No need for a new ‘Arsenal for Democracy’, US expert says

In the post-COVID era, a robust, innovative and globally competitive industrial base is a critical component to solving any national security equation. The rise of great power competition and renewed multipolarity across the geopolitical spectrum has served to only reinforce the growing importance of a reliable, sovereign industrial capacity.

This global shift has equally heralded the rise of an increasingly multipolar world, driven in large part by the rise of ancient powers, namely China and India, flanked by an equally formidable array of emerging powers including Indonesia, Vietnam, Brazil, South Africa, and a myriad of others across the globe.

In the face of this rapidly evolving — and as the government is often fond of reminding us — deteriorating strategic environment, Australia’s strategic thinkers and policymakers have been forced to improvise, adapt, and overcome in order to adjust to the new paradigm and its implications on national security.

Australia isn’t alone in staring down the immensity of these mounting challenges, with even the world’s sole superpower, the United States, confronting the very real limitations of its own industrial, economic, and political power following nearly three decades of living the equivalent of a fast-food junkie.

Nowhere is this clearer than with mounting economic stagnation and de-industrialisation, in the name of globalisation, beginning in the 1980s and continuing unabated through the 1990s and into the early 2000s, have further undermined the world’s great powers and are serving to dramatically shift the global balance of power.

The United States, which prides itself on being the “Arsenal of Democracy” is now a shadow of its former capacity, with very real limitations across the once mighty defence industrial base having an impact on the capacity of the United States to support, not only its own military requirements, but equally that of the broader Western alliance network, Australia included.

Or is it? For Georgetown University’s Jennifer Kavanagh, widely held and discussed belief that the United States’ defence industrial base and capacity to support the US and its allies, there are some challenges, but the “Arsenal of Democracy”’ approach isn’t necessarily what’s needed to rebuild the defence industrial base.

VIEW ALL

Kavanagh unpacks her thesis, stating: “As the war in Ukraine continues, there is an emerging consensus across the national security community — including senior defence leaders, members of Congress, defence industry professionals, and think tankers – that the US defence industrial base (DIB) is in crisis, lacking the capacity to meet the demands of a major power war or adequately arm allies and partners for self-defence. The most widely endorsed solution to these perceived shortcomings is a rapid and significant increase in DIB capacity to recreate the ‘arsenal for democracy’ of the World War II era, but this approach would be a costly overcorrection to the underlying challenges. Instead, Washington should adopt a more narrow and sustainable strategy that includes increasing efficiency and flexibility in the US DIB and prioritising arms transfers across partners.”

We have to get the balance just right

The concerns about the capacity of the US defence industrial base cover a number of key areas, namely, its capacity to recapitalise and modernise the US Armed Forces following nearly two decades of continuous conflict in the Middle East and a near decade of budget cuts and sequestration, and the capacity to support allies across the globe have consistently gained traction as a result of concerns raised both within the US, and more broadly as a result of the vast consumption of modern munitions in Ukraine.

In particular, the rapid expenditure of “dumb munitions”, namely, small arms and artillery rounds, and increasingly precision-guided munitions including the now famed Javelin and Stinger missile systems, has resulted in major concerns about the war stocks of the US and the capacity of the US defence industrial base to meet the demand of partners and allies around the world.

“Most of what the United States has sent Ukraine to meet near-term needs has come from US stockpiles, but Washington has struggled to keep pace with Ukraine’s requirements. There are now signs that remaining reserves are reaching levels that the Pentagon is unwilling to fall below, especially for high-demand capabilities. More recent US security assistance packages to Ukraine have not included any additional Stingers or Javelins, for instance. Furthermore, military aid to Ukraine over the first four months of 2023 included a greater share of promised future production through the Ukraine Security Assistance Initiative than was the case over 2022,” Kavanagh explains.

Kavanagh explains the background and concerns around the US defence industrial base, saying, “In his March 28 testimony on the Pentagon’s FY2024 budget request, Secretary of Defense Lloyd Austin told the Senate Armed Services Committee that the Pentagon planned to invest over $30 billion to expand the US defence industrial base (DIB). This commitment responds to the emerging consensus that defence sector consolidation and inconsistent investment have left the United States without the defence industrial capacity to meet the demands of a major power war or adequately arm allies and partners, including especially Taiwan and Ukraine but also key frontline allies in Europe and countries like Philippines and Japan in the Indo-Pacific, for self-defence.”

Central to these concerns is the long-term neglect and under-investment in the nation’s defence industrial base since the fall of the Soviet Union as a result of the peace dividend which swept across the triumphant Western world. With us now facing an increasingly challenging and multipolar world, the consensus appears to be returning to what has worked well in the past, or as I often say, “success leaves clues”.

However, for Kavanagh, this approach runs the risk of exacerbating the geostrategic competition between the United States and nations like China, Russia and others, necessitating a novel and cost-effective mechanism for rebuilding the capacity of the US defence industrial base, Kavanagh highlights this stating: “A critical assessment of the US DIB and its response to the Ukraine war, however, suggests that existing gaps are limited and pose a less severe national security threat than the prevailing narrative warns. A move to rebuild an ‘arsenal for democracy’ would be out of proportion to underlying challenges and impose new costs and layers of bureaucracy. Shifting the US DIB to wartime footing also risks becoming a self-fulfilling prediction, making war more likely by further militarising US foreign policy, and potentially feeding new arms races.”

“Instead, Washington should adopt a more narrow and sustainable strategy, using existing defence industrial bandwidth more efficiently by modernising production lines, eliminating supply chain bottlenecks for key systems, increasing flexibility, and more rigorously prioritising arms transfers across partners,” Kavanagh adds.

Capacity is expanding, but...

Importantly, in a timely manner, the US defence industrial base is rallying, at least in part to meet the voracious demand of Ukraine in particular, with “production of 155mm ammunition will increase from 15,000 to 90,000 shells per month by the end of 2024. By the end of 2023, production rates for Javelin missiles will double their pre-war baseline, and Stinger missile production will rise 50 per cent by 2025”, demonstrating the capacity of the US to still surge when and where required.

However, it is important to remain clear eyed about the capacity of the United States’ defence industrial base to support the allied war efforts. Mainly, it is important for allied nations, including Australia to accept the uncomfortable reality, the United States is struggling to support Ukraine and when push comes to shove, the US is going to default to prioritising itself in the event of any major conflagration with a rival great power.

In spite of this uncomfortable reality, Kavanagh states, “But the gap between Ukraine’s requirements and US production capacity is as indicative of Ukraine’s sky-high requirements as it is of US DIB deficiencies. For instance, Ukraine says it needs 250,000 ammunition rounds per month, about 25 times the amount used for a similar period in Afghanistan. An effort to supercharge DIB capacity might result in this higher production level in the long-term but it will be no better in meeting near-term demands than the status quo. Furthermore, it is not clear that the additional investments and risks required to meet this higher production level are aligned with the narrow US interests at stake in Ukraine.”

This reality gives further cause for concern in light of mounting tensions in the far-flung expanse of the Western Pacific, the island state of Taiwan, a longstanding US ally is now finding itself right in the firing line of Xi Jinping’s ambitions and designs for the global order which is casting further doubt on the capacity of the US to ramp up production and support both conflicts concurrently.

Kavanagh explains, “Ukraine’s high rate of weapons consumption might be more relevant to Taiwan — another heavy buyer of US arms and possible source of pressure on the US DIB — which could face some of the same force size and training issues. Still, Taiwan’s needs in a potential conflict are likely to differ from Ukraine’s, favoring longer-range missiles and air defence and anti-ship mines rather than the shorter-range systems and artillery featured centrally in Ukraine.”

However, this concern goes beyond the immediate demand as is the case in Ukraine and more heavily emphasises the delays and wait times associated with supplying Taiwan, with some interesting and concerning implications for Australia’s own long-term planning and acquisition, worthy of broader consideration and open discussion.

“Taiwan does have unmet weapons needs, including a large backlog of delayed US deliveries. However, these delays result less from insufficient US DIB capacity than they do from ineffective prioritisation of arms sales partners. Between 2018 and 2022, the United States sent arms to over 100 countries, but has no means to prioritise across buyers based on need; this leaves vulnerable partners like Taiwan waiting behind legacy clients like Saudi Arabia for crucial systems like Harpoon anti-ship missiles. The fastest way to meet Taiwan’s needs may be to find better ways to prioritise existing DIB bandwidth rather than building more capacity,” explains.

Final thoughts

Australia’s overwhelming dependence on other major powers for critical supplies ranging from raw industrial inputs and liquid energy, through to highly specialised military munitions, has increasingly drawn attention from policymakers and strategic planners, yet despite the rhetoric of successive governments, we seem to be going around in circles and reinventing the wheel.

However, with renewed emphasis on modernising and expanding the US defence industrial base, and the Western defence industrial base more broadly, is it time for Australia to take real, measurable steps to embrace the opportunities presented by agreements like AUKUS and to take the initiative to build a viable, competitive, and sustainable defence and advanced manufacturing industrial base?

Meanwhile, the rapid devolution of our strategic environment, coupled with the advent of grey zone warfare and hybrid conflict being levelled against us require a dramatic reimagination of our concept of national security and sovereignty. This shift is perhaps best explained by US academic Charles Maier, who unpacks the concept of national security as: “National security ... is best described as a capacity to control those domestic and foreign conditions that the public opinion of a given community believes necessary to enjoy its own self-determination or autonomy, prosperity and well-being.”

In the second part of this short series, we will take a closer look at Kavanagh’s suggestions for reshaping the US defence industrial base to better utilise the existing capacity, while equally expanding the capacity to better support surge requirements in the face of mounting geopolitical challenges, and ask the question, what more can Australia do to ease the burden on the US defence industrial base, while building opportunities for ourselves.

Get involved with the discussion and let us know your thoughts on Australia’s future role and position in the Indo-Pacific region and what you would like to see from Australia’s political leaders in terms of partisan and bipartisan agenda setting in the comments section below, or get in touch This email address is being protected from spambots. You need JavaScript enabled to view it. or at This email address is being protected from spambots. You need JavaScript enabled to view it..