As Congress continues to negotiate federal spending levels for next year and seeks to avoid a government shutdown, one of the key sticking points has been the continuation of U.S. aid to Ukraine in its efforts to repel Russia’s invasion. We see a lot of emphasis on the top line numbers, but these figures can often be misleading. To date, the United States has supplied somewhere around $75 billion dollars to help the Ukrainian people defend themselves. In total, congress has appropriated around $113 billion for this effort. But what does this aid look like in practice? The reality shows a smart approach that has a big impact on Ukraine’s success while also serving as a critical investment in America’s future. So here’s a look at what American spending to support Ukraine actually looks like.
1) Military Hardware
Perhaps the easiest form of assistance to visualize is that of America’s support in terms of military hardware. The United States has provided nearly $50 billion worth of artillery pieces, tanks, defensive missile systems, and training/logistical support. These investments are game-changing for Ukraine, but still only make up about 5-10% of the annual U.S. military budget. A significant share of this equipment is military surplus that was already headed for the scrapyard anyway. In some of these cases, it’s cheaper to give away this equipment than it would be to safely scrap and decommission it.
Among the other benefits of this program is that the U.S. military is gaining a wealth of information about the tactical applications and limitations of some of its most vital technology. American military analysts are learning more every day about how these materials can be utilized in a theoretical military engagement with another significant power. And since these stockpiles are continually being replenished, defense production companies can continue to employ millions of Americans during an otherwise tight labor market.
2) Financial Assistance
Running a wartime economy takes much more than just bombs and bullets. Ukraine’s financial system has taken a monumental hit from the disruption of entire industries and Russia’s campaign to destroy Ukrainian grain exports. That’s why a significant portion of America’s assistance to Ukraine is taking the form of loans and economic stimulus to keep Ukraine’s economy afloat and stave off financial implosion. Often these loans have low or no interest rate, but they are still expected to be paid back to the U.S. once the war is over and Ukraine’s finances are on a firmer footing.
This program of economic assistance not only helps Ukraine, it reinforces the stability and resiliency of the entire global economy. A systemic failure of Ukraine’s economy would have significant ripple effects at a time when the international financial system is already reeling from supply chain issues and inflationary pressure. These investments in Ukraine’s economy also directly support the financial success of America’s heartland. Just like U.S. states such as Minnesota or Nebraska are major global food producers, so too is Ukraine. Ensuring stability in this market keeps American farmers in business.
3) Humanitarian Assistance
The last major area of U.S. assistance to Ukraine takes the form of our more traditional development assistance and humanitarian aid. These are funds that go towards food, refugee relief services, and other ways to support the Ukrainian people while they fight for their lives and livelihoods. In general, U.S. development assistance through programs like U.S. AID are not simply blank checks. There are significant stipulations and oversight on these aid dollars to ensure they are being utilized effectively and efficiently.
One of the most overlooked aspects of U.S. development aid is that goods or services are often procured within the United States and then sent overseas. This helps to stimulate the U.S. economy while also keeping people alive in Ukraine. In Minnesota alone, the foreign affairs budget helped stimulate $23.5 billion in exports and is tied to the employment of nearly 20% of Minnesota’s workforce. That’s a significant return on investment that also provides a tremendous good for the Ukrainian people.
Why We Must Continue This Support
Overall, providing this support to Ukraine is both the right thing to do and in our interest to do it. On a moral level, we simply cannot allow large military powers to seize and annex the territory of another country. Territorial conquest has been one of the most prevalent reasons for war throughout human history, so limiting the appeal of this rationale is essential to global peace and stability. On a practical level, the United States is helping to completely degrade the military, diplomatic, and intelligence capabilities of our second-largest adversary for a fraction of the total cost spent during the height of the Cold War. When combined with the direct benefits to U.S. military capabilities, the American economy, and global stability, continued U.S. assistance to Ukraine just makes sense.