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The Military-Industrial Complex

The Military-Industrial Complex

James A. Huston

Probably no presidential farewell address since that of George Washington in 1796 has had a greater impact or more lasting quality than that of Dwight Eisenhower in 1961. Washington's is remembered mainly for his warnings against political factions and foreign alliances. Eisenhower's is remembered for his warning against the military-industrial complex. Coming from Eisenhower, who had risen through the military ranks and was assumed to be a "friend of big business," the words surprised listeners but also carried great weight. Apparently the term itself may be attributed to him.

In mid-December 1960, Norman Cousins, editor of the Saturday Review, had suggested the idea of a farewell address. Eisenhower turned to one of his special assistants, Malcolm Moos, a young political scientist from Johns Hopkins University, to draft the speech, and worked closely with him in preparing the text. The president's closest economic advisers were not aware of the contents of the speech until they heard it broadcast.

Speaking to the nation on radio and television on the evening of Tuesday, 17 January 1961, Eisenhower said the following about the MILITARY-INDUSTRIAL complex:

Until the latest of our world conflicts, the United States had no armaments industry. American makers of plowshares could, with time and as required, make swords as well. But now we can no longer risk emergency improvisation of national defense; we have been compelled to create a permanent armaments industry of vast proportions. Added to this, three and a half million men and women are directly engaged in the defense establishment. We annually spend on military security more than the net income of all United States corporations.

The conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence economic, political, even spiritualis felt in every city, every State house, every office of the federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society.

In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the MILITARY-INDUSTRIAL complex. The potential for the disastrous rise of misplaced power exists and will persist.

At a press conference the next morning, Eisenhower expanded on the military-industrial complex theme. In response to one question he said:

It is only a citizenry, an alert and informed citizenry, which can keep these abuses from coming about. And some of this misuse of influence and power could come about unwittingly but just by the very nature of the thing, almost every one of your magazines, no matter what they are advertising, has a picture of the Titan missile or the Atlas or solid fuel or other things, there is almost an insidious penetration of our own minds that the only thing this country is engaged in is weaponry and missiles. And, I'll tell you we just can't afford to do that. The reason we have them is to protect the great values in which we believe, and they are far deeper even than our own lives and our own property.

Eisenhower's main concern was that military industries would exert an undue influence on government policy. Munitions makers were likely to encourage warlike policies in the interest of their own profits. Beyond that, Eisenhower saw a danger that individual companies might influence military strategy by their advocacy of their own weapon systems. Further, a great conglomerate of military industrial power might threaten individual liberty.

The main concern of others, like Seymour Melman, an industrial engineer and economist at Columbia University, has been that government policy, concentrating on the development and maintenance of a big military industry, would have an unfortunate impact on the national economy.

Indeed, Eisenhower shared the concern about the economic cost of maintaining large armaments. In an address before the American Society of Newspaper Editors on 16 April 1953, he had called for control and reduction of armaments. He said that if an unchecked armaments race continued, "the best that could be expected" would be:

a life of perpetual fear and tension; a burden of arms draining the wealth and the labor of all peoples; a wasting of strength that defies the American system or the Soviet system or any system to achieve true abundance and happiness for the people of this earth.

Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.

This world in arms is spending the sweat of its laborers, the genius of its scientists, the hopes of its children.

The cost of one modern heavy bomber is this: a modern brick school in more than thirty cities. It is two electric power plants, each serving a town of sixty thousand population. It is two fine, fully equipped hospitals. It is some fifty miles of concrete highway.

We pay for a single fighter plane with a half million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than eight thousand people.

This is not a way of life at all, in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron.


Historians have not yet devoted much study to the military-industrial complex. It has surfaced as a concept and concern only in very recent times. Moreover, well-developed bodies of theory and data are not readily available. The editors of the Journal of International Affairs have aptly summarized the situation:

Of all the political ideas that gained popular currency in the 1960s, the military-industrial complex is the concept perhaps most gravely deformed by public mastication. The debate of 1968 and 1969 over the influence of the military establishment in the United States proved, with few exceptions, consistently unsatisfying. After all was said, the concept of the military-industrial complex remained muddled and its attendant questions of international and domestic political influence were still unanswered.

Political leaders reflected the confusion of the man in the street, of business leaders, industrial workers, farmers, college students, and activists for conflicting causes. All were caught up in a dilemmathat armaments cause wars, and that arms industries create prosperity. At the same time, nearly everyone agreed that some military forces were needed for national security, and these in turn depended upon some kind of military industry.

Here we can see the great dilemma of U.S. military-industrial policy: Can the security of the United States be better served, can the economy of the nation flourish more, and can the attending evils of arms manufacture be better reduced or avoided by government or by private manufacture of munitions? This was a question to which leaders gave their attention from the early days of the Republic.

The American military-industrial complex may be said to have had its origins with Alexander Hamilton and Eli Whitney. Those two men of genius were in the vanguard of a group of imaginative men who set the course for the national arms policy of the United States. Hamilton emphasized government manufacture of arms, though he recognized the need to develop a private arms industry as well if what he conceived to be the defense requirements of the country were to be met. Whitney was the entrepreneur par excellence who saw opportunities for profit in making arms for the government.

In 1783, Hamilton, a twenty-eight-year-old former lieutenant colonel, presented a report on a military peace establishment to the Continental Congress. In it he called for the establishment of "public manufactories of arms, powder, etc." and proposed the employment of troops in the national armories. This, he maintained, would be far more economical than the importation of arms from Europe. But Hamilton's concern for domestic arms manufacture went beyond the possible economies. He thought independence from foreign arms makers to be essential for national security.

In his celebrated "Report on Manufactures" in 1791, Hamilton offered a program whose central theme was the development of domestic industries for national security. Hamilton would encourage domestic arms production by a protective tariff and by an annual purchase of weapons as an incentive for continuous manufacture. Still, in the long run, Hamilton looked to the desirability of government manufacture of all arms of war. His concern about the private manufacture of weapons was not that the private companies would become too powerful and would exert undue influence on national policy. It was that private companies could not be relied upon to provide the arms necessary for national security.

Eli Whitney of New Haven, Connecticut, desperately in need of capital, turned to the U.S. government with a fantastic proposal to manufacture 10,000 or 15,000 stand of arms at the very momentwhen war with France threatened that the government could not afford to turn down any halfway realistic proposal for making arms. As he followed the debates in Congress on proposed appropriations for arms procurement, Whitney decided that here was the best possible opportunity to get a government contract.

Whitney decided that the only practical way to produce 10,000 satisfactory muskets in the United States, where skilled armorers were few, was to reduce the complex steps of gunmaking to a series of more simple tasks, each of which could be done with less skilled hands, and to design machines that would duplicate some of the armorer's skill. For best results, it would be necessary to make parts precise enough to be inter-changeable. This would permit the maximum division of labor and make it possible to accomplish repairs simply by replacing parts.

One of the most important contributions to the development of a domestic arms industry was the act of 1808 for arming the militia. By this time the national armories were making 5,000 to 10,000 muskets a year, but relatively few were being delivered by private makers under contracts of 1798, and, even though they were admitted duty free, almost none were coming in from Europe, where the Napoleonic wars were raging.

The act of 23 April 1808 provided for the appropriation of an annual sum of $200,000 for arms and military equipment for the militia of the United States, by either purchase or manufacture. The purveyor of public supplies, Tench Coxe, advertised in newspapers of the leading cities for bids for contracts to make muskets. Between 30 June and 9 November of that year, Coxe let contracts to nineteen firms for a total of 85,200 muskets. The contracts were for five years, with one-fifth of the total number, in most cases, due each year. However, the time schedules proved to be unrealistic and a number of the manufacturers unreliable.

Unique among the states, Virginia took upon itself the task of manufacturing arms for its militia independent of outside sources. Authorized in 1798, the Virginia Manufactory of Arms, occupying an impressive building along the James River in Richmond, turned out enough weapons between 1802 and 1821 to arm all the county militia58,400 muskets, 2,100 rifles, 4,200 pistols, and 10,300 swords.

Soon a national arms system based upon two national armories and a group of dependable private firms was fairly well established. Beginning with the funds appropriated for the arming of the militia, the government gradually developed a policy of providing orders for the most promising establishments on a long-term basis. As to the advantages of public versus private manufacture of military arms, there was much to be said on both sides. In the earlier period there was strong sentiment in favor of depending solely on national armories. The national armories were readily available and less expensive, and they established price standards for private contractors. Private manufacturers seemed more likely to improve models, and to experiment with new materials and new methods. Both were needed for the best possible system of arms production.

Recognizing that the military-industrial complex does exist as a powerful, if informal, structure in American military and economic affairs, the following questions arise: How did it get that way? What are its consequences? What can be done about it?

The forces that have driven the development of the military-industrial complex include the following:

  1. The national arms policy during the first half of the nineteenth century. The early decision to rely on production both in government facilities and by private firms for providing armaments set the stage. The policy of long-term contracts with private arms manufacturers planted the seeds for a permanent arms industry in peacetime.
  2. Industrial expansion during the Civil War. The first industrial mobilization that approached total war created undreamed-of opportunities for profit and showed what might be done in arms production.
  3. Industrial mobilization during World War I. This carried the opportunities a step higher, but the effects were only temporary, because no large-scale defense industry persisted after the war, when the drives for disarmament and isolation amid cries against profiteering by "merchants of death" discouraged such activities.
  4. World War II expansion. This was several notches higher than the mobilization for World War I and was when many firms got their start in military production, and then continued after the war under conditions far different from the postWorld War I period.
  5. Government-sponsored research and development on a large scale. This major development during World War II had important consequences in the years that followed. This has been one of the keys to the growth of the military-industrial complex.
  6. Nuclear weapons. This was another legacy of World War II that overshadowed defense policies in the postwar world.
  7. The Cold War. The perceived threat of the Soviet Union to security in Europe, and the perception of communism as a worldwide threat led to an armaments race in both nuclear and conventional forces that gave a certain permanence to defense industries. Broad programs of foreign military assistance became a part of this, and added to demand for military production.
  8. Korea. The communist attack against South Korea called up further military-industrial efforts and gave credibility to the fears of the Cold War.
  9. Vietnam. This conflict maintained the demand for military equipment at a high level over a long period of time.
  10. The Gulf War. Just when there were growing demands for cuts in military expenditures to help reduce the national deficit, the crisis in the Persian Gulf served to renew requirements for production.
  11. The policy of maintaining a "guns and butter" economy in the buildup for Korea, for Vietnam, for the Gulf War, and for the Cold War in general meant that if the unsettling impact of continuous conversion and reconversion on domestic industries was to be avoided, some measure of a military industry on a more or less permanent basis would have to be maintained.
  12. The economic impact of defense industries on local economies, and the supposed stimulus of defense spending on the national economy. This brings pressure from local industrial leaders and from local labor unions and workers in general who are employed in defense plants, from local chambers of commerce and businesses that stand to benefit from providing consumer goods and services to defense workers and their families, and from members of Congress and other political leaders anxious to stimulate employment in their districts.


With all these forces at work, what are the consequences spawned from the powerful military-industrial complex? Several unfortunate consequences emergean undue influence on military policy and strategy, a tendency to extravagance and waste in defense spending, a negative long-range impact on the economy, and a possible weakening of the country itself.

To what extent do the pressures of manufacturers worried about profits, communities worried about unemployment, and members of Congress and presidents worried about local or general business depressionand ultimately about votes in key statesinfluence our choice of weapon systems, and thus affect the military considerations in our national strategy? Do we build a new bomber or a new missile or a new aircraft carrier because our strategy requires it, or because some group demands it, and then develop a strategy to include it? There always is the prospect that elements of a powerful military-industrial complex will influence national policy and strategy in the interest of favoring certain weapon systems not simply on the basis of military advantage, but for the benefit of the companies making them, or for the armed service using them, or for the locale where they and subsidiary instruments are made.

Why else would General Dynamics take out a two-page, full-color advertisement in Smithsonian magazine to proclaim its F-16 Fighting Falcon "the finest fighter in the world" and to review its achievements in producing the B-24 bomber during World War II and the B-36 afterward? Why would the same company take a two-page, color ad in National Review to extol the virtues of its M-1 Abrams tank? Why does McDonnell Douglas present a television commercial to "sell" its F-15 Eagle fighter aircraft?

In the fifty years after the conclusion of World War II, three forces led to the maintenance of a military establishment of unprecedented proportions

Contractor Headquarters DOD Contracts FY 1968 (billions of dollars) Main Projects
General Dynamics New York $ 2.24 F-111 fighter-bomber, Polaris submarine
Lockheed Aircraft California 1.87 C-141, C-5A transports, Polaris missile
General Electric New York 1.49 jet engines, electronics
United Aircraft Connecticut 1.32 jet engines, helicopters
McDonnell Douglas Missouri 1.10 Phantom F-4, Douglas A-4 bomber
AT&T New York .78 Safeguard missile, antisubmarine projects
Boeing Washington .76 B-52, helicopters, Minuteman missile
Ling-Temco-Vought Texas .76 A-7 fighter, electronics, Lance missile
North American Rockwell California .67 avionics, submarine electronics
General Motors Michigan .63 gas-turbine aircraft engines, tanks, M-16 rifle
Contractor DOD Contracts
Lockheed Martin $ 12.67 billion
Boeing 11.57
Raytheon 6.40
General Dynamics 4.56
Northrop Grumman 3.19
United Technologies 2.37
Litton Industries 2.10
General Electric 1.71
TRW 1.43
Textron 1.42

for the United States over such a length of time: the Cold War with the Soviet Union, involving an arms race throughout most of the period; the Korean War (19501953), and the Vietnam War (19641975). As the period ended (that is, as the Cold War at last appeared to have come to a close), a fourth situation assured continuation of military-industrial productionthe deployment of forces and combat operations in the Persian Gulf region.

Military orders for goods and services went from $27.5 billion in 1964 to about $42.3 billion in 1969. The total defense budget for fiscal year 1969 was $79.788 billion, which amounted to 42.9 percent of the total federal budget, and between 9 and 10 percent of the gross national product (about the same percent as throughout the preceding decade). Defense funds went to every state, to 363 of the 435 congressional districts and to over 5,000 communities. Workers in defense industries and in defense-related production in mining, agriculture, construction, and services comprised over 10 percent of the total labor force. The Defense Department itself employed as many civilians as the populations of New Hampshire, Vermont, and Maine combined.

Despite the lowering of tensions between the United States and the Soviet Unionand between Eastern Europe and western Europein 1989 and 1990, the Pentagon in 1990 still was planning to put $100 billion into the improvement of the nuclear arsenal over the next ten years. This was in addition to the continuation of the Strategic Defense Initiative ("Star Wars") research program. The SDI effort began in a television address to the nation by President Ronald Reagan on 23 March 1983. It was a call for a defense system that would protect the United States from enemy nuclear missiles. The specific objectives of the program were not clear. At first it was offered as a more or less total net to protect against all missiles. Then it was suggested as something that would be valuable against missiles from China, North Korea, or other countries. Then it was seen mainly as protection of American missile silos so that the capacity to retaliate against a first strike would be guaranteed. To say the least, it was controversial largely out of conviction on the part of many scientists that it never would work, and on account of the vast expense involved. By 1987 the funding for SDI research and development had reached about $6 billion a year. The Department of Defense in 1990 estimated that the annual outlay would rise to about $12.5 billion in 1997. In September 2000 President Bill Clinton announced that he would not proceed with an order to build the missile defense system. Incoming President George W. Bush announced that he would continue the program. The total cost was estimated at $60 billion.

In any case, "Star Wars" was the epitome of the kind of program best calculated to encourage the military-industrial complex. It involved the expenditure of billions of dollars a year for many years, with no end in sight. Its effects spread into many kinds of activities and into many parts of the country. Much of it was conducted in secrecy. There was no way that it could be criticized for being over budget or behind schedule. Even many scientists who remained skeptical about the possible effectiveness of such a scheme were willing to acquiesce, and even to participate in it, for they saw it as a significant source for research funds when other sources were drying up.

At the end of the 1980s, Department of Defense officials were becoming concerned, not about an expanding military-industrial complex, but about a decline in American industrial capacity for military production. In 1990 the share of the United States in the world machine-tool market was less than half of what it had been in 1980. In the first half of the 1980s, the rate of growth of productivity in the United States was 3.5 percent, compared to nearly 6.5 percent in Japan. Deployment of forces to the Persian Gulf region changed all the impetus for reduction. That exercise in 19901991 added an estimated $30 billion to defense expenditures.

An increasingly significant arm of the military-industrial complex was the research communitythe universities and private think tanks that lived on defense contracts. About half of all the scientific research being carried on in the United States in fiscal year 1969 was related to the military. Some 195 educational institutions received defense contracts of $10,000 or more during the year. The Massachusetts Institute of Technology, Stanford, and Johns Hopkins were among the nation's top 100 defense contractors.


Surely the greatest direct impact of the military-industrial complex on American foreign policy, and the greatest direct impact of American foreign policy on the military-industrial complex, has been in the transfer of arms among nations, programs of military assistance, cooperative production programs, arms sales abroad, and the rise of multinational corporations in arms and related industries.

One of the most serious charges leveled against the military-industrial complex is that it campaigns actively and effectively against arms control and disarmament, and exerts a controlling influence on the shaping of foreign policy. Those who traffic in military procurement have a vested interest in an unstable international environment. According to proponents of this view, the profits and power of the complex would decline catastrophically if real progress were made in limiting strategic nuclear weaponry and conventional weapon systems. For this reason, it is claimed, advocates of huge arms expenditures use all available means of shaping public attitudes and governmental behavior to perpetuate an illusion of great international danger emanating particularly from the communist bloc of nations. Modern "merchants of death" are said to pursue their own interests in complete disregard of humanitarian considerations.

Juan Bosch, former president of the Dominican Republic, writes of what he calls "Pentagonism." No longer do advanced capitalist nations send out their military to conquer and exploit colonies. Foreign warfare or the threat of warfare provides "access to the generous economic resources being mobilized for industrial war production. What is being sought are profits where arms are manufactured, not where they are employed, and these profits are obtained in, and bring money in from, the place where the center of pentagonist power lies." In short, the domestic population is exploited now as colonies were in the past.

But the serious question remains: Do not countries that have no substantial arms industry have a right to obtain arms from outside sources in order to defend themselves? And is it not in the national security interest of the United States to have allies who are well armed and equipped for military action?

The opening rounds of the Cold War took place in the intercontinental crossroads of the Near East. Only there did Russian efforts fail to consolidate a system of "friendly" buffer states along the Soviet borders. Communist guerrillas in Greece had threatened to extend communist influence in the Balkans and to deliver to the Soviets another strategic area for possible domination of the eastern Mediterranean.

What had brought matters to a head so far as American policy was concerned was not a new and sudden communist attack, but the announcement by the British in February 1947 that they no longer would be able to continue the assistance they had been giving to Greece and Turkey. This might have opened the door to communist penetration. Actually, it set the stage for the policy of military aid that came to be known as mutual defense assistance.

Even as the North Atlantic Treaty was being discussed in early 1949, the implication was clear that American matériel assistance to the participating countries would be necessary if the new organization were to have any real effectiveness as a deterrent to aggression. But President Harry Truman waited until the day after he signed the instrument of ratification to follow it up with a formal request for military assistance. Calling for $1.45 billion, this proposal would consolidate in one act the existing programs for Greece and Turkey, Iran, Korea, the Philippines, and the Western Hemisphere, with a new program for North Atlantic Treaty countries. It envisaged three types of assistance: (1) direct transfer of American military equipment; (2) expert guidance in using the equipment and in production of equipment; and (3) dollar aid to increase direct military production in Europe. Ten weeks later Congress approved the program in the Mutual Defense Assistance Act.

In three years of war in Korea, allied forces other than those of the United States and the Republic of Korea never reached as much as 10 percent of the total troop strength. The United States provided half or more of the logistic support for these forces, but this amounted to a relatively insignificant fraction of the total supplies and services furnished by the United States and Korean forces. But the problems of coordination, negotiation, and accounting were as great as if troop contributions had been several times as large.

A truck rebuilding program in Japan grew to a large scale for the Korean War efforts. Civilian automotive experts sent by the Department of the Army began to arrive in Japan in December 1947 to set up the first production lines. The plan was to rebuild motor trucks on a mass production basis. Although Japan was the foremost industrial power of the East, much in American methods of mass production was foreign to many Japanese workers and supervisors. They were not used to the close tolerances and rigid inspections necessary for the complete interchangeability of parts that is the basis for mass production, and many of their work habits and customs seemed quaint when compared with American factory methods. A training program soon overcame most of those obstacles, and completely renovated trucks began to roll off the assembly lines in ever-increasing numbers.

Old trucks brought into the plants first went to the disassembly line, where they were completely broken down to the last nut and bolt. These parts were then sorted, cleaned, and sent to the various shops. Engines, transmissions, carburetors, and other major assemblies were rebuilt in separate plants. Various parts came together on the assembly line after the fashion of Detroit. The new trucksbuilt of old partsthen went through a tune-up shop, received a new coat of paint, and a thorough final inspection, and then entered the supply system. In 1951 vehicles were coming off some assembly lines at the rate of one every four minutes. Some 30,000 Japanese were working on the project under the supervision of 50 ordnance officers, nearly 300 civilian experts from the Department of the Army, and about 500 enlisted men from the Ordnance Corps. Here, surely, was an indirect boost to the Japanese automobile industry, and perhaps a further thrust toward a "military-industrial complex international."

An aspect of the defense business that was becoming more significant, with a new twist and a different thrust, was the sale of arms and equipment abroad. The provision of military equipment to foreign countries around the world under the mutual defense assistance programs and other programs already has been mentioned, but there was more to it than that. Now there was a studied effort to persuade other governments to buy American military matériel.

As a part of military assistance to other countries, the United States at first emphasized cooperative production programs with certain of those countries. Undoubtedly, the cooperative production programs contributed significantly to European defense. But Europeans saw the whole effort as too much of a one-way street. The United States showed little inclination to accept European designs for cooperative production either in the United States or in other European countries, even when European designs were favored by those countries. According to one view expressed at the time, this situation was the natural result of American technological superiority and Yankee salesmanship. Another suggested that it was due at least in part to pressure by the U.S. government, which had been lobbied by its own defense industries.

Recognizing what was appearing to many to be the growth of an unhealthy situation, Secretary of Defense Robert McNamara suggested a "common market" in armaments within the NATO alliance. This would encourage trade among all the allies on the basis of economy and quality, including better opportunities for European nations to sell to the United States. The impediment to this scheme came not mainly from trade barriers but from government procurement policies. A serious blow to anything approaching the kind of "common market" that McNamara envisaged came in the fall of 1967 with a nationalistic restriction that Congress imposed on the Defense Appropriation Act. In this instance, the members of Congress who offered the restrictive amendment evidently were interested mainly in eliminating foreign competition for shipbuilding industries in their home districts. But the vote in support was so large that it seemed likely that other members might be seeking similar protection for other kinds of goods at a later time.

Another point of some criticism was in U.S. arms sales to developing countries that could ill afford them. In 1972 four nationsthe United States (which accounted for one-third of the world's total weapons), the Soviet Union, Britain and Francewere responsible for more than 90 percent of all exports of arms to ninety-one developing countries. Total exports of U.S. arms to foreign countries from 1945 to 1972 (whether in grants or in sales) amounted to approximately $60 billion. This was a significant addition to the orders of American defense industriesand a further impetus to expansion and consolidation of the military-industrial complex.

Some critics have suggested that American enthusiasm for the expansion of NATO to include Poland, Hungary, and the Czech Republic was based less on concerns for national security than on the opening of new markets for the American arms industry. William Greider writes in Fortress America (1998) that an official of Lockheed Martin was on the ground in those three countries, and in other potential new member countries, even before the expansion agreements had been accepted. He was there to make a sales pitch for his company's fighter planes, air transports, communication satellites, radar, and other matériel. Not that there was any new threat to the security of those countries, but now they would be moving to replace their old Russian-made armaments with more modern and compatible items from the United States. With pressure sales from British and French concerns as well as American, something of an arms race was under way in Latin America and in Asia.

After dropping sharply from an all-time high of $81.5 billion in 1984 (in 1997 prices) to a low of $42.2 billion in 1994, international trade in arms took a sharp upturn. By 1997 it had risen by 26 percent from that low point, and by 23 percent just over the previous year, to $54.6 billion. Three regionsthe Middle East, East Asia, and western Europeaccounted for 80 percent of that trade in 1997, but arms sales to South American countries were rising at a rate of 20 percent a year from 1992 to 1997.

During the 19951997 period, Saudi Arabia was the leading arms importer, with a total of $31.3 billion. Others in the top ten arms importers were Taiwan, $12.5 billion; Japan, $6.8 billion; Egypt, $5.3 billion; Kuwait, $5 billion; Turkey, $4.9 billion; United Kingdom, $4.5 billion; South Korea, $4.2 billion; United States, $3.8 billion; United Arab Emirates, $3.8 billion. The United States was the main supplier of arms for eight of those countries (all except the Arab emirates, where France was the chief supplier).

The American share of world arms exports grew from 29 percent in 1987 to 58 percent in 1997. During that period, the Russian share of world arms exports declined from 37 percent to 4 percent; the British increased from 8 percent to 12, and the French from 4 percent to 11. In dollar amounts, world arms exports in 1995 1997 totaled $142 billion. The total for the United States during that period was $77.8 billion; for the United Kingdom, $18 billion; for France, $12 billion, and for Russia, $9.2 billion. In 1997 arms exports represented 4.6 percent of the total exports of the United States, 2.3 percent of the exports of the United Kingdom, 2 percent of the exports of France, and 2.6 percent of the exports of Russia.

While arms trade totals of North Korea were not high when compared with totals of other nations, it should be noted that in 1988, 32.3 percent of North Korea's total imports were in armaments, and 29.2 percent of its total exports were in armaments. By 1997 those figures had declined to 2.1 percent and 8.1 percent, respectively. The People's Republic of China's arms exports amounted to $1.1 billion in 1997, 0.6 percent of its total exports, and its arms imports were $142.2 million, 0.4 percent of its total.

A further complication on the international scene is the growth of domestic arms industries into international conglomerates and multinational corporations. When a great military aircraft manufacturer leaps national boundaries and takes in companies or builds plants in many countries, where does its loyalty lie? What control does its home country have over it? If a foreign branch builds planes or tanks or guns for a country that has become an adversary, how can the company be accused of trading with the enemy?


Granted that the national security of the United States requires a substantial military industry, a question remains: How can the unfortunate consequences of a powerful military-industrial complexthe kind of conglomerate of special economic and military interests against which Eisenhower warnedbe alleviated? One measure might be that favored by Woodrow Wilson and the League of Nations, that is, nationalization of the armaments industry.

Jan Christian Smuts, a distinguished South African soldier and statesman who served in the British war cabinet (and who sometimes is regarded with Woodrow Wilson as a cofounder of the League of Nations), in December 1916 circulated his draft of a constitution for a league of nations. Its paragraph 17 stated:

That all factories for the production of direct weapons of war shall be nationalized and their production shall be subject to the inspection of the officers of the council; and the council shall be furnished periodically with returns of imports and exports of munitions of war into or from the territories of war into or from the territories of its members, and as far as possible into or from other countries.

Why, it can be asked, should a private company such as General Dynamics, most or all of whose business is with the government, be private? It has been shown that defense contractors often show less profit than comparable companies in civilian production, but with little or no risk, why should their profits be as great? Jacques Gansler estimated that in 1967 just four firms held 93 percent of the contracts for satellites, nuclear submarines, missile guidance systems, space boosters, aircraft fire-control systems, inertial navigation systems, jet aircraft engines, helicopters, and fighter, attack, transport, and tanker aircraft. This concentration became even more pronounced over the next twenty years. The number of military contractors and subcontractors of all types fell from 138,000 in 1982 to fewer than 40,000 in 1987.

Government ownership and operation would eliminate the need for any profit at all and reduce the pressures on the government for big defense spending for the benefit of a company. Of course, it would not eliminate this kind of pressure altogether. As we have seen, locales and political leaders apply pressure for defense orders in their areas whether the facility concerned is government or private, and subsidiary industries that benefit from defense production still would urge those expenditures that would benefit them indirectly.

There are those who contend that government industrial facilities would be less efficient and more costly than private concerns. That is not necessarily true. The Springfield and Harpers Ferry armories were effective in producing high-quality rifles at lower cost than private factories; government navy yards have been effective in building ships (sometimes they were more costly because they paid higher wages and granted more paid holidays than private shipyards); the government's Philadelphia clothing factory has been effective; an army depot has been effective and far less costly than private contractors in overhauling tank engines.

In the development of ballistic missiles in the 1950s the army probably did as well in terms of cost and effectiveness at its Huntsville (Alabama) Redstone Arsenal as the air force did with its favored private contractors. In the end, the air force won out in that competition, some allege on account of politics, and thus gave a great boost to the private military industry of southern California.

Wartime still might require the conversion of civilian plants to military production. But that is a different matter. A thriving automobile factory has no real stake in converting to tanks or aircraft, and it would be reconverted to the civilian production when the immediate need had been met. Another approach might be to prohibit the export of armaments. This usually brings the rejoinder, "Well, if we did not sell arms to other countries, someone else would." The answer to that is, "So be it; at least we would not be putting advanced American weaponry into the hands of potential enemies."

A further step toward reducing undue influences of the military-industrial complex might be a more complete separation of government-sponsored research and development from those who have an immediate stake in the production of the items concerned. In any case, control must depend upon effective and sympathetic leadership at the top, in the White House and in the Pentagon.


An army that had resisted breech-loading rifles and cannon, automatic rifles, machine guns, motor trucks, and airplanes has now, since World War II, done a complete about-face. Now anything old is likely to be discarded. Certainly, improved weapons and equipment are desirable. But the military-industrial complex has betrayed an almost "Detroit mind-set" in developing new models every year or so. It is difficult to escape the conclusion that the constant quest for novelty is due in part to the activities of researchers and industrialists anxious to maintain the flow of research and development dollars and anxious to keep production lines going. This was a major factor in keeping defense budgets high. When people looked forward to a "peace dividend" funds that might be available for other purposesafter the pullout from Vietnam, they were disappointed to find that there was little of a peace dividend. All kinds of new weapon systems were waiting to eat it up.

A more serious consequence of a powerful military-industrial complex is the drain that a permanent defense industry on a large scale creates on the national economy. Many people accept the myth that a big defense industry brings prosperity. They point to the economic well-being of a community that is dependent on a local defense industry. They point out that it really was World War II that brought the United States completely out of the Great Depression. There is some truth, of course, to those contentions. Defense industries do provide an economic shot in the arm. But in the long run, and for the country as a whole, defense industries on a big scale can only be a drain on the actual or potential economic wellbeing and strength.

A healthy partnership between the military establishment and private industry was sought from the early days of the nation. In more recent years, this has been actively cultivated as demands for national security have required a greater industrial base. It has been in the interest of corporate profits and individual careers as well as in the interest of national defense. At times, there have been evidences of costly mismanagement and of collusion, conspiracy, and even fraud. But for the most part the growth of what has come to be known as the military-industrial complex has been benign. Gaining a kind of momentum of its own, it has grown to have unfortunate consequences in spite of itself.

The greatest military rival of the United States in the postWorld War II period was the Soviet Union. It devoted a large share of its resources to military production (from 9 to 10 percent of gross national product). By 1990 its economy was in chaos. The greatest economic rival of the United States, Japan, devoted a small share of its resources to defense (less than 1 percent of GNP). Its economy was flourishing at a high level.

Related to the question of prosperity and economic well-being is the broader question of the long-range strength of the nation. Military expenditures, stimulated by the military-industrial complex to unnecessarily high levels over extended periods of time, actually can pose a threat to national security. This was the concern that Eisenhower expressed in his address of 16 April 1953 and in other speeches early in his presidential term. It was a concern that General Douglas MacArthur expressed during the same period: "In final analysis the mounting cost of preparation for war is in many ways as materially destructive as war itself."

The problem is to maintain a balance between overcommitment beyond capabilities of the armed forces and overextension of the military at the expense of the domestic economy. For example, after World War II, Great Britain was facing military commitments beyond its resources and had to call upon the United States to fill the gap. Arnold Toynbee wrote, on the other hand, that the ancient Assyrian Empire fell of its own military weight. And in the Peloponnesian War, the overextension of its military effort in the expedition to Sicily was the undoing of Athens.

In The Rise and Fall of the Great Powers, a provocative study published in 1987, Paul Kennedy warns that overextension in military commitments has been a critical factor in the decline of great powers over the past five centuries. He concludes:

Yet the history of the past five hundred years of international rivalry demonstrates that military "security" alone is never enough. It may, over the shorter term, deter or defeat rival states (and that, for most political leaders and their publics, is perfectly satisfactory). But if, by such victories, the nation over-extends itself geographically and strategically; if, even at a less imperial level, it chooses to devote a large proportion of its total income to "protection," leaving less for "productive investment," it is likely to find its economic output slowing down, with dire implications for its long-term capacity to maintain both its citizens' consumption demands and its international position.

We therefore return to the conundrum which has exercised strategists and economists and political leaders from classical times onward. To be a Great Powerby definition, a state capable of holding its own against any other nation demands a flourishing economic base. Yet by going to war, or by devoting a large share of the nation's "manufacturing power" to expenditures upon "unproductive" armaments, one runs the risk of eroding the national economic base, especially vis-a-vis states which are concentrating a greater share of their income upon productive investment for long-term growth.

An irony of modern war is that to preserve victory, the victors must maintain a large military establishment. At the same time, they force a strict limitation of arms on the late enemies. This permits the latter to devote their resources to expand their economies, and then they forge ahead of the victors economically.

But a major development of the last half of the twentieth century was the spread of lowintensity conflict with the support of international trade in arms. As John Keegan put it in A History of Warfare (1993):

The Western-style militarisation of the new independent states of Asia and Africa in the four decades after 1945 was as remarkable a phenomenon as it had been with the non-warrior populations of Europe in the nineteenth century. That it had many of the same doleful effectsoverspending on arms, subordination of civilian to military values, superordination of self-chosen military elites and even resort to warcould be expected. It was equally to be expected that most of the hundred or so armies brought into being after decolonisation were of little objective military worth; Western "technology transfers," a euphemism for selfish arms sales by rich Western nations to poor ones that could rarely afford the outlay, did not entail the transfusion of culture which made advanced weapons so deadly in Western hands.

Yet, African rebels and irregulars and government forces came to inflict casualties upon each other in appalling numbers.


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See also Arms Control and Disarmament; Arms Transfers and Trade; Foreign Aid; Nuclear Strategy and Diplomacy .

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