Purchasing Power: US Overseas Defense Spending and Military Statecraft

• Published date: 01 February 2020
• Author: Brian Blankenship,Renanah Miles Joyce
• Date: 01 February 2020
• DOI: 10.1177/0022002719854786
• Subject Matter: Data Set Feature

Data Set Feature

Purchasing Power:

US Overseas Defense

Spending and Military

Statecraft

Brian Blankenship

1

, and Renanah Miles Joyce

2

Abstract

The literature on economic statecraft has long focused on the effectiveness of

foreign aid and trade as tools of inducement. However, existing scholarship largely

neglects the role played by government procurement. By choosing to purchase

goods or hire labor in foreign states, governments can provide economic benefits for

strategic ends. The United States in particular leverages its defense procurement as a

foreign policy tool. We introduce a new data set of US government procurement

using information on all contracts executed overseas from 2000 to 2015. We

develop a typology of how states use procurement to achieve foreign policy goals—

power projection, counterinsurgency, and development—and provide descriptive

statistics to explore variation in spending across countries and over time. We

illustrate the power of the contract data by using it to code US military access in

Africa, assess the relationship between spending and economic growth, and test

whether economic inducements can buy influence.

Keywords

power, international cooperation, foreign policy, foreign aid, government

procurement, economic statecraft, power projection

1

John S. Dickey Center for International Understanding, Dartmouth College, New York, NY, USA

2

Department of Political Science, Columbia University, New York, NY, USA

Corresponding Author:

Brian Blankenship, Department of Political Science, University of Miami, 1300 Campo Sano Avenue, Coral

Gables, FL, 33146, USA.

Email: bxb731@miami.edu

Journal of Conflict Resolution

2020, Vol. 64(2-3) 545-573

ªThe Author(s) 2019

Article reuse guidelines:

sagepub.com/journals-permissions

DOI: 10.1177/0022002719854786

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Leaders must leverage money and contracting in operations.

—Commander’s Guide to Money as a Weapons System

Introduction

Large posters on barrack walls asked the US soldiers occupying Mosul in 2003:

“What have you done to win Iraqi hearts and minds today (Hedgpeth and Cohen

2008)?” One answer, which became an integral part of the US counterinsurgency

strategy in Iraq, was to spend money. American military officers were directed to do

business locally whenever possible to create jobs and economic opportunities. As a

handbook on “money as a weapons system” told officers, “Money and contracting in

a [counterinsurgency] environment are vital elements of combat power” (Multi-

National Corps—Iraq [MNC-I] CJ8 2009, i). Shipments of cash moved around the

battlefield in armed convoys known as “jingle runs.”

1

Using contracting to fight an insurgency is just one way that governments use

spending toward strategic ends. Since World War II, the United States in particular

has leveraged its defense spending as a foreign policy tool. Yet we know little about

the conditions under which it does so—or the consequences. How much business

does the United States do with foreign firms, where, and why? What impact does this

spending have on US foreign policy interests and what are the effects on stability or

economic growth in recipient countries?

Within the field of international relations, scholars focus on the role of foreign aid

and sanctions in manipulating changes in states’ behavior. Within the field of eco-

nomics, scholars examine the effects of government procurement on domestic mar-

kets and international trade. Neither, however, can adequately explain the conditions

under which states contract with foreign firms to achieve policy ends. Yet, as

Baldwin (1985, 43) notes, “Direct monetary payment is one of the most common

ways for some people to get other people to do things they would not otherwise do.”

Scholars are beginning to study how states use economic power abroad for

political ends as attention shifts to China’s economic rise. Surprisingly, however,

this literature largely neglects the “world’s largest client” (Kuchins and Sanderson

2010, 6). The US military spends more money annually than any other organization

in the world; this spending can be strategic, meaning that it is designed to meet both

efficiency and policy needs. Military spending thus represents a huge potential tool

for inducing policy compliance, albeit one with uncertain effects.

In this article, we conceptualize spen ding as military statecraft. First, we outline

the interests that motivate spending and sketch the conditions under which the

United States chooses procurement as a policy tool. Next, we introduce an original

data set of global US government procurement, created from contracti ng records in

the Federal Procurement Data System—Next Generation (FPDS-NG). We illus-

trate the potential of these data not only to test the framework’s implications but

also for a variety of academic purposes. In particular, spending functions as a

546 Journal of Conflict Resolution 64(2-3)