Arms manufacturers make a killing on imperialist rearmament
Core Argument¶
The article argues that the current wave of global rearmament is not a rational response to genuine security needs but a mechanism for channelling vast sums of taxpayer money into the pockets of a handful of arms manufacturers, who are prioritising shareholder returns over productive investment. The central thesis is that the contradiction between the political imperative for states to rearm and the profit-driven logic of capitalist arms firms is generating both grotesque windfalls for the few and intensified austerity for the working class. The author claims this dynamic is not accidental but flows from the structural crisis of capitalism, which drives inter-imperialist rivalry and makes militarism a systemic necessity.
Theoretical Grounding¶
The analysis draws on Lenin's observations on imperialism and war, particularly the insight that war is "terribly profitable" for monopoly capital. The article operates within the classical Marxist tradition that understands militarism not as an aberration but as an organic feature of the capitalist mode of production in its imperialist stage. The theoretical framework is grounded in the Marxist theory of the state as an instrument of class rule, where bourgeois governments extract from the working class through taxation to fund the accumulation needs of the arms sector. The piece also implicitly deploys the concept of fictitious capital — the arms manufacturers' preference for share buybacks and dividends over expanding productive capacity points to a disjuncture between financial accumulation and real industrial output. The critique of the market's inefficiency in meeting even the state's own military requirements echoes Engels' observations on the anarchy of capitalist production.
Conjunctural Relevance¶
The article is situated in the immediate aftermath of Russia's full-scale invasion of Ukraine and Israel's war on Gaza, with global military expenditure reaching $2.24 trillion in 2022. It cites specific data: the leading 15 arms manufacturers are forecast to generate $52 billion in free cash flow by 2026; Europe's Stoxx defence stocks rose 50 percent in 2023; individual firms like Rheinmetall and Aselsan saw share price increases of up to 340 percent since 2022. The piece highlights the contradiction between the $300 billion order backlog facing European manufacturers and their reluctance to invest in new capacity. It draws on a rare public warning from US Navy Secretary Del Toro, who criticised defence contractors for prioritising stock buybacks over shipyard investment and lamented that China now dominates global shipbuilding — a confession that inadvertently reveals the inefficiency of leaving strategic production to market forces. The article connects this to austerity, citing Portugal as an example where military spending rose 14 percent while healthcare increased only 10 percent, with the government planning to spend three times more on the military than on higher education by decade's end.
Where the Argument Continues¶
The article opens several lines of inquiry that are developed elsewhere in the IDOM corpus. The relationship between rearmament and the tendency of the rate of profit to fall is gestured at but not elaborated — the question of why capital prefers financial speculation over productive investment in arms manufacturing is taken up in other IDOM pieces on the crisis of overaccumulation. The geopolitical dimension of inter-imperialist rivalry, particularly the US-China contradiction and the role of Taiwan as a flashpoint, is mentioned but not fully developed; this is explored in depth in Against the Stream episodes on the new Cold War. The article's call for a revolutionary alternative — "books, not bombs" — is a slogan that recurs across IDOM's anti-war literature, but the strategic question of how to build working-class opposition to militarism in the current conjuncture is left for other pieces on the labour movement and the anti-war left. The specific dynamics of the Ukraine war as a proxy conflict between NATO and Russia are treated as background rather than analysed in detail; IDOM has dedicated articles on the political economy of that conflict.
Connections¶
The article connects to Lenin's Imperialism, the Highest Stage of Capitalism as its foundational theoretical text. It also resonates with Engels' The Housing Question and his writings on the state's role in managing capitalist crises. Within the contemporary Marxist literature, it aligns with analyses of the military-industrial complex by figures like Michael Roberts and with the Monthly Review school's work on monopoly capital and militarism. The specific critique of share buybacks as a form of fictitious capital accumulation connects to broader Marxist debates on financialisation. Readers should also consult IDOM's articles on the Ukraine war, the crisis of the NHS, and the political economy of NATO expansion, as well as Against the Stream episodes on the new arms race and the militarisation of the Pacific.
Key Quotes¶
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"These astonishing figures do not match actual increases in industrial output. Companies face serious bottlenecks. Europe's largest arms manufacturers have a combined backlog of more than $300 billion in orders. And they are in no rush to address this problem."
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"To speak plainly, this means the billions that are being syphoned off from the state coffers are going straight to the pockets of a handful of capitalists. Why invest when you can just pocket the cash?"
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"Of course, Del Toro is criticising arms manufacturers from the reactionary perspective of US imperialism, which needs a powerful army to plunder the rest of the world. But unintentionally his comments reveal the inefficiency, wastefulness, and corruption of the capitalist market. These defenders of the market system have been hoist by their own petard."
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"Capitalist governments never have money for healthcare or education, but mysteriously they always find billions for tanks and missiles."
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"The crisis of capitalism leads to the intensification of inter-imperialist conflicts, because the pie of the world market is shrinking and, therefore, inevitably, the struggle to carve it up intensifies. This turns rearmament into a pressing need for all capitalist governments."
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"Consequently, our struggle against militarism and imperialist wars is also a struggle against capitalism, for the world socialist revolution."