In 1935, Major General Smedley Butler, a two-time Medal of Honor recipient and one of the most decorated Marines in U.S. history, wrote War is a Racket. His words were a scathing indictment of war’s true function—not as a necessity of state survival, but as an economic engine driven by profit-hungry interests. Nearly a century later, Butler’s warnings have never been more relevant. As the drums of war echo across Europe and beyond, we must ask: Who benefits? Who pays the price? And most importantly, who is making the decisions?
The Economics of War: Inflation, Military Spending, and Policy Manipulation
Inflation has surged worldwide, but its roots lie deeper than supply chain disruptions or monetary policy. War is a primary driver of inflation, not in isolation, but as part of a broader economic strain. Governments fund military efforts through borrowing, and in the U.S., this means a transactional relationship between the Treasury and the Federal Reserve. Each dollar printed to finance war increases the money supply, fueling inflation that ordinary citizens bear.
The current conflict in Ukraine has only accelerated this process. Billions in military aid have been funneled into Kyiv, but this aid is rarely new. Instead, the U.S. sends outdated equipment, purchasing new stockpiles to replace it. This cycle benefits weapons manufacturers—Lockheed Martin, Boeing, Raytheon—whose profits surge with every new defense contract. Smedley Butler saw this happen in his time, writing:
“In the World War a mere handful garnered the profits of the conflict. At least 21,000 new millionaires and billionaires were made in the United States. That many admitted their huge blood gains in their income tax returns. How many other war millionaires falsified their tax returns no one knows.”
Today, the pattern remains unchanged. Defense contractors reap the rewards, while taxpayers foot the bill through economic instability and rising costs of living.
The Politics of Controlled Escalation: Profiting from Prolonged War
War, once started, rarely follows a clean trajectory. The U.S. has had the ability to influence Ukraine’s effectiveness in defending itself against Russian advances. Yet, under President Biden’s administration, there were explicit restrictions on Ukraine’s ability to strike military targets inside Russia. This policy, had it been different from the outset, may have changed the battlefield dynamics significantly.
Only in May 2024 was this restriction eased, allowing limited strikes inside Russia’s border regions with U.S. weapons, but only for defensive purposes. This raises a disturbing question: Was the delay strategic? Prolonged wars guarantee continuous military expenditures, extended contracts, and entrenched political justifications for further spending. Butler foresaw this exact pattern:
“It is possibly the oldest, easily the most profitable, surely the most vicious. It is the only one in which the profits are reckoned in dollars and the losses in lives.”
It is difficult to ignore how modern conflicts mirror his observations. Decisions that appear strategic on the surface often have deep financial motivations. If Ukraine had been allowed to push back more aggressively months or even years earlier, would the war have taken a different course? And if it had, would the defense industry have been as profitable?
The Machinery of War: Profits over People
Butler exposed how the U.S. military-industrial complex functioned in his time, revealing that businessmen and financiers manipulated policy to ensure war remained profitable. He cited examples from World War I, noting that companies such as DuPont and Bethlehem Steel saw record profits while soldiers died in trenches. He wrote:
"A few profit— and the many pay. But there is a way to stop it. You can't end it by disarmament conferences. You can't eliminate it by peace parleys at Geneva. Well-meaning but impractical groups can't wipe it out by resolutions."
Fast forward to today, and the Pentagon’s budget has reached unprecedented levels—over $886 billion in 2023, with 2024 projections exceeding $900 billion, larger than the next ten militaries combined. The war in Ukraine has served as a justification for continued expansion, even as domestic infrastructure crumbles and national debt skyrockets.
To put this in perspective:
Raytheon, Lockheed Martin, and Northrop Grumman have seen their stock prices surge since the Ukraine war began.
The U.S. has committed over $100 billion in aid to Ukraine, a significant portion of which cycles back into the defense industry.
Meanwhile, ordinary Americans see real wages stagnate, housing costs rise, and inflation eat away at their savings.
Policy: A Tool for Profit?
War is often sold to the public under noble pretenses—defending democracy, protecting freedoms, or ensuring global stability. Yet, the reality is far more cynical. Smedley Butler understood this well:
“I spent 33 years and four months in active military service... And during that period, I spent most of my time being a high-class muscle man for Big Business, for Wall Street and the bankers. In short, I was a racketeer, a gangster for capitalism.”
This candid admission should make any citizen question the true motives behind military intervention. When policymakers make decisions, are they prioritizing national security or corporate interests? When conflicts drag on indefinitely, who benefits?
A War Machine That Never Sleeps
Butler proposed solutions that are just as relevant today as they were in 1935:
Military service should be truly defensive, not used for corporate gain.
War profits should be eliminated. If companies cannot profit from war, conflicts will become far less frequent.
The public should have a say in war declarations. If the burden of war were truly shared, fewer politicians would be eager to engage.
Yet, nearly a century later, the war racket continues. Conflicts do not arise organically—they are nurtured, manipulated, and prolonged by those who stand to gain. The modern global war economy is sustained through lobbying, defense contracts, and carefully managed escalation.
Where Do We Go from Here?
With tensions rising between NATO, Russia, and other global powers, we stand on the precipice of a new, unpredictable war. This will not be like World War I or II. The next global conflict will be fought across multiple domains—military, economic, cyber, and informational. And once again, it will be fueled by those who see profit in destruction.
Smedley Butler’s message should serve as both a warning and a call to action. As citizens, we must question the motivations behind war, hold leaders accountable, and refuse to be pawns in a game driven by wealth and power. If history has taught us anything, it is that war is rarely fought for the people—it is fought for the few who stand to benefit.
The question is: Will we let them?
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