Profit and the Arms Economy

Philip Roddis

Three years ago, Global Research showed that interests backing Trident also finance Russia’s nuclear programme.

This news, relayed a few months later by the Canary, should have caused a storm in anti-war circles. In fact few noticed. Debate around Trident continued to centre on whether or not it was (a) insurance against a credible threat, (b) worth a price tag running to hundreds of billions,[1] (c) a diversion from more efficient uses of arms spend, or (d) intrinsically deranged.

That last comes closest to the truth, to be sure, but too few of those who see nuclear weapons as monstrous are taking in the full picture. That ‘deterrence’ industries operate to a rule book written by Catch-22’s Milo Minderbinder, aka the demented laws of capital accumulation, is an aspect frequently lost sight of when discussion is confined on the one hand to pragmatics, on the other to moral absolutes.[2]

Bear with me a moment. Back in the eighties, with the world again on the brink of realising its worst nightmare, Socialist Workers Party had the strap line, “Neither Washington nor Moscow”. Other left sects denounced this as a sop to popular sentiment created by market driven media in what Herman and Chomsky would later call the manufacture of opinion.

Those sects were no less dismissive than SWP of a USSR leadership they saw as freeloading on the property gains of 1917 while incapable of defending said gains against a Western imperialism that would never accept – could never accept, other than as a temporary setback – the closing off of one sixth of the world’s land mass to profit.

All the same, SWP’s left critics rejected the moral equivalence implicit in ‘neither Washington nor Moscow’. There were many aspects to this but what matters here is that the very natures of capitalism on the one hand, top-down economic planning[3] on the other, have hugely different implications for their arms sectors. Every dollar spent by the US on arms is:

  • enabled by a unique advantage conferred by Bretton Woods and altered but in no way negated by Nixon’s 1971 removal of the dollar from gold parity[4]
  • a boost to its grotesquely distorted economy
  • a transfer of wealth within the USA from the many to the few
  • a means, with US military bases across the globe vastly outnumbering those of all other states combined, of enforcing its imperialist will, defined in the last analysis by the export of monopoly capital and repatriation of profits.

In stark contrast, every rouble spent on arms by the USSR was a drain on its economy. Indeed, forcing that economy to its knees via the diversion of labour values from industrial and welfare infrastructure to a spiralling arms race was an explicit goal of the Reagan era.

So what? The USSR is history. It is, but the arms industry of today’s Russia shares two striking features with its pre-1990 ancestor. First, it is largely under state control, which is not quite the same as being state funded – though it is that, and to a degree America’s pork barrel senators would denounce as communistical.[5]

Second, it continues to be a drain on the Russian economy, holding back the gains made since the departure of the drunken buffoon, Yeltsin. A drain on the economy. Think about that. Arms spend, in a sane world, bloody well should be a drain! That a Western public has ‘learned’ to accept arms for profit as normal and even desirable is of itself a pretty clear indicator of how far we’ve travelled the road of moral turpitude, and imbibed the logic of Alice in Wonderland.

I’ll close by handing over to Eric Zuesse. Writing in OffGuardian, he begins:

Unlike a regular corporation, the corporations that manufacture and sell weapons to their government are virtually 100% dependent upon their government and its military allies, for their own success; their markets are only those governments, not individuals (such as is the case for normal corporations).

Consequently, either their government will control them, and those firms won’t have any effective control over their own markets, or else those firms will, themselves, control their government, and thereby effectively control their markets, via the government’s foreign policies — not only via expanding its military alliances (those firms’ foreign markets), but via its designating ‘enemy’ nations that it and its ‘allies’ (those arms-producers’ foreign markets) can then use those weapons against.

In countries such as the United States, arms-producers are benefiting and controlled by the country’s billionaires, instead of (as in Russia, for example) benefiting and controlled by the government. These totally profit-driven arms-producers need to have market-nations that are called ‘allied’ governments, but they also need to have some target-nations that are called ‘enemy’ governments, so as to ‘justify’ more arms-production by these firms, against which to use these weapons. Only in nations where arms-producers are privately instead of publicly controlled are the government’s foreign polices predominantly controlled by the country’s arms-producers. That’s the way it is in America.

Full piece here.


[1] Even some trade unionists defend Trident on the ground it creates 30,000 jobs. Do the sums. CND puts Trident costs at £200bn. Divide by 30k and we see that each worker could be given £6.6m each and sent home. OK, CND may be inflating the figure – though long experience suggests costings for such projects are invariably underestimated – but however we slice it the jobs argument for Trident is absurd.

[2] Speaking of moral absolutes, while nuclear weapons terrify me, in the here and now it would be madness for North Korea to ditch them, and madness for Iran not to make their acquisition a burning priority.

[3] “Soviet Union” was a misnomer, Stalin having abolished the soviets, one of whose functions would have been more responsive bottom-up economic planning, in the late twenties.

[4] In The Global Minotaur, Yannis Varoufakis sets out how – in the context of the need of all ruling classes not only to extract surplus value but to store and/or recycle it – post WW2 America became the first economy ever to make permanent debt profitable.

[5] There are those in arms geek circles who say Russia makes better weapons – SAMS, tanks and small arms in particular – because their primary purpose is to deter and if necessary kill, whereas the primary purpose of armaments in the USA is, one way or another, to make profits.


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Categories: latest, Russia, United States
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May 16, 2019 11:57 PM

This is a good article about the US war machine

May 16, 2019 9:11 PM

“Speaking of moral absolutes, while nuclear weapons terrify me, in the here and now it would be madness for North Korea to ditch them, and madness for Iran not to make their acquisition a burning priority.”

I have yet to be convinced that Iran has any desire to obtain nuclear weapons.

Philip Roddis
Philip Roddis
May 17, 2019 9:00 AM
Reply to  John2o2o

Well I don’t know about the Ayatollah’s intent either, John2o2o. I was speaking to the logic of the fix they’re in. Right now their best insurance against US aggression escalating into outright, falsely flagged invasion would be a nuclear deterrent.

George Cornell
George Cornell
May 17, 2019 10:17 PM
Reply to  John2o2o

They would be mad not to. Israel is constantly agitating within the US for anti-Iran measures, including direct attack.

May 18, 2019 11:37 PM
Reply to  John2o2o

Every country in the world should have them, or none. Maybe it’s time to democratise nuclear weapons. If the utterly vile Zionist Regime has them, everybody else should as well.

If Iraq/ Yemen/ Libya had them, millions of people now dead would still be alive. Millions of people. Regardless of what regime rules a country, its first duty is to keep its people alive. Pakistan and DPRK have done it, so everybody can. People have to do what it takes to protect themselves from Murder and Mayhem Inc., AKA the Yew Ess Ayy.

Profit and the Arms Economy – steel city scribblings
May 16, 2019 8:13 PM

[…] This post also features in OffGuardian […]

May 16, 2019 7:37 PM

Take the profit out of war and warfare will be as dead as the dodo. This can be done relatively easily and simply The Neutrality Legislation of post WW1 USA would be a suitable template. No private arms manufacturing or trade, all a government monopoly. No bank loans to countries at war. Strict state control of the wartime economy, with a closure of financial markets, strict control of wages, incomes, prices, rationing and taxes to pay for the war. No draft dodging by the rich and well connected. If this had been the prevailing situation, Vietnam/ Iraq and all the rest would never have happened. If a new war threatened the annual bonus, Goldman Sachs would turn into fanatical pacifists overnight. This has always been the case with warfare through the ages. The Hundred Years War was waged between 1337-1453. It was a disaster for both countries. The French countryside… Read more »

George Cornell
George Cornell
May 16, 2019 9:00 PM
Reply to  mark

I completely agree. The solution is to use democracy for what it was intended. In the West it has been gamed comprehensively. Here the punter has a choice between the Tories, afflicted with the same condition as Oz’s tin man, and Labour riddled with dissension, excelling in backbiting and eating their young, but all told, hardly any different. The single issue fanatic parties as Safire called them, don’t yet provide credible alternatives for those concerned with global issues. In the US, it is depressingly similar. The ragtag gaggle of deeply unattractive Dem challengers, are backbiting before anyone knows what they stand for, other than themselves. Some even make the odious Trump look like a candidate. The obsession of the MSM, first with the election results in which they claimed Hillary won, gave way to ridiculous China-bashing and Russia-scaremongering, and now has been distracted by preoccupation with his taxes and finances.… Read more »

May 16, 2019 9:14 PM
Reply to  mark

I may agree with your first paragraph, but fail to see how you would see that put into practice.

I have to disagree with your assertion about riches in the final paragraph. Money has less meaning in cultures without banks.

May 16, 2019 10:04 PM
Reply to  John2o2o

It WAS put into practice (partly) in the aftermath of WW1.
There were banks in this period, the Templars, the Florentines, Aaron of Lincoln in England.
As to money having no meaning, I find that odd. Money then was gold and silver coin, not the worthless toilet paper we have today.
Wealth was held mainly in the form of land. One of William the Conqueror’s right hand men was worth £53 billion in today’s values. I think his money probably had a lot of meaning to him.

James Doyle
James Doyle
May 18, 2019 1:26 PM
Reply to  mark

Trump needs to fire the 3 Warmongers and physcos from his administration, before they start World war 111. Bolton, Pompeo,and Abrahams are dangerous clowns with nothing on their mind only war war war. Let them be first on the battlefield when they are so willing to start. War’s