War is a racket and all wars are bankers’ wars.

Southeast Asia, since the end of WWII, provides us with numerous examples of the negative externalities of the arms trade and warfare. The former Laotian capital of Luang Prabang is a wonderful city of great beauty and charm, but much of the surrounding countryside is scattered with unexploded ordnance (UXO). Per capita Laos is the most heavily bombed country on the planet.[i] Even today, fifty or so years after the bombs were dropped by American forces in an undeclared and secret war, they are still a health hazard. According to author William Blum, “It is estimated that up to 30 percent of the two million tons of bombs dropped by the United States in Laos failed to explode and that 11,000 people have been killed or injured subsequently, of which more than 30 percent have been children…Vietnam and Cambodia harbor (sic) similar dangers.”[ii] Scientists, engineers and designers worked very hard to build those bombs and the planes that dropped them: tax dollars were spent, backhanders were accepted, corruption was stoked, men were turned into killers, Communism was fought, atrocities were committed, trauma was inflicted, wives were widowed, women and girls were raped, children were orphaned, and people (of all shapes, sizes and colours) were relieved of their arms and/or legs. Persons unknown sure were happy to sell the bombs and pocket their blood money safe in the knowledge that politicians would protect them. It was, after all, “just business.”

Thailand is not a signatory to the 1951 International Refugee Convention, which means that technically, none of the tens of thousands of refugees along the Thai-Burmese (Myanmar) border are actually refugees. If you think this is some sort of joke, I’m not laughing, and neither are they. Thailand and Myanmar have a long and conflicted history; there is no love lost between them. Burma also has a long history of intra-ethnic conflict, with the military government dominated by ethnic (Buddhist) Burmans. People are born, live and die in the refugee camps. Places, which although de facto permanent settlements, have no legal status, and refugees are forbidden to build ‘permanent’ structures. It’s Kafkaesque.

The military regime in Myanmar (Burma) is both brutal and racist. The Thai government are also often extremely racist against Burmans and the various other ethnic groups that live in the refugee camps, so the options of the refugees are extremely limited. For many, the least bad option is to relocate to Bangkok and work (illegally) on a building site, save money, usually paid at a rate lower than the Thai minimum wage, and hope for some kind of lucky break. That or sell yah bah (literally translated as ‘crazy medicine,’ namely, amphetamine/caffeine pills) and pray to God that the Royal Thai police force don’t catch you. The alternative is to become a prostitute, also illegal in Thailand despite what your eyes might tell you if you visit Patpong, Soi Cowboy or the Nana Entertainment Plaza, and hope that you don’t catch AIDS and/or get raped and/or murdered.

International embargoes on Myanmar mean that the regime must make strategic alliances with the Thai military and other cliques of the Thai elite to sell their timber, diamonds, opium and other natural resources. Although discrimination against the Burmese is common, powerful members of the Thai elite are willing to do business with the military junta for the natural resources that Burma has, the green of the dollar overriding mistrust and centuries of violent history. The Burmese regime has ‘an arms habit’: they are addicted to guns, which they must ‘feed’ on a daily basis. It is a cesspit of corruption that leaves tens of thousands in limbo for years or even decades but rewards the most brutal and selfish of individuals. With a rampant arms trade and endemic corruption, this is the reality of life for tens of millions of people all over planet Earth. Like a heroin addict taking methadone, refugee camps ‘manage’ the problem ‒ they do not solve it. But in any case, ‘it’s just business.’

But Southeast Asia is just one part of the world, and we can, in fact, find examples of the vileness of the military-industrial-complex/arms trade in all corners of the globe. Depleted Uranium (DU) has been used by the American military and/or its allies in Iraq from 1991 and 2003[1] onwards, Yugoslavia (in 1991), Afghanistan (from 2001 onwards) and possibly other locations[iii]. William Blum in his superlative work Rogue State: A Guide to the World’s Only Superpower describes the production and usage of DU thus,

Depleted uranium (DU) is a by-product of the production of enriched uranium fuel for nuclear reactors and weapons. It’s used in the manufacture of armaments such as tank cartridges, bombs, rockets, and missiles.

Because DU is denser than steel, shells containing it are capable of drilling a hole through the strongest of tank armours or penetrating thick walled bunkers under the ground. But depleted uranium has its drawbacks‒it’s radioactive, and like all heavy metals, uranium is chemically toxic.

DU has not just been implicated in a rise in birth defects and cancers in Iraq but also to a variety of diseases of American military personnel who have been exposed to it while serving abroad. Given that DU is both radioactive and toxic, its effects will be felt by the civilian populations of the countries where it has been used for centuries to come. Despite this horrendous record, DU has serious competition for the title of “most dreadful weapon” from several different corners, including but not limited to Agent Orange, biological and chemical weapons, cluster bombs, land mines, napalm, torture equipment and white phosphorous. For reasons of space, not all of these ingenious ways of killing people can be explored in this work, so let’s just narrow our focus to cluster bombs. Blum makes these observations about them,

Cluster bombs are ingeniously designed. After being dropped from a plane, the canister breaks open in mid-air at a predetermined altitude, typically scattering 200 or so “bomblets” the size of a soft drinks can. The bomblets (or “sub-munitions” as they are often called) explode upon hitting the ground, each one shooting out hundreds of shards of jagged steel at high velocity, able to saturate an extremely large area. One description of cluster bombs says “they can spray incendiary material to start fires, chunks of molten metal that can pierce tanks and other armour, or shrapnel that can slice with ease through…human flesh and bone.”[iv]

He goes on to say,

…In the past 40 years, the United States has unleashed hundreds of millions of bomblets upon the land and people of Laos, Cambodia, Vietnam, Iraq, Kuwait, Yugoslavia and Afghanistan. According to the Defence Department, US warplanes dropped 1,100 cluster bombs on Yugoslavia in 1999, each carrying 202 bomblets. Thus 222,200 of these weapons were propelled across the country. With a stated failure rate of 5 percent (other reports claim rates up to 30 percent), this means that about 11,110 cluster bomblets were left lying unexploded, ready to detonate on contact; in effect becoming landmines.[v]

When subjecting the international arms trade to a true cost accounting of all externalities, we could set aside any moral judgement and make a purely economic judgement on the arms trade. When the net revenue generated against the financial cost of the negative externalities is weighed, we can easily find that while small cliques of well-connected individuals benefit, society at large makes a loss. So even if we were to discount any moral, political, social, spiritual, philosophical or religious views against the arms trade, we can still find a purely economic argument against it. But actually, unlike ideological late-stage Capitalism, let’s not discount the moral and/or ethical argument against the arms trade. What then are the negative externalities of the arms trade? They include but may not be limited to:

Increased incidences of torture

Increased incidences of amputations

Increased incidences of rape and sexual abuse

Increased incidences of child emotional trauma

Increased incidences of drug and/or alcohol abuse

Increased incidences of PTSD

Increased incidences of homelessness among veterans

Increased incidences of incarceration of veterans

Increased demand on welfare systems by veterans

Increased number of refugees

Abduction of children to be used as soldiers

Greater burden on mental-health professional and facilities

Increased demand on health services in general

Loss of skilled personnel to the armed forces

Destruction of property

Increased pressure on finite material resources

The five permanent members of the United Nations Security Council have been the five biggest spenders on arms, with the United States way out ahead for most of the post WWII period. Four came in among the top five global arms exporters with only China outside the top five, coming in at seventh (according to the Stockholm International Peace Research Institute).[vi] Is it then surprising that the arms issue was not on the global agenda of governments?

Will Black makes this observation in his insightful book Psychopathic Cultures and Toxic Empires, “British Prime Ministers and other world leaders seem to see nothing wrong in going to arms fairs and acting as cheerleaders for companies wishing to sell weapons to undemocratic, despotic regimes.”[vii] Simply put, the Security Council are UNinterested in the issue of tackling the military-industrial-complex. If a true cost accounting were ever to be carried out, we would objectively see that the arms trade represents a negative development for global society as a whole. As Oscar Arias Sanchez, Nobel Laureate and former President of Costa Rica, once observed,

When a country decides to invest in arms, rather than in education, housing, the environment, and health services for its people, it is depriving a whole generation of its right to prosperity and happiness. We have produced one firearm for every ten inhabitants of this planet, and yet we have not bothered to end hunger when such a feat is well within our reach. Our international regulations allow almost three-quarters of all global arms sales to pour into the developing world with no binding international guidelines whatsoever. Our regulations do not hold countries accountable for what is done with the weapons they sell, even when the probable use of such weapons is obvious.[viii]

Since the arms trade has, in fact, been flourishing since the end of WWII, the inescapable conclusion that can be drawn is that those in power have been acting in the interests of those people profiting from arms dealing, either directly or indirectly; by owning shares in companies that sell arms or receiving payments, in whatever form, by representatives of those companies. This was achieved at the expense of local taxpayers, who often foot the bill for underwriting arms deals, and global society as a whole. The negative economic externalities of the arms trade are truly the negative externalities that dare not speak their name.

[1] Neither George W Bush nor Tony Blair have ever been charged with war crimes for their roles in the destruction of Iraq.


[ii] Blum, Rogue State, p. 133 and 135.

[iii] Blum, Ibid., p. 127.

[iv] Blum, Ibid., p. 132.

[v] Blum, Ibid.,p. 132‒3.


[vii] Black, p. 66.


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