Good business - for some


Manufacturing for war has always been a lucrative business. During the Vietnam War, many consumer-oriented companies turned towards military production because it offered a much higher profit rate. While it is the broader political, economic and strategic factors that actually cause nations to go to war, the arms manufacturers and traders are war's handmaidens. HARRY VAN MOORST looks at their profits — and how we pay for them.

In a conservative estimate, the 40 days of full-scale air warfare and the few days of ground warfare in the Gulf would have cost the allies in the vicinity of $80 billion. To this must be added the acknowledged cost of $10 billion from August to December to maintain the massive US military force in the Gulf.

The Australian government, apart from spending $24 million per day on the normal running of our military forces, allocated an additional $230-$250 million for the Gulf war.

The full destruction caused by allied bombs and missiles has yet to be determined, but conservative estimates put the reconstruction costs in Iraq at well over $100 billion.

The reconstruction of Kuwait is estimated to cost about $40 billion, and allied bombs and missiles will have been responsible for a substantial proportion of this, although the Iraqi armed forces also caused immense destruction in Kuwait.

Already the multinational vultures are lining up to make windfall profits from reconstruction contracts in the area. Some of these companies are the same ones that made huge profits from arms sales.

Money for death

Each year the world spends $1000 billion on the development, production and maintenance of arms and the forces that bear them. Each year 7.5 million children die through lack of simple medicines the supply of which would cost $44 million — the amount spent on arms every 23 minutes.

Each US or UK plane shot down during the war cost more than the medicine to save 7.5 million lives. If the bombing raids of only nine B-52s had been cancelled, it would have saved not only the lives obliterated by the bombs but also enough funds to buy the medicine for saving a further 7.5 million children.

In 1989 arms exports totalled $31.8 billion, 52% of which went to the Third World. The USSR with 36.6% and the USA with 33.8% are the major exporters, followed by France (8.6%) and the UK (5.1%). About a quarter of all arms exports go to the Middle East, with Iraq the largest arms purchaser during 1985-89, followed by Saudi Arabia, Syria, Egypt, Libya, Iran and Israel in that order.

However, 1988 and 1989 were not good years for the arms traders. There was a glut on the market, and sales to the Third World dropped from $26.2 billion in 1987 to $16.3 billion in 1989. This was partly the result of economic circumstances and partly due to the lack of any t. A war was just what the arms traders needed.

War profiteers

Of the top 100 war companies in 1988, 49% are located in the USA; of the top 10 companies, nine are in the USA. US companies dominate in both number and size: the 49 US companies account for 64% of the total arms sales of the top 100 companies.

In 1988 the top five companies, all from the US, had arms sales totalling $37,150 million.

The typical US multinational armaments corporation is General Dynamics. It was the world's third largest arms seller in 1988, with sales of $8 billion. It makes F-16 fighter planes, Tomahawk cruise missiles, M-1, M48 and M60 battle tanks and Trident submarines, amongst a broad list of deadly products.

General Dynamics has sold its F-16s to Bahrain, Egypt and Israel, its various deadly missiles to Bahrain, Egypt, Israel and Saudi Arabia, its main battle tanks to Bahrain, Egypt, Lebanon and Saudi Arabia. These contracts have amounted to well over $3 billion since 1982.

General Electric, the fourth largest, and maker of engines for fighter planes and helicopters, radar systems and missile control systems, has sold arms to Bahrain, Egypt, Israel and Saudi Arabia.

General Motors, the fifth largest and maker of engines for fighter aircraft, ships, transport planes and armoured vehicles, sold to Bahrain, Egypt Israel, Jordan, Kuwait and Saudi Arabia.

McDonnell Douglas, the top war profiteer in 1988 and which provides Australia with F/A-18 fighters and Harpoon missiles, provided Iraq with helicopters in 1983 and 1985 and Kuwait with a military flight training centre in 1987. It has also provided its deadly wares to Bahrain, Egypt, Israel and Saudi Arabia.

Other well-known multinationals making large profits from the Middle East arms trade are Ford (selling missiles to Bahrain, Egypt, Israel, Oman and Saudi Arabia), Lockheed (aircraft to Jordan, Oman and the United Arab Emirates) and Westinghouse (electronic systems to Bahrain, Egypt, Israel, Jordan, Kuwait and Saudi Arabia).

Australia buys arms from Boeing, Ford, General Electric, General Motors, Honeywell, Lockheed and McDonnell Douglas, amongst a long list of US arms providers.

Who pays

The massive economic and social cost of the arms trade is borne disproportionately by the poor and the weak and by the working classes of the various countries caught up in the arms race. The poor in the US are as much victims of the arms race as the people of Kuwait and Iraq.

In the developed world, the arms race maintains the gap between rich and poor in much the same way that other forms of capitalist production do, but with several important differences. Military y about half the number of jobs per dollar as other forms of production, so spending greater proportions of GNP on military production creates or exacerbates unemployment. In addition, military production is usually more inflationary and therefore has severe consequences for the poorer sections of the community. We can see some of these effects in Australia today, where a massive defence deficit in past has been a major contributor to high inflation, high interest rates and high unemployment.

In the Third World, the arms trade not only costs a massive proportion of the GNP of many countries, thereby directly causing the deaths of millions as a result of deprivation, but also provides the means whereby the elites can maintain their power and repress movements for social justice. The vast bulk of the arms trade to the Third World goes to military dictatorships and oligarchies.

Britain's Disasters Emergency Committee has estimated that 20 million Africans face death by starvation this year. They will be the unrecognised victims of the Gulf War and the arms race. The cost of the Tomahawk missiles fired in the war alone ($1.3m each) would be sufficient to provide the required food supplies for the next six months.

Where next?

Renewed efforts should be made to expose and fight the arms traders. For the sake of the millions of lives at stake each year, for the sake of our resources and the environment, the arms race must be reversed.

One of the most useful tasks we can perform is to tackle the Australian government and its increasing militarisation of the Pacific. A major focus for action this year, in direct response to the Gulf War and its aftermath, should be the arms bazaar in Canberra, AIDEX '91, 6to will be held in the Canberra National Exhibition Centre on November 26-28.

AIDEX, partly financed and sponsored by federal and state governments, and will be the biggest collection of the merchants of death and their goods that the Pacific region has ever seen.

The Australian peace movement should begin now to organise massive opposition to make it impossible to ever again run such an arms bazaar within our shores.

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