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World military spending falls, but China, Russia’s spending rises, says SIPRI
an article by Stockholm International Peace Research Institute (abridged)

World military expenditure totaled $1.75 trillion in 2012, a fall of 0.5 per cent in real terms since 2011, according to figures released today by Stockholm International Peace Research Institute (SIPRI). The comprehensive annual update of the SIPRI Military Expenditure Database is accessible at www.si pri.org/databases/milex.


World military expenditure by region, 2012 (from SIPRI website)

click on photo to enlarge

The fall—the first since 1998—was driven by major spending cuts in the USA and Western and Central Europe, as well as in Australia, Canada and Japan. The reductions were, however, substantially offset by increased spending in Asia, Eastern Europe, the Middle East and North Africa, and Latin America. China, the second largest spender in 2012, increased its expenditure by 7.8 per cent ($11.5 billion). Russia, the third largest spender, increased its expenditure by 16 per cent ($12.3 billion).

Despite the drop, the global total was still higher in real terms than the peak near the end of the cold war.

‘We are seeing what may be the beginning of a shift in the balance of world military spending from the rich Western countries to emerging regions, as austerity policies and the drawdown in Afghanistan reduce spending in the former, while economic growth funds continuing increases elsewhere,’ said Dr Sam Perlo-Freeman, Director of SIPRI’s Military Expenditure and Arms Production Programme. ‘However, the USA and its allies are still responsible for the great majority of world military spending. The NATO members together spent a trillion dollars.

In 2012 the USA’s share of world military spending went below 40 per cent for the first time since the collapse of the Soviet Union. A declining trend that began in 2011 accelerated in 2012, with a drop in US military spending of 6 per cent in real terms to $682 billion.

The decline is mostly the result of reduced war spending, which fell from $159 billion in FY 2011 to $115 billion in FY 2012, and is set to continue its downward course, with only $87 billion requested for 2013.

US military spending in 2012 was also projected to be $15 billion lower than previously planned as a result of cuts to the Department of Defense linked to the 2011 Budget Control Act. The bulk of cuts under this legislation will begin in 2013.

Austerity policies also caused falls in military spending in most of Europe in 2012. Since the 2008 global financial crisis, 18 of the 31 countries in the European Union or European NATO have cut military spending by more than 10 per cent in real terms.

Even in those parts of the world where spending has increased, the effects of the economic crisis can still be seen: slowing economic growth in emerging regions has led to slower rates of growth in military spending. Only the Middle East and North Africa increased their rate of military spending between 2003–2009 and 2009–2012. . . .

* All percentage increases and decreases are expressed in real terms (constant 2011 prices).

DISCUSSION

Question(s) related to this article:


Does military spending lead to economic decline and collapse?,

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Latest reader comment:

I think it was Marx who said that military spending is like throwing money into the sea, since it does not produce anything of value for people.

We could saw this previously in the case of the Soviet Union that was driven into bankruptcy by the arms race, which was a deliberate and successful strategy of NATO.

But now, if we look clearly, we can see it is now the case for the United States which produces very little for export and imports enormously (especially from China), while it spends most of its wealth on arms production.  

Arms production is hidden in the official government budget of the United States.  First, the government adds in social security which does not come from taxes, but which is simply a form of saving by those who pay into the system.  Then it hides much of military spending in other budgets (for example nuclear production is hidden under energy).  And finally, it fails to mention that most of the enormous budget item of debt payment is actually the payment for previous wars and arms production.

According to the careful research of the War Resisters League (available at their website, almost half of the federal budget of the United States is for present and past military expenses.  This amounts to over 1.3 trillion dollars a year!


This report was posted on April 19, 2013.