The lucrative business of war

The US House of Representatives has approved another 57 billion euro aid package for Ukraine and a further 24.7 billion euros for Israel, but who will benefit from this money – the people suffering from armed conflicts or the Military Industrial Complex?


After months of stalled funding by a group of Republican lawmakers, in a rare weekend session, the US House of Representatives approved an additional package of some 89 billion euros in assistance for Ukraine, Israel, and Taiwan on Saturday.

The three foreign aid items that were voted separately will provide 57 billion euros for Ukraine, 24.7 billion euros for Israel and 7.6 billion euros for security in the Indo-Pacific region, including billions for Taiwan. The package also includes a ban until March 2025 on funding to the UN Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), which provides vital assistance in Gaza.

The bulk of this aid will go to weapons support, including new weapons systems for the Ukrainian and Israeli militaries directly from US defence contractors, as well as to resupplying US and allied weapons arsenals. Let’s not forget that the Biden administration is about to approve the sale of up to 50 F-15 fighter jets to Israel, in a deal expected to exceed $18 billion.

According to the official rhetoric of President Joe Biden’s administration, this money is an urgent and necessary sacrifice at a time when threats and wars besiege US allies. Republican opponents of the bill argued that these budget items should be tied to addressing national border security problems and the country’s growing debt burden, warning against spending more funds, many of which are channelled directly to the arms industry.


The skyrocketing profits of war

The military assistance package approved last weekend is the latest in a string of major subsidies or taxpayers’ money recycling into the arms industry since the outbreak of the war in Ukraine, which has become a gold mine for the US and European MIC. This should come as no surprise, as it is often the case in every armed conflict.

According to a study by GlobalTimes, US defense contractors received almost half – $400 billion – of the $858 billion earmarked in the 2023 defence budget. Since the start of the war in Ukraine, the largest Wall Street-listed companies in the sector have accumulated share price gains of 24 billion euros.

Moreover, US weapon sales abroad rose sharply last year, reaching a record 223 billion euros, 56 per cent more than in 2022, according to State Department data.

As for the rest of NATO, the decision of the main members to increase their investment in defence due to pressure from the United States has boosted the growth projections of many multinationals in the weapons industry which, in some instances, have registered increases of up to 150% in the stock market and profits of more than 300% over the previous year, as in the case of Germany’s Rheinmetall.

Spain is experiencing the largest increase in military spending in the last 40 years. The defence budget already represents 23% more than in 2022, making it the item with the highest growth in state spending. Defence companies such as Indra, Navantia and Santa Bàrbara de Sistemas have made huge profits.

When taking into account the genocide in Gaza and the fact that the war in Ukraine has been more than lost for months, it is hard to understand how this new funding will benefit anyone, beyond the defence industry and the pockets of the politicians who are linked to it. But as BlackRock employee Serge Varlay said: politicians are easy to buy, and war is good for business.

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