It's back: the global arms race

China now sees itself as a major power, and US defense spending is at its highest inflation-adjusted level since 1946.

By David R. Francis

from the March 26, 2007 edition

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A global arms race has picked up speed. Leading the pack is the United States, whose military spending exceeds that of every other nation on earth combined.

"It's not a spiraling thing," says Siemon Wezeman, an arms trade expert at the Stockholm International Peace Research Institute (SIPRI) in Sweden.

Nonetheless, the "peace dividend" resulting from the end of the cold war has disappeared. World military expenditures slightly exceeded $1 trillion in 1990, a year before the collapse of the Soviet Union, figures SIPRI. They again topped $1 trillion in 2005 (in inflation-adjusted 2003 dollars).

SIPRI won't finish its compilation of last year's national defense spending around the world until June. But with the cost of the Iraq and Afghanistan wars rising, and with more spending on arms by China, Russia, the Middle East, and elsewhere, it is likely that global spending will easily beat $1 trillion again.

"That's a tragedy," says John Siebert, executive director of Project Ploughshares, an antiwar program of the Canadian Council of Churches, in Waterloo, Ontario. Though not opposed to absolutely necessary levels of defense expenditures, spending on education, health, and other social programs should have a higher priority, Mr. Siebert holds.

Mr. Wezeman warns that arms build-ups are "a dangerous game." There's always a risk that some nation will use its weapons, not just parade them.

Revived military spending has caught the attention of Wall Street. Merrill Lynch several months ago issued a 20-page report for investors on the global arms race, ending with a list of technology areas likely to receive more funding from the US government.

The report notes world military spending consumes 2.5 percent of the world's gross domestic product. It costs $173 per person. This spending has surged by 25 percent over the past five years. And "all indications suggest that spending will continue to grow," the investment banking firm finds.

The new arms race also is causing concern in other nations. Speaking of American plans to erect a missile defense shield in Poland and the Czech Republic, German Foreign Minister Frank-Walter Steinmeier last week said it was important not to let the US project spark a new arms race in Europe.

Also last week, China's Prime Minister Wen Jiabao tried to reassure the world that its rapid buildup in defense spending was not threatening. China's official military budget for 2007 has increased 18 percent, to $45.3 billion. This continues a decade-long run of double-digit rises. In real terms, the Pentagon says, China's defense spending is getting close to that of Britain and France, two major powers.

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