Global military spending rose during recession

 

At a time when businesses and economies were heading south, military spending around the world actually increased. It turns out that companies in this industry were fairly recession proof. According to the Stockholm International Peace Research Institute (SIPRI), which releases a report on the topic annually, global military spending rose 5.9% in 2009. This took place at a time when global GDP decreased by 0.9%. The U.S. was responsible for more than half of the increase but other major powers also added to the up tick in spending. Does this mean that the world is becoming more militarized? Perhaps, but the story is not so cut and dry.

Some of the increase in spending may actually be as a result of the economic downturn, oddly enough. The most prevalent school of thought during recessions is that government spending should increase to create demand which private businesses will meet. This strategy was definitely implemented across the globe in the last recession when many of the leading counties made stimulus packages for their own economies. Military spending may not have seen an increase there specifically, but it certainly wasn’t cut and with the war in Afghanistan taking place, as well as, other areas of activity, the spending on arms could only go up.

Although the U.S. spends more on their military than any other nation by far, second place China has increased their military budget much more than the U.S. did over the last 10 years. There is an ongoing concern that China’s goal is to eventually spend more money than the U.S. on their military which could sway the balance of power to their side. As a westerner, this would not be good for the world at all. However, since the U.S. spends more than 6 times as much as China on their military at the moment ($661 billion to be exact), this is likely not an immediate concern for anyone.

There is also a technological and personnel quality advantage that the U.S. holds over everyone else which will not strictly follow the money trail in to China. The U.S. has some of the most advanced companies and most talented people in the industry which took many years to develop. They not only enable the Americans to produce the most technologically advanced weapons and systems for themselves, but they also make it possible for the U.S. to export these products and services abroad to their allies which brings in a lot of money and further cements military ties with those nations.

Being the number military in the world allows that country to have the world operate more in their favor on many issues. This means that their businesses can better compete and benefit from various situations that other countries’ companies may not be able to. This brings even more economic power to that country, which in today’s world is an even larger influence than military power. If done correctly, this creates a cycle that strengthens that world power and the citizens of that nation.