Society’s values are in constant flux, as seen by once-lauded individuals falling out of public favor, similarly, business has shifted, and the underlying meaning of what it is to be a good organization. The Economic Policy and Research Group delved into how divestment from the military industrial complex changes the financial landscape of the United Kingdom. Many people today who morally disagree with investing in fossil fuels and trillions of pounds have consequently been moved out of such stocks. While attempting to limit profiting on defense may seem noble, is it counter effective to the country’s goal of de-Londonizing the economy and will it therefore hurt lower income areas?
Nearly 70 million people live in the country, but most of the money is in the capital which has prompted people calling for the de-Londonisation of business. The military employs nearly 200,000 people directly but many more indirectly such as with engineering projects or through supporting roles in towns where the main employer is the defense sector. Trillions of pounds are invested in the industry through public companies like BAE Systems and Lockheed Martin who generate massive revenues. Military bases are in rural regions such as ocean towns in Scotland or Wales where there are fewer jobs and often present a career path open to anyone, regardless of family background and income.
The defense industry is evolving from guns and tanks to cyber security and a lack of investment implies less successful civilian spin-off applications such as computers, GPS, Jeep, canned food, and even microwaves to name a few. Yet a lack of expenditure on defense, which now stands at 2.1% GDP could mean higher investment in other areas like education and public health and other tech, which one could argue led Japan to austerity. If traditional equipment such as tanks and artillery are being phased out, what could this mean for the regions that rely so heavily on the presence of private defense manufacturing? How will our defense industry adapt to a world where breaches of data security are more feared than actual territorial threats?
A theory based analysis on the impact of military divestment is crucial to form the basis for future government spending as a response to this, but a segmented, in-depth analysis, informed by history and socioeconomic factors must be required to support the most vulnerable regions of the UK. The role of NGOs and charities is becoming an increasingly influential one in this and similar movements, and these organisations can be important stakeholders in investment decisions.
The overarching social and political context of these phenomena is crucial to predicting its impacts, therefore, an understanding of the UK post-Brexit and awareness of the effects of the current pandemic is essential in characterizing the environment in which private and public divestment will occur.
Fossil fuel divestment challenges the morals of those using and profiting from CO2 emissions, yet does it help lower emissions, and does it justify the many towns and 10,000s of households it has impoverished? As universities and organizations seek to divest from defense and civilians call for less defense spending, the future of its effects is murky.
EPRG seeks to contextualize and underline the role military divestment will play in our regional environment through this report, provoking pertinent questions and making insightful predictions on the framework of our defense industry, based on robust data analysis. Shaped by our unique student perspective, and geopolitical awareness, we aim to crystallize some of the impacts that military divestment is likely to have on the UK’s future, not just between borders, but within them as well.
Read Economics Policy & Research Group’s full report here.