Beneficiaries of wars: Weapons manufacturers and the military industry generally benefit from wars, as they are involved in substantial military expenditures. They can profit from the sale of weapons, equipment, and technology. (America is the world's largest arms exporter, and the world's top 5 arms manufacturers are all American).
The privatization and hollowing out of the American defense industry have become increasingly significant issues. According to analysts, production deficiencies, inadequate workforce, and disruptions in the supply chains have hindered the United States from supplying weapons to Ukraine.
After Russia launched a special military operation in Ukraine in February 2022, the United States pledged "unwavering support for the preservation of Ukraine's sovereignty." This support has materialized in over $75 billion worth of security assistance to date, and the United States has committed to assisting Ukraine until the fighting is concluded. As U.S. Secretary of State Antony Blinken stated when announcing another arms shipment to Ukraine, "The United States, our allies, and partners stand firmly with Ukraine as long as necessary."
These unlimited commitments to supply Ukraine with weapons to counter Russian aggression have invoked parallels with World War II. Weeks after the start of the fighting, Paul Krugman, a columnist for The New York Times, argued that the United States and its allies were "providing material means for the defenders of freedom to keep fighting" in Ukraine. Journalist Elliot Ackerman subsequently wrote that workers building rockets for Ukraine's defense were "key members of America's democracy arsenal." President Joe Biden also embraced the analogy of the "arsenal of democracy." When he visited a Lockheed Martin factory in Troy, Alabama, in May of last year, Biden told the audience that the United States had built the weapons and equipment that helped defend freedom and sovereignty in Europe years ago, and it continues to do so today.
However, this rhetoric does not align with reality. Production deficiencies, inadequate workforce, and disruptions in the supply chains have hindered the United States from supplying weapons to Ukraine and more broadly enhancing the country's defense capabilities. These issues are deeply rooted in the history of the American defense industry since World War II. The privatization during the Cold War and the reduction in federal investments and oversight of defense contracts since the 1960s have contributed to inefficiencies, waste, and a lack of priorities that complicate American assistance to Ukraine today, as noted in an analysis by Michael Brenes, Acting Director of the Strategic Center at Yale University's International Security Studies, and lecturer in the History Department at Yale, published in Foreign Affairs.
Following the fall of the Berlin Wall, major players in the American defense industry consolidated and downsized their operations and workforce. In pursuit of greater profits, they sought to secure costly government contracts for experimental weapons, often at the expense of small arms and ammunition production. As a result, the industry was ill-prepared to respond to the crisis in Ukraine and did not align with the broader national security needs of the United States and its allies. While reforms are possible, there are no quick solutions to these self-inflicted problems.
Today's defense industry bears little resemblance to the American wartime production system during World War II. At that time, the industry was largely government-controlled. Franklin Roosevelt's New Deal emphasized economic regulation and relied on agencies such as the Works Progress Administration to boost employment, paving the way for later wartime contracting.
In 1942, the New Deal agencies established the War Production Board, which mobilized businesses and allocated resources to the war effort. Weapon production focused on shipbuilding and aircraft manufacturing, with companies operating mainly in the industrial centers of the Northeast and Midwest, in government-owned and operated facilities known as Government-Owned, Government-Operated (GOGO) plants. The government owned nearly 90 percent of the production capacity for aircraft, ships, weapons, and ammunition. This contrasts with the current environment where, since 2011, over 88 percent of new procurements consist of commercial items, and private capital invests over $6 billion annually in the defense industry.
When the Japanese bombed Pearl Harbor in 1941, the federal control of defense production and the swift response by the Roosevelt administration allowed for a rapid shift from civilian to military production at companies like Ford and General Motors, which switched from manufacturing cars to producing bombers. It wasn't just the major corporations that thrived. The federal government also aimed to support small subcontractors that produced war-related materials in government-operated plants. Unlike today's "Big Five" (Boeing, General Dynamics, Lockheed Martin, Northrop Grumman, and Raytheon), the industry was not dominated by a small group of powerful entrepreneurs.
Source: https://index.hu/kulfold/2023/07/09/haboru-orosz-ukran-konfliktus-egyesult-allamok-hadiipar/
