The Business of War Essay Example

On September 11, 2001 America was attacked on a day that will always be infamous. This day launched America into war with various countries in the Middle East that are still going on today. The general feeling among U.S. citizens about the War on Terror and its aftermath is one of confusion and betrayal. Fingers point at the Bush administration, which apparently lied to the American public. No weapons of mass destruction were ever found, as originally promised. Instead of a quick and clean victory, hundreds of troops have been killed. The occupation has been long, violent, and largely unsuccessful.

Terrorism has not stopped, or even been slowed. However, the leaders of this country have painted a narrative that the war has been successful. Afghanistan, where the United States began battling the Taliban in October 2001, victory apparently came there with lightning speed. The next year, President George W. Bush announced that the group had been “defeated.” In 2004, the commander-in-chief reported that the Taliban was “no longer in existence.” Yet, somehow, they were. By 2011, Gen. David Petraeus, then commander of US forces in Afghanistan, claimed that his troops had “reversed the momentum of the Taliban.” Two years later, then-commander Gen. Joseph Dunford spoke of “the inevitability of our success” there. The horror of violent conflict that continues today have made everyone wonder how this whole war got started, and who exactly are we fighting?

The answer to this question delves deeply into the history of colonialism, politics, and war on which this country was built. America’s invasion of Afghanistan is just the latest example of a long tradition of colonialism and self-preservation that dates to our founding. America fights when there is a profit to be had, which is why most of our recent military actions have occurred in oil rich countries such as Colombia, Venezuela, Kuwait, Saudi Arabia, Afghanistan and now Iraq. While the motivation for becoming involved in Afghanistan follows from the traditional American doctrines of hegemony, the specific dynamic of the war and wealth plundering has changed to reflect the modern era.

The United States involvement presents itself as a way for us to analyze the business of war. We investigate these trends below, outlining the connection between political doctrine, government favors, corporate contracts, and private military companies. We conclude by discussing how these elements affect the future of the war-torn countries and its people on the eve of its regaining of governmental control. 

War Profiteering

The business of reconstruction is one way that countries profit off of war. A war creates disaster that later you need to rebuild and this is a good business for countries who won the war and can control the reconstruction. Under the Bush Administration, Texas Construction Company Brown and Root Industrial Services, was awarded a contract to rebuild a war-torn country, it did not surprise many people.  After all, the President was also a Texan, and his administration had past ties to the massive company.  The contract was very lucrative, signing over billions of dollars to the company to rebuild virtually the entire infrastructure of the country.  The deal was “no-bid”, meaning Brown and Root won the contract without competition, and without a ceiling on the price of this lucrative offering.  Not surprisingly, the United States Congress began to question where the money was going, and whether ties to the administration were directly responsible for awarding contracts.  This, however, is not the first instance of the government doing things like this; Abraham Lincoln's first Secretary of War, Simon Cameron, was forced to resign in early 1862 after charges of corruption relating to war contracts. In 1947, Kentucky congressman Andrew J. May, Chairman of the powerful Committee on Military Affairs, was convicted for taking bribes in exchange for war contracts. 

War profiteering is the exploitation of government contracts during wartime, usually by private sector companies that win deals to perform services during or after the conflict.  In almost every conflict in the United States’ history, war profiteering has existed in some form.  This statement is drawn from the basic principle that wartime boosts the economy, and this increased production of goods and services is reflected in US industry profits.  In addition, this hectic time is almost always coupled with a loosening of control on the contracts that are given to companies.  Frequently, companies with close ties to the administration are presented with lucrative contracts to simplify the selection process.  When the companies vying for these deals find themselves with no competition, there is little incentive to cut costs and lower the bids.  In reality, the companies present swollen proposals, and often pocket the leftover cash at the end of the work project.  

War is huge business and according to Samuel Stebbins and Thomas C. Frohlich 

“The U.S. government spent $598.5 billion, over half of its discretionary budget, on military and weapons technology in 2015. The 100 largest arms-producing and military services companies across the globe sold an estimated $370.7 billion worth of arms. U.S.-based companies continue to dominate the defense market, a trend that is unlikely to change meaningfully any time soon. Virginia-based Lockheed Martin's arms sales totaled $36.44 billion in 2015, by far the most of any company. U.S and Western Europe-based companies account for 82.4% of arms sales by the 100 largest military procurement companies.” “According to a recent report by the Congressional Research Service, developing nations continue to be the main focus of arms sales. Countries without large arms industries rely heavily on exports from powerful nations, primarily the United States and Russia. From 2011 to 2014, the United States and Russia dominated the arms market in the developing world. Over that period, the United States made nearly $115 billion in such agreements, nearly half of the total value of military deals. Agreements with Russia totaled $41.7 billion.”

Moving to Privatization

Since the first Gulf War in 1991, the proportion of private forces to U.S. military personnel has more than tripled. These private contractors include everything from janitorial and food service work to construction, security and intelligence. The U.S however is not the only country that outsources military jobs. When Sierra Leone faced an insurgency in 1995, Valentine Strasser's government hired Executive Outcomes, a South African security firm, to train and support its troops. When the 1995 Dayton Accords required that the Bosnian military be rebuilt, MPRI (Military Professional Resources Incorporated), an American firm, was hired to advise and train the Bosnian military.

From 1994 to 2002, the U.S. Department of Defense purchased more than 3,000 Private Military Company contracts valued at more than 300 billion dollars, according to the Center for Public Integrity. (Conachy) Jobs once restricted to the Defense and State Departments are now replicated by civilian agencies contracting their services to the U.S government. In most cases this outsourcing to private companies is because some critical skills that could not be readily acquired from within the United States own military and government personnel pool. However, in some cases the use of these services provide the ability for the U.S to publicly distance itself from events that the U.S cannot publicly support. Northbridge is but one of the numerous PMCs employed by the U.S. government. The demand for these corporate militaries has been fueled by the hyperactive military action deployed by the US since September 11th. The American forces currently have 350,000 troops deployed in 130 countries worldwide, with 135,000 in Iraq. The military is stretched thin, with not nearly enough personnel to handle all of the necessary functions, creating a market for the PMCs. “Our most precious asset is people,” said General Barry McCaffrey, “and there are whole categories of things that lend themselves to being outsourced.” (Masland) The advantages behind outsourcing according to Jeremy Hobson “is flexibility. Contractors can be called upon fairly quickly and have forces ready to go that are trained and equipped, for the most part.

And then the second is that they're force multipliers. They can easily add more boots on the ground. It depends on the theater and the Status of Forces Agreement that they have in that theater. But sometimes contractors can also get around force management levels. There are certain caps put on the number of military boots on the ground in-theater, but not necessarily on Department of Defense civilians or contractors, and so you can actually add more bodies to your force without actually reaching that limit." With this ability to essentially add a shadow force allows for you to also save on costs by using the funds that would be used to train soldiers and use it to hire already trained soldiers who do not have to be identified necessarily as U.S soldiers and also don’t have to go through the approval of Congress. 

Politics of War

Though war initially had the objective of territorial expansion and resource gathering, the country may also profit politically and strategically, replacing governments that do not fulfill its interests by key allied governments. War is an instrument of policy, the use of military force is a means to a higher end—the political objective. War is a tool that policy uses to achieve its objectives and, as such, has a measure of rational utility. So, the purpose for which the use of force is intended will be the major determinant of the course and character of a war. An example of this is the United States invading Panama in 1989 in an attempt to overthrow military dictator Manuel Noriega, who had been indicted in the United States on drug trafficking charges and was accused of suppressing democracy in Panama and endangering U.S. nationals. Noriega’s Panamanian Defense Forces were crushed, forcing the dictator to seek asylum with the Vatican anuncio in Panama City, where he surrendered on January 3, 1990.

The justification behind this invasion was protecting the integrity of the Torrijos–Carter Treaties (A treaty signed between the U.S and Panama to give Panama Control of the Canal after 1999) Members of Congress and others in the U.S. political establishment claimed that Noriega threatened the neutrality of the Panama Canal and could halt trade through the Canal. War is a political instrument to help regulate International business which is a critical part of the world economy that shapes the fortunes of individuals and entire nations.

The impact of global wars on international business would be enormous, depending on the quantity of countries involved in the war, we would see nationalization of companies and some factories would be forced to produce war equipment. Also, manpower would be redirected to the defense forces, reducing the labor force available for the industries. An example of this would be the United States preparing for both WWI and WWII. The wars we have experienced more often are regional wars, they are nothing like total wars, and nothing to serious to harm the international business environment. Some business sectors can be seriously damaged by wars, while others like the defense industry can thrive during these times. The impact of regional wars on International business could be the following: an increase on the price of a commodity or material that one of the participating countries produces. All of these changes and actions that are taken stem from the politics of war. 

Conclusion

America has been privileged enough to not have to fight a major war on its own soil since the civil war, however the countries that we have gone to war with on foreign soil are left with the burden to rebuild. The soldiers and civilians of the war struck country bear the burden of war perpetually. Their battle is during the war and they remain upfront to shoulder the after-effects as well. They have to wrestle physical, emotional, psychological and economical stress. The children are left with the most trouble from war. There occurs damage to human life, damage to the property, damage to usual working and added stress on citizens about the outcomes. The destruction of the human lives is another important factor affecting the country’s workmanship post war. Human deaths, relocation of citizens, relocation of refugees, all affect the labor force post war, often showing up in decreased manpower in every industry. Even the winners of war suffer to reconstruct their infrastructure, reconstitute future prospects and realign the workforce.

Inflation of prices; however, is the most common immediate effect of war. The general public has been made to suffer economically with increased prices, higher taxes and consequent low quality of life. In the most extreme cases, the currencies lose their value and the country is forced into an economic depression. The country’s infrastructure gets involved in the management of war related industries leading to low funding in their healthcare industry, education, infrastructure development and also, basic necessities required by the people of the country. Also, during the course of war, the country suffers destruction of infrastructure precipitating further loss in its economy. The buildings destructed leads to loss of work or schooling; damage to the transportation services leads to hassles in commutation and loss of work; attacks on civilians and soldiers increases the pressure on healthcare services and government. All these events extravagantly increase the burden on the economy of the country. The residual impacts of war include physically and mentally deprived soldiers who are tasked to go back to living a “Normal Life.” This is the Business of WAR.

Bibliography

(n.d.). Retrieved from https://www.msn.com/en-us/money/companies/20-companies-profiting-the-most-from-war/ar-AAmTAzm

Admin. (n.d.). War is a big business. Retrieved from https://www.pecob.eu/war-is-a-big-business/

Conachy, J. (2004, May 03). Private military companies in Iraq: Profiting from colonialism. Retrieved from https://www.wsws.org/en/articles/2004/05/pmcs-m03.html

Schumacher, G. (2007). A bloody business: Americas war zone contractors and the occupation of Iraq. New Delhi: Manas.

The U.S. invades Panama. (2010, February 09). Retrieved from https://www.history.com/this-day-in-history/the-u-s-invades-panama

Wbur. (2017, May 10). One Analyst On Why The Boom In America's Privatized Military Is 'Here To Stay'. Retrieved from https://www.wbur.org/hereandnow/2017/05/10/america-privatized-military