Abstract

Prez Pampers Peddlers of Pain

Arms manufacturing is a source of high-wage employment, something that is rapidly disappearing in the U.S. Yet a closer look at the economics of weapons exports suggests that the domestic economic benefit from these sales is highly exaggerated. Such exports involve enormous government largesse and numerous hidden costs, benefiting a few dominant corporations but draining nearly everyone else. Most significant hidden costs are industrial offsets, the technical term for the lucrative trade-offs that weapons manufacturers routinely grant foreign governments as enticement for buying their goods. It is clear that disclosing the now-hidden costs associated with sales, gradually phasing out government financing of weapons transfers, establishing controls on offsets and transferring funds to public and civilian spending would enhance not only world peace and America's human rights record but its economy too.