Since the Russian invasion began on February 24th, military assistance to Ukraine from NATO member states has been impressive. The West rallied into unison to a degree unseen in recent times to meet the challenge of Russian aggression, and one large part of its efforts have been direct military assistance to Ukraine. However, there is one nation that above all underwrites this Western response: the United States of America.
This notebook is intended to summarise in broad terms the military aid given to Ukraine by the United States - both before and after the outbreak of this year's war. It will explore direct military assistance to Ukraine, as well as US efforts to support the donations of other NATO members, and the impact all of this is having on the US defence industry itself.
I. Direct Military Assistance to Ukraine
I.I: Before the Invasion
The US, along with the UK, has a key interest in the security of Ukraine, especially vis-à-vis Russia. After all, it was those two countries, along with the newly formed states of Ukraine and Russia, that signed the Budapest Memorandum in 1994, pledging against the "use of force against the territorial integrity or political independence of Ukraine", in exchange for Ukraine giving up its nuclear weapons.
According to SIPRI*, weapons transfers to Ukraine from the West did not begin in earnest until after Russia's annexation of Crimea in 2014**. However, the US had been committing large funds to aid the Ukrainian state and military since its independence in late 1991, mostly through the State Department and USAID (the development assistance arm of the US government). According to a report from the US Congressional Research Service, aid throughout the 1990s (fiscal years 1992-2000) totalled $2.6 billion (averaging $287 billion per year), the figure for FY2001-2009 standing at $1.8 billion (averaging $199 billion per year). In the five years leading up to Russia's 2014 invasion, the yearly average fell to $105 million (yielding a total of $525 million).
*The Stockholm International Peace Research Institute, which maintains a comprehensive database of country-to-country arms transfers.
**According to SIPRI, the largest donor of arms to Ukraine from 2014-21 was actually the Czech Republic, which accounted for around 35 percent of Ukrainian arms imports (including 87 armoured vehicles and 56 pieces of artillery). The United States accounted for around 30 percent.
However, after the 2014 invasion, aid contributions from the State Department and USAID jumped to an average of $418 billion per year from FY2015-2020. Moreover, the Defense Department began committing additional military aid under its "Ukraine Security Assistance Initiative" (USAI). During the Obama era, the military equipment provided was exclusively non-lethal, given the Obama administration's "concerns about potential conflict escalation". For example, an aid package committed in March 2015 comprised of $75 million worth of unmanned drones, radios and communications equipment, radar, and medical equipment (incl. military ambulances), as well as 230 Humvees (military jeeps).
Source: US Congressional Research Service*
*Source: US Congressional Research Service*
*Note: this particular report was written in October 2021, and as such does not foresee the enormous amounts of aid to be committed in 2022 after the outbreak of war.
The Trump administration broke new ground in March 2018 when the State Department approved a $47 million sale to Ukraine of 210 Javelin anti-tank missiles and 37 launchers - the first lethal weapons provided by the US since the 2014 invasion. In October 2019, the State Department approved yet another sale of the Javelin system - 150 missiles and 10 launchers - worth $39.2 million.
The Defense Department's announcements of aid in 2018, 2019 and 2020 all used nearly identical language, re-affirming the "long-standing defense relationship between the United States and Ukraine"; however, the 2020 statement upped the rhetoric by calling Ukraine a "critical partner on the front line of strategic competition with Russia".
Under the Biden administration, military aid continued unabated. On March 1st, the Defense Department allocated $125 million to USAI with a package that included armed Mark VI patrol boats. On June 11th, an additional $150 million package was committed by the Defense Department, providing "counter-artillery radars, counter-unmanned aerial systems, secure communications gear, electronic warfare and military medical evacuation equipment". It also provided for "training and equipment to improve the operational safety and capacity of Ukrainian Air Force bases".
The visit of Ukrainian president Volodymyr Zelenskyy to Washington D.C. in August 2021 brought both a new $60 million aid package - approved by Biden and consisting of Javelin missiles among other items - as well as a bilateral Strategic Defense Framework calling for closer cooperation between the US and Ukrainian militaries to counter Russian aggression.
The buildup of Russian forces around Ukraine in late 2021 prompted an acceleration of US military aid. In December 2021, the Biden administration approved a new $200 million package that included Javelins and "other anti-armor systems, grenade launchers and munitions". All in all, more than $650 million of military aid was committed in 2021.
On January 19th, 2022, the Biden Administration notified Congress of its intent to provide five Mi-17 helicopters (a Soviet-designed model) to Ukraine, drawing them from Defense Department inventories.
I.II: During the Invasion
Russia's attack on Ukraine spurred a significant torrent of aid. On February 25th, Biden authorised $350 million of assistance, including "anti-armor, small arms and various munitions, body armor, and related equipment". This was supplemented on March 12th by a $200 million package aimed to provide "further defensive assistance to help Ukraine meet the armored, airborne, and other threats it is facing".
On March 16th, the Administration went further by committing $800 million of aid, in a package that included:
800 Stinger anti-aircraft systems;
2,000 Javelin, 1,000 light anti-armor weapons, and 6,000 AT-4 anti-armor systems;
100 Tactical Unmanned Aerial Systems;
100 grenade launchers, 5,000 rifles, 1,000 pistols, 400 machine guns, and 400 shotguns;
Over 20 million rounds of small arms ammunition and grenade launcher and mortar rounds;
25,000 sets of body armor; and
25,000 helmets.
On April 1st, under the USAI, the Defense Department allocated $300 million of assistance, including:
Laser-guided rocket systems;
Switchblade Tactical Unmanned Aerial Systems;
Puma Unmanned Aerial Systems;
Counter-Unmanned Aerial Systems;
Armored High Mobility Multipurpose Wheeled Vehicles;
Small-to-large caliber nonstandard ammunition;
Night vision devices, thermal imagery systems, and optics;
Tactical secure communications systems;
Non-standard machine guns;
Commercial satellite imagery services;
Medical supplies, field equipment, and spare parts.
On April 5th, the Administration allocated an additional $100 million, in a package that included extra Javelin units.
On April 13th, Biden approved a further $800 million of assistance, including:
18 155mm Howitzers and 40,000 artillery rounds;
10 AN/TPQ-36 counter-artillery radars;
Two AN/MPQ-64 Sentinel air surveillance radars;
300 Switchblade Tactical Unmanned Aerial Systems;
500 Javelin missiles and thousands of other anti-armor systems;
200 M113 Armored Personnel Carriers;
100 Armored High Mobility Multipurpose Wheeled Vehicles;
11 Mi-17 helicopters;
Unmanned Coastal Defense Vessels;
Chemical, Biological, Radiological, Nuclear protective equipment;
Medical equipment;
30,000 sets of body armor and helmets;
Over 2,000 optics and laser rangefinders;
C-4 explosives and demolition equipment for obstacle clearing; and
M18A1 Claymore anti-personnel munitions (configured to be consistent with the Ottawa Convention).
This was supplemented by another $800 million package on April 21st, consisting of:
72 155mm Howitzers and 144,000 artillery rounds;
72 Tactical Vehicles to tow 155mm Howitzers;
Over 121 Phoenix Ghost Tactical Unmanned Aerial Systems; and
Field equipment and spare parts.
The latest assistance package was announced on May 6th; worth $150 million, it consisted of:
(25,000) 155mm artillery rounds;
(3) AN/TPQ-36 counter-artillery radars; and
Electronic jamming equipment; and
Field equipment and spare parts.
I.III: The Grand Total
As of May 8th, the United States has committed $3.8 billion of military aid to Ukraine since the start of the invasion on February 24th, bringing total US aid since 2014 to $6.5 billion. This includes nine separate drawdowns by Biden under the Presidential Drawdown Authority - which allows for equipment transfers from existing US military stockpiles without congressional approval - on top of Defense Department aid provided under the USAI, which entails the provision of contracts to arms manufacturers.
Source: US Congressional Research Service*
*Note: this particular report was last updated on April 29th, 2022, and so does not include the May 6th drawdown under the Presidential Drawdown Authority.
In material terms, this aid has consisted of:
1,400+ Stinger anti-aircraft systems;
5,500+ Javelin anti-armor systems;
14,000+ other anti-armor systems;
700+ Switchblade Tactical Unmanned Aerial Systems;
21+ Phoenix Ghost Tactical Unmanned Aerial Systems;
90 155 mm Howitzers;
16 Mi-17 helicopters;
7,500+ small arms
60,000,000+ million rounds of small arms ammunition;
45,000 sets of body armor and helmets;
200 M113 Armored Personnel Carriers;
Hundreds of Armored Humvee Vehicles;
Laser-guided rocket systems;
Three patrol boats;
200 grenade launchers and ammunition;
200 shotguns;
200 machine guns;
1,000,000+ grenades, mortar, and artillery rounds;
Puma Unmanned Aerial Systems;
Four counter-artillery and counter-unmanned aerial system tracking radars;
Four counter-mortar radar systems;
Night vision devices, thermal imagery systems, and optics;
Tactical secure communications systems;
Commercial satellite imagery services;
Explosive ordnance disposal and de-mining equipment; and
Medical supplies to include first aid kits.
I.IV: The Near Future
This enormous degree of US military aid to Ukraine shows no signs of relenting. On April 28th, Biden submitted a request to Congress for $33 billion to cover assistance for Ukraine until October this year: this includes $20.4 billion for military aid, as well as $8.5 billion in economic assistance and $3 billion in humanitarian aid. Furthermore, on the same day, the US House of Representatives voted 417-10 in favour of the "Ukraine Democracy Defense Lend-Lease Act of 2022" (after it unanimously passed the Senate), which for the years 2022-23, authorises the US government to "lend or lease defense articles to the Government of Ukraine or to governments of Eastern European countries impacted by the [Russian invasion]", thus facilitating the provision of any future aid.
This scale of assistance is astonishing. If Biden's request is met, total outlays for the year 2022 would amount to more than $24 billion, making Ukraine the largest yearly recipient of US military aid of at least the last two decades. This is more than twice the largest yearly total ever provided to Afghanistan - where the US was actually involved in state building*. It is also higher than the total military budgets of all but 15 countries in 2021. Even in the heyday of the US-Saudi arms relationship under Trump, weapons sales never exceed $15 billion a year.
*Annual US military aid to Afghanistan peaked at $11 billion in FY 2011, amid the Obama-era"troop surge" (see here).
Indeed, the figure of $24 billion is roughly four times the size of Ukraine's total military budget in 2021 (estimated by SIPRI to be $5.9 billion), and more than a third of Russia's 2021 military budget (roughly $66 billion). Furthermore, it amounts to roughly 12 percent of Ukraine's GDP in 2021, which stood at around $198 billion. Given the IMF's prediction of a 35 percent reduction in Ukrainian GDP in 2022, it is conceivable that US military assistance to Ukraine in 2021 could amount to nearly a fifth of the country's total GDP the following year. Including other kinds of assistance aside from direct military aid, the total outlay for Ukraine aid in 2021 surges to roughly $50 billion, or nearly 40 percent of projected Ukrainian GDP in 2022*.
*This figure includes Biden's $33 billion package requested on April 28th, as well as the $13.6 billion in aid signed into law by Biden on March 15th, plus the other transfers of aid outlined in this notebook.
All this makes the United States of America a vital driving force behind Ukraine's defensive efforts - essentially, the primary bankroller of its war against Russia. This is not too surprising given that America is by the far the predominant military-industrial power, not only of the West, but of the entire world. As Ukraine suffers further destruction and its own military-industrial base degrades, this role might attain even greater importance.
II. Assistance to NATO Allies
Of course, the United States is not the only NATO member state that is sending military assistance to Ukraine; indeed, aid has been forthcoming from several European corners. This includes the UK, which has long been one of Ukraine's principal backers in Europe (and which recently pledged $1.6 billion in aid on top of previous commitments). However, this also includes countries which do not enjoy the strong military-industrial base enjoyed by nations such as the United States and the United Kingdom - and it is here that again, America is expected to serve as the armourer of the West.
A case in point is Poland's announcement back on March 8th that it would send all of its MiG-29 fighter jets to Ukraine "immediately and free of charge" via the US' Ramstein Air Base in Germany on the condition that the "United States provide[s] us with used aircraft with corresponding operational capabilities". This proposal was rejected by the United States the following day.
Another example is Slovakia's transfer in early April of the Soviet-model S-300 air-defence system to Ukraine. Slovakia had apparently been planning this transfer for weeks but it had "asked the U.S. to deliver a Patriot missile system before giving it up, so that the country could continue to defend its airspace with the S-300". The United States announced that this would be done.
The Wall Street Journal additionally noted in early April that "Central European governments ... are broadly eager to help rearm Ukraine, but some officials are nervous about depleting their own stockpiles of weapons and ammunition". Hence, they are "turning to the Biden administration for assurances that the U.S. will help replace equipment they are donating to Ukraine".
A striking example is Slovenia, which has been sending military equipment "to a point where it has run through its own stockpiles". Prime Minister Janez Jansa noted that "Unfortunately, our reserves are depleted and now we try to replace equipment ... with new delivery from U.S."
Indeed, since late February, European states have been engaged in an all-out scramble to shuffle all sorts of munitions to Ukraine - from small arms to heavy weapons. This, however, is only one of a three-pronged approach taken by European NATO states to the Russian attack. Another is to increase military deployments to NATO's eastern flank, and a third is to increase national defence spending.
Source: Financial Times
As of April 2022, since the start of the Russian invasion, eight European NATO states had pledged to raise their national defence budgets to at least 2 percent of GDP - the guideline established for all NATO members but actually followed by only a few (see the chart below). These states include Belgium, Denmark, Germany, Lithuania, the Netherlands, Norway, Poland and Romania.
Source: NATO
For states such as Poland and Germany, a vital part of this military upgrade will be increased arms purchases from the United States. For example, in late January, amid the Russian military buildup, the US State Department approved a $6 million arms sale package to Poland, including M1 Abrams tanks (manufactured by General Dynamics Corp.) and other equipment. Since the invasion, Poland has engaged in talks with US officials to secure further purchases, including attack helicopters and air defence systems, with the goal of helping the military of Ukraine's western neighbour become "one of the most capable in Europe". Meanwhile, as part of Germany's 100-billion-euro military modernisation package, the Bundeswehr plans to acquire American-made F-35 fighter jets (manufactured by Lockheed Martin Corp.), a nuclear-capable model that is planned to replace Germany's ageing Tornado jets.
Hence, Europe looks set to continue its years-long rise in arms import spending. A SIPRI report released this year notes that for the years 2017-21, European arms imports were up 19 percent compared to 2012-16. In the 2017-21 period, the United States alone accounted for 54 percent of these imports. Therefore, we can expect that increased European military spending will be matched by increased American arms exports to Europe.
III. Impacts on the US Arms Industry
Generally speaking, the war in Ukraine has been both a blessing and a curse for the US arms industry. On the positive side, increased US production - spurred by lucrative new contracts both at home and in Europe - could boost earnings. On top of the hundreds of millions of dollars allocated to contracts in the USIA, the US government will inevitably rely on defence contractors to fill the void left by drawing down the American military's existing stockpiles as part of aid packages to Ukraine. For instance, the $13.6 billion package signed by Biden on March 15th allocated $3.5 billion to "replenish US stocks of equipment sent to Ukraine through drawdown". This could be particularly beneficial for Lockheed Martin Corp., which manufactures the Javelin missile system, and Raytheon Technologies Corp., which manufactures both the Javelin and the Stinger. The Defense Department has called for "surge" production of both missile systems to offset inventory drawdowns destined for Ukraine, part of a wider effort to boost production across the entire arms industry.
(A calculation by Mark Cancian of the Centre for Strategic and International Studies estimates that Javelin transfers to Ukraine amount to about a third of existing US army stocks at the end of 2021; see chart below.)
Source: The Economist
On the flip side, US economic sanctions against Russia have dealt a blow these companies' reliance on Russia as a customer base and as a source of raw material. Before the invasion, some US contractors had done business with Russian aircraft makers - for example, Raytheon was involved in the development of the MC-21 airliner, built by the Irkut Corporation, part of United Aircraft Corporation, which is in turn majority-owned by Russian state defence conglomerate Rostec. First designed to use Raytheon-built engines, the aircraft will now only fly with Russian engines.
Furthermore, large aircraft manufacturers such as Boeing and Raytheon were quite vulnerable to the disruption of Russian exports of titanium, a material vital to the construction of airframes and engines. Russia is home to VSMPO-AVISMA Corporation, the world's largest titanium producer, which apparently provided for a third of Boeing's titanium requirements and half of that of Boeing's European rival, Airbus. The United States' import-dependence for titanium (in 2019, it apparently imported 95 percent of all titanium it used) does not bode well for companies such as Boeing.
Nevertheless, this has not prevented a precipitous increase in the share price of various defence contractors since the beginning of 2022. The chart below shows the share price movements of the United States' top five defence contractors: Raytheon Technologies Corp. (RTX:US), Boeing Corp. (BA:US), Northrop Grumman Corp. (NOC:US), General Dynamics Corp. (GD:US) and Lockheed Martin Corp. (LMT:US). Nearly all showed jolting upward movements upon news of Russia's invasion in late February. The only exception is Boeing, which suffered a precipitous decline, potentially due to the supply considerations outlined above, as well as Boeing's general difficulties due to Covid-19 and its recent record of fatal crashes.
Source: Bloomberg
Despite this initial promise, it could take some time before defence contractors are actually able to fulfil many of the production demands being placed on them. A Wall Street Journal report claims that the manufacturing capacity of the US defence industry is being hampered by "pandemic-driven shortages of computer chips, rocket motors, propellant and labor". Moreover, this sharp increase in procurement orders has exposed some previously hidden issues with production capacity. For example, Raytheon's chief executive noted that as the Pentagon had not ordered new Stinger missiles for almost two decades, some of the previously used parts are no longer commercially available, raising the need for a redesign of the Stinger (in particular, the electronics in the missile seeker head), and that is "going to take us a little bit of time". Similar supply-chain issues have been affecting Lockheed Martin, which, as of late April, had not actually started increasing production of any of the newly ordered weapons.
These problems had already been anticipated by the defence industry earlier this year. In February, the National Defense Industrial Association (NDIA) released its annual Vital Signs report, which stated that as a result of COVID-induced "workforce shortages, inflation. and supply chain disruptions", the overall health of the industry was at a record low. Particularly worrying was the score they gave to the industry's "productive capacity and surge readiness", which has fallen from 80/100 in 2019 to 67/100 in 2020, and then 52/100 in 2021 (compared to a score of 94/100 for demand in 2021). A survey of nearly four hundred industry respondents showed that the most significant shortfalls appeared to be in skilled and security-cleared labour*, with materials not too far behind.
*The WSJ laments that Lockheed Martin's Javelin production is running up against the "tightest labor market in 50 years".
Source: NDIA
Hence, only will time how quickly the US defence industry can rise to the challenge.
IV. Conclusion
"I think it's an important step to take and a responsibility of everyone to make clear this is not a proxy war ... This is a war between Russia and Ukraine. NATO is not involved. The United States is not fighting this war". These words, uttered by White House press secretary Jen Psaki about a week ago, seem incredibly disingenuous.
It is true that the United States does not have troops on the ground in Ukraine. Yet, if it is not involved in the war, then why is it committing so much military aid as to amount to a significant fraction of Ukrainian GDP? Why is it training Ukrainian troops in Germany on "key systems being used to defend Ukraine against the Russian invasion"? And why is it engaged in providing "real-time battlefield intelligence" of the sort that helped Ukraine sink the Moskva missile cruiser*? Coupled with the United States' financial war against Russia, its arms transfers and battlefield assistance to Ukraine point to the conclusion that America is indeed employing all means short of combat to assist the Ukrainians in their war effort. The Americans are in it for real.
*This was reported by NBC News and The New York Times on May 5th but denied by Jen Psaki a day later.
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