Mises Wire

The Economics of Nuclear Weapons

Obtaining nuclear weapons is a way of getting reliable defensive capability on the cheap. This is why small, relatively powerless countries want them. North Korea can shell Seoul from the DMZ with conventional weapons fairly easily, but having a few nukes certainly hasn’t hurt North Korea’s ability to keep much larger powers at bay. Pakistan’s status as a nuclear power means it faces no true threat of invasion from foreign powers, even large ones. 

While they do not ensure a complete lack of armed aggression against one’s territory, they have shown that they will prevent all-out foreign invasion or any foreign action that threatens the existence of a nuclear-armed state. (The end of the USSR shows that internal threats to a regime can be maintained without nuclear war.) And at a relatively low price tag. In other words, countries with nuclear weapons need not face the dreaded “unconditional surrender” demand that is standard practice for the US in its conflicts with non-nuclear powers. 

But the same low-cost advantages hold true for large regimes as well. During the 1950s, for example, the United States and Western Europe were no match for the conventional-warfare capability of the Soviet military and the huge Red Army — at least not without spending a lot more money. Eisenhower, who actually cut military spending and was totally unwilling to fight the Soviets over the occupation of Eastern Europe, relied on nuclear arms for defense, instead. He routinely refused pressures to build up conventional-warfare capability or the size of the army. Meanwhile, he spent more money on nukes — but not as much money as he would have spent had he wanted to match the conventional capability of the  Soviets. 

Later, the French, realizing that they didn’t want to take orders from NATO if they didn’t want to, developed their own nuclear arsenal. Thus, the French face no credible threats of invasion today, not because they’re part of NATO, but because they have their own stockpile. Naturally, this also saves France the expense of maintaining a large conventional force for purposes of defense. 

The Advantages of Nukes for Small Countries  

One country that, for whatever reason, never learned this French lesson however, is the Ukraine. Forgotten by many today is the fact that Ukraine once possessed a large nuclear arsenal. when the USSR was dissolved, 130 nuclear missiles were on Ukrainian lands. By 1994, however, the US, UK, and Russia, all wanting to maintain as much of a monopoly as they could on nuclear power, assured Ukraine that they would guarantee Ukraine’s safety if it gave up its nuclear arsenal. Naturally, the major powers said that they were motivated by only the good of humanity in wanting to prevent nuclear proliferation. But, in fact, by opposing military capability, they were of course only strengthening their own positions. 

Today, that decision may be coming back to haunt the Ukrainians who are in a position that the French had acted to avoid. While it is debatable how much of a threat the Russians pose to the Ukrainian state, the fact is we wouldn’t even be having the discussion if Ukraine had its own nuclear capability. There would simply be a near-zero probability of Russian (or NATO, for that matter) invasion of the Ukrainian heartland. The risk of backing the Ukrainian state into a corner would be too great. 

Moreover, in the unlikely event that, say, Ukraine and Russia ended up in a nuclear conflict, the conflict would be more likely to remain a regional conflict in that case, than if the US were in the position of playing the role of a proxy nuclear defense for the Ukrainians. 

And finally, of course, as with the nuclear arsenals of India and Pakistan, nukes would provide a cheap alternative to a huge conventional army and arsenal. 

Back in 1993, John Mearsheimer, one of the few prominent realists among international relations scholars, wrote how it was a mistake for Ukraine to give up its arsenal, and noted that nuclear deterrence works. Relying on the West for assurance of security simply isn’t feasible, Mearsheimer wrote. Guaranteeing German safety during the Cold War, for example, had been extremely expensive and high-maintenance. But an economical and effective solution was within reach: nuclear proliferation. 

Today, Mearsheimer has been proven right. The Ukrainian regime, necessarily lacking a conventional capability that matches the Russians, turns to the US taxpayer to cover the gap instead. But the US, broke and on borrowed time, is unlikely to be able to keep up pouring money into Ukraine to continue involvement in what is a regional and ancient conflict. 

Thus, not surprisingly, some are now discussing the possibility of making Ukraine a nuclear power again. [See here.] Ukraine has used this possibility as a bargaining chip to get more free stuff from taxpayers in the West. And Ukraine is invoking those old promises of security to demand 1,000 anti-tank missiles, at great cost, of course. Not that American weapons manufacturers will complain if they’re paid to ship off another 1,000 units. Nevertheless, the ongoing black hole of military spending continues, and continues to be aggravated by a faulty ideology against nuclear proliferation that really only serves the interests of establishes large states with nuclear arsenals. 

In fact, as Mearsheimer notes in the case of Ukraine — but which is true in all similar cases in which a smaller country faces a larger regional hegemon — nuclear proliferation actually helps to prevent more serious military conflicts while also placing a far smaller burden on the taxpayers in the form of a smaller need for conventional arms. Many claim today that large states are needed to maintain stability in the face of large nuclear armed states. In fact, it only seems this way because there are so few small nuclear armed states. It is actually more likely that a world with a large number of small nuclear-armed states would be far more peaceful and stable than the one we have now, since it would preclude more regional wars.

[See here for my discussion on the military needs of small states.]

Additionally, as Zackary Keck recently discussed in The Diplomat, the reality of nuclear deterrence is one of the more rock-solid laws we have in international relations. And, it is even more useful than we might think since nuclear coercion — making people do things based on threats of nuclear war — fails. That is, nuclear arms are useful in frightening potential aggressors away from conflicts, but at the same time, potential aggressors fail when they try to use a threat of nuclear war to force compliance from foreign regimes. [See Keck’s piece for more.] 

But what this tells us is that nuclear arms are an inexpensive means of providing reliable defense to small regimes in the face of much larger regimes that could not be opposed with mere conventional weapons. It is a solution that is within the grasp of small, wealthy states. Nuclear arms are the great equalizers and actually make a world of small states possible, while a world of “nonproliferation” only serves to maintain a lopsided advantage for large states at the expense of small ones. 

Mearsheimer has not changed his views in the meantime, by the way. In this 2012 debate with Dov Zakheim, Mearsheimer takes the position that a nuclear-armed Iran would increase stability in the region. He maintains the position (also somewhat shared by Kenneth Waltz) that nuclear weapons are “weapons of deterrence. They have hardly any offensive capability at all.” 

In this, of course, Mearsheimer doesn’t mean that nuclear arms can’t destroy things and kill people. They obviously can. The fact remains, however, that the strategic value of nuclear arms lies almost totally on the side of defense, since nukes offer no offensive strategic advantage, unless of course, a state is the only nuclear state, as was the case with the US in 1945. 

All Rights Reserved ©
What is the Mises Institute?

The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard. 

Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.

Become a Member
Mises Institute