Wars of the Few, Costs for the Many

Oligarchic Power and the Emerging Political Economy of Conflict

As Published by the Security & Democracy Forum at https://www.securityanddemocracy.org/post/new-report-wars-of-the-few-costs-for-the-many

Introduction

The global wars of the 21st century are often narrated through familiar lenses such as nationalism, territorial sovereignty, or ideological contestation. Yet such interpretations increasingly obscure a deeper structural reality about contemporary conflicts. Modern warfare is not merely a clash between states, but is shaped by the gradual erosion of institutionally structured decision-making processes, alongside the rise of networked elite influence across political and economic domains, whose incentives are deeply embedded within global systems of production, security, and governance. Within this context, war emerges not simply as an outcome of geopolitical crisis but as a mechanism through which processes such as friend-shoring and strategic economic alignment are reinforced within global systems of capital, production, and governance. Therefore, normalising political disagreements , as an integral element of how global systems sustain themselves.

Increased Defence Spending and Structural Inequality

Since the early 2000s, global policy trajectories have gradually aligned with the consolidation of elite influence across sectors such as finance, defence, energy, and technology. This convergence has contributed to a political economy in which war and its preparation are no longer treated as anomalies, but as a recurring investment towards broader patterns of growth, control, and technological advancement. What we may therefore be witnessing today marks the early stage of a broader paradigm shift; a transition toward an emergent form of Industrial Revolution 4.0. However, unlike earlier industrial movements, this phase is defined not merely by technological advancement or innovation alone, but by the tighter coupling between public authority and strategic private sectors. This development is rapidly reshaping both the nature of warfare and the architecture of global order. Contrary to the post-Cold War transnational expectation that economic interdependence would reduce the likelihood of large-scale conflict, policy trajectories since the early 2000s have increasingly pointed toward a steady prioritisation of security and strategic resources towards active militarisation. This shift matters, because it has gradually re-oriented systems of global governance that have blended both procedural stability with management of systemic pressures. The drawback, however, remains that such a blend is executed at the expense of institutional adaptability and reforms at scale. Over time, these priorities have transformed into global policy frameworks that today are resistant to reforms, while remaining capable of sustaining long-term global inequalities and a stratified international order. According to data from the Stockholm International Peace Research Institute, global military spending rose from approximately 1.24 trillion dollars in 2000 to around 2.6 to 2.7 trillion dollars by 2024, effectively doubling over the course of two decades. Thus, contributing to the global military burden, which in 2024 accounted for an approximate 2.5 percent of the global GDP. Additionally, the per capita military expenditure exceeded three hundred dollars globally. This rise in military spending is both persistent and concentrated within a small group of major economies, namely the United States, China, Russia, Germany, and India, which together account for roughly 60 percent of total global military expenditure. Empirical studies in macroeconomics further support this pattern, indicating that while defence expenditure can stimulate aggregate output and employment, particularly in industrial and blue-collar sectors.

Figure 1. Global military expenditure, 2000–2024 (constant 2022 US$ billions). The figure illustrates the long-term rise in global military spending, with accelerated growth since the mid-2010s and a record level in 2024. Source: Security and Democracy Forum, based on data from the Stockholm International Peace Research Institute Military Expenditure Database — SIPRI, https://doi.org/10.55163/CQGC9685 .

It also reinforces simultaneous wealth concentration by disproportionately benefiting the higher-income groups and capital-intensive industries. This dual effect highlights the impact of militarisation in supporting economic growth, while deepening structural inequalities.

Notably, the world witnessed such industry-linked policy support even during global crises such as the 2008 financial collapse or the COVID-19 pandemic, where crisis-driven redistribution expanded, but without a corresponding shift in underlying security priorities. Programs such as the Troubled Asset Relief Program in the United States and austerity-driven restructuring across parts of Europe coexisted with sustained defence commitments and limited demilitarisation. Likewise, during the COVID-19 pandemic, expansive welfare measures, including the CARES Act in the United States and the European Union’s recovery frameworks, were implemented alongside stable or rising military expenditures. Overall, these pivotal policy norms indicate that while redistributive interventions tend to be more contingent, uneven, and subject to recalibration, security-oriented economic priorities exhibit greater continuity and industrial protection. This continuity reflects more than just a policy preference; it is a pivotal shift towards a governance foundation that is interest-aligned and pro-stability and cooperation, yet enables policy interventions that become increasingly selective, uneven, and conditional over time. This is evident in recent work by the Geneva Academy of International Humanitarian Law and Human Rights, which contends that sustained military expenditure can have broader distributional consequences, as public resources directed toward defence may limit investments in health, education, and overall social protection. In this respect, budgetary priorities will no longer remain neutral, as they become essential for shaping long-term social and economic outcomes.

The structure of military spending itself also reveals important shifts. Since the early 2000’s, many states have reduced the relative share of personnel expenditure while increasing allocations toward procurement, operations, maintenance, and research and development. This transition strengthens ties between governments and defence industries, particularly through long-term contracts and specialised technological systems. Additionally, the report emphasises upon the increasing use of off-budget and extra-budgetary expenditures (expenditures that remain outside the scope of regular state budgets), especially within the developed states.

Figure 2. Approximate percentage distribution of the U.S. Department of Defense (DoD) budget authority by expenditure category, FY2000–FY2024. The figure illustrates a gradual shift in the composition of defence spending, with personnel costs declining as a share of total budget authority while operations and maintenance, procurement, and research and development assume relatively larger shares. Thereby, illustrating broader shifts in contemporary defence planning. Note: Although the proportional changes appear modest, they reflect a sustained reallocation of budgetary priorities over more than two decades. Source: Security and Democracy Forum, adapted from the U.S. DoD Comptroller Green Book, Peter G. Peterson Foundation, RAND Corporation, Econofact, and O’Hanlon (2024, Brookings Institution).

Although such policy measures in military budgets were previously considered during crises, regulatory complexities or political sensitivities. Such practices today pose a risk towards diminished state transparency and democratic oversight, one that will only constrain scrutiny and increase the risk of inefficiencies or corruption, thereby reinforcing institutional inertia. For instance, an empirical case study illustrates these dynamics in a 2014 study on corruption in defense and military. The study, through a survey administered to 100 senior Colonels in the Taiwanese military, spotted a rising concern over procurement opacity, misuse of classified budgets, and favouritism in appointments as a critical concern within the military fraternity. Similarly, in the UK, in 2016, the Single Source Regulations Office raised concerns over millions in disputed defense-related expenditures that fell outside standard contract rules. While such examples do not define the system as a whole, they point to recurring vulnerabilities in how defence spending is structured and monitored.

Wars as Extensions of Elite Incentive Structures

To describe modern conflicts as wars of the few is not to dismiss the presence of genuine geopolitical interests, but to recognise how those interests are structured in ways that reinforce entrenched policy frameworks. Vital conflict industries including energy, technology and natural resources, operate within environments where persistent insecurity can generate stable demand, long-term contracts, and protected market access. When viewed through a nexus-oriented perspective, these sectors do not function in isolation but as interconnected systems, where developments in one domain, like energy security or resource access, will directly shape outcomes in others, including defence policy and geopolitical alignment. This interdependence creates reinforcing feedback loops, whereby security concerns that drive energy strategies will eventually create energy dependencies that influence foreign policy, and both can sustain demand for defence capabilities.

Over time, such conditions produce a circularity in incentive structures that are less sensitive to conventional economic cycles and more closely tied to long-term strategic positioning. As a result, policy continuity across such sectors is not incidental but structurally embedded, gradually narrowing the range of viable alternatives. These arrangements, in the long term, therefore, tend to favour actors and institutions that remain insulated from the broader social and economic consequences of conflict while operating across national boundaries. ; a symbiotic framework that extends into post-conflict environments as well.

Figure 3. Conceptual representation of the conflict–industry nexus. The diagram illustrates how energy insecurity, defence policy, procurement, industrial capacity, and geopolitical positioning interact as mutually reinforcing components of a broader strategic system. Rather than depicting a linear causal process, the framework highlights feedback loops through which security concerns, industrial investment, and geopolitical priorities become institutionally embedded over time. Source: Security and Democracy Forum.

Today reconstruction post-wars are no longer purely ad hoc, it has become an institutionalised domain , involving private contractors, financial flows, and long-term infrastructure development. Thus, creating a permanence between conflict and post-conflict economies, where the incentives that operate during war do not disappear, but are reorganised into new forms of economic engagement. Consequently, this can produce a system in which different actors respond to similar conditions that reward policy stability and predictable returns for capital and continuity. These patterns are further bolstered through institutional arrangements and evolving policy frameworks. In some cases, governments formalise partnerships with strategic industries in ways that deepen long-term dependence. For example, recent policy developments in France have introduced provisions allowing designated private operators to support or substitute certain military functions under state authorisation. While such measures are often justified in terms of efficiency and operational flexibility, they also illustrate how public authority can become increasingly aligned with specialised industrial actors. Over time, these arrangements can make policy frameworks more difficult to adjust, as existing commitments, expertise, and infrastructure become embedded within a relatively narrow set of institutions.

It is within this context that the insights of Robert Michels, Theory of the Iron Law of Oligarchy, gains renewed relevance. Michels argued that complex organisations, regardless of their democratic intent, tend toward the concentration of power in the hands of a few. This theory, when applied at a systemic level, suggests that as sectors become more interconnected and technically specialised, the decision-making authority over capital and institutional access may shift towards actors with the necessary expertise and secretarial influence positioned within these networks. Besides, these dynamics are further reinforced by overlapping professional networks that connect public institutions with private industry.

Figure 4. The Funnel of Policy Consolidation in Security and Defense Sectors. The figure illustrates how democratic inputs are sequentially narrowed through institutional filters, technical experts, and networked elites, ultimately constraining policy outcomes. As specialised sectors become more interconnected, decision-making authority shifts away from broad participation toward a small circle of stakeholders. The inverted pyramid thus represents the transition from broad democratic participation (top) to concentrated authority (middle) and locked-in outcomes (bottom). Leading towards the constriction of policy alternatives, that create entry points for narrow set of stakeholders; resulting in technical capture and institutional insulation (“state within the state”). Source: Security and Democracy Forum.

As is evident in many advanced economies, where senior government officials frequently transition between regulatory roles and private positions within defence, energy, or consulting sectors, a pattern which is often described as the revolving door. Although this does not imply the collapse of democratic institutions or undue influence, it does concentrate the decision-making capacity within a relatively small circle of stakeholders. As a result, policy formation tends to occur within networks that share similar strategic assumptions, yet simultaneously limit the range of perspectives that shape long-term security choices. Robert Michels theoretical writings in The Sociology of the Party System in Modern Democracy argues that complex organisations tend to concentrate decision-making power among a privileged few, due to the practical demands of the organisation itself, which are in need of expertise, knowledge exchange, and administrative control. Thus, gradually elevating a smaller group of actors within the system. Contemporary security and global industrial policies reflect similar dynamics where states increasingly rely on specialised actors to design, manage, and implement know-hows. Recent policy developments illustrate how such patterns take shape in practice, for instance, in countries like China and India, which increasingly integrate economic planning with defence and industrial priorities, reinforces long-term alignment between state objectives and strategic sectors.

These developments do not imply direct control by private actors, but they do reflect the structural tendencies Michels identified as the tactical and technical necessities which result from the consolidation. Ones where expertise and authority that concentrates within the governance systems over time, produces what Michels described as a state within the state, that operates policymaking in silos, and leads to the creation of a distinct class of leaders who are separated from the rest of the party members, they represent.

Conclusion: The Limits of Acceptable Stability

If contemporary systems of conflict, growth, and governance appear increasingly stable, the more pressing question is not whether they are functioning, but under what conditions they do so. Stability, in this sense, does not necessarily imply alignment, as systems can endure, adapt, and even innovate, while remaining largely indifferent to how their outcomes are distributed or the longer-term conditions they produce.

A defence-oriented economic structure, therefore, further complicates this dynamic. At one end of the spectrum, weakly regulated environments can enable forms of regulatory capture, allowing private actors to exert disproportionate influence over policymaking. At the other end, highly centralised systems can consolidate authority within bureaucratic institutions, limiting transparency and competition. In both cases, the result is a narrowing of institutional flexibility and a tendency toward opaque, self-reinforcing policy structures. Thus, pointing towards a more rigid possibility, that the persistence of current patterns may not reflect a lack of alternatives, but a gradual narrowing of what is considered politically and economically feasible.

Over time, this is how oligarchic tendencies acquire durability, by not only shaping socio-economic or political outcomes but by defining the boundaries of acceptable change itself. Policymaking and institutional reforms, in such contexts, tend to preserve continuity for interests that often comes at the expense of broader distributive equity.

In such a setting, the challenge, therefore, is not to analyse the economic or geopolitical necessities of a conflict, but to examine the conditions under which it is pursued and the interests it consistently stabilises. Without sustained scrutiny, current geopolitical processes are unlikely to produce systemic change. Instead, they may reinforce incremental adjustments, where regulatory responses are increasingly pre-emptive and designed to steer potential disruption back within existing frameworks. What may emerge, then, is not only a concentration of power, but a global environment in which conflict persists, even as the space for meaningful consensus gradually narrows.