For your 239-year-old history The United States launched 209 wars and armed conflicts. In essence, this is a specific national business, primarily for the largest monopolies and the political elite.
During the Cold War, the so-called permanent military economy developed in many western countries and in the USSR. It reached its highest level of development in the 80s of the last century. The dominant position in the global military-economic activities of the United States. They accounted for more than half of global and roughly 2 / 3 total military spending. The highest level of expenditure of the US Department of Defense reached the 1987 year - 401,7 billion dollars.
In the third millennium, the trend has continued. According to the Stockholm Peace Research Institute (SIPRI), in 2010, the US spent 668 billion on defense — more than the following 10 countries.The slowdown and even decline in military spending between 2011 and 2012 over the years has been associated with economic stagnation, economic policies and a reduction in mission in Afghanistan. But even then, the United States had a military budget four times as large as the PRC.
However, in 2013, it was 631 billion, in 2014, 624 billion, and in 2015, 584 billion. All this could not but affect the position of the leading defense companies. That is why many experts believe that Western politicians and media deliberately distort events and create a negative image of Russia in order to rally the transatlantic community and revitalize the US military-industrial complex. Moreover, the entire “Ukrainian operation” was conceived with the aim of luring Russia into a trap, which would make it possible to return to the Cold War containment policy, when the arms race brought fabulous profits unattainable in civilian industries.
Such techniques were repeatedly used in the diplomatic game of the United States (it suffices to recall the test tube with chalk, which became the reason for the invasion of Iraq), sometimes not so much for achieving military or political goals as for business. Therefore, behind the pathos of the US president, when presenting a new national security strategy, the interests of military-industrial capital are hidden in the first place.
The United States does not "win" the war, which lead, because the victory in them - a secondary task, writes the magazine The American Conservative. Victory or defeat is not particularly significant, because the conflicts that incite Washington are not vital for the country. In the process of wars, the United States receives a completely different profit than just a victory over the enemy, the newspaper notes.
In essence, this is a specific national business, primarily for the largest monopolies and the political elite. It is absolutely clear that those who are its main stakeholders, and initiate military preparations, cause hysteria not only in the United States, but also in the world.
Who does not fight, he does not drink champagne
The US military-industrial complex occupies a special place and position both in the country's economy and in political life. The production facilities of the majority of military-industrial concerns are based on factories built with state funds and transferred to corporations for management. This allows them in a short time and without special expenses to expand the production of armaments while raising the situation and eliminates the need to reconstruct the plants at their own expense when they switch to new types of MPP. With minimal capital construction costs (no more than 1% of annual turnover), concerns transfer to the government virtually all expenses related to the expansion and reconstruction of not only rented state, but also their own military factories.
A characteristic trend in the development of the US military-industrial complex in the late XX - early XXI century is the extreme level of monopolization, the formation of a narrow group of holdings such as Boeing, Raytheon, Northrop Grumman, Lockheed Martin and General Dynamics, which divided and subordinated almost the entire defense business. In 1993-2007 alone, the number of general military contractors in the United States fell from 37 to five. The integration went virtually unidirectional, with the exception of a few cases: the acquisition of Pratt & Whitney by Rocketdyne from Boeing in 2005, the sale of a number of Lockheed Martin assets to the British BAE in 2000. In fact, we are talking about a market with oligopolistic competition, which in some cases is fraught with overstating the value of contracts. Therefore, the leading US defense companies feel confident. Military business profitability for 2014 is ahead of the S & P500 index.
Today, among the catalysts for the growth of the sector, we can highlight the recent appeal by the US President to Congress asking for permission to use military force against the Islamic State group, statements by the defense and air forces ministers about the growing threat from Russia. This creates the prerequisites for the growth of the value of large defense industry companies, on which investors can earn. In particular, over the course of 2014, Lockheed Martin's capitalization increased by 31 percent, the price per share reached 200 dollars. At the same time, experts believe that the company's securities are still undervalued and have the potential for growth to 250 dollars. According to 2011, 708 billions of US dollars were invested in the military industry, which is 4,7 percent of GDP for the same year. This figure is huge, many "blue chips" can only envy.
MIC stimulates the development of many industries, science, and the banking sector. Assessing the huge potentials, coupled with small risks and tangible benefits for the entire economy in the States, it is not surprising that approximately 50 percent of the total federal budget is invested here. The US industry at 65 percent is involved in military orders. In addition, the country's military-industrial complex is the largest employer in the world, feeding more than 3,2 a million people.
Barack Obama wanted to conduct a campaign to reduce federal spending and cut Pentagon funding. It was about 500 billions (71% of today's funding) for five years. What would this mean for the country's economy? Approximately 1,5 – 1,6 million people (according to the most optimistic forecasts) would lose their jobs due to such a reduction. To maintain the level of employment, the government would have to invest significantly large amounts of money (to support private firms, improve the business climate, etc.). This is an extremely difficult task. The load on the social apparatus will increase significantly. Domestic consumption will decrease, leading to a strong fall in GDP. It can no longer be issued for a simple fluctuation or cyclical decline. The reduction in GDP will hit the currency, reducing its attractiveness on the world market, which is catastrophic for the United States at this stage. If measures affect production weapons for export, the trade balance deficit will provoke more state debt to the Fed.
This development of events at one time leads the United States to their already inevitable default. Therefore, the military industrial complex has long become an important macroeconomic tool and regulator, a factor in the prosperity of the American economy.
The export of weapons brings the USA huge means, due to which they are trying to keep afloat. Also, any conflicts stimulate the work of the military industrial complex, and most importantly, they help to introduce the dollar into poor and destroyed countries as a reserve currency. There are plenty of examples of this. The fact that America is funding the rebels, whom in the West they like to call opposition, is a well-known fact, as well as the fact that they are armed with overseas "friends" and other supporters of "democracy."
What will be the end result from the introduction of the dollar - is still unknown, but the fact that they did not miscalculate with the export of weapons and the profits from it is a fact. Only in 2014, the Americans sold their weapons for 34,2 billion dollars and, according to official data, made profits for 30 billions.
In the first weeks of fighting in Iraq, the US military dropped more than 8,7 thousands of bombs and up to three thousand missiles of various classes. Already in the first strike on Baghdad, 36 Tomahawk cruise missiles worth about a million dollars each were used. One downed Apache attack helicopter cost 2003 millions in 22, and Bradley BMPs destroyed 1,2 millions.
It can be stated: the US manufacturing sector is kept from falling mainly due to the military-industrial complex and aircraft industry. At the same time, in other industries the volume of orders is reduced and enterprises working for export are particularly affected.
Therefore, a reduction in defense spending even in the context of fighting the US budget deficit is extremely disadvantageous for the entire economy. If this happens, the production sector of the recovery locomotive may become its brake. Hence the dilemma: either to abandon the savings in military production, or to stimulate domestic consumption and exports. If you choose the second path, the default may be the way: a weak dollar will revive exports.
From the middle of 90, Western states, first of all the USA, began to engage commercial structures that dealt with purely military tasks by civilian forces, many of whom in the past had experience in army service. Individual components of logistics, technical and operational support, combat and operational training began to be transferred to private companies. So at a completely new, almost legal level mercenary revived. Currently there are more than three thousand such companies operating in more than 60 countries around the world.
The activities of PMCs are controlled by Western intelligence agencies, primarily British and American ones. Moreover, since these companies cannot independently resist the enemy, surpassing the level of armaments, they will get the support of military special forces in advance.
The most vividly new processes in the military were manifested in the Balkans. Thus, in 1995, a weak Croatian army unexpectedly conducted a lightning-fast and successful operation to seize the Serbian Krajina. Military observers described the offensive as a classic NATO. Later it turned out that Croatian officers were preparing, developing a plan of operation and acting as advisers to employees of the private American company MPRI (Military Professional Resources Incorporated), consisting of retired generals and officers of the US Armed Forces.
For example, Blackwater PMC, which in February 2009 of the year received the name XE Services, can be cited. It was founded by former American Special Forces E. Prince. This is a small but well-armed private army, consisting of about 21 thousands of people. The success of the company can be judged by the size of annual revenues: if they were no more than a million dollars in 2001, they exceeded a billion in 2007.
The social base of militarism
The US Department of Defense has two government programs to attract small business orders: SBIR (Small Business Innovation Research - “Small Innovative Business”) and STTR (Small Business Technology Transfer - “Technology Transfer by Small Business”). In January, 2012-th Barack Obama reissued the SBIR and STTR annual funding law — about 2,5 a billion dollars over six years. With these programs, US federal agencies help small businesses bring the best innovations to the market. It is the results of rapid implementations that bring the United States to the forefront in the military field, strengthen competitiveness on a global scale.
The SBIR and STTR programs are coordinated by the Government's Small Business Agency (SBA). It focuses extrabudgetary funds with a volume of 2,5 percent of the total planned expenditures of all federal agencies for research with the ability to immediately send grants to entrepreneurs. According to annual reports, more than half of the funds are accounted for by companies where less than 25 people are employed, and a third - by firms with up to 10 people. Thirteen percent of total recipients are new businesses.
State development of small businesses began in the US in 1982, with the adoption of a special law. According to a report by Rep. Sam Graves, there are three main objectives: stimulating technological innovation in this sector, satisfying research and development by the federal government, and commercializing federal investment funds. Now the law is periodically extended by the US Congress.
In 2010, under the SBIR 11 program, US federal ministries and departments, including the Department of Defense, the National Aeronautics and Space Administration, the National Security Agency, provided small businesses with over two billion dollars in grants and contracts for innovation leading to commercialization. After participating in SBIR, companies own their idea as intellectual property and have all rights for subsequent use.
American threat all
The collapse of attempts to issue the surrender of our country's positions through the Minsk format hit Obama, who was never able to achieve a critical weakening of the Russian economy, in order to encourage the Russian elites to change course on the conditions the US insisted on. Right now, the Republicans rightfully say: we must urgently expand the Ukrainian part of the defense budget, in effect strengthening the financial and military involvement of the United States in the conflict, which at this stage is being carried out by those who have lost it.
Therefore, the maximum pressure is put on Obama to shift to more tough opposition scenarios. Of course, in the American military-political establishment, attempts continue to be resolved through diplomatic, compromise means. Recall that the word “war” in such pugals means rather a strengthening of the current hybrid war, and not a direct collision between the American and Russian armed forces, which, due to the factor of nuclear weapons, looks unlikely. Nevertheless, the US Republican Party, which controls both houses of Congress, is pushing for an increase in military spending by cutting back on social items. The House of Representatives has already adopted a resolution on the draft budget for the next year, providing for the allocation to the Pentagon of an additional 40 billions of dollars. The same document provides for a reduction in total expenditure of five trillion dollars over the next ten years due to savings on social items.
The internal security of the United States "worth hundreds of billions" needs a constant threat. No matter where it comes from - from Al-Qaida, ISIS or the Russian Federation. Therefore, maintaining the myth of the Russian threat is an important task of the US intelligence services.
Since 2001, the “war on terror” has officially been one of the priorities of the American administration. In domestic policy, this means expanding the apparatus of violence, restricting civil rights. For a decade and a half, the United States has spent a trillion dollars building an intelligence and law enforcement infrastructure, as well as military operations against elusive terrorists. After the attack on 11 skyscrapers in New York in September, 2001 in the United States created or reorganized 263 government organizations, including the Department of Homeland Security, the National Center for Counter Terrorism and the Transportation Security Administration. Intelligence agencies annually prepare a huge number of reports on these problems. The 51 organization tracks cash flow in extremist networks. Nevertheless, many observers have the impression that the United States does not so much fight terrorism as cooperate with it.
For the US, military business continues to be the core not only of foreign but also of domestic policy, although in many cases the main political goal of a war or unleashed military conflict is not victory, but the hype around it that hides backstage bargaining for commercial gain.
Since the Cold War, the composition of the military business’s shareholders has changed significantly: while in 70 it was a closed elite club, now the widest range of participants is observed - almost the 2 / 3 industry, one way or another connected with the execution of Pentagon orders, and a mass of various kinds of large and small military contractors, and a wide range of university scholars, not only American ones, and near-political forces that support national militarism and constitute the social and public base go lobby, and numerous media, faithfully working out the money of the military-industrial capital, including supranational. In essence, the distribution of the Pentagon’s money has become a separate kind of profitable business, to which the widest masses of the population are connected, if not directly, then as a social base for building up militaristic sentiments in society, creating favorable conditions for military commerce.
At the same time, there is a sharp increase in centralization and monopolization in the military-industrial complex: if in the past, thousands of enterprises were tough to compete with each other, now there are only a few who have divided the existing markets.
Everything is becoming the circle of national elites that determine the foreign policy of Washington, while the overall position on preserving and increasing the militarization of the economy remains virtually unchanged. At the same time, it is the main pivot of the national strategy for achieving global leadership at any cost.
The main macroeconomic problems of the United States (gigantic public debt, instability of the financial system, etc.) are directly related to constantly generated aggressive policies, the desire for a force scenario in relations with other countries, causing military hysteria and the growth of military production, in fact, not increasing GDP, but reducing.
On the other hand, the analysis shows that it is precisely the developed military production that is the main locomotive of the American economy and it is unlikely that it will be possible to solve economic and social problems in the country without his participation. Thus, it turns out that one of the key sources of Washington’s aggressive policy, and, accordingly, tensions in the world, is currently the American military business.
To build up military preparations, to invigorate militaristic propaganda, the widest range of not only proven, but also new tools is used: permanent information war, primarily against Russia - an old and habitual source of threats for “white and fluffy” Americans; economic war as a way to make Moscow play by the rules of Washington; “Color revolutions”, mainly against the Russian world, narrowing and undermining the influence of our country as much as possible, provoking it to retaliate power moves, which will immediately be exposed as aggression, which they “warned”.
Hence the conclusion: exposing the predatory, anti-human nature of the military business, in every way strengthening the partnership with the peace-loving forces, we should not allow ourselves to be dragged into a new arms race. An adequate response to emerging threats should be given in less costly ways. For this, it is necessary not only to complete the import substitution programs in the military-industrial complex as quickly as possible, but also to create a reserve for the future that ensures the country's military-technical security.