Military Industry Always Wins

After 20 years of war in Afghanistan, the Taliban have retaken control of the country, and they are not the only winners. Wars, even if they are lost in advance, are extremely profitable for the influential military industry.

Since Sept. 11, 2001, Canada has eaten up about $20 billion in the Afghan conflict. The United States has spent over $2 trillion — that’s $300 million a day, every day, for two decades. In trying to smother the Taliban regime, we have spent more than the net worth of Bill Gates, Jeff Bezos, Elon Musk and the 30 richest billionaires in America all put together.

But who has profited from all this governmental spending? The answer can be found partly in the portfolio of five military companies — Boeing, Raytheon, Lockheed Martin, Northrop Grumman and General Dynamics — and their shareholders.

Profitable

The numbers speak for themselves. The war in Afghanistan was started Sept. 18, 2001 by George W. Bush. At this precise moment, if you would have bought $10,000 worth of shares in these five huge military companies, you would have $97,295,000 in your pocket today.

You yourself have probably profited from this war, without necessarily knowing it. The financial service called “La Caisse de dépôt et placement” that manages retirement accounts for more than 6 million Quebecers, holds millions of shares in military companies like General Dynamics.

The yields of the defense sector are significantly superior to those that were offered on the whole equity market during the same period. For example, $10,000 in an index fund like the S&P 500 would now be worth close to $62,000.

During the Afghan conflict, the shares in the military sector outperformed the stock market in the whole by 58%. The war against the Taliban is not the only reason that explains such a rise in stocks, but it has certainly contributed to it.

Lessons

Are we going to learn any lessons from the Afghan failure? Is the catastrophic unraveling of this war going to cool the Western zeal in leading wars that are lost from the start, but generate enormous profits?

Allow me to doubt that one. In 1961, American President Dwight D. Eisenhower had already put out a serious warning against the all-powerful military lobby.

In his farewell address when leaving the White House, this is how Eisenhower spoke to the arms industry. “The total influence — economic, political, even spiritual — is felt in every city, every Statehouse, every office of the Federal government.… In the councils of government, we must guard against the acquisition of unwarranted influence.”

That a president who was also chief of staff for the American army would so fervently denounce the all-powerful defense sector says a lot.

Sixty years later, it is now obvious that this military lobby has not lost its influence. The Americans failed to establish their regime in Vietnam in the 1970s, and today, the fall of Kabul is becoming the “Saigon of Joe Biden.”

When the deceased Rock Demers wrote “La Guerre des Tuques,”* he had Ti-Guy Lalune say “war, war, that’s not a reason to harm yourself!” It’s true! War is also, and more than anything, a reason to make money.

*Translator’s note: In English-speaking countries the film is called “The Dog Who Stopped the War,” although the title literally translates as “the war of the beanie hats.”