Novye Izvestia Analytics: how military spending is growing in Russia and in the world

Yelena Ivanova, Natalia Seibil

To whom is a pandemic, and to whom war is a mother. This conclusion can be drawn from reading a new study by the Swedish Peace Research Institute SIPRI. The world has not become more stable over the past year, and more and more people are willing to resolve their issues by demonstrating or using force.

"We have just seen how, wishing to force the West to talk to itself, Russia began to use the possibility of military operations on the territory of Ukraine as a means of pressure. China is expanding its military ambitions. More and more people are willing to solve international problems by force. And military budgets naturally grow", - says military expert Alexander Golts.

The difference between 2019 and 2020 is not significant, but it is still growth. Last year, all countries together spent $ 1 trillion 981 billion on the maintenance of armies and weapons, which is 64 billion more than in 2019. So the trend is clear.

“We can confidently say that the pandemic did not have a significant impact on military spending in the world in 2020”, - said SIPRI researcher Diego López da Silva. They grew globally by another 0.2% and amounted to 2.4%.

Valery Mironov, Deputy Director of the Institute for the Development Center of the National Research University Higher School of Economics, although he notes the absence of a sharp ideological split in the modern multipolar world, as it was in the era of the confrontation between the United States and the Soviet Union, rivalry in various spheres, including the military, continues. Somewhere in the minds of the old paradigm persists that war is the continuation of politics by other means, while weapons are accumulating:

- They are not used yet, perhaps because everyone remembers how the Americans used nuclear weapons in 1945, what the consequences were, and this is holding everyone back. While the weapon is used according to the chess principle, as a threat, which is more terrible than its execution. It is sometimes said that the buildup of weapons, in terms of game theory, contributes to peace. Supposedly, by arming ourselves, we keep the peace. A controversial statement, but the reality is that countries are either arming themselves or looking for powerful allies, and this is important for everyone to understand.

The rating of countries is topped by the United States. 778 billion dollars went to the upkeep of the army and its weapons, three times more than all the income of Russia for the same year. The US military budget accounts for 39% of all world military spending. From 2010 to 2017, US military spending declined. They began to grow over the past three years.

“The United States invested primarily in the modernization of the nuclear arsenal, although there were large purchases of conventional weapons, ships and combat aircraft”, - Der Spiegel quotes Alexandra Marksteiner of SIPRI.

Russian experts believe that the US nuclear rearmament program is at the very beginning, but this is a matter for the future.

"So far, within the framework of current expenses, we are talking about R&D at an early stage. The main expenses are the upkeep of the troops, first of all. This includes the purchase of military equipment, but there is nothing super unexpected in the costs. The maintenance of troops abroad, the conduct of wars - that's all", - says Alexander Golts.

Military economist Vasily Zatsepin advises not to overestimate the growth of US military spending. The United States has a large military budget, so all its changes are perceived differently:

"Many NATO member states are increasing their budgets, in particular, Great Britain (took 5th place in the rating right after Russia - editor's note), in response to the policy pursued by Russia. I do not think that the United States has increased its military budget, it just has a large military budget, so their small changes are perceived as big, especially by revisionist countries that have a power economy, and which always look with envy at the so-called “opponents,” “geopolitical rivals”, someone comes to “enemies”.

China ranks second in terms of military expenditures, although they are three times less than American ones. Nevertheless, for 26 years in a row, the military budget of the Celestial Empire has been growing every year. SIPRI experts remind that China has been modernizing its army and especially its navy for several years. The Chinese armed forces are two and a half million people, not counting the gigantic mobilization resource. Substantial money is spent on this - $ 252 billion. China now produces a full range of weapons to equip its own army and navy. Goltz recalls that Russia once sold SU-27s to the Chinese, and then was surprised to find that now China itself sells its own fighters to Pakistan, which are no different from Russian Sushki. India occupies the third line of the list for the second time. With China as its main military adversary, it is doomed to reach for it in military spending.

Russia is in fourth place in terms of military expenditures. The military budget of our country amounted to 61.7 billion dollars. It also grew by 2.5% compared to 2019. The same survey by the Stockholm Institute says that Russia has not spent 6.6% of the 2020 military budget. The official version says: as the program of rearmament of the Russian army is carried out, the output of defense products will decline. There is another explanation - during the pandemic, there was a decline in production, which also affected military products.

But the fact is, says Vasily Zatsepin, that the so-called economy is formed in our country every year. Several years ago, the President accepted the proposal of the Ministry of Defense to cut operating expenses by 200 billion rubles in connection with the failure to fulfill the State Defense Order and the catastrophic growth of accounts receivable on advances issued by the state, including due to an increase in direct losses. In our financial sector, excuse me, it's a mess, the expert says. There is a law on the federal budget, and there is an updated list of expenses. Both the Finance Ministry itself and the law enforcement agencies very actively use this freedom of hands, which arises due to the fact that we not only need to comply with the law adopted by the State Duma, but this very refined list, which, according to the rules that are not clear to an outside observer, functions ... That $ 200 billion is a big chunk of this savings that is talked about every year because they can't spend:

- They do not go into the amount approved by the law, but into this refined painting and hang out like something in the ice hole for several years and create these effects. This is a fictitious non-fulfillment, because we are not talking about the implementation of the law on the federal budget, but the non-fulfillment of the specified list, which is a strange shadow of the state budget, which is determined in our country by law, just as the presidential administration is a strange shadow of the government, the Public Chamber is strange shadow of parliament. This strange economy is a means of feeding our social structures. It is much easier to steal from them with a refined list, which is formed by officials uncontrollably.

The annual ranking of countries in terms of their military expenditures raises many questions from Russian experts. While in Stockholm, they take the costs of each country and recalculate them in dollars. From the point of view of arithmetic, everything is accurate. However, economists say there is a need to switch to accounting for military spending at purchasing power parity. Then the picture of the world would have changed significantly, says Vasily Zatsepin:

"Russia has a military budget in the region of $ 60 billion, which is completely wrong. Russia actually has about $ 180 billion in parity terms. And surely not India will be in third place. I think that Russia and China are tied for second place after the United States, given all these shadow financing mechanisms for military spending that are used in China and in Russia. India is still far from us, despite its large population and large economy".

Experts state that the Russian leadership does not report any sane figures that could be relied on, and the Russian parliament does not demand from it. Alexander Golts says:

"Our Russian budget consists of one and a half dozen figures that are not correlated with each other. The main source of information is the speech of Mr. Shoigu at the final board of the Ministry of Defense. Moreover, the figures that he reported in the previous year do not beat the figures that he reports in the current one. They do not bother with this at all, because there is no one in the country who would ask the minister a question why he promised to put on alert duty, for example, 4 S-400 regiments, but put only 3 regiments. And he does not explain why his state defense order is being fulfilled by 9.9%. Nobody bothers with this today".

In general, the situation now is such that there is no reason to expect a reduction in military budgets next year. The Americans are planning the rearmament of the strategic nuclear forces, on which more than a dozen billion dollars will be spent. The good news is that the presidents extended the START treaty for another five years, so they even plan their rearmament based on the limitations of this treaty, which allows each side to have 1,550 deployed warheads and 500 deployed carriers.