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The Hidden Costs of U.S. Defense Spending

Aerial view of the Pentagon, headquarters of the U.S. Department of Defense, central to discussions on military spending and policy

Summary: The article examines the growing influence of defense contractors on U.S. defense spending and policy, with nearly half of the $895 billion 2024 defense budget allocated to companies like Lockheed Martin, Palantir, and SpaceX. It highlights bipartisan lobbying efforts that prioritize corporate interests while public needs like healthcare and infrastructure remain underfunded.

Drawing on Eisenhower’s warning about the military-industrial complex, the piece explores modern ethical dilemmas, including the use of AI and satellite technology in warfare. It calls for greater transparency and accountability to ensure defense policies serve all Americans, regardless of political affiliation.

How Corporate Influence Shapes U.S. Defense Spending

Corporate influence in U.S. defense spending shapes policies and raises questions about who truly benefits. While Americans focus on political debates, corporate influence in U.S. defense spending ensures billions are funneled to defense contractors, raising questions about who benefits. In 2024, the defense budget is projected to reach $895 billion, with nearly half going to defense contractors, according to OpenSecrets. This amount is more than the combined military spending of the next ten largest powers, highlighting the significant influence of the military-industrial complex.

Defense firms like Lockheed Martin, Boeing, and Northrop Grumman are among the largest spenders on lobbying, shaping government policies to align with their priorities. For example, between 2019 and 2023, defense contractors spent over $1 billion on lobbying, with Lockheed Martin contributing over $50 million alone, according to OpenSecrets. In 2023 alone, Lockheed Martin lobbied on key legislation such as the National Defense Authorization Act for Fiscal Year 2024 (H.R.2670 and S.2226) and the Department of Defense Appropriations Act (H.R.4365), focusing on defense procurement and budget allocations. These efforts illustrate how deeply defense contractors influence policy decisions, leaving many to question whether it truly matters which political party is in power when both rely on corporate donors.

Public Needs vs. Corporate Influence in Defense Spending

While defense spending soars, many Americans struggle to meet basic needs. With nearly half of the $895 billion budget allocated to military contractors, the U.S. faces rising healthcare costs averaging $12,500 per person annually, according to the Kaiser Family Foundation. Public infrastructure continues to crumble, earning a C- from the American Society of Civil Engineers, and childcare costs exceed $10,000 per year, forcing families into impossible choices.

In Detroit, a single mother of two works three jobs just to pay rent, while her kids go to schools with leaking roofs and outdated textbooks, only a few miles from a defense contractor making billions in federal contracts. At the same time, wages have stayed the same, but housing costs keep going up. A report from Rent.com shows that in cities like Boston, Jersey City, and New York, rents are now over $4,000 a month, with many other places above $2,000. For millions of people, these high costs mean sleepless nights, skipping medications, and putting dreams on hold just to get by.

Supporters of big defense budgets say we need to stay strong to protect the country, especially with growing tensions with China and Russia. But critics argue that putting corporate profits ahead of fixing problems at home hurts everyday Americans in the long run.

Closeup of a draft from Eisenhowers farewell address mentioning the military-industrial complex highlighting his warning about corporate influence in US defense policy

A rough draft of President Eisenhower’s farewell address, featuring them term ‘military-industrial complex’

Historical Context: Eisenhower’s Warning

President Dwight D. Eisenhower’s 1961 farewell address warned of the “unwarranted influence” of the military-industrial complex. This cautionary message rings true today. Companies like Palantir Technologies and Shield AI epitomize this influence, securing lucrative contracts that prioritize private innovation in national security. For instance, Palantir’s $480 million U.S. Army contract and Shield AI’s $198 million U.S. Coast Guard contract highlight how defense priorities increasingly depend on private corporations.

This reliance raises ethical concerns. If the forces shaping military technologies are unaccountable to the public, how can we ensure transparency? Despite congressional oversight, regulatory frameworks often lag behind technological advancements, leaving ethical gaps that Eisenhower’s foresight predicted.

WestExec Advisors and the Revolving Door

Founded in 2017, WestExec Advisors bridges the gap between Silicon Valley innovation and Washington policymaking. The firm was co-founded by Antony Blinken, who has served as Secretary of State since 2021, and Michèle Flournoy, who served as the Under Secretary of Defense for Policy from 2009 to 2012. WestExec specializes in helping businesses secure government contracts and navigate complex regulatory environments.

WestExec’s clients include tech and defense powerhouses. According to The Intercept, the firm has advised Google’s Jigsaw and Shield AI. Harper’s Magazine reports collaborations with Palantir Technologies. These partnerships highlight the entanglement of corporate agendas with public policy.

The revolving door between government and private firms exemplifies this dynamic. Antony Blinken’s transition from WestExec to Secretary of State under President Biden underscores how corporate consultants influence U.S. policy at the highest levels.

Adding to this bipartisan influence, Jewish Insider reported that Elbridge Colby, who served as Deputy Assistant Secretary of Defense for Strategy and Force Development, is being considered for a senior position in a potential Trump administration.

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Secretary of State Antony Blinken addresses the press in the briefing room on October 20, 2023

Ethical Concerns About AI and U.S. Defense Spending

As corporate influence in U.S. defense spending grows, the rise of artificial intelligence raises significant ethical and operational questions in modern warfare. Companies like Shield AI develop unmanned drones capable of operating without direct human oversight, raising concerns about accountability in critical scenarios. For example, the Israeli military’s use of the AI-powered “Lavender” database to identify targets in Gaza, as reported by The Guardian, resulted in controversial bombing raids with devastating collateral damage.

Beyond warfare, Palantir’s $480 million contract with the U.S. Department of Defense for the development of the Maven Smart System prototype highlights the increasing reliance on AI to analyze surveillance data and guide military decision-making. As reported by The Register, this contract reflects the government’s growing investment in artificial intelligence to enhance operational efficiency while raising concerns about potential biases and misuse of such technologies. Similarly, SpaceX’s Starlink satellite systems, as reported by SpaceNews, now support the U.S. Department of Defense under unique terms, improving connectivity in both military and humanitarian operations. While these technologies enhance coordination and decision-making, they raise persistent questions about oversight, accountability, and the potential for embedding systemic biases.

These technologies are often developed by private firms with minimal public accountability, leading to discussions about whose interests are being served. As OpenSecrets highlights, defense contractors’ lobbying efforts ensure corporate priorities dominate defense spending, often sidelining public welfare.

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Elon Musk and President Trump attend a SpaceX Falcon 9 launch briefing on May 27, 2020, at Kennedy Space Center

Despite growing concerns, international agreements to regulate AI in warfare remain stalled. The UN’s Convention on Certain Conventional Weapons, which addresses emerging technologies in the context of armed conflict, has struggled to reach consensus on banning lethal autonomous weapons. According to the UN Office for Disarmament Affairs, debates on regulating these technologies are ongoing, with significant challenges arising from differing national interests and the rapid pace of technological development. Without stronger oversight, the risks associated with AI-driven warfare continue to grow faster than safeguards can be implemented.

Conclusion: Breaking the Cycle

Defense contractors play a significant role in shaping U.S. policy through financial contributions and lobbying, impacting decisions that affect all Americans, regardless of political views. This dynamic highlights the importance of transparency and accountability in how policies are developed and implemented. Addressing corporate influence in U.S. defense spending is essential to ensure policies prioritize public needs over private profits.

As Abraham Lincoln stated in the Gettysburg Address, a government “of the people, by the people, for the people” reflects the foundation of democracy. Ensuring greater oversight and transparency in decision-making can help align policies more closely with the broader public interest.

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