Sometimes, a news story seems so ordinary that it barely garners any attention, even as it turns the world upside down. Sometimes, innocent frolicking on the surface distracts from a rot extending below. This is what happened last week, when the Biden administration announced its plans to send an additional $300 million to Ukraine, meant as a stopgap until Congress can finally pass a funding package. According to national security adviser Jake Sullivan, this aid package was made possible by “unanticipated cost savings” in various contracts with the defence industry to replace equipment already sent to Ukraine.
At first, it seemed like a benign piece of news. What, after all, is wrong with saving a bit of money? Yet the reality is far more complicated. What Jake Sullivan actually announced wasn’t merely a case of finding $300 million of change under a Pentagon sofa cushion, but another sordid act in the slow-rolling and underreported drama that is the ongoing collapse of the American military.
To understand why, it’s useful to begin with some basic facts about America’s military aid to Ukraine. When the Pentagon decided to send weapons to Kyiv, these were mostly taken from already existing stocks. This was unavoidable, for at least two reasons. First, US munitions production was wildly inadequate to cover wartime demands. Second, the lead time for new production was simply too long: many of the weapons ordered for Ukraine in 2022 would realistically only be ready for use after the war had concluded. And so, the United States stripped its own warehouses of equipment — and it didn’t stop there. In some cases, it looted ammunition and weapons from its own combat formations. In others, it stripped many of its allies, such as South Korea, of a large amount of their equipment, too.
All of which raises an important question: when one sends an already existing weapon to Ukraine because producing a new one is too impractical and slow, how much does that weapon really cost? Unfortunately, there isn’t a straightforward answer. For instance, some of the weapons sent to Ukraine were no longer in production, and in fact could not be produced anymore. This could be due to their electronic components being obsolete, the factories and tooling having been sold off, the manufacturer being defunct, and so on. So, while the US Army might indeed have paid around $40.000 for a Stinger missile in the mid-Eighties, extrapolating the cost of one today is at best a matter of guesswork. Even in less dramatic cases, where the munitions are still in production, costs can still be subject to extremely high volatility: the price of acquiring 155mm artillery shells for Nato allies has roughly quadrupled since the start of the Ukraine war.
For America, this made it possible to send huge quantities of Nato weapons to Ukraine, while merely guesstimating the real cost of those weapons. And unsurprisingly, this has massively incentivised making optimistic estimates: the less you say the shells and rockets are worth, the more of them you can send within your allotted replacement budget. Of course, if you lowball your cost estimates, or inflation and labour scarcity mean that it is no longer profitable for the defence industry to produce at that price, the end result is a form of budgetary looting. Something has been taken away, money has in theory been allocated to replace it, but either due to naivete, corruption or malice, that money is not sufficient to actually pay for replacements. Ultimately, you’re left with a big hole in your budget, and a big hole in your military readiness. Whether costs are intentionally lowballed or simply underestimated doesn’t matter; the result is the same. The US political class, having long believed that their country can go anywhere and do anything, are simply not in the mood to take no for an answer.
Nor is budgetary raiding confined to the Ukraine war. When, for instance, Congress didn’t want to allocate funding for the extremely polarising issue of the southern border wall, the Trump administration briefly floated the idea of simply taking that money out of the US military. Elsewhere, the US Navy is currently planning to pay for its ongoing operations in the Red Sea by taking money out of funds it previously had allocated to badly needed modernisation programmes. In other words, the Navy’s budget is being cannibalised: critical future investments are being eaten up in order to sustain daily operations.
Why is this happening? In the interest of brevity, it’s sufficient to point out that the US no longer even has a regular budget process. Sadly, few people grasp just how dysfunctional Congress has become these days, and what consequences this has for many important institutions. More often than not, it fails to adopt a budget at all; and even when it manages to do so, the spending bills are chronically delayed. The most central, practical upshot of this is that most US spending is on a form of autopilot. For various reasons, making changes to spending, or reacting to new events or sudden needs, is becoming near-impossible.
When people today talk about the massive level of US debt ($34.5 trillion and rising fast) or the ongoing federal budget deficit (upwards of $1.6 trillion for fiscal year 2024), they often assume that these things are problems of the future. All agree that, at some point, these fiscal problems will start to truly harm the nation’s global standing; people simply disagree about when this will start happening. Unfortunately, the reality is that the massive debt load and the federal deficit is already beginning to destroy America from within. This is not a problem of the faraway future; it is a problem in the here and now.
With the fiscal sword of Damocles hanging over Congress, rather than assign additional funding to cover true cost increases, the name of the game is now budget trickery and budget raiding, shuffling money from one “pool” to another. But when that money is shuffled, it generally isn’t getting replaced. The “pool” that was drained in order to furnish money for something else remains empty, awaiting a refill that might never come.
It is this fundamental glitch in the US system that is now manifesting in all sorts of places, behind all sorts of headlines. So, when the Pentagon discovers some $300 million in “savings”, allowing for more equipment to be sent to Ukraine, this is in fact an accounting trick. But that trick belongs to a whole family of illusions, and their effect on the US military, taken as a whole, is rapidly becoming catastrophic. Thus, we now read stories about the US National guard temporarily cutting its retention bonuses in the middle of a massive recruitment crisis, or the Air Force removing special duty pay for many jobs within the service. Structural underfunding within the armed forces appears to be endemic.
Yet what’s particularly worrying is not even the lack of money per se, but the way in which the charade has been maintained. In the German movie Goodbye Lenin, the mother of an East German family falls into a coma right before the collapse of the Berlin wall. When she eventually wakes up, communism has already collapsed, and East Germany no longer exists. Her children, having been told that her mother’s heart probably can’t handle the shock of that revelation, then set out to create an illusory world around their mother. They raid pantries for older brands of foodstuffs, they put on fake news broadcasts, and they loot the attics of friends and neighbours for communist memorabilia.
Today, America increasingly resembles a sort of capitalist funhouse mirror version of this. Its political class is more of a grey-haired gerontocracy than that of the late Soviet Union, and they very much were born in a time when US wealth was limitless and US military power was without equal. Yet in order to protect that belief that nothing has changed, a much more systemic deception is being maintained; rather than pantries and attics, the US is raiding bonus funds for its sailors and soldiers and looting the money meant to maintain its ships and planes. All the while, the debts keep growing and the real budget (adjusted for inflation) keeps shrinking.
In Goodbye Lenin, maintaining the illusion that the DDR still exists becomes impossible in the end, and the ailing mother goes to her grave having realised that the state she lived her life in collapsed years ago. Whether Nancy Pelosi or Joe Biden will share that fate is an open question. For now, the slash-and-burn inside the US Navy, Army and Air Force continues, as people such as Jake Sullivan work tirelessly to make sure their fragile elders don’t discover the truth.
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Subscribe“But at least you could make a compelling argument that it was a good idea to get rid of Trump.” Most certainly! Look at how much better things are in America now that Joe Biden is President. (Note for the sarcasm-impaired: this is a sarcastic comment.)
LOL. And remember the apoplexy exhibited over the “power” and influence that the Koch Brothers had at once time? They are now mere pikers in this billionaire’s game. Oh, the hypocrisy of it all!
I’m not sure of the rationale behind supporting big tech and billionaire money to get rid of a problem one agrees with (i.e. “get rid of Trump”) yet decry everything else. This highlights the impossibility of our current dilemma: “get rid of Trump” even if it is done by illegal means. It just doesn’t work that way. Selling one’s soul for one thing keeps it in a cage for everything else to be bought (for the right price).
The Vietnamese vilage analogy: Destroying democracy in order to save it. From Trumpian toxicity which is not limited to Trump. They really wish for all those proles in the hinterlands to shut up, comply, and drink Victory Gin.
“Bill Gates and his now-discarded wife, Melinda French Gates” Um – she discarded him because he’s a sleazy little pervert. He was using her to play the “good husband & father” for the public. He’s a creep.
Being a creep doesn’t matter when you are worth that much money. The starry-eyed receivers of all that cash are complete and utter hypocrites.
Like Democrat politicians Spitzer & Cuomo as well – both of whom cheated on lovely women for side dishes…
“the real danger may be confiscation, as people recognise the enormous gap between oligarchic posturing and the reality of class relations.”
It’s impossible to maintain a stable society with the level of income inequality we currently have (at least in the USA).
If the wealthy oligarchs want to preserve their own freedom, they need to advocate for living wages, affordable housing, and universal health care.
Otherwise, they will have to live behind iron gates in constant fear of the kinds of violent overthrows that have occurred in the past.
It is in the best interests of the oligarchs to redistribute enough wealth that people are not so enraged that they “burn it all down.”
The best way to save capitalism is to put a floor underneath how desperately poor the population can become.
I don’t care about people being much richer than myself. What I do care about is how the wealthy use their money to buy politicians.
What are talking about? Many of them already live behind iron gates and weaponized security guards. It was a good laugh several years ago when Nancy Pelosi advocated for no walls on the southern border as pictures of her walled residential compound circulated online.
Equating “income” with wealth as you have done is actually one of the best scams the elites ever came up with. An entrepreneur or professional who takes on enormous debt and has a negative net worth but finally achieves a high income will give up most of that money to taxes. In Canada I pay 54% of my income in taxes, plus another 13% of nearly everything I spend. But the truly wealthy only pay tax on their “income”, and their accountants have figured out how to ensure that they don’t book their income in any jurisdiction that will tax them. As the cry for more wealth redistribution grows louder and louder, watch what happens – as always it will be income and not wealth that gets targeted. Thus ensuring that the rich get richer and no one can claw their way up. Meritocracy has all but given way to nepotism and the new feudalism.
If you wish to preserve your wealth and influence, go unnoticed. That is what I do.
I hope you lose both. Be careful.
I was joking. I done never had any of either.
Was it Lenin who said “when it comes time to hang the capitalists, they will vie with each other for the rope contract”?
Lenin was asked how did 11000 Russian communists conquer Russia and he replied ‘because the educated left were a bunch of useful idiots’.
Instead of class based marxism we now have green and race based marxism and both have the same bunch of ‘useful idiots’ supporting them without ever asking themselves would happen if BLM or XR actually became their govt
A very good analogy, and enjoyable to read. The sort of writing I look for on Unherd. As missionaries led to old style colonization, I fear we are seeing a merely updated version of the cross and the sword, the recolonization of the world by the self-anointed multi-national “great and good” under the banner of the Green (quite primitive and totemistic, really) Religion. They require a staggering degree of suspension of disbelief and individual discretion, in exchange for promises of survival, in a condition of increasing bondage.
Explain ‘..quite primitive and totemistic..’ as epithets for what you call the ‘Green Religion’ – most advocates of climate-friendly policies base their views on widely accepted scientific studies that have been subjected to quite fierce review. Or do you just mean to criticise the wealthy but hypocritical?
…fierce review ? You’ve got to be joking Andrew. Any one who applies normal scientific skepticism to claims of climate catastrophe is immediately cancelled. “Widely accepted” means nought. Galileo was the exception to the widely accepted, but he was right.
Plato recognized that nepotism was one of the greatest threats to any meritocratic society. His radical solution in The Republic – the only way to avoid the wealthy using their power to tip the scales to give their (often less able) offspring unfair advantage – was to take children from their parents at birth and have them raised in institutions. Everyone starts at zero but gets the full enjoyment of the fruits of their own talent and effort during their lifetime, amassing whatever fortune they can. But no one gets to inherit anything – no one gets a leg up or to live off the success of another. I wouldn’t go as far as Plato proposed, but I would start taxing inheritance much more than income – to better incentivize productive activity and penalize sloth. Somehow we got it exactly backwards – taxing income and not wealth. It’s almost like the wealthy elites make the rules.
will simony ever be sinful to the woke ‘church’?
I have a dream that one day hipsters will consider the neo-liberalising of their souls as cringe, and all will live happily ever after
Philanthropy in the 19th and early 20th century provided goods and services to low income members of our society. Those roles have since been taken over by government, whose resources dwarf those of philanthropists. Philanthropy thus has redirected its energy and money into influencing government rather than to direct action to aid the poor.
I appreciate this article is about America not the UK – but there is an interesting comparison between your view and the philanthropy of the rich & successful in victorian times that build many of the great cities in the UK.
Of course names like Colston built grand architecture and donated to local organisations to engender their own power and influence – but in those times government was smaller and taxed less, leaving the space for philanthropy.
Not for profit was largely beneficial in that era.
And now we are tearing down his name & image because posthumously we have taken a dislike to the way he made his money (and many like him, he’s merely an example here)
I doubt any of these elites could identify any plant or animal – they don’t really know any about Mother Earth at all…
How can any conspiracy behind the scenes be good in any democratic nation? You have been listening too much to Sam Harris and his bad ideas about Trump and elections.
“the new rich embrace a racial, gender and environmental agenda that, while undermining merit and economic growth, still leaves them on top of the heap.”
The culture wart makes a lot more sense once you realize it’s just the same old class war wrapped up in fancy clothes.
Sorry to fawn, but this is an excellent piece. Nice research and reporting of a dismal trend.
Sorry to fawn, but this is an excellent piece! Thank you, Joel.
I have been following this dismal trend and recording the instances I found but this lays it out in all of its grotesque reality. Marked up and saved.
You need to be aware that the rich are becoming richer under the New Normal rules, so they have not jettisoned the concept of their own wealth, merely jettisoned the concept that their wealth is aided by the prosperity of many others.
Thank you Joel for this excellent reporting.
I have 2 words for Mr Kotkin: Koch Brothers.
Seriously? They are no more than flies on an elephant’s bum, for heaven’s sake, compared to the level of wealth named above. Shall there be zero defenders of freedom in your world?
Koch stayed married to a lovely woman for 25 years until he died (no talk of cheating either)…he did wonders for NYC – gave millions to the Metropolitan Museum to rebuild their front fountains & galleries and to numerous other NY groups as well..great guy…