On December 14, one day after writing the first part of this work, it was announced that the United States Senate approved the National Defense Authorization Act (NDAA), an instrument that establishes the spending and policies of the country’s Department of Defense, empowering the Pentagon to spend a record $886 billion by fiscal year 2024.
Now, the initiative will be considered by the House of Representatives. The document contemplates expenditures such as the purchase of ships, ammunition and aircraft, as well as military aid to Ukraine and measures aimed at counteracting China’s influence in the Pacific. However, the figure is false, because in reality, it is much higher.
For decades, independent researchers have claimed that actual US military spending is about twice as much as officially recognized. In 2022, actual US military spending reached $1.537 trillion, doubling the publicly reported $877 billion. These data are reported from figures from the United States Office of Management and Budget (OMB).
But they face a trap because they suffer from two important deficiencies. First, the figures provided by the OMB regarding “defense spending” are substantially lower than those provided in the United States National Income and Product Accounts (NIPA), the most complete and definitive source on income and the country’s national spending to the point that it is the total basis of analysis of the American economy.
Second, as is well known, key areas of US military spending are included in other parts of federal spending and do not fall under the OMB’s “defense spending” category. To that amount we would have to add federal space expenses, and the real total of subsidies to foreign countries. Military health insurance (which consists of payments for medical services for dependents of military personnel on active duty at non-military installations) should also be considered.
According to a study for Monthly magazine Review by Gisela Cernadas, economist at the National University of La Plata in Argentina and John Bellamy Foster, professor emeritus of sociology at the University of Oregon in the United States, these figures should also include benefits, life insurance and other costs for veterans, military health insurance, military parts of space expenses, grants in aid to other governments and the proportion of net interest attributed to actual federal military expenditures.
In any case, the United States’ reported military spending is three times that of China ($292 billion) and 10 times that of Russia ($86.4 billion). In fact, US military spending is almost equal to that of the 10 countries that follow it in the table, including Russia, China and India, its NATO allies, the United Kingdom, France, Germany and Italy as well as Japan, Korea of the South and Ukraine.
Taking into account the data that I mentioned in the first part of this work, it is not spending that measures the efficiency of the armed forces on the planet. In the case of the United States, such a situation also has another perspective, if one considers that arms manufacturing is the main component of its ailing economy. In this way, the increase in its military spending and the pressure for its allies to imitate it is directly related to the need to safeguard the economic potential and stability of the country.
In such a way that waging war or generating conflicts responds to a vital need of the North American nation. Peace is considered an enemy of its economy. This is clear from the statements of James O’Brien, Undersecretary of State for European and Eurasian Affairs during a hearing of the Senate Foreign Relations Committee on financing to Ukraine, who admitted that the armed conflict in that country points in this direction. O’Brien said: “The battle for Ukraine also allows us to revitalize our own industrial base. We are creating new energy technologies and putting them into practice around the world. We are building new defense technologies.”
This statement coincides with information that military orders for Ukraine have increased the income of major US defense contractors, such as Lockheed Martin, General Dynamics, Raytheon Technologies Corporation (RTX), Boeing, and Northrop Grumman among others.
It was President Joe Biden himself who came to corroborate O’Brien’s assessment. In urging Congress to approve a war aid budget for Ukraine and Israel, the president used the same argument as his official, revealing what until now was a “secret” in the country: the significant dependence of its economy on the wars. In this regard, Biden was even more explicit than O’Brien: “We sent equipment to Ukraine that is in our arsenals. And when we use the money approved by Congress, we use it to replenish our own reserves, our arsenals, with new equipment – equipment that defends the United States and is made in the United States.” And he explained: “… Patriot missiles for anti-aircraft batteries made in Arizona; artillery ammunition manufactured in 12 states across the country [including] Pennsylvania, Ohio, Texas.”
For its part, the Wall Street Journal reports statements by Jason Aiken, chief financial executive of General Dynamics, who commented that the war in Ukraine had already increased demand for the company’s products. Aiken noted that he believed “that the Israeli situation will only put even more upward pressure on that demand.” Likewise, William D. Hartung, senior researcher and specialist in the military industrial complex at the Quincy Institute in Washington, explained that the country’s largest military contractors “would not exist without a constant flow of financing from the Pentagon.” And so that there is no doubt, he gave the example of Lockheed Martin, which receives 73% of its sales income through contracts with the United States government. He finished off his idea by stating that these were not capitalist companies in the traditional sense.
In this way, the macabre link between war and economy that sustains the existence of the United States in its daily future was exposed with express authenticity. Although, it also needs to demonstrate leadership to maintain its hegemony. In this sense, the Secretary of Defense, Lloyd Austin, assured that today’s problems will only “get worse” without “strong and firm” American leadership.
Austin, who after retiring from active duty in the armed forces in 2016 became a member of the board of directors of Raytheon Technologies, Nucor and Tenet Healthcare, regularly issues opinions aimed at increasing sales at the Military Industrial Complex. Thus, on December 2, during his speech at the Reagan National Defense Forum in California, he stated that “only one country on Earth can offer the type of leadership that this moment demands.” That country, according to him, is the United States.
This was the context in which Austin launched what he called “the most ambitious modernization effort [of the armed forces] in almost 40 years,” consisting of an investment of about50 billion dollars in the defense industrial base. This, according to him, will give the North American country an “ultimate strategic advantage that no competitor can match.” But, as is becoming common among Washington political leaders, this announcement could not be made without the rhetoric that has characterized the imperial nation since its very birth: “The US Army is the most lethal fighting force in the history of the humanity. And we will continue like this . We must not give our friends, rivals or enemies any reason to doubt the determination of the United States.
Of course, Austin now speaks as a public official and employee of large military contractors. Money made him forget his “military qualities” and now he expresses desires that reality denies. A single Russian hypersonic missile can dash their dreams of greatness.
It is the American sources themselves that are in charge of refuting Secretary Austin’s chimeras. From reading a draft of the first “National Defense Industry Strategy”, cited by the American news service “Politico” on December 2, it appears that the United States military industrial complex (MIC) has problems to achieve the pace and responsiveness that will allow it to stay ahead of China.
The document points out the inability of the American industrial base to meet demands at the necessary speed and scale. He adds that they would also be unable to respond “to a modern conflict at the speed, scale and flexibility required to meet the dynamic demands of a larger conflict.” Ukraine is in sight.
The report exposes the impossibility [of the CMI] of manufacturing the weapons requested with the desired speed, which would be causing a mismatch representing “a strategic risk” for the United States as the country becomes involved in an increasingly greater number of conflicts, particularly in the “Indo-Pacific”.
According to the study, the Russian military operation in Ukraine and the conflict between Israel and the Palestinian movement Hamas “uncovered a different set of industrial demands with corresponding risks,” making it clear that insufficient production and supply capacities are now deeply rooted problems at all levels of manufacturing supply chains.
So far this century, the United States armed forces have been involved in several wars, they have lost them all even though until the conflict in Ukraine their military potential had not been tested. Overwhelming interventions in Iraq, Afghanistan, Syria, Somalia and Libya have been sealed with defeats, destruction of countries and endless interventionist military presences that wore down Washington without being able to obtain tangible results that would bring it strategic successes.
In all cases, the United States dragged its allies into confrontation with southern countries, with a low level of development and limited economies. Despite this, a brief overview shows that neither in Central Asia, nor in Western Asia, nor in Africa have they obtained palpable victories that could have changed the global correlation of forces in their favor.
But when Washington launched NATO against Russia using Ukraine to do so, its inability to obtain strategic victories became evident. On the contrary, its economy has been weakened even further, its capacity for diplomatic maneuver has been limited, the potential to generate security and confidence in its allies has diminished and its usual instruments of pressure: blackmail, threats, arrogance and intimidation They have lost effectiveness in the face of the growing decision of people to follow a different path.
All the military potential of the United States – which, as has been demonstrated in this work – is still enormous, is not enough to undertake a major war and succeed in it. This equation that advances under the shadow cast by hypersonic missiles and that hangs over the United States the specter of its total destruction in the event of unleashing an atomic war, could be a powerful instrument that leads decision-makers in Washington to desist from the assumption of that it is possible to obtain a strategic victory that certifies that “history had ended” with the absolute dominance of capitalism and the United States on this planet.
That will no longer be possible.