OK, now do spending?
But arguably a lot more companies that aren't on the face of it defense and arms manufacturers are getting a larger and larger piece of the pie. Tech companies rely on defense – and "national security" – spending as key revenue streams, and they've built the connections with the government to match. (I think both SpaceX and Oracle are very much obvious examples now.)
So, perhaps the definiton of the MIC has to be updated for the 21st century to include "national security" spending and other significant technical suppliers.
Thank god, this also hit the Russians incredibly bad, but yeah; people's perceptions of the production capacity of both countries is wildly, wildly overestimated.
The MIC basically had its budget slashed by ~80% or so after the cold war. Thousands of factories were permanently shuttered, hundreds of companies more or less ceased to exist - sometimes some of their engineers were aqui-hired by other firms, but by and large they just stopped working for the MIC in general.
https://www.youtube.com/watch?v=CqjvTKFufuk
This is what they called the "Peace Dividend"; when the Soviets collapsed, we no longer felt we needed a military that could repel a conventional assault from the Soviet Union (with all 700m citizens, and the heartland of industrial Europe (i.e. Germany, Poland, Czechia) backing them). We just, worst-case, needed to stop Russia and their 140m citizens.
They called it that because it unlocked a huge chunk of the budget that previously went to the MIC. A literal dividend of money.
He classifies the Tech companies as not part of the military industrial complex, which seems like a mistake. The US tech industry is integrated with the US intelligence establishment and is effectively part of their military presence. Musk, for example, was making a very visible contribution to the Ukranian war effort with Starlink. Google & Facebook are a bigger threat than the US military when it comes to governments being taken out in my opinion and the US military is probably more of the same mind than they let on.
He's also very focused on earnings which is a headscratcher. He has revenues right next to that, and revenues are what matter. Earnings just say the US weapons producers are an inefficient industry which isn't a matter of controversy because it doesn't matter much. He seems to be confused about what figures to look at.
The 2024 budget was 15% national defense.
in 2024, the US Fed collected 4.9 Trillion in taxes and spent 3.8 trillion (78% of revenue) on the following programs: Social security, Medicare, health, and income payments like disability.
It also had 1.8 Trillion dollars of deficit spending, bringing the total to 6.7 trillion with welfare taking up (57% of total spending). The fed spent 0.9 trillion (13%) paying interest.
https://fiscaldata.treasury.gov/americas-finance-guide/feder...
- 1350B on social security
- 870B on Medicaid
- 850B on Medicare
- 830B on the military
- 660B on interest payments
Out of total of $6200B. Essentially 3/4 of all spending is in these 5 major categories. There is little left to save in other ones.
How to minimize taxes in retirement. (the RMD causes panic because if forces taxation). Many get a pension, social security, have a 401k, paid off house, and savings. Not everyone needs social security.
But we're not quite there yes, and I imagine many gen X will need that social security.
Increase social security taxes (example: no longer stop taxing wages over $150k for a start)
Decrease social security benefits. Means testing. If you have over $200K of income, then no check (or $300k, pick a number. Just not $50k)
Cancel 1 leg of the nuclear Triad. Cost / Benefit military procurement vs. keeping Lockheed healthy.
A functioning congress could fix this problem. If they functioned.
(*) https://www.brookings.edu/articles/is-government-too-big-ref...