Ukraine and Russia have been fighting a war for over 14 months and the effects of this war are being felt across the world. Before the war even broke out, US Congress agreed to increase the Defense budget exponentially with the war in Ukraine still waging in 2023, US Congress has agreed to raise the defense budget even more. With all of the ammunition and supplies being shipped to the Eastern European country, it has caused massive depletions of US reserves. With this FY2023 increased defense budget, it will enable the US defense industry to start producing more munitions to restock the reserves that have been shipped out to Ukraine. However, as this war continues to draw out and Ukraine continues to go through munitions at as an alarming rate as it has, then the US stockpiles will continue to deplete to critical levels. The good news though is that now with more funding in the Defense budget, more defense contractors can start to produce new munitions and more industrialization of munitions will produce a greater market for competition. As long as this war continues then it is plausible to assume that the US defense budget will continue to vastly increase each year.
The added wrench in the cog though is with China and the increasing tensions with Taiwan we may see a heavier mobilization of the defense industry which in turn will most likely initiate emergency defense spending.
What is your take?
Posts
No comments:
Post a Comment