I did not discover weapons systems through the Iran war.
As a boy growing up around PAF Base Sakesar, I used to read Jane’s Weapons Systems with the fascination other children reserved for sports magazines. Aircraft interested me. So did missiles, radar and the engineering behind them. Long before I studied political science, I had learned to look at a weapon as a system rather than simply an object designed to kill.
Military affairs never disappeared from my life.
My brother-in-law serves in Pakistan’s Corps of Electrical and Mechanical Engineers (EME), and many of my longtime friends come from Pakistan Army backgrounds. Military technology and preparedness therefore enter ordinary conversations around me. Those discussions have also taught me something important: military preparedness should not automatically be confused with a desire for war.
My banking career later gave me another way of looking at the same machinery.
I spend my working day around international banking, where enormous sums can cross borders without making a sound. A financial message arrives. Numbers move. Somewhere else, money has changed hands before most people know the transaction existed.
War looks very different on television.
We see missiles rising from ships. Aircraft leave runways. Then come the explosions.
But watching the Iran war in 2026 has made me think increasingly about what happens before and after those images appear. Governments allocate money. Factories expand production. Contracts stretch across years.
Once that machinery exists, shutting it down becomes an economic decision as well as a strategic one.
That does not prove that defense companies create wars.
The more difficult question is whether a country can build such a large permanent military-industrial system that continued geopolitical tension becomes economically easier to sustain than genuine de-escalation.
I think America is approaching the point where that question deserves much more attention.
Washington Is Talking About a Wartime Footing
The numbers first caught my attention.
The Trump administration’s FY2027 proposal calls for a $1.5 trillion national-defense topline. CSIS calculates that, once reconciliation funding is included, the proposal represents a 38 percent inflation-adjusted increase over FY2026 spending. The Department of Defense component, at about $1.45 trillion, would rise by nearly 40 percent in real terms.
There is an important qualification.
Congress had not enacted the full $1.5 trillion request as of August. The figure is therefore a presidential budget request, not money that Washington has already spent.
The Iran war adds another layer.
Earlier commentary discussed the possibility of a $200 billion wartime supplemental. That amount should not be confused with the $1.5 trillion defense proposal. They were separate funding questions.
We now have better evidence about the actual costs.
On September 15, the nonpartisan Congressional Budget Office estimated that U.S. combat operations against Iran had cost the Defense Department about $38 billion through August 1. CBO estimated that another month could cost between $2 billion and $3 billion, depending on the intensity of the fighting.
In June, the administration requested $87.6 billion in supplemental appropriations, including $67.1 billion for the Defense Department. CBO estimates that about $42.3 billion of the request appears directly related to the Iran conflict.
Those distinctions matter. A proposed budget is not expenditure. A supplemental request is not the same thing as the measured cost of a war.
The numbers are still enormous.
And they reveal something else.
War does not merely consume weapons. It creates demand for replacing them.
A Missile Fired Today Creates Demand Tomorrow
The Iran conflict has exposed a problem that supporters of higher military spending have warned about for years.
American munitions inventories are finite.
CBO estimates that replacing weapons expended during the Iran conflict represents a large part of the $38 billion cost. It also warns that estimates remain uncertain because the Defense Department did not provide all the information CBO requested.
The consequences can persist long after a missile leaves its launcher.
CBO has warned that the expenditure of missile-defense interceptors could leave inventories below desired levels for several years. That matters if another missile-intensive conflict erupts before production catches up.
Recent reporting points to the same pressure. Rebuilding some U.S. precision-missile inventories could take years.
Here the economics become interesting.
On September 17, Lockheed Martin announced details of its AIM-260 Joint Advanced Tactical Missile and an agreement with the Defense Department intended to expand production. The Pentagon is trying to rebuild inventories while maintaining capacity for possible future conflicts. Lockheed says it will invest in additional production capacity under the framework.
None of this proves that Lockheed Martin wanted the Iran war.
It proves something narrower.
Military operations consume inventory. Governments then need replacement weapons, and private companies receive orders to manufacture them. Higher expected demand can justify investment in production capacity that would otherwise be difficult to finance.
The Pentagon itself has adopted unusually revealing language for this process.
It wants the defense industrial base on a “wartime footing.”
The Phrase Is Not Mine
I initially regarded “permanent war economy” as a political-economy description.
Then I began reading the defense establishment’s own documents.
CSIS reported in July that the Pentagon had first articulated the goal of putting the American industrial base on a “wartime footing” in November 2025. The objective is to create enough industrial capacity to deter a prolonged conflict and, if deterrence fails, sustain one.
The scale of the transformation is considerable.
CSIS reports that roughly 10,000 new firms entered the defense market during the previous two years. Nontraditional companies received more than $120 billion in contract obligations in FY2025. Government investment in critical mineral and rare-earth projects has expanded as Washington tries to strengthen vulnerable supply chains.
From a national-security perspective, there is a rational argument behind this policy.
A military that cannot replace missiles during a prolonged war eventually loses its ability to fight. Recent conflicts have exposed production bottlenecks and long manufacturing lead times. Some critical munitions depleted during the Iran conflict could take years to replace.
I do not dismiss that problem.
Industrial capacity, however, cannot survive indefinitely on strategic theory. Factories eventually need another order.
When Deterrence Acquires an Industrial Base
This is where my banking background affects how I look at military expenditure.
I do not see $1.5 trillion simply as a defense number.
I see suppliers receiving money and payrolls depending on government contracts. Behind them sit investment decisions extending across several years.
There is nothing inherently improper about that. Governments need companies capable of producing military equipment, just as they need private companies to build other specialized infrastructure.
The institutional consequences deserve scrutiny, however.
Once a military program supports factories and specialized workforces across many locations, reducing that program no longer affects only military planning. People depend on the expenditure for their livelihoods. Local economies can become attached to it too.
The Pentagon therefore faces a peculiar economic problem.
It needs private firms to maintain production capacity that may be urgently required during war. Private companies, in turn, need predictable government demand before they invest billions in factories that might otherwise sit idle.
CSIS describes this explicitly as the need for strong and consistent government demand signals.
That is sensible industrial policy if a major war comes.
What happens if it does not?
Follow the Money Around Washington
Think tanks deserve examination here too, although this subject requires care.
Take the Center for Strategic and International Studies.
CSIS publishes substantial research on military preparedness and argues that America needs greater defense-industrial capacity. Its researchers have examined how the United States could sustain prolonged conflict and what would be required to establish a wartime industrial footing.
CSIS also publicly discloses its donors.
Its FY2025 corporate donor list places General Dynamics, Lockheed Martin and Northrop Grumman among organizations contributing $250,000 or more. RTX appears in the $100,000-to-$249,999 category.
That disclosure matters.
It does not establish that those companies purchased particular conclusions from CSIS. I found no evidence that would justify making such a claim.
The overlap nevertheless creates a legitimate transparency question.
When an institution recommends policies that could increase demand for military equipment while receiving money from companies that manufacture military equipment, readers should know about the financial relationship.
Disclosure allows them to judge the research for themselves.
The same standard should apply to organizations arguing for lower military expenditure. Financial transparency is useful regardless of the policy position being advanced.
Then There Is the Revolving Door
Movement between government and the defense industry presents a related problem.
Federal law already contains post-government employment restrictions. For certain former acquisition officials involved with major contractors, federal procurement law has included a one-year restriction on accepting compensation from relevant contractors.
The rules are more complicated than a blanket ban on Pentagon officials joining defense companies.
Critics have argued that existing safeguards remain inadequate. Proposals placed before Congress have called for longer cooling-off periods and stronger disclosure of post-government employment by senior military and Pentagon officials.
Some proposals would impose additional restrictions on former senior officers working for major defense contractors.
I think this debate matters more as defense expenditure rises.
A revolving door does not prove corruption in an individual case.
It does create potential conflicts of interest that a credible procurement system must manage.
Suspicion is not evidence. Institutional incentives are still worth examining.
The Argument Against My Argument
This is where my childhood interest in weapons systems and my conversations with people from military backgrounds make me cautious about an easy conclusion.
There is an obvious objection to everything I have written so far.
Perhaps America is not constructing a war economy.
Perhaps it is repairing a dangerously weak defense industrial base.
Anyone who has spent time discussing military preparedness with serving or former military professionals will recognize the practical problem. A missile system is not useful merely because it exists on paper. Ammunition must be available. Equipment must remain serviceable. Replacement capacity matters when stocks begin disappearing faster than factories can replenish them.
That concern is not an invention of defense contractors.
Recent evidence gives it considerable weight.
The Iran war has depleted important U.S. munitions. Production lines cannot instantly replace sophisticated missiles. CBO warns that some missile-defense inventories could remain below desired levels for several years.
The industrial base also faces lengthy manufacturing times and supply-chain weaknesses despite increased investment.
Deterrence has its own economic logic.
A country that visibly possesses the capacity to sustain a long conflict may make an adversary less willing to start one. In that interpretation, missile factories are not evidence that Washington wants war. Their purpose is to make war less attractive to America’s opponents.
I take that argument seriously.
Perhaps growing up reading Jane’s makes me particularly reluctant to pretend that military hardware can simply appear when a crisis begins. A modern weapon system sits at the end of a long industrial chain. Engineers have to maintain it. Spare parts matter. Ammunition stocks matter even more once combat starts.
The problem appears when deterrence becomes economically difficult to distinguish from permanent mobilization.
How much industrial capacity is enough?
More importantly, who decides?
Companies receiving contracts naturally prefer predictable orders. Military planners have professional reasons to maintain adequate inventories rather than discover shortages during a war.
Politicians face another pressure. Federal expenditure creates employment, and employment creates constituencies that may resist spending cuts.
None of those interests individually requires a conspiracy.
Together they can still produce institutional momentum.
The Human Balance Sheet Looks Different
Military expenditure is normally measured in dollars.
War is not.
Brown University’s Costs of War project estimates that the post-9/11 wars it studies have displaced more than 38 million people across Afghanistan, Iraq, Pakistan and several other countries.
Its researchers estimate total direct and indirect deaths associated with those war zones at roughly 4.5 million to 4.7 million, while stressing that precise mortality figures remain uncertain.
Those numbers matter to me partly because Pakistan appears in that accounting.
I have watched the consequences of the post-9/11 security era from Karachi. The strategic language used in Washington can sound clinical from this distance.
We hear about deterrence and readiness. Military planners discuss force posture.
The consequences rarely remain clinical when they reach this region.
That does not mean every American military operation was economically motivated. Such a claim would be impossible to establish from the evidence I have examined.
My concern is different.
Once war begins, powerful economic institutions can emerge around sustaining the machinery required to fight it.
The Pentagon Still Cannot Pass Its Audit
There is another reason financial accountability matters.
The Pentagon has still never completed a department-wide clean financial audit.
Full department-wide audits began in 2018. The Defense Department subsequently failed eight consecutive audits, although officials say they are working toward an unmodified audit opinion by 2028.
The problems involve fragmented systems and unreliable asset information, among other accounting weaknesses.
This does not mean trillions of dollars have disappeared.
That popular interpretation of the failed audits is misleading.
It means auditors have repeatedly been unable to obtain sufficient reliable evidence to give the entire department clean financial statements.
GAO has separately warned about systemic problems in weapons procurement. In June 2026 it reported that the Pentagon’s costliest weapons programs have repeatedly exceeded original cost estimates and schedules, producing billions of dollars in waste.
If Washington intends to maintain something approaching a wartime industrial footing, financial scrutiny should rise with military spending.
Not fall behind it.
What Would Reform Actually Look Like?
I would begin with disclosure.
Think tanks producing defense-policy research should make relevant corporate and government funding easy to identify alongside the work readers are consuming. Disclosure does not discredit research. It gives readers information needed to evaluate possible conflicts.
The revolving door deserves another examination as well.
Congress could consider longer cooling-off periods for senior officials whose Pentagon responsibilities directly involved companies that later employ them. Any rule would need careful drafting because existing federal restrictions already cover some post-government activity.
Pentagon auditing is the less glamorous reform, but perhaps the more consequential one.
Congress does not need to pretend that failed audits mean missing trillions. It can demand measurable progress toward reliable asset records and auditable financial statements.
Procurement deserves the same attention when major programs repeatedly exceed initial cost estimates.
None of these reforms requires accepting the claim that America deliberately creates wars for profit.
I do not think the evidence allows me to make that claim.
Something subtler worries me more.
Peace Has an Industrial Problem
A missile fired over the Middle East disappears in seconds.
Replacing it can take years.
That replacement employs workers. It requires factory investment.
Eventually another government appropriation appears somewhere in the financial system.
I return to the world I know.
Money leaves traces.
The boy reading Jane’s Weapons Systems at Sakesar would probably have looked first at the missile’s range, guidance system and speed.
The banker I became asks another question.
Who pays to replace it?
The difficult question is not whether defense companies profit from military expenditure. Governments hire them precisely because governments need weapons.
The question is what happens after a country builds an industrial structure that depends on continuous military demand.
A system does not need a secret meeting in a dark room to acquire interests of its own.
Contracts mature. Factories need future orders. Institutions also develop incentives to defend the budgets that sustain them.
Perhaps that is where we should look for the permanent war economy.
Not in the simplistic claim that a corporation secretly starts a war.
Look instead at what happens after military preparedness becomes permanent economic infrastructure.
At that point, ending a conflict may still make strategic sense.
But peace now encounters an economic obstacle that did not exist before factories expanded and contracts were signed. Livelihoods have become attached to military demand.
That is the part of the war economy I find hardest to ignore.
Editorial Transparency: I wrote this analysis independently and have no financial ties to the defense industry. My perspective is informed by my academic background in political science, my professional experience in international banking, and a lifelong interest in military systems. Family and friends with military backgrounds are mentioned only as personal context; they are not sources for the factual claims or conclusions in this article.