Bloody lobby

Who and how profits from global wars and conflicts 

Recently, US President Joe Biden signed a bill to provide Ukraine with $40 billion in aid. This is just an unprecedented amount. However, there is nothing to do with caring for Ukrainians here. Most of this money will be spent on military needs one way or another. The special military operation in Ukraine is akin to a ‘gold rush’ for the Western lords of war. Hiding behind the intentions of protecting ‘democratic ideals’, they are in a hurry to cut down a multibillion-dollar jackpot. However, not only they. Surely ‘pops’ of champagne corks are already can be heard in the US Congress, as well as in the Pentagon and other corridors of power.

Historical background

No matter how much they repeat in the White House about the importance of restoration of peace in Ukraine, this does not add any credence to the speakers. After all, the longer this conflict lasts, the more tangible are the losses from it (including for Europe and the whole world), the more ‘cream’ the US defence industry gathers for itself and the faster stocks of the giants of the Western military industry grow in price. 

After all, large corporations are patronised by very influential people from the world of big politics.

This has always been the case in history. Nonetheless, this was especially evident during the years of the First and Second World Wars, which convinced the most cynical and ambitious businessmen in Washington that the shortest way to enrichment lay through the rent-seeking behaviour towards the country’s military budget.
In the post-war years, the US military budget was reduced to an ‘indecent’ $12 billion. The Cold War had not yet gained momentum, but then a miracle happened: the war in Korea. Its beginning in 1950 quickly returned the country’s military spending to its normal size. 

From 1953 to 1961, approximately $230 billion was spent on military purposes in the United States at the time. 

For many large companies, the only way to prosper was a generous military budget. And the only reason to justify it is a war or a tense international situation.
In January 1961, Dwight D. Eisenhower unexpectedly warned people in his Farewell Address leaving the White House after two terms in office, 

“This conjunction of an immense military establishment and a large arms industry is new in the American experience… Yet we must not fail to comprehend its grave implications… In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex…”

Contributors and stakeholders

However, all these years, big money went along with big politics, and the influential American establishment openly lobbied for the interests of large military corporations. In return, they paid big money to their guardians in power. 

A US study by Brown University found that the US military industry has spent $2.5 billion lobbying its interests over the past two decades.

However, experts believe that in fact the figures are significantly underestimated and do not take into account the bribery of congressmen and representatives of the Pentagon and the State Department. For instance, according to data from open sources, Senator Richard Blumenthal received $258,000 for his election campaigns from the largest corporation Raytheon Technologies. The first tranches began to arrive in 2016. Naturally, this money had to be worked off. And Blumenthal did it well, lobbying for the idea of awarding a contract for the production of engines for the F-35 fighter jets to Pratt & Whitney, a subsidiary of Raytheon in Washington.
About five years ago, Blumenthal began to actively advocate for the supply of weapons to Ukraine, “Increased Russian aggression is leading to more wounded Ukrainian soldiers. The US must increase its support. We will be relentless and stay side by side with the people of Ukraine in this war. I am deeply impressed by the determination of the Ukrainians. They are brave, resilient, they will fight in the streets of their cities if we give them the weapons they need. That is why I am calling for the Stinger and Javelin man-portable air defence systems to be handed over to them so that they can destroy tanks and aircraft.”
Needless to say, both of these complexes are manufactured by Raytheon Technologies. 

For five years, Javelin alone brought the company $1.5 billion and what is more important Ukraine is a key market for this company.

Point of biography

Raytheon Technologies has its cronies not only in the legislative, but also in the executive branch of government. Secretary of Defence Lloyd Austin, for example, is a former board member and major shareholder in the colossus. His predecessor, Mark Esper, is also a former top manager at Raytheon.
US Secretary of State Antony Blinken welcomed any military conflicts that the States unleashed throughout his political career. Where does such a passion for wars come from? Is it really because of the desire to rebuild the ‘unjust’ political regimes in Iraq, Syria, Libya, Afghanistan? No, everything is far more practical.

There is an interesting point in the biography of Blinken, like the head of the Pentagon Austin: an equity partner of Pine Island Capital Partners company, which makes money on investments in defence industry enterprises. Not without reason, with the arrival of both in the White House, military assistance to Ukraine has almost doubled. Was it just pure coincidence? It’s a rhetorical question. 

War as a form of enrichment

Eric Sperling, the Executive Director of the American anti-war organisation called Just Foreign Policy, who previously served in the US Congress, told Xinhua News Agency that the lobbying power of the US military industry should not be underestimated.

Not surprisingly, senior military officials and retired employees often are part of the board of directors of military industrial enterprises or act as advisers, while those who worked in these enterprises hold government positions. 

According to a January report by Project on Government Oversight, an independent oversight organisation, Lockheed Martin has hired 44 former Pentagon officials, Raytheon and Northrop Grumman have hired 24 each, Boeing — at least 23, and General Dynamics — 8 in the past three years alone.
Analysts note that Russia’s special military operation in Ukraine will bring additional income to US defence corporations. The facts speak for themselves. Over the past few years, the US has provided almost 40 percent of the world’s arms exports, and its defence industry has flourished even more under Joe Biden. Since the beginning of Russia’s special operation in Ukraine, the shares of all the largest American military giants have jumped sharply. Thus, the value of the leading shares of Lockheed Martin rose from $354 per share at the beginning of the year to $453 on March 25th, which indicates an increase of 28 percent. Raytheon Technologies shares are up almost 20 percent over the same period. Northrop Grumann and General Dynamics followed with significant gains, with 20 percent each, and military-industrial colossus Raytheon with about 10 percent. Even though the stock growth indices of these companies fluctuated around zero and below at the beginning of the year.

Naturally, big business, including the giants of the defence industry, is striving in every possible way to at least maintain the current state of affairs, promoting those who will push their interests at all levels into power. 

By the way, this is also the answer to the question of how a president ends up at the helm of a world superpower, who greets the air, stumbles out of the blue and regularly experiences memory lapses. After all, it is much easier to manipulate such inadequate politicians, and the big financial and industrial magnates have learned this well for a long time.




By Yevgeny Kononovich