America’s Defense Industry Capitalizes on the Conflict in Ukraine*
*Editor’s note: On March 4, Russia enacted a law that criminalizes public opposition to, or independent news reporting about, the war in Ukraine. The law makes it a crime to call the war a “war” rather than a “special military operation” on social media or in a news article or broadcast. The law is understood to penalize any language that “discredits” Russia’s use of its military in Ukraine, calls for sanctions or protests Russia’s invasion of Ukraine. It punishes anyone found to spread “false information” about the invasion with up to 15 years in prison.
Western arsenals dwindle; arms manufacturers cash in.
U.S. officials often assert that helping Ukraine is a moral as well as strategic imperative. Ukraine is purportedly at the forefront of a global struggle between democracy and authoritarianism. But this argument does not hold up under scrutiny.
In the first place, Ukraine is, itself, a corrupt and repressive autocracy, not a freedom-loving democracy, even under the broadest definition of democracy. Second, far from a confrontation between good and evil, the events in Ukraine represent a cynical battle for resources.
It is difficult to say to what extent America’s press and political elite actually buy into their own propaganda. By and large, they have selfish reasons for wanting Washington to continue its proxy war against Russia.
First and foremost are the enormous financial benefits to the U.S. military-industrial complex. The United States has already provided more than $100 billion in aid to Kyiv, most of which will be used to pay Raytheon, Lockheed Martin and other arms manufacturers. Meanwhile, a group of hawks in Washington is already sounding the alarm that U.S. and NATO arsenals are being depleted — which means more business for military contractors.
And, so, the military conflict in Ukraine presents an ideal opportunity for America’s defense industry to reap profits.
The Reasons behind the Transfer of Weapons to Ukraine
U.S. Secretary of Defense Lloyd Austin inadvertently revealed America’s true motives for sending weapons to Ukraine. He said that Washington's goal is not just to help Ukraine stave off the invasion, but also to weaken Russia to such an extent that it no longer poses a threat to anyone.
To achieve that end, hostilities in Ukraine will have to be prolonged, regardless of the impact on the people of that country. The U.S. employed the same cynical strategy in Afghanistan in the 1980s. Prominent political scientist and former U.S. National Security Advisor Zbigniew Brzezinski recounted how the Jimmy Carter administration began supplying arms to the Mujahideen even before Moscow intervened in December 1979 to support the faltering pro-communist government in Kabul.
In both instances, Washington’s goal was the same: to intimidate the enemy and bleed it dry. No one cared then, nor do they care now, about the consequences of the proxy war for the local population. Thomas Twetten, a senior CIA official in the 1980s, later admitted that American leaders never had any post-war plan for Afghanistan.
America’s Defense Industry Appetite
According to The Wall Street Journal, Lockheed Martin has stepped up production to replenish depleted stocks of Stinger man-portable air defense systems and Javelin anti-tank missiles to meet current demand, while Raytheon is rehiring former employees.
Bringing retirees back to work at Raytheon is a dubious proposition from a practical standpoint. It will not increase productivity at all in the short term because retraining personnel dismissed a long time ago takes time. But it will create a beautiful illusion for investors and the media. As a result, the company's stock has risen by 15% since mid-October.
Lockheed Martin Corporation, for its part, has doubled its production of Javelin anti-tank systems and plans to increase production of HIMARS multiple launch rocket systems and GMLRS missiles by 60%. As a result of this public demonstration of the company's capabilities and pronouncements about the "invincibility" of the HIMARS system, Lockheed Martin's stock is up by 25% since mid-October (from $388 per share to $486 per share). The meteoric rise began on Feb. 24, 2022.
Lockheed Martin’s economic indicators appear to improve every time a HIMARS hit is mentioned in the Russian, Ukrainian or Western press.
The Depletion of US Arsenals
American military experts admit that the United States is exhausting its defense inventory by providing military assistance to Ukraine.
Washington currently promotes a policy of “arsenal democracy” in Ukraine, which is to say that it supplies Ukrainian troops with weapons while avoiding any direct participation in the conflict. But this policy puts the U.S. at risk of depleting a significant portion of its arsenal at a time when it lacks sufficient production capacity to replenish its stockpiles quickly. The current situation could expose America's vulnerability. And this vulnerability could, in turn, play a significant role in a subsequent confrontation between the great powers.
The United States has already supplied Ukraine with approximately 60,000 anti-tank guided missiles and 25,000 MANPADS, which is nearly a third of the American stockpile. Clearly, President Joe Biden did not expect the conflict in Ukraine to drag on for so long. As conditions evolve, the U.S. will have to transfer increasingly more weapons and special military equipment to Ukraine. The United States is now faced with a dilemma: Should it continue to arm Ukraine, laying bare America’s stockpiles, or should it hold on to inventory it might need in the future for its own defense?
The conflict in Ukraine has become a harbinger of the problems the United States will face in a potential confrontation with China or Russia. If Washington is forced to go to war in Eastern Europe or the Western Pacific, it will exhaust its stockpile of critical munitions within a matter of days or weeks. The U.S. is also likely to suffer the serious loss of tanks, aircraft and warships, all of which are difficult and expensive to replace.
Experience has shown that American economic supremacy is no longer grounded primarily in manufacturing. A shortage of skilled labor and available production capacity can slow down rearmament in time of war. For example, the United States is unable to quickly ramp up production of Stinger missiles for Ukraine because it now lacks the skilled labor force needed to do so.
America's stockpile of critical weapons is smaller than one might imagine — in part because of production constraints and in part because most of the Pentagon's approximately $750 billion budget is consumed by payroll, health care and other aspects of defense unrelated to munitions.
According to Defense News, a backlog forced the United States to delay a shipment of military equipment to Taiwan as early as 2019. American officials and experts recognize that, despite the fact that Ukraine is currently a priority, the U.S. must not forget Taiwan because China's conduct is becoming increasingly provocative.
America’s ‘Brain Trust’ Weighs In
In early January, the Center for Strategic and International Studies released a report on the depletion rate of U.S. munition inventories.
The analysis shows that it will take years for U.S. arsenals to replenish some of the systems sent to Ukraine. According to the Center’s tabular data, depending on the pace of production, it will take the American defense industry four to seven years to replenish the 155-mm howitzer shells; five to eight years for Javelin charges; two to three years for HIMARS missiles; and from six to 18 years for Stinger missiles.
The American defense industry will be filling orders for years to come. And this is one of the main reasons why the United States has an interest in prolonging the conflict in Ukraine.
Diversion of American Weapons in Ukraine
The U.S. State Department has developed a two-year program to combat the diversion of weapons in Ukraine. The State Department's Office of Export Control Cooperation announced a grant of at least $3.9 million to combat arms trafficking in Eastern Europe, according to the plan’s documents. The State Department will implement the funding as part of the previously adopted U.S. Export Control and Related Border Security Program. It aims to build the capacity of security, law enforcement and border control officials in Ukraine and its neighboring states to deter, detect and put a stop to illicit trafficking in certain advanced conventional weapons.
The United States plans to strengthen its control over the illicit circulation of weapons by implementing educational programs and training for law enforcement officers in target regions, primarily in Ukraine. At the same time, the authors of the initiative report that the project may be extended in the future to U.S. regional partners in Central and Eastern Europe and the Balkans.
Summary and Conclusions
American arms manufacturers and, to a lesser extent, their European counterparts, are thriving as the conflict in Ukraine is prolonged. It is they who are lobbying against peace negotiations because they will benefit the most from a continuation of hostilities.
The events in Ukraine are not only an opportunity for the United States to pursue its geopolitical ambitions, but also a chance to turn a profit. Consequently, the use of foreign "know-how" in Ukraine can and should be assessed solely in terms of advantage.
We must also keep in mind that the U.S. military has a professional interest in drawing out the conflict in Ukraine for as long as possible. Former Soviet equipment is being decommissioned on Ukrainian battlefields, and new weapons, munitions, unmanned aerial vehicles, aircraft and missiles are being tested. Soldiers attack one another with the most recently developed light and heavy weaponry. The U.S. is testing new combat options in real time. It is putting the latest satellite and electronic systems — whose effectiveness remains unconfirmed during regular exercises — to active use.
Washington's boundless commitment to providing military assistance to Kyiv creates an equally boundless danger. Conditions are ripe for a prolonged war of attrition that will leave Ukraine in ruins. The question is whether the Biden administration is cynical enough to pursue its proxy war down to the last Ukrainian.
Unfortunately, this scenario seems quite plausible in light of American precedent. Meanwhile, it is in Ukraine’s best interests to insist on negotiations to end the bloodshed as soon as possible. Washington's current policy is both reckless and cruel.
Western arsenals dwindle; arms manufacturers cash in.
U.S. officials often assert that helping Ukraine is a moral as well as strategic imperative. Ukraine is purportedly at the forefront of a global struggle between democracy and authoritarianism. But this argument does not hold up under scrutiny.
In the first place, Ukraine is, itself, a corrupt and repressive autocracy, not a freedom-loving democracy, even under the broadest definition of democracy. Second, far from a confrontation between good and evil, the events in Ukraine represent a cynical battle for resources.
It is difficult to say to what extent America’s press and political elite actually buy into their own propaganda. By and large, they have selfish reasons for wanting Washington to continue its proxy war against Russia.
First and foremost are the enormous financial benefits to the U.S. military-industrial complex. The United States has already provided more than $100 billion in aid to Kyiv, most of which will be used to pay Raytheon, Lockheed Martin and other arms manufacturers. Meanwhile, a group of hawks in Washington is already sounding the alarm that U.S. and NATO arsenals are being depleted — which means more business for military contractors.
And, so, the military conflict in Ukraine presents an ideal opportunity for America’s defense industry to reap profits.
The Reasons behind the Transfer of Weapons to Ukraine
U.S. Secretary of Defense Lloyd Austin inadvertently revealed America’s true motives for sending weapons to Ukraine. He said that Washington's goal is not just to help Ukraine stave off the invasion, but also to weaken Russia to such an extent that it no longer poses a threat to anyone.
To achieve that end, hostilities in Ukraine will have to be prolonged, regardless of the impact on the people of that country. The U.S. employed the same cynical strategy in Afghanistan in the 1980s. Prominent political scientist and former U.S. National Security Advisor Zbigniew Brzezinski recounted how the Jimmy Carter administration began supplying arms to the Mujahideen even before Moscow intervened in December 1979 to support the faltering pro-communist government in Kabul.
In both instances, Washington’s goal was the same: to intimidate the enemy and bleed it dry. No one cared then, nor do they care now, about the consequences of the proxy war for the local population. Thomas Twetten, a senior CIA official in the 1980s, later admitted that American leaders never had any post-war plan for Afghanistan.
America’s Defense Industry Appetite
According to The Wall Street Journal, Lockheed Martin has stepped up production to replenish depleted stocks of Stinger man-portable air defense systems and Javelin anti-tank missiles to meet current demand, while Raytheon is rehiring former employees.
Bringing retirees back to work at Raytheon is a dubious proposition from a practical standpoint. It will not increase productivity at all in the short term because retraining personnel dismissed a long time ago takes time. But it will create a beautiful illusion for investors and the media. As a result, the company's stock has risen by 15% since mid-October.
Lockheed Martin Corporation, for its part, has doubled its production of Javelin anti-tank systems and plans to increase production of HIMARS multiple launch rocket systems and GMLRS missiles by 60%. As a result of this public demonstration of the company's capabilities and pronouncements about the "invincibility" of the HIMARS system, Lockheed Martin's stock is up by 25% since mid-October (from $388 per share to $486 per share). The meteoric rise began on Feb. 24, 2022.
Lockheed Martin’s economic indicators appear to improve every time a HIMARS hit is mentioned in the Russian, Ukrainian or Western press.
The Depletion of US Arsenals
American military experts admit that the United States is exhausting its defense inventory by providing military assistance to Ukraine.
Washington currently promotes a policy of “arsenal democracy” in Ukraine, which is to say that it supplies Ukrainian troops with weapons while avoiding any direct participation in the conflict. But this policy puts the U.S. at risk of depleting a significant portion of its arsenal at a time when it lacks sufficient production capacity to replenish its stockpiles quickly. The current situation could expose America's vulnerability. And this vulnerability could, in turn, play a significant role in a subsequent confrontation between the great powers.
The United States has already supplied Ukraine with approximately 60,000 anti-tank guided missiles and 25,000 MANPADS, which is nearly a third of the American stockpile. Clearly, President Joe Biden did not expect the conflict in Ukraine to drag on for so long. As conditions evolve, the U.S. will have to transfer increasingly more weapons and special military equipment to Ukraine. The United States is now faced with a dilemma: Should it continue to arm Ukraine, laying bare America’s stockpiles, or should it hold on to inventory it might need in the future for its own defense?
The conflict in Ukraine has become a harbinger of the problems the United States will face in a potential confrontation with China or Russia. If Washington is forced to go to war in Eastern Europe or the Western Pacific, it will exhaust its stockpile of critical munitions within a matter of days or weeks. The U.S. is also likely to suffer the serious loss of tanks, aircraft and warships, all of which are difficult and expensive to replace.
Experience has shown that American economic supremacy is no longer grounded primarily in manufacturing. A shortage of skilled labor and available production capacity can slow down rearmament in time of war. For example, the United States is unable to quickly ramp up production of Stinger missiles for Ukraine because it now lacks the skilled labor force needed to do so.
America's stockpile of critical weapons is smaller than one might imagine — in part because of production constraints and in part because most of the Pentagon's approximately $750 billion budget is consumed by payroll, health care and other aspects of defense unrelated to munitions.
According to Defense News, a backlog forced the United States to delay a shipment of military equipment to Taiwan as early as 2019. American officials and experts recognize that, despite the fact that Ukraine is currently a priority, the U.S. must not forget Taiwan because China's conduct is becoming increasingly provocative.
America’s ‘Brain Trust’ Weighs In
In early January, the Center for Strategic and International Studies released a report on the depletion rate of U.S. munition inventories.
The analysis shows that it will take years for U.S. arsenals to replenish some of the systems sent to Ukraine. According to the Center’s tabular data, depending on the pace of production, it will take the American defense industry four to seven years to replenish the 155-mm howitzer shells; five to eight years for Javelin charges; two to three years for HIMARS missiles; and from six to 18 years for Stinger missiles.
The American defense industry will be filling orders for years to come. And this is one of the main reasons why the United States has an interest in prolonging the conflict in Ukraine.
Diversion of American Weapons in Ukraine
The U.S. State Department has developed a two-year program to combat the diversion of weapons in Ukraine. The State Department's Office of Export Control Cooperation announced a grant of at least $3.9 million to combat arms trafficking in Eastern Europe, according to the plan’s documents. The State Department will implement the funding as part of the previously adopted U.S. Export Control and Related Border Security Program. It aims to build the capacity of security, law enforcement and border control officials in Ukraine and its neighboring states to deter, detect and put a stop to illicit trafficking in certain advanced conventional weapons.
The United States plans to strengthen its control over the illicit circulation of weapons by implementing educational programs and training for law enforcement officers in target regions, primarily in Ukraine. At the same time, the authors of the initiative report that the project may be extended in the future to U.S. regional partners in Central and Eastern Europe and the Balkans.
Summary and Conclusions
American arms manufacturers and, to a lesser extent, their European counterparts, are thriving as the conflict in Ukraine is prolonged. It is they who are lobbying against peace negotiations because they will benefit the most from a continuation of hostilities.
The events in Ukraine are not only an opportunity for the United States to pursue its geopolitical ambitions, but also a chance to turn a profit. Consequently, the use of foreign "know-how" in Ukraine can and should be assessed solely in terms of advantage.
We must also keep in mind that the U.S. military has a professional interest in drawing out the conflict in Ukraine for as long as possible. Former Soviet equipment is being decommissioned on Ukrainian battlefields, and new weapons, munitions, unmanned aerial vehicles, aircraft and missiles are being tested. Soldiers attack one another with the most recently developed light and heavy weaponry. The U.S. is testing new combat options in real time. It is putting the latest satellite and electronic systems — whose effectiveness remains unconfirmed during regular exercises — to active use.
Washington's boundless commitment to providing military assistance to Kyiv creates an equally boundless danger. Conditions are ripe for a prolonged war of attrition that will leave Ukraine in ruins. The question is whether the Biden administration is cynical enough to pursue its proxy war down to the last Ukrainian.
Unfortunately, this scenario seems quite plausible in light of American precedent. Meanwhile, it is in Ukraine’s best interests to insist on negotiations to end the bloodshed as soon as possible. Washington's current policy is both reckless and cruel.
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