Defense firms feast on Bush’s “War on Terror”
Al Jazeera Magazine | August 30 2005
Analysts say that a significant part of the American’s national life is determined by the financial interests of the "mighty 10."
The “mighty 10" are not the Marines, Army, Navy, Air Force or Special Forces; they’re huge arms firms that stand to make hundreds of billions of dollars from Bush’s ongoing wars in Iraq and Afghanistan. Of the "10" -- Lockheed Martin, Boeing, Raytheon, Northrop Grumman, General Dynamics, Litton, General Electric, United Technologies, TRW and Textron -- six are among the world’s top 10 arms-producing companies.
The Pentagon’s spending on the American President’s “battles against terror” in Iraq and Afghanistan is keeping U.S. defense contractors alive.
The fiscal 2006 defense budget is set to climb to US$441 billion, an increase of US$21 billion over this year. It envisions an additional US$50 billion for the wars in Iraq and Afghanistan.
While the "war on terrorism" is the rationale for the proposed $48 billion jump in the fiscal 2006 defense budget, analysts suggest that much of that money looks like a political payoff.
If the war is targeting "terrorists" in Iraq and Afghanistan, as the American President claims, then why should the United States spend $475 million to build the Crusader, a 70-ton self-propelled artillery system so massive you couldn't get it to Afghanistan on a dare?
According to reports, Lockheed Martin, Boeing, Northrop Grumman, Raytheon, General Dynamics, Honeywell and United Technologies posted all-time best-ever profits in the first half of this year and they still have a huge list of orders.
H1 profits of Lockheed Martin, a large U.S. "defense entity", jumped 41 percent to US$830 million. Half-year sales rose to US$17.8 billion from US$17.1 billion in the same period last year, despite a drop in deliveries of F-16 fighter jets that cut into warplane sales.
Lockheed, which is also strong on missile defenses, integrated electronic combat systems and military space programs, projects sales for this year of up to US$38 billion and has orders worth another US$73 billion.
Q1 and Q2 sales of Boeing, the second-largest commercial aircraft maker after Airbus, is also the second-largest US defense contractor, were up 8 percent to US$27 billion.
Also Boeing's military division posted sales of US$15.3 billion in H1, an increase of 5 percent. Operating profits rose 16 percent to US$1.7 billion.
Boeing also operates Future Combat Systems (FCS), a US$125 billion project responsible for integrating new weapons and communications systems to help the U.S. soldiers be more effective.
At the end of June, Boeing had military orders of USS$85.7 billion.
Also Raytheon, best-known for military electronics and weapons systems, saw sales rise 8 percent in the first half of the year to US$10.4 billion.