{"id":192362,"date":"2021-08-23T12:00:56","date_gmt":"2021-08-23T11:00:56","guid":{"rendered":"https:\/\/www.transcend.org\/tms\/?p=192362"},"modified":"2025-01-10T15:08:33","modified_gmt":"2025-01-10T15:08:33","slug":"10000-invested-in-defense-stocks-when-afghanistan-war-began-now-worth-almost-100000","status":"publish","type":"post","link":"https:\/\/www.transcend.org\/tms\/2021\/08\/10000-invested-in-defense-stocks-when-afghanistan-war-began-now-worth-almost-100000\/","title":{"rendered":"$10,000 Invested in Defense Stocks When Afghanistan War Began Now Worth almost $100,000"},"content":{"rendered":"
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Was the Afghanistan War a failure? Not for the top five defense contractors and their shareholders.<\/em><\/p>\n<\/blockquote>\n

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Illustration: Soohee Cho\/The Intercept, Getty Images<\/p><\/div>\n

16 Aug 2021 – <\/em>If you purchased $10,000 of stock evenly divided among America\u2019s top five defense contractors on September 18, 2001 \u2014 the day President George W. Bush signed the Authorization\u00a0for Use of Military Force in response to the 9\/11 terrorist attacks \u2014 and faithfully reinvested all dividends, it would now be worth $97,295.<\/p>\n

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This is a far greater return than was available in the overall stock market over the same period. $10,000 invested in an S&P 500 index fund on September 18, 2001, would now be worth $61,613.<\/p>\n

That is, defense stocks outperformed the stock market overall by 58 percent during the Afghanistan War.<\/p>\n<\/div>\n

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Moreover, given that\u00a0the top five biggest defense contractors \u2014 Boeing, Raytheon, Lockheed Martin, Northrop Grumman, and General Dynamics \u2014 are of course part of the S&P 500, the remaining firms had lower returns than the overall S&P returns.<\/p>\n

These numbers suggest that it is incorrect to conclude that the Taliban\u2019s immediate takeover of Afghanistan upon the U.S.\u2019s departure means that the Afghanistan War was a failure. On the contrary, from the perspective of some of the most powerful people in the U.S., it may have been an extraordinary success. Notably, the boards of directors of all five defense contractors include retired top-level military officers.<\/p>\n<\/div>\n

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Several commentators address<\/a> this dynamic in the 2005 documentary \u201cWhy We Fight,\u201d about a warning that President Dwight Eisenhower issued about the military-industrial complex. Former CIA contractor and academic Chalmers Johnson states, \u201cI guarantee you, when war becomes that profitable, you\u2019re going to see more of it.\u201d A retired Air Force lieutenant colonel says, \u201cAmerican people who have a son or a daughter that\u2019s going to be deployed \u2026 they look at the cost-benefit, and they go, \u2018I don\u2019t think that\u2019s good.\u2019 But when politicians who understand contracts, future contracts, when they look at war, they have a different cost-benefit analysis.\u201d<\/p>\n

These\u00a0are the specific results for the relevant contractors since September 2001. All except Boeing receive the vast majority of their revenue from the U.S. government.<\/p>\n

S&P 500<\/h3>\n