are only looking at the Martial Artist advanced class. People, there's a reason that they gave classes names like "Strong Hero" and "Smart Hero". It was a subtle attempt to get people to stop getting your character and your class mixed up.
The Martial Artist class has a lot of great stuff in it. You'll do well to take levels in it, and it's a must-have if you want to make a powerful martial artist hero. But don't stop there. A few levels of soldier will go a long way, and you can explain it as your character leaving the sanctity of the dojo to take stuff to the street and learn true combat effectiveness, if you like.
My ultimate martial artist character was a Strong3/Fast1/Martial Artist6/Soldier10. Those MA levels were nice, but frankly, I was more into having my criticals auto-confirmed.
To put it another way -- notice how the Gunslinger has SOME cool stuff, but he's not the bestest in the world at what he does? If you want that level of specialization, add Soldier levels. Do the same for the Martial Artist if you want to be the master of unarmed combat. Martial Artist levels alone won't do it.
If straight smashing isn't your gig, add Daredevil or Infiltrator levels. Either one will make your guy more versatile.
3) I argue that people who complain about low damage are underestimating the damage a martial artist can do and underestimating the lethality of the game.
At 20th level, I was doing 1d8+a bunch from strength, melee smash, greater weapon specialization, and Streetfighting. With point buy, I made a guy with an 18 Strength -- up to 20 by level 20. I BELIEVE that it was:
1d8 (martial artist living weapon ability)
+1d4 Streetfighting
+2 (Strong Hero melee smash)
+4 (Soldier, Greater Weapon Spec)
+5 (Strength)
So, that's 1d8+1d4+11. That's at LEAST 13, and the average is 18, which will clear the damage threshold on just about anyone. I attack four times per round, if I'm interested in doing as much damage as possible, OR I can use Power Attack to put all my damage in one basket and be SURE of forcing someone to make a Fort save or drop to -1. In addition, I have an 18-20 threat range, I do x3 damage on a critical, and my criticals are auto-confirmed because of my soldier levels. Think about that. 15% of the time, my hit does 3d8+33+1d4 points damage, no crit-confirm needed. Is that horrible underpowered?
I'm not arguing that a gun-person can't do more damage than a martial artist. Quite the opposite -- in the hands of a 20th-level Fast Hero/Gunslinger/Soldier, a gun is a deadly and terrifying thing. It can also be disarmed using the Strike an Object rules, as Charles Ryan confirmed. And if that gun goes away, the Fast Hero/Gunslinger/Soldier is in deep trouble. An unarmed-specializing martial artist can't be disarmed, can't lose his weapons because of roleplaying reasons, and never has to worry about running out of ammo.
But that just gets into the argument I didn't want to get into -- who is better? Who is better is stupid. They're different characters with different concepts, and each has its advantages and disadvantages, some of which I mentioned above. No, the issue is, "Are martial artists too weak to be fun?"
My answer, I suppose, is yes, if you're not smart enough to choose the right feats, wise enough to choose the right classes, or intelligent enough to choose the right combat tactics.
Just like with every other class.
-Tacky