Military-Industrial Complex, Fifty Years On
from Greenberg Center for Geoeconomic Studies

Military-Industrial Complex, Fifty Years On

Fifty years after President Eisenhower’s warning, the "military-industrial complex" still thrives and dictates national priorities, says CFR’s Les Gelb, who argues that President Obama should make a case for building a strong domestic economy as a national security issue.

January 12, 2011 1:59 pm (EST)

To help readers better understand the nuances of foreign policy, CFR staff writers and Consulting Editor Bernard Gwertzman conduct in-depth interviews with a wide range of international experts, as well as newsmakers.

On Monday, January 17, 1961, President Dwight D. Eisenhower’s farewell address warned the nation to guard against the influence of a rising "military-industrial complex." That nexus of military, industrial, technological, and congressional interests has expanded considerably since Eisenhower’s cautionary speech, says military affairs analyst Leslie H. Gelb. Secretary of Defense Robert Gates, who has invoked Eisenhower’s warnings in the past year, recently promised $78 billion in cuts over the next several years, but Gelb says it’s unclear whether this will happen and what those cuts will be. Stressing the need for the federal budget to focus more on bolstering the economy--rather than a huge military--Gelb says he would advise President Barack Obama to make a strong case to the public for why the economy and jobs are "essential for the maintenance of democracy, for the maintenance of our economic competitiveness and our schools, and for our military security in the world."

Wasn’t the military budget at the time of Eisenhower’s speech much less than it is today, in comparable figures?

You’re right, if you do it in constant dollars. Compare how much we are spending on the military today, which would be about $750 billion a year. If you compare the Eisenhower budget in today’s dollars, it would be a little more than half, or $400 billion. So there is a huge difference, and he went out of his way even then to warn of the growth of the military spending.

What caused Eisenhower, who led the allied troops in Europe during World War II, to be so concerned?

More on:

Budget, Debt, and Deficits

Eisenhower had to go really out of his way to keep defense spending down, because the pressures had already begun with the Korean War to increase military spending by leaps and bounds. Eisenhower was able to keep the lid on it because he was Eisenhower, but he knew when he was leaving office that his successors were going to be in real trouble. That is why he made that warning about the dangers of the military industrial complex.

You were a senior official in the Pentagon in the 1960s and assistant secretary of state for political-military affairs in the 1970s during the Carter administration. So you had to deal with military spending in both jobs. How formidable is the military industrial complex?

It really is as important as Eisenhower said in January 1961. This is a juggernaut, and it’s not just the military industrial complex. Eisenhower in that farewell address also warned about the power of technology. So you have the military industrial and technology complex and it doesn’t even end there, as Eisenhower well knew, because you have Congress. What you really have is "the military-industrial-technological-congressional complex."

In the draft of that farewell speech, he originally called it "the military-industrial-congressional complex."

That’s right. If you add up those forces always pushing for more and more spending, never doing anything about waste in the military--of which there is plenty--then you have an ever-increasing budget. If you compare the spending in constant dollars of the Truman and Eisenhower administrations right after World War II, it was about half of what we are spending now. People like to distort the comparison by saying "Well, put it in GDP terms." If you do it that way, the gross national product during the Truman and Eisenhower administrations was tiny--a few trillion dollars. Now it’s almost fifteen trillion dollars. When you put it in those terms, the Truman and Eisenhower military budgets look gigantic. But the GDP comparisons don’t mean anything, because the GDP today is so much greater than it was then.

If you add up those forces always pushing for more and more spending, never doing anything about waste in the military--of which there is plenty--then you have an ever-increasing budget.

You have written about the GDP and the military a lot. How do you get around this whole problem that we’ve just been talking about?

More on:

Budget, Debt, and Deficits

I do not know how the devil you get around it. You mentioned I was running political military affairs at the State Department under Carter, and both Ambassador [William] "Bill" Sullivan, who was our ambassador to Iran at the time, and I proposed slowing down U.S. arms sales to Iran, so the shah of Iran, who was then an American ally, could use some of the money for economic development. When we made that proposal, this military- industrial-technological--congressional complex that I’m talking about, and which Eisenhower warned about, came into play and just smacked us down. We did not have a chance. We sold Iran stuff that they couldn’t use. The advanced fighter planes sat on runways and deteriorated.

Does that continue?

It is generally the case. Arms sales are a huge export for the United States. Now, I have no objection to it. In fact, before I went into the State Department in the 1970s, I wrote an article saying arms sales are a major instrument of U.S. foreign policy, and then I had to implement President Carter’s policy of cutting back on arms sales. You know, if arms sales are no good for our national interest, we shouldn’t make them. If they don’t hurt our national interest, sure let’s sell the arms. It’s good to develop the military ties and it’s good for exports, but you just can’t sell arms willy-nilly.

In your article on GDP in Foreign Affairs you write, "The main challenge for Washington, then, is to recompose its foreign policy with an economic theme, while countering threats in new and creative ways. The goal is to redefine ’security’ to harmonize with twenty-first century realities." Does this call ring a bell in Washington at all?

If arms sales are no good for our national interest, we shouldn’t make them. If they don’t hurt our national interest, sure, let’s sell the arms. It’s good to develop the military ties and it’s good for exports, but you just can’t sell arms willy-nilly.

No. It rings a rhetorical bell for some people. I can point to a half-dozen speeches by President Obama where he cites the same theme, but then doesn’t do anything about it. The point of the article is not simply that we ought to have an economic focus to our foreign policy, and that it’s not impossible to do it because President Truman and Eisenhower did it. Those two presidents made building up the U.S. domestic economy their first national security requirement. They were going to subordinate everything else to that. Secondly, they were going to build up the economies of our key allies, namely Western Europe and Japan--and they did. They created a market for us, they created allies for us, and by the time Eisenhower turned over power to President John F. Kennedy--when you added up the economic, military, and diplomatic power of Western Europe, Japan, and the United States--we had 75-80 percent of all the power in the world. They made the policy I’m talking about actually work.

Isn’t it true though that the demise of the Soviet Union was caused in a way by Ronald Reagan’s heavy military spending on such things as Strategic Defense (Star Wars)?

There is no evidence of that at all. That’s a claim made by the neo-conservatives, but it’s not supported by the evidence we’ve gotten from the old Soviet Union, from the national security archives, or from memoirs. The Soviets weren’t going to try to compete with us in military spending; at that point they couldn’t. So it’s not as if they spent themselves into an economic mess; they were already in an economic mess. They didn’t try to match us or match President Reagan’s Star Wars program because they didn’t think it would work, and even today almost all these missile defense tests fail.

Secretary of Defense Robert Gates recently announced $78 billion cuts in the defense budget. Was that an important announcement?

We still aren’t clear exactly how much or what is being cut. I don’t trust anything until I see the numbers or I see experts pore over the numbers and make sure just what is being done. When I looked at these same numbers only six weeks ago or so for an article I did for the Daily Beast, I found that was not only were we not planning to reduce the defense budget in real terms, but we were planning to increase it by 1-2 percent a year over the next five years. Secretary Gates went to Abilene, Kansas, Eisenhower’s home, last May, to give a speech at the Eisenhower Library. He quoted from the portions of the farewell address I so admire, and said Eisenhower was right that our economy is the basis of our military power. So everyone of course drew the conclusion that he was going to make contributions to the economy by cutting the defense budget. But as I told you, I went back and checked the actual numbers and found that cuts would be spent in other Pentagon areas.

Now in the last two weeks, Gates seems to be indicating some actual real cuts, but we do not know the real dimensions yet.

Congress seems dependent on keeping military spending high to keep jobs going. Isn’t that a major factor?

It’s dumb. Military spending is the least efficient way to create jobs. That is, you create fewer jobs by military spending then if you spent the same money, let’s say, on building infrastructure in the country: roads, bridges, and highways.


Because those expenditures on infrastructure are labor intensive, while most of the Pentagon expenditures are not labor intensive; they are technologically intensive. They require people with a lot of training and knowledge. You do not need as many of them as you do to break up and build roads.

If Obama called and said, "Give me some advice, what should I do the next two years?" What would you tell him?

I would say: Don’t just talk about making the domestic economy and jobs the number one priority. Go and explain to the American people why this is essential for the maintenance of democracy, for the maintenance of our economic competiveness and our schools, and for our military security in the world. Tell them that if we let the economy really fall, if we don’t make the tough decisions now to rebuild it, then we are going to be jeopardizing our military security as well.


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