Part 11 of the series: How Systems Are Rigged Against the Bottom 90%

The U.S. military budget for 2024 is $968 billion. That’s more than the next 10 countries combined. More than China, Russia, India, Saudi Arabia, UK, Germany, France, South Korea, Japan, and Ukraine combined.

And here’s what makes this the perfect example of extraction: both parties vote for it. Every year. Republicans vote yes. Democrats vote yes. The budget increases regardless of which party controls Congress. Regardless of whether we’re at war or at peace. Regardless of whether there are any actual threats that require this level of spending.

This isn’t about national defense. If it were about defense, we could cut the budget in half and still spend more than any other country. This is about funneling nearly $1 trillion annually from taxpayers to defense contractors. And both parties participate because both parties take money from those contractors.

While troops are on food stamps, contractor CEOs make $22-27 million. While veterans wait months for healthcare, contractors post record profits. While schools are underfunded and infrastructure crumbles, Congress votes for another $50-100 billion increase to the military budget with bipartisan support.

Let’s look at exactly where that $968 billion goes and who profits.

The Scale of Military Spending

$968 billion is hard to conceptualize. Let’s break it down:

• $2.65 billion per day • $110 million per hour • $1.84 million per minute • $30,685 per second

Every second, $30,685 in taxpayer money goes to military spending. While you read that sentence, another $150,000 was spent.

International Comparison

Military spending by country (2024):

• United States: $968 billion • China: $296 billion • Russia: $109 billion • India: $84 billion • Saudi Arabia: $76 billion • UK: $74 billion • Germany: $67 billion • France: $64 billion • South Korea: $48 billion • Japan: $46 billion

Total for next 9 countries: $864 billion. U.S. spending: $968 billion. We outspend the next nine countries combined.

But wait—most of those countries are our allies. Let’s look at potential adversaries:

• China: $296 billion • Russia: $109 billion • Iran: $10 billion • North Korea: Estimated $6 billion

Total potential adversary spending: $421 billion. U.S. spending: $968 billion. We spend 2.3x what all potential adversaries spend combined.

And that’s before accounting for NATO allies (UK, Germany, France total $205 billion) who would fight alongside us in any major conflict.

As a Percentage of Budget

The federal budget for 2024 is approximately $6.1 trillion. Military spending accounts for:

• 16% of total federal spending • 54% of discretionary spending (spending Congress votes on annually) • More than Education ($305B), Transportation ($137B), and Veterans Affairs ($137B) combined

What could we do with $968 billion?

• Make all public universities tuition-free: $70 billion/year • Universal childcare: $150 billion/year • Fix all U.S. bridges and roads in poor condition: $125 billion/year for 10 years • Forgive all outstanding student debt: $1.8 trillion (less than 2 years of military spending) • Universal pre-K: $77 billion/year • Double NIH research budget: $48 billion/year

We could do ALL of those things and still have $498 billion left for military spending—more than China spends.

Where the Money Goes: Following the $968 Billion

The military budget is divided into several categories:

• Operations and Maintenance: $350 billion • Military Personnel: $185 billion • Procurement (buying equipment): $170 billion • Research and Development: $145 billion • Military Construction: $13 billion • Other: $105 billion

About $315 billion goes to procurement and R&D—this is where defense contractors make their money. Another $350 billion in operations and maintenance also heavily involves contractors for logistics, IT, maintenance, and services.

So roughly $665 billion of the military budget flows to private contractors. Not to troops. Not to veterans’ healthcare. To corporations.

The Big Five Defense Contractors

Lockheed Martin:

• 2023 Revenue: $67.6 billion (89% from U.S. government) • CEO James Taiclet 2023 Compensation: $23.5 million • Major products: F-35 fighter jet, missiles, space systems • Stock price: Increased 156% from 2013-2023

RTX Corporation (Raytheon):

• 2023 Revenue: $68.9 billion • CEO Greg Hayes 2023 Compensation: $22.8 million • Major products: Missiles, radar systems, aircraft engines • Stock price: Increased 140% from 2013-2023

Northrop Grumman:

• 2023 Revenue: $39.3 billion (86% from U.S. government) • CEO Kathy Warden 2023 Compensation: $27.1 million • Major products: B-21 bomber, missile defense, drones • Stock price: Increased 315% from 2013-2023

General Dynamics:

• 2023 Revenue: $42.3 billion • CEO Phebe Novakovic 2023 Compensation: $24.2 million • Major products: Submarines, tanks, IT systems • Stock price: Increased 245% from 2013-2023

Boeing Defense:

• 2023 Defense Revenue: $24.5 billion • CEO David Calhoun 2023 Compensation: $22.6 million • Major products: Aircraft, satellites, missiles • Note: Boeing commercial aviation has had major problems (737 MAX crashes, door failures), but defense division remains highly profitable

Combined revenue of Big Five: $242 billion. CEO compensation: $120.2 million total, average $24 million each.

These five companies receive nearly 40% of all Defense Department contract dollars. They’re essentially guaranteed customers with guaranteed profits funded by taxpayers.

Failed Programs That Never End

Defense contractors profit not just from successful programs, but from spectacular failures that continue for decades while costs balloon.

The F-35 Fighter Jet

The F-35 is the most expensive weapons system in human history:

• Original estimate (2001): $233 billion total program cost • Current estimate (2024): $1.7 trillion lifetime cost (acquisition + maintenance through 2088) • Per aircraft cost: $130-170 million depending on variant • Original delivery date: 2012 • Actual initial operational capability: 2015-2019 (depending on variant) • Years behind schedule: 3-7 years

Problems with the F-35:

• Can’t fly supersonic for more than 30 seconds without damaging itself • Costs $36,000 per hour to operate (vs $22,000/hour for older F-16) • Software still has critical bugs after 20+ years of development • Maintenance requires proprietary systems only Lockheed can access • Can’t operate effectively in cold weather • Helmet-mounted display gives pilots nausea • Not fully combat-ready until 2027—26 years after program start

Despite all this, Congress continues funding F-35 production. Why? Lockheed has subcontractors in 45 states—meaning 90 Senators have F-35 jobs in their states. Voting against it means losing jobs and campaign contributions.

Lockheed’s profit on the F-35 program: $75+ billion over program lifetime.

The Littoral Combat Ship (LCS)

The Navy’s Littoral Combat Ship was supposed to be a cheap, versatile ship for coastal operations:

• Original estimate: $220 million per ship • Actual cost: $500-700 million per ship • Original plan: 55 ships • Revised plan: 35 ships • Ships built: 35 (completed 2024)

The problems:

• Propulsion system fails constantly • Hull cracks appeared in multiple ships • Can’t survive combat—inadequate armor and weapons • Mission modules (the modular equipment that was supposed to make them versatile) don’t work properly • Maximum lifespan reduced from 25 years to 10-15 years • Navy is already decommissioning LCS ships after only 5-7 years of service

Total program cost: $25+ billion. Contractor profits: Billions. Useful ships delivered: Essentially zero—most will be decommissioned as failures.

The Zumwalt-Class Destroyer

The Zumwalt was supposed to be the future of naval warfare:

• Original plan: 32 ships • Revised plan: 3 ships • Ships built: 3 • Original cost estimate: $1.4 billion per ship • Actual cost: $7.5 billion per ship (after reduction to 3 ships spread development costs)

The problems:

• Main gun ammunition costs $800,000-1 million per round—so expensive the Navy cancelled ammo procurement, leaving ships with useless guns • Stealth features less effective than claimed • Reliability issues with propulsion and power systems • So expensive per ship that buying 3 cost more than the original 32-ship program was supposed to cost

Total program cost: $23+ billion for 3 partially functional ships. That’s $7.5 billion per ship that can’t fire its main weapons.

The Pattern

Notice the pattern:

1. Contractors low-ball initial estimates to win contracts 2. Once program is underway, costs balloon 2-10x 3. Programs experience massive delays and technical failures 4. Congress continues funding despite failures because:    – Jobs are spread across many congressional districts    – Contractors donate to campaigns    – Sunk cost fallacy (“we’ve already spent so much”)    – Admitting failure means admitting wasted billions 5. Contractors make guaranteed profits regardless of whether products work 6. Taxpayers pay the bill

This isn’t defense spending. It’s contractor welfare.

The Pentagon’s Accounting Problem

The Pentagon has failed every audit since audits began in 1990. Every single one. For 34 years.

What does “failed audit” mean? It means auditors cannot verify where the money went. Transactions aren’t properly documented. Assets aren’t tracked. Money disappears into a black hole of accounting.

The Missing $2.3 Trillion

In 2001, Defense Secretary Donald Rumsfeld announced that the Pentagon could not account for $2.3 trillion in transactions. Not $2.3 million. Not $2.3 billion. $2.3 trillion.

This announcement was made on September 10, 2001. The next day, 9/11 happened, and the accounting issue was forgotten.

Has the problem been fixed? No. The 2023 audit found $3.8 trillion in adjustments to the Army’s general fund balance sheet alone. These “adjustments” are accounting errors so large that auditors can’t determine what actually happened to the money.

Why This Matters

Every other federal agency is required to pass audits. The Social Security Administration passes. The Department of Education passes. The IRS passes. If they failed audits, Congress would defund them immediately.

But the Pentagon fails every audit, year after year, and Congress keeps increasing the budget. In 2024, after the Pentagon failed its 6th consecutive audit, Congress increased the military budget by $28 billion.

Why? Because failed audits mean contractors can overbill without detection. Equipment can be “lost” and replaced at taxpayer expense. Waste and fraud can flourish because no one is actually tracking where the money goes.

This isn’t incompetence. It’s intentional. Proper accounting would reveal the waste and fraud. Failed audits provide cover for extraction.

Examples of Waste

Government Accountability Office (GAO) reports document extraordinary waste:

• $43 million natural gas station in Afghanistan (estimated normal cost: $500,000) • $640 toilet seats • $7,622 coffee makers • $640 million spent on planes immediately sent to scrapyard • $28 million camouflage uniforms for Afghan army—in wrong pattern that doesn’t match Afghan terrain • $1 billion in military equipment abandoned in Afghanistan • $85 billion in equipment lost or stolen over past decade

These aren’t exceptions. These are examples of systemic waste enabled by failed audits and lack of accountability.

Troops on Food Stamps While CEOs Make Millions

Here’s the obscenity of military spending: while we pour $968 billion into defense contractors, the actual troops are struggling financially.

Military Pay

• E-1 (Private, first year): $24,204 annual base pay • E-2: $27,158 • E-3: $28,616 • E-4 (average 4 years service): $33,739 • Median military household income: $68,000 (including spousal income and allowances)

Compare this to contractor CEOs:

• Lockheed Martin CEO: $23.5 million (971x E-1 base pay) • Northrop Grumman CEO: $27.1 million (1,120x E-1 base pay) • General Dynamics CEO: $24.2 million (1,000x E-1 base pay)

Military Families on Food Stamps

An estimated 24,000 active-duty military families use SNAP (food stamps). This is likely an undercount—many eligible families don’t apply due to stigma or not knowing they qualify.

Why are troops on food stamps when the military budget is $968 billion?

Because the money doesn’t go to troops. It goes to contractors. $185 billion goes to military personnel (all pay and benefits for 2.1 million active duty and reserve). $665 billion goes to contractors.

We spend 3.6 times more on contractors than on the people actually doing the fighting.

Veterans’ Healthcare

Veterans Affairs budget: $137 billion (2024). This covers healthcare, benefits, and services for 19 million veterans.

Problems:

• Average wait time for VA appointments: 20-30 days • Disability claims backlog: 300,000+ pending claims • Veteran suicide rate: 17.5 per 100,000 (vs 14.5 per 100,000 civilian rate) • VA healthcare is chronically underfunded and understaffed

Meanwhile, the F-35 program alone costs $1.7 trillion lifetime. We could double the VA budget for 12 years with that money. We could hire enough staff to eliminate wait times, process all backlogged claims, expand mental health services, and provide better care for veterans.

But that money goes to Lockheed Martin instead.

The Obscenity

We tell troops they’re heroes. We thank them for their service. We wave flags and give speeches about supporting our military.

And then we pay them so little that 24,000 families need food stamps. We underfund their healthcare so they wait months for appointments. We deny disability claims while veterans kill themselves at higher rates than civilians.

While defense contractor CEOs make $27 million. While Lockheed posts $75 billion in F-35 profits. While the Pentagon can’t account for $3.8 trillion in “adjustments.”

The money exists. It’s just going to the wrong people.

Both Parties Are Complicit

Military spending is one of the clearest examples of bipartisan extraction. Both parties vote for increases. Both parties take money from defense contractors. Both parties perpetuate the system.

The Voting Record

2024 National Defense Authorization Act (NDAA):

• Total budget: $968 billion • House vote: 310-118 (passed with bipartisan majority) • Senate vote: 87-13 (overwhelming bipartisan support)

This pattern repeats every year:

• 2023: $816 billion (House 219-210, Senate 86-11) • 2022: $768 billion (House 363-70, Senate 88-11) • 2021: $740 billion (House 335-78, Senate 84-13) • 2020: $738 billion (passed with veto-proof majorities)

The budget increases every year. Regardless of party control. Regardless of whether we’re at war. Both parties vote yes.

The Money Trail

Defense contractor political spending (2020-2024 cycle):

• Total lobbying by defense contractors: $155+ million • Campaign contributions: $64+ million • Top recipients include members of Armed Services Committees, Defense Appropriations Subcommittees, and leadership in both parties

Lockheed Martin specifically:

• Lobbying (2020-2024): $64 million • Campaign contributions: Roughly 50-50 split between parties • Has subcontractors in 45 states—meaning 90 Senators have Lockheed jobs in their states

This isn’t Republicans taking defense contractor money or Democrats taking defense contractor money. Both parties take the money. Both parties vote for increases. Both parties protect contractor profits.

Jobs as Hostages

Defense contractors deliberately spread production across as many congressional districts as possible. The F-35 program has subcontractors in 45 states. Every major weapons system is designed the same way.

This means voting against a defense program = voting against jobs in your state. Even if the program is wasteful, even if it’s over-budget, even if the equipment doesn’t work—voting against it makes you vulnerable to attack ads about killing jobs.

This is intentional. Contractors spread jobs around not for efficiency, but for political protection. It works perfectly—programs that should be cancelled continue for decades.

The Revolving Door

Hundreds of former military officers and government officials work for defense contractors:

• 380+ former high-ranking military officers work for defense contractors • Former Defense Secretaries regularly join contractor boards (e.g., Jim Mattis joined General Dynamics board) • Former members of Congress work as lobbyists for contractors • Pentagon acquisition officials retire and immediately join companies they were overseeing

This creates obvious conflicts of interest. Officers make decisions knowing they’ll be hired by contractors after retirement. Acquisition officials approve contracts knowing they’ll join the company later. Congress members vote for programs knowing they’ll lobby for those companies after leaving office.

The system is designed for corruption. And both parties participate.

What We Actually Need for Defense

The question isn’t whether we need a military. We do. The question is: do we need to spend $968 billion when potential adversaries spend $421 billion combined?

Actual Defense Requirements

The U.S. needs to defend:

• U.S. territory • Treaty allies (NATO, Japan, South Korea, Australia, etc.) • International shipping lanes • Deter nuclear adversaries • Maintain technological superiority

Current capabilities:

• 11 aircraft carriers (next largest: China with 3, being built) • 5,000+ aircraft • 68 submarines (including 14 ballistic missile subs) • 6,800+ nuclear warheads • 750+ military bases in 80+ countries • Most advanced military technology in the world

Compare to China (our primary potential adversary):

• 3 aircraft carriers (being built) • 3,300+ aircraft • 59 submarines • 350 nuclear warheads • 1 foreign military base

We already have overwhelming superiority. We could cut military spending in half—to $484 billion—and still outspend China by $188 billion. Still have 11 carriers to their 3. Still have technological superiority. Still have 6,800 nuclear warheads to their 350.

What About China?

The argument for massive military spending is usually: “What about China?”

China’s military spending: $296 billion. U.S. spending: $968 billion. We spend 3.3x what China spends. We have 31 treaty allies who would fight alongside us in any conflict. China has North Korea.

Add NATO allies (combined $300+ billion military spending) and the imbalance becomes absurd. The U.S. + allies spend $1.27 trillion on defense. China + Russia + North Korea spend $415 billion.

The U.S. is not vulnerable. We’re not threatened. We’re not in danger. We have overwhelming military superiority and alliances that make any conventional military conflict unwinnable for adversaries.

The spending isn’t about defense. It’s about contractor profits.

The ‘NATO Allies Aren’t Paying’ Myth

A common argument: “We have to spend so much because NATO allies don’t pay their fair share.”

This is a misunderstanding of how NATO works. The “2% of GDP” guideline is not money paid to NATO or the U.S. It’s what each country spends on their own military. NATO allies aren’t supposed to pay us. They’re supposed to maintain their own militaries.

Current NATO ally spending as % of GDP (2024):

• Poland: 4.1% (above guideline) • United States: 3.5% • Greece: 3.1% • Estonia: 3.4% • Latvia: 3.2% • UK: 2.3% • Lithuania: 2.9% • France: 1.9% • Germany: 1.5% • Canada: 1.3% • Spain: 1.3%

Several allies now meet or exceed the 2% guideline. Those that don’t include Germany, Canada, and Spain. But here’s the thing: even if every NATO ally hit 2%, the U.S. military budget wouldn’t decrease at all. We’re not spending $968 billion to make up for their shortfall. We’d still be spending $968 billion because that’s what defense contractors want.

Proof: From 2014-2024, NATO ally spending increased by over $100 billion as more countries reached the 2% guideline. During that same period, did U.S. military spending decrease? No. It increased from $610 billion to $968 billion. We increased our spending by $358 billion while allies increased theirs by $100+ billion.

The “NATO allies aren’t paying” argument is cover for extraction. Even if every ally doubled their military spending tomorrow, Congress would still vote to increase the U.S. budget because contractors lobby for it and both parties take their money.

Plus, let’s be honest about why we maintain such a large military presence in Europe and Asia: it’s not just to defend allies. It’s to maintain global power projection that benefits U.S. economic and political interests. We keep bases in 80+ countries not because those countries aren’t pulling their weight—we keep them because they serve U.S. strategic interests. And defense contractors profit from every one of those bases.

Endless Wars

Since 2001, the U.S. has spent $8+ trillion on wars in Iraq and Afghanistan:

• Cost of Iraq War: $3 trillion (Costs of War Project, Brown University) • Cost of Afghanistan War: $2.3 trillion • Additional counter-terrorism operations: $1+ trillion • Care for veterans of these wars: Projected $2+ trillion through 2050

Results:

• Iraq: Destabilized, led to ISIS • Afghanistan: Taliban back in power after 20 years • 7,000+ U.S. troops killed • 50,000+ wounded • 400,000+ civilians killed

Who benefited? Defense contractors. Halliburton, KBR, DynCorp, and others made billions in wartime contracts. Mission accomplished—for shareholders.

The International Comparison: Proving We’re the Outlier

Let’s compare military spending as a percentage of GDP:

Military Spending as % of GDP (2024)

• United States: 3.5% • Russia: 4.1% (at war with Ukraine) • Saudi Arabia: 7.3% (regional conflicts) • Israel: 4.5% (constant conflict) • China: 1.7% • India: 2.4% • UK: 2.1% • Germany: 1.5% • France: 1.9% • Japan: 1.2% • Canada: 1.3%

The only countries spending more as a percentage of GDP are those actively at war or in constant conflict. We’re not at war. We’re not under threat. Yet we spend more than any other peaceful nation.

Per Capita Military Spending

• United States: $2,900 per person • Saudi Arabia: $2,150 per person • Israel: $2,400 per person • Russia: $760 per person • China: $210 per person • UK: $1,100 per person • Germany: $800 per person • France: $980 per person • Canada: $570 per person • Japan: $365 per person

We spend $2,900 per person on military—4x what other developed democracies spend. And they’re all safe. They’re all secure. They’re not being invaded.

What Other Countries Spend That Money On

Countries that spend less on military spend more on things that actually improve citizens’ lives:

Germany:

• Military: 1.5% of GDP ($67B) • Education: 4.2% of GDP • Healthcare: 11.7% of GDP • Infrastructure: Extensive high-speed rail, renewable energy • Free university, universal healthcare, robust public transit

Japan:

• Military: 1.2% of GDP ($46B) • Education: 3.3% of GDP • Healthcare: 11% of GDP • Infrastructure: World-class rail, urban transit • Universal healthcare, excellent schools, advanced infrastructure

United States:

• Military: 3.5% of GDP ($968B) • Education: 5% of GDP (but results worse than other developed countries) • Healthcare: 17% of GDP (most expensive, worst outcomes among developed nations) • Infrastructure: Crumbling roads, outdated transit, aging electrical grid • No universal healthcare, expensive education, declining infrastructure

We spend more on military and get worse results in everything else. Other countries invest in their people. We invest in contractors.

What We Could Do With Half the Budget

Cut the military budget to $484 billion—still more than China, Russia, and Iran combined. That frees up $484 billion annually. What could we do with it?

• Free public universities: $70 billion/year • Universal childcare: $150 billion/year • Double NIH research budget: $48 billion/year • Universal pre-K: $77 billion/year • Fix all deficient bridges and roads: $125 billion/year • Expand Medicaid to all states: $14 billion/year

Total: $484 billion. Exactly what we’d save.

Or we could:

• Forgive all student debt in 4 years ($1.8T ÷ $484B/year) • Build high-speed rail connecting major cities • Upgrade electrical grid for renewable energy • Expand VA healthcare to eliminate wait times • Triple pay for E-1 through E-4 troops

The money exists. We’re spending it on contractors and failed weapons programs instead of investing in our people.

Conclusion: The Most Obvious Extraction

Military spending is the clearest example of bipartisan extraction in the entire U.S. system.

$968 billion annually. More than the next 10 countries combined. Both parties vote yes. Every year. Defense contractors donate to both parties. Profits flow to CEOs making $27 million while troops are on food stamps. The Pentagon fails every audit. Programs balloon to 10x original cost and still get funded. Wars cost trillions and accomplish nothing.

And nothing changes. Because both parties take contractor money. Because jobs are spread across congressional districts. Because the revolving door ensures officials will work for contractors after leaving government. Because admitting the waste would require admitting complicity.

We could cut the budget in half and still have overwhelming military superiority. We could invest the savings in education, healthcare, infrastructure, childcare—things that actually improve citizens’ lives. We could triple pay for junior enlisted troops and still save $400+ billion.

But we won’t. Because the system isn’t designed to provide defense efficiently. It’s designed to extract $968 billion annually from taxpayers and transfer it to contractors. And both parties ensure it continues.

This is what bipartisan consensus looks like: both parties agreeing to funnel nearly $1 trillion per year to corporations while troops struggle financially, veterans wait months for healthcare, and infrastructure crumbles.

When people say both parties are the same, this is what they mean. Not that there are no differences—there are. But on the extraction systems that transfer wealth from the bottom 90% to the top 10%, both parties are completely aligned.

Healthcare, housing, education, prisons, military—every extractive system we’ve covered gets bipartisan support. Both parties take money from the industries profiting from these systems. Both parties vote to maintain them. Both parties use language to prevent honest analysis.

The military budget makes this undeniable. It’s too big to ignore. Too bipartisan to blame on one party. Too obviously wasteful to defend. And that’s exactly why it’s the perfect example of how the system actually works.

Next time:We’ll examine the political system itself—how both parties maintain these extractive systems, why they agree on the things that matter most to the top 10%, and why the differences they campaign on are designed to divide us while the wealth extraction continues.