It's high time the world starts to realize that most wars have a profit motive behind them. Not always, but often enough. As noted in "Profits of War: Corporate Beneficiaries of the Post-9/11 Pentagon Spending Surge," a 2021 report by the Watson Institute and Center for International Policy:14
"The United States government's reaction to the terrorist attacks of September 11, 2001 led to dramatic increases in Pentagon funding and revenues for weapons contractors. While the costs and consequences of America's war policies of the twenty-first century have been well-documented, the question of who has profited from this approach has received less attention.
Corporations large and small have been, by far, the largest beneficiaries of the post-9/11 surge in military spending. Since the start of the war in Afghanistan, Pentagon spending has totaled over $14 trillion, one-third to one-half of which went to defense contractors.
Some of these corporations earned profits that are widely considered legitimate. Other profits were the consequence of questionable or corrupt business practices that amount to waste, fraud, abuse, price-gouging or profiteering.
The Pentagon's increasing reliance on private contractors in the post-9/11 period raises multiple questions of accountability, transparency, and effectiveness. This is problematic because privatizing key functions can reduce the U.S. military's control of activities that occur in war zones while increasing risks of waste, fraud and abuse.
Additionally, that the waging of war is a source of profits can contradict the goal of having the U.S. lead with diplomacy in seeking to resolve conflicts.
More broadly, the outsized influence of defense contractors has resulted in a growing militarization of American society. This is manifested in everything from the Pentagon's receipt of the lion's share of the federal discretionary budget — more than half — to the supply of excess military equipment to state and local law enforcement agencies."
Bankers Also Profit From War
Contractors aren't the only ones that can cash in on war. Did you know, for example, that Goldman Sachs, the New York-based investment bank, is profiting from the war in Ukraine by selling Russian debt? In March 2022, NBC News reported:15
"As the Western world scrambles to defend Ukraine by locking down Russian money, the company is acting as a broker between Moscow's creditors and U.S. investors, pitching clients on the opportunity to take advantage of Russia's war-crippled economy by buying its debt securities low now and selling them high later, according to four financial world sources familiar with the strategy.
An investor who declined a Goldman trader's offer to add Russian debt to his hedge fund's portfolio — because of the war — said the trader suggested he could 'just put it in your personal account' to avoid scrutiny. That does not violate the U.S. sanctions regime, but it is very different from the public face Goldman is putting on its relationship with Russia ...
When U.S. officials sanctioned Russian banks this month, it became illegal for U.S. companies to do business directly with major Russian financial institutions. But the Treasury Department's Office of Foreign Assets Control, or OFAC, issued a memo affirming the legal legitimacy of trading Russian assets in "secondary markets" — those not directly involving the Russian banks. That's why Goldman can act as a broker ...
Goldman's effort to profit from the war highlights the complexities the Biden administration faces in trying to punish Russia without harming Wall Street and the economies of the U.S. and its allies. And it is a stark reminder that no asset is too toxic to be traded when there are willing buyers, sellers and brokers."
Indeed, shortly before Russia's launch of its "special military operation" in Ukraine, Putin had demanded NATO rule out allowing Ukraine — which shares a border with Russia — into the alliance. In June 2022, Russian Foreign Minister Sergei Lavrov told the BBC:17
"We declared a special military operation because we had absolutely no other way of explaining to the West that dragging Ukraine into NATO was a criminal act."
Russia has also accused Ukraine of conducting dangerous bioweapons research on behalf of the U.S. I reviewed the evidence for this in "Bioweapons Expert Speaks Out about US Biolabs in Ukraine." Thirdly, Russia has been critical and seemingly grown weary of Ukraine's attacks on native Russians in the Donbas region, a conflict that has been ongoing since 2014. So, there's more to this story than what the media are telling us.
- 1, 4, 5, 6 Bloomberg June 13, 2022
- 2 Treasury.gov Ukraine/Russia-Related Sanctions
- 3 CNBC June 23, 2022
- 7 Radio Free Europe April 28, 2022
- 8, 9 Bloomberg June 14, 2022 (Archived)
- 10 Politico May 19, 2022
- 11 American Magazine March 9, 2022
- 12 The Telegraph April 22, 2022 (Archived)
- 13 Washington Post April 26, 2022 (Archived)
- 14 Watson Institute, Profits of War
- 15 NBC News March 10, 2022
- 16 The Guardian June 14, 2022
- 17, 18, 19 BBC June 19, 2022
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