Wars Shape Destiny: Money (Part 2)

Sud Alogu
7 min readNov 30, 2023

One notable historical example of merchants selling arms and armor at high prices during the Middle Ages can be found in the context of the Italian city-states, particularly Venice and Genoa, during the 12th to 14th centuries.

Venetian and Genoese Arms Trade:

  • Venice and Genoa, two powerful maritime republics, were renowned for their production and trade of arms and armor. These city-states were strategically located to control key trade routes across the Mediterranean.
  • Their economies were heavily reliant on trade, and among their most lucrative products were military supplies, including arms and armor.

Example of the Crusades:

  • A specific instance of this arms trade can be seen during the Crusades. Both Venice and Genoa capitalized on these military expeditions by supplying arms, ships, and armor to the Crusaders.
  • The Fourth Crusade (1202–1204) is a particularly striking example. The Venetians, under Doge Enrico Dandolo, struck a deal with the Crusaders to transport them to Egypt. In return, the Crusaders were to pay a substantial sum of money. However, when the Crusaders couldn’t meet the payment, Venice directed the Crusade to attack the Christian city of Zara (now Zadar, Croatia) to compensate for their expenses. This diversion highlights how arms merchants and suppliers could influence the course of military campaigns for financial gain.

Quality and Price of Arms and Armor:

  • The arms and armor produced by the Venetians and Genoese were highly sought after for their quality. Italian armorers and craftsmen were considered some of the best in Europe. Their products were not only functional in battle but often ornately decorated, reflecting the wealth and status of the wearer.
  • Due to the high quality and demand, these arms and armor were sold at premium prices. Knights and nobles from across Europe were willing to pay significant sums to equip themselves with the best gear available, often imported from Italy.

Impact on Economy and Power:

  • The trade in arms and armor contributed significantly to the wealth and power of the Italian city-states. It was an important factor in their ability to maintain strong navies and mercenary armies, which were crucial for their dominance in Mediterranean trade and politics.

PMCs, evolving from small groups of former military personnel, have grown significantly in influence and scope. Initially formed to offer specialized military skills unavailable in regular armed forces, these entities have filled a niche in modern conflict scenarios. Financed by government contracts and private corporations, particularly in high-risk regions, PMCs have expanded their roles to include combat, training, security, and technical support. Their growth, accelerated by the end of the Cold War, represents a shift in warfare tactics, where private entities increasingly partake in what was traditionally the domain of national armies.

As the Cold War drew to a close, the world witnessed a substantial demobilization of armed forces, especially in major powers like the United States and Russia. Coupled with this was a notable reduction in defense spending, a phenomenon often termed the “peace dividend.” Governments scaled back their military budgets, leading to smaller national armies and less military infrastructure. This shift resulted in a surplus of experienced military personnel who found themselves without active engagement in national defense.

The post-Cold War period was not as peaceful as many had hoped. Instead, it saw the emergence of numerous regional conflicts, particularly in Africa and the Balkans. These conflicts often required specialized military skills that national armies were either unable or unwilling to provide. Moreover, the rise in asymmetric warfare, including terrorism and insurgency, called for a different approach to security and conflict response, diverging from traditional state-on-state military engagements.

Private Military Companies Step In

In this new security environment, Private Military Companies began to fill the void. PMCs, often established by former military personnel, provided a range of services from combat support and training to logistics and intelligence. These companies offered the expertise of highly trained ex-military professionals, including special forces and officers, who brought with them valuable skills and experience from their time in national services.

The Appeal of PMCs

PMCs presented several advantages over traditional military forces. They offered flexibility and efficiency, able to deploy rapidly with specialized skills tailored to specific conflict scenarios. For governments, outsourcing military functions to PMCs also provided a degree of plausible deniability, mitigating the political and public relations risks associated with deploying national troops. Furthermore, PMCs could operate without the bureaucratic constraints typical of state military organizations, making them an attractive option for various clients.

Clients and Services

The clientele of PMCs was diverse, ranging from governments requiring support in military operations to multinational corporations, NGOs, and international bodies operating in conflict zones. The services provided by PMCs expanded over time to include anti-piracy operations, cybersecurity, humanitarian missions, and even support for UN peacekeeping efforts.

Notable Examples and Ethical Considerations

Prominent PMCs like Executive Outcomes and Blackwater (now Academi) became well-known in the 1990s and 2000s. Executive Outcomes, for instance, played significant roles in conflicts in Angola and Sierra Leone. However, the growth of PMCs and their involvement in global conflicts also raised important ethical questions. The privatization of military force brought concerns about accountability, the nature of warfare, and the implications of having private entities engaged in what was traditionaIn recent decades, Private Military Companies (PMCs) like Executive Outcomes and Blackwater (now known as Academi) have become prominent in global conflicts. Their involvement raises significant ethical questions about the privatization of military force. This essay explores their roles in specific conflicts and the broader ethical implications of such involvement.

Body

1. Executive Outcomes in Angola and Sierra Leone

Angola (1993–1996): The Angolan government hired Executive Outcomes during its civil war. The company’s soldiers fought against the rebel group UNITA, helping the government regain lost territory. This intervention, while militarily successful, raised concerns about using hired soldiers in a country’s internal conflict.

Sierra Leone (1995–1997): In Sierra Leone, Executive Outcomes was tasked with stabilizing the country and helping control diamond mines. They trained government forces and fought the rebels, which led to a decrease in rebel activities. However, the company’s role in a war driven by diamond wealth brought up ethical issues about profit motives in conflict zones.

2. Blackwater in Iraq and Afghanistan

Iraq (2003 onwards): In Iraq, Blackwater provided security, especially to U.S. officials. Their involvement became controversial after the 2007 Nisour Square incident, where Blackwater guards killed several Iraqi civilians. This incident highlighted the lack of accountability PMCs face and their impact on civilian safety.

Afghanistan: Similar to Iraq, Blackwater operated in Afghanistan, offering security and training services. The concerns here mirrored those in Iraq, focusing on the use of excessive force and the unclear legal status of PMC personnel.

Broader Ethical Implications

The involvement of PMCs in conflicts leads to several ethical challenges. There are concerns about accountability, as PMCs often operate in legal gray areas. This raises questions about who is responsible for their actions. The nature of warfare also changes with PMCs, as war becomes privatized, altering traditional concepts of military engagement. The use of PMCs by governments challenges the idea of state responsibility and sovereignty. Finally, the profit motive in warfare, especially in resource-rich conflict zones, complicates efforts towards peace and conflict resolution.

Conclusion

The roles of Executive Outcomes and Blackwater in conflicts like those in Angola, Sierra Leone, Iraq, and Afghanistan demonstrate the complex and often problematic nature of PMCs in modern warfare. Their involvement in these conflicts highlights the ethical and legal challenges that arise when military services are privatized and operated for profit. As PMCs continue to play a role in global conflicts, these issues demand careful consideration and effective regulation.

‘ n lly a state responsibility.

Economic Incentives and Resource Exploitation

Warfare creates environments ripe for the exploitation of natural resources. The breakdown of governance in conflict zones enables the illicit extraction of resources like oil and minerals, often fueling further conflict. Notable examples include the Democratic Republic of Congo’s mineral conflicts and the oil-related strife in the Iraq War and the Nigerian Delta. This exploitation often leads to environmental damage, human rights abuses, and undermines legitimate economic development.

Political and Economic Ramifications of War

The allure of economic gains through territorial expansion or control can be a significant motivator for conflict. Wars have historically been used to consolidate power, foster nationalism, and distract from domestic issues. Economic benefits, however, come with substantial costs, including international isolation, sanctions, and the moral implications of profiting from conflict. Examples like the Falklands War and the invasion of Kuwait by Iraq in 1990 illustrate these dynamics vividly.

Technology and Innovation in Warfare

War has been a catalyst for technological advancements, with many innovations initially developed for military use later benefiting civilian life. The rapid development and focused innovation driven by military needs have led to breakthroughs in areas such as the internet, drones, jet engines, and medical advancements like penicillin. These innovations, while beneficial, also raise ethical concerns due to their origins in conflict and potential dual-use applications.

The Economics of War: A Double-Edged Sword

While war can stimulate certain economic sectors, like arms manufacturing and technology, the overall costs often outweigh these benefits. Direct military expenditures, long-term care for veterans, and reconstruction costs represent significant economic burdens. Moreover, the opportunity cost of diverting resources from civilian needs to military endeavors has long-term implications for a nation’s development.

Ethical and Humanitarian Considerations

The stark contrast between economic gains and human suffering in war presents profound ethical dilemmas. The morality of profiting from conflict situations, especially in the arms trade, faces intense scrutiny. The disparity in impact, where defense companies profit while civilians endure suffering and loss, raises questions about corporate responsibility and the need for stronger international regulations.

Global Impact of Prolonged Conflicts

Prolonged conflicts disrupt global trade, create market volatility, and alter international relations. They can lead to shifts in global power dynamics, spread instability, and become breeding grounds for terrorism. The Syrian Civil War and U.S.-China trade tensions exemplify the wide-reaching implications of such conflicts, affecting not only the involved regions but also the international community.

The business of war, encompassing PMCs, resource exploitation, and war economies, presents a complex interplay of economics, politics, and ethics. While technological advancements and economic stimulation are some of its facets, the overarching consequences of war — including human suffering, moral dilemmas, and global instability — underscore the need for careful consideration and regulation in matters of conflict. As the nature of warfare evolves, so too must our understanding of its broader implications for society and the international order.

--

--