U.S. arms manufacturers profiting greatly from Ukraine war – The administration of U.S. President Joe Biden has been announcing fresh military packages on a regular basis, which means American weapons being sent to Ukraine will be keeping U.S. arms manufacturers occupied for a long time to come.
The combined U.S. military aid until now makes for a total of at least $25 billion committed since late February until August 3, according to the Ukraine Support Tracker.
On Thursday, Secretary of State Antony Blinken announced a new $2.2 billion military package for Ukraine and neighboring countries. Earlier President Biden had also approved a separate $675 million in weapons to Ukraine, Defense Secretary Lloyd Austin announced.
But there is no sign the U.S. is ending there; on Friday the White House said Biden will request a further $11.7 billion in emergency funding from Congress to provide lethal aid and budget support.
The five largest companies in the world that manufacture weapons are all American: Lockheed Martin, Raytheon, Boeing, Northrop Grumman and General Dynamics. In fact, half of the top 100 producers of arms are based in the U.S., while twenty are European.
In the aftermath of the Ukraine conflict, these five American firms saw their stock prices soar in a sign that investors believed profitable days were ahead. At a time when the broader stock market as measured by the S&P 500 had slumped by about 4%; Lockheed Martin’s stock price was up over 12% – with most of the gains occurring in its immediate aftermath. Northrop Grumman has jumped by 20%.
It’s not just the dealers making profit. Over the past months, reports have emerged showing how members of Congress stand to personally profit off the war with lawmakers or their spouses holding stock in arms dealers such as Lockheed Martin or Raytheon Technologies.
Likewise, politicians in the UK such as members of the House of Lords made tens of thousands of pounds by owning shares in the largest British weapons manufacturer and sixth in the world: BAE Systems. The arms dealers’ share price rose by 23% following the outbreak of fighting in Ukraine.
It’s not just politicians who benefit from the vast arms supplies to Eastern Europe; weapons dealers have many people on their payroll as well. These include the many pundits on the face of American mainstream media who discuss the war in Ukraine while having strong links to U.S. arms manufacturers.
It makes the job of the Biden administration much easier when trying to sell to the public the reasons to send more weapons and making announcements about new military packages.
The U.S. has shipped at least 5,500 Javelin anti-tank missiles manufactured jointly by Raytheon Technologies and Lockheed Martin. The two firms will be paid to replenish American stocks with the money coming from a $40 billion package signed by Biden.
The other weapons America has been sending include longer range missile systems, anti-ship missiles, anti-tank missiles, anti-aircraft missiles, helicopters, rockets, launchers, howitzers, radar systems, drones, aerial systems, armored vehicles, small arms, artillery and other arms. Washington has also put aside money for training, maintenance and sustainment.
That’s a lot of arms being shipped over by the U.S., which is leading the Western war effort in Eastern Europe against Russia which has long blamed the U.S. and NATO for triggering the conflict.
Moscow requested an emergency meeting of the United Nations Security Council on Thursday to discuss Western arms supplies to Ukraine.
The Russian ambassador, Vasily Nebenzya, told the council it was a “fantasy” to believe that Western powers can determine the outcome of the conflict with their weapons supplies.
“Western weaponry is not playing a decisive role in the battlefield” Nebenzya said.
He warned that “a significant proportion of these weapons finds itself in the hands of smugglers right from the warehouses. In the darknet, you can find all kinds of offers to buy these weapons. We’ve already seen similar situations in the Balkans and the Middle East where Western military arsenals were then re-exported to Europe and then used by criminal groups on European territory or found their way into the hands of terrorists.”
The UN’s disarmament chief, Izumi Nakamitsu, has also warned that the flood of weapons being sent to conflict areas such as Ukraine “raises many concerns including the potential for diversion”.
Campaigners have also been speaking out about the consequences of where these vast number of weapons may end up. Kristen Bayes, a spokesperson for the Campaign Against the Arms Trade, says the provision of weapons to Ukraine is not problem free. “You might think you’re handing over weapons to people you know and like, but then they get sold on to people you absolutely don’t”.
Campaigners say the risk of advanced and sophisticated weapons delivered to Ukraine ending up on the black market is high because authorities are not in full control of all territory. They argue it is also difficult to keep track of the arms when they have been sent so quickly.
In July, the Financial Times quoted Western officials with knowledge about talks between several NATO members and Kyiv to explore a tracking system or detailed inventory lists for weapons highlighting Western fears about missing weapons.
“All these weapons land in southern Poland, get shipped to the border and then are just divided up into vehicles to cross: trucks, vans, sometimes private cars,” said one of the Western officials. “And from that moment we go blank on their location and we have no idea where they go, where they are used or even if they stay in the country.”
It’s not just the U.S. of course; the United Kingdom has also committed at least £2.3 billion in military assistance. Following the UK is Poland, Germany, Canada, the Czech Republic, Australia and France. Out of the 28 countries sending weapons, 25 are NATO members.
Many European countries used the Ukraine conflict to announce plans for increased military spending. The additional commitments are worth at least €200bn according to the EU.
Germany committed an extra €100 billion in the coming years, with Chancellor Olaf Scholz saying defense would make up two percent of his country’s GDP from now on. As a result of the news, German arms manufacturers can expect to see their sales grow significantly. Berlin has already announced it will be purchasing 35 American F-35 war planes, which are produced by Lockheed Martin and have an estimated lifetime cost of $1.6 trillion.
The French President Emmanuel Macron has pledged to expand his country’s defence budget, while the British government had already planned increased spending before the conflict broke out but faces pressure from Labour to spend even more.
Poland said that it had requested 500 HIMARS launchers and ammunition from Lockheed Martin. Estonia confirmed it has been in touch with the American manufacturer also to buy launchers and ammunition worth. Latvia and Lithuania are expected to follow suit.
Campaigners say with so much profit being made from the war, it’s not surprising that peace is not being pursued.