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Back in September 2008, Senator Joe Biden offered a bit of wisdom while running for vice president on Barack Obama's ticket. In a speech criticizing the Republican presidential campaign of senatorial colleague John McCain, he claimed to be quoting his own father when he said: "Show me your budget and I'll tell you what you value."
Almost 14 years later, how apt his father was when it comes to the country his son now presides over (more or less). After all, Joe's $1.75 trillion domestic social-spending package, the Build Back Better bill, is in a ditch at the side of some West Virginia road. Meanwhile, as TomDispatch regular and Pentagon expert William Hartung and Julia Gledhill, a defense analyst at the Project on Government Oversight, make all too clear today, the next Pentagon budget, at an astronomical $813 billion dollars, is heading for passage by a humongous congressional majority. (To put that figure in perspective, it's $75 billion more than Donald Trump's last "defense" budget.) Worse yet, numerous representatives, particularly on the Republican side of the aisle, are already demanding yet more of the same. In fact, in think-tank Washington and beyond, there are now even calls for a future Pentagon budget that would top one trillion dollars annually. Imagine that, in a country already spending more on what's still called "national security" than the next 11 countries combined, even as crucial elements of the domestic budget that would actually keep so many Americans more secure increasingly end up in that West Virginia ditch.
So, give Joe Biden's dad a little credit. He was all too on target. Show me your budget and I'll tell you what you do indeed value. Is there any question about that in the America of 2022? As retired Air Force lieutenant colonel and historian William Astore wrote recently, this country has "reached the point in our collective history where we face three certainties: death, taxes, and ever-soaring spending on weaponry and war." And that should be the definition of "insecurity." If you doubt me, just let Hartung and Gledhill fill you in on the ever more militarized "gold rush" this Ukrainian moment of ours represents. Tom
The New Gold Rush
How Pentagon Contractors Are Cashing in on the Ukraine Crisis
By William D. Hartung and Julia Gledhill
The Russian invasion of Ukraine has brought immense suffering to the people of that land, while sparking calls for increased military spending in both the United States and Europe. Though that war may prove to be a tragedy for the world, one group is already benefiting from it: U.S. arms contractors.
Even before hostilities broke out, the CEOs of major weapons firms were talking about how tensions in Europe could pad their profits. In a January 2022 call with his company's investors, Raytheon Technologies CEO Greg Hayes typically bragged that the prospect of conflict in Eastern Europe and other global hot spots would be good for business, adding that "we are seeing, I would say, opportunities for international sales" [T]he tensions in Eastern Europe, the tensions in the South China Sea, all of those things are putting pressure on some of the defense spending over there. So I fully expect we're going to see some benefit from it."
In late March, in an interview with the Harvard Business Review after the war in Ukraine had begun, Hayes defended the way his company would profit from that conflict:
"So I make no apology for that. I think again recognizing we are there to defend democracy and the fact is eventually we will see some benefit in the business over time. Everything that's being shipped into Ukraine today, of course, is coming out of stockpiles, either at DoD [the Department of Defense] or from our NATO allies, and that's all great news. Eventually we'll have to replenish it and we will see a benefit to the business over the next coming years."
Arms to Ukraine, Profits to Contractors
The war in Ukraine will indeed be a bonanza for the likes of Raytheon and Lockheed Martin. First of all, there will be the contracts to resupply weapons like Raytheon's Stinger anti-aircraft missile and the Raytheon/Lockheed Martin-produced Javelin anti-tank missile that Washington has already provided to Ukraine by the thousands. The bigger stream of profits, however, will come from assured post-conflict increases in national-security spending here and in Europe justified, at least in part, by the Russian invasion and the disaster that's followed.
Indeed, direct arms transfers to Ukraine already reflect only part of the extra money going to U.S. military contractors. This fiscal year alone, they are guaranteed to also reap significant benefits from the Pentagon's Ukraine Security Assistance Initiative (USAI) and the State Department's Foreign Military Financing (FMF) program, both of which finance the acquisition of American weaponry and other equipment, as well as military training. These have, in fact, been the two primary channels for military aid to Ukraine from the moment the Russians invaded and seized Crimea in 2014. Since then, the United States has committed around $5 billion in security assistance to that country.
According to the State Department, the United States has provided such military aid to help Ukraine "preserve its territorial integrity, secure its borders, and improve interoperability with NATO." So, when Russian troops began to mass on the Ukrainian border last year, Washington quickly upped the ante. On March 31, 2021, the U.S. European Command declared a "potential imminent crisis," given the estimated 100,000 Russian troops already along that border and within Crimea. As last year ended, the Biden administration had committed $650 million in weaponry to Ukraine, including anti-aircraft and anti-armor equipment like the Raytheon/Lockheed Martin Javelin anti-tank missile.
Despite such elevated levels of American military assistance, Russian troops did indeed invade Ukraine in February. Since then, according to Pentagon reports, the U.S. has committed to giving approximately $2.6 billion in military aid to that country, bringing the Biden administration total to more than $3.2 billion and still rising.
Some of this assistance was included in a March emergency-spending package for Ukraine, which required the direct procurement of weapons from the defense industry, including drones, laser-guided rocket systems, machine guns, ammunition, and other supplies. The major military-industrial corporations will now seek Pentagon contracts to deliver that extra weaponry, even as they are gearing up to replenish Pentagon stocks already delivered to the Ukrainians.
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