PROVIDENCE — The Pentagon has spent more than $14 trillion on the war in Afghanistan, with “one-third to one-half” of the total going to military contracts, according to a newly released report by the Costs of War Project at Brown University.
According to the report, which outlines the corporate beneficiaries of post-9/11 Pentagon spending, one-quarter to one-third of all contracts in recent years have been awarded to just five major corporations: Lockheed Martin, Boeing, General Dynamics, Waltham, Mass.-based Raytheon, and Northrop Grumman.
An estimated $4.4 trillion of the $14.1 trillion spent by the Pentagon went toward weapons procurement and research and development, which primarily benefitted corporate contractors, according to the report. William Hartung, director of the Arms and Security Program at the Center for International Policy and author of the report, called this estimate “conservative.”
“The reaction to the 9/11 attacks created a political climate that opened the floodgates to massive increases in Pentagon spending, with few questions asked. In the era of America’s ‘war on terror,’ trillions of dollars have gone straight to the biggest military contractors,” said Hartung.
He wrote that the Pentagon’s budget for operations and maintenance also subsidizes contractors but that it’s harder to determine what share of this category goes to private firms.
These top five companies, however, received more than $286 billion in contracts in fiscal year 2019 and fiscal year 2020 alone. From fiscal year 2001 to fiscal year 2020, these five firms split more than $2.1 trillion in Pentagon contracts.
Lockheed Martin received $75 billion in Pentagon contracts in fiscal year 2020, which is well over the entire budget for the State Department and Agency for International Development for that year, which totaled $44 billion, according to Brown researchers.
Weapons makers spent $2.5 billion in lobbying over the last two decades, employing, on average, more than 700 lobbyists per year over the last five years — which is more than one for every member of Congress.
Harry Stonecipher, then-vice chairman of Boeing, told The Wall Street Journal in October 2001, that “the purse is now open. . . . Any member of Congress who doesn’t vote for the funds we need to defend this country will be looking for a new job after next November.”
But weapons makers were not the only beneficiaries. Logistics and reconstruction firms like Halliburton, through its Kellogg, Brown and Root (KBR) subsidiary, saw their contracts grow more than tenfold from fiscal year 2002 to fiscal year 2006 to rebuild Iraq’s oil infrastructure and to provide logistical support for US troops in Iraq and Afghanistan. By August 2008, the company had received more than $30 billion for work under the Logistics Civil Augmentation Program, or LOGCAP, contract.
The report goes on to say that the privatization of logistics was initiated by Dick Cheney when he served as secretary of defense in the early 1990s. Cheney served as the chief executive of Halliburton up until he became vice president under former president George W. Bush in 2001. But he had stock holdings in the company that were worth approximately $46 million, and as of late 2002, had received a $162,000 in deferred compensation from the company.
“Cheney’s journey from the government to Halliburton and back was a classic case of the revolving door between the Pentagon and the defense industry, with all the real and potential conflicts-of-interest that entails,” wrote Hartung.
Armed private security contractors, some of whom were involved in guarding US facilities, like Blackwater and DynCorp, were considered a second stream of revenue for corporations tied to the war.
But the contracting work didn’t always go to Americans.
While an armed contractor with a background in the US Marines could earn up to $200,000 per year, in Iraq, the majority of contractors were foreign workers from nations such as Nepal, the Philippines, or Iraq, according to the report. Many non-US personnel accounted for about three-quarters of the contractor workforce and received as little as $3,000 per year.
Hartung wrote that the Pentagon’s increasing reliance on private contractors over the last two decades raises questions of accountability, transparency, and effectiveness.
“The privatization of key functions undertaken in Iraq and Afghanistan has increased the risk of waste, fraud and abuse, since it reduces the military’s control of activities within war zones,” said Hartung. “It has also resulted in shoddy work and a diversion of weaponry to U.S. adversaries that has put our troops at risk.”
The report also outlined how corporations took advantage of wartime conditions, which require speed of delivery and have less rigorous oversight, to “overcharge” the government or “engage in outright fraud.” The Commission on Wartime Contracting in Iraq and Afghanistan estimated in 2011 that waste, fraud, and abuse have totaled between $31-60 billion.
Even as the United States reduces its military footprint in Iraq and Afghanistan, the report said military contractors will continue to profit from inflated spending because of “exaggerated estimates” of the military challenges posed by China that are being used as an argument to keep the defense department’s budget high.
“This report illustrates how US militarism is like a cash register,” said Stephanie Savell, codirector of the Costs of War Project, which is housed at Brown’s Watson Institute for International and Public Affairs. “Military contractors will continue to profit as long as US policymakers prioritize military assertiveness as the best way to conduct foreign affairs. It’s time to evaluate not only the true costs of war, but also who benefits.”