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Rebuilding the Arsenal of Democracy

  • December 9, 2025
  • Peter Juul
  • Justin Littleford
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America’s defense industry can no longer produce arms and ammunition at the required cost, scale, and speed. Despite some progress in reviving munitions production since the Russian invasion of Ukraine in February 2022, the American defense industry no longer resembles the famed arsenal of democracy that won World War II or the sprawling military-industrial complex that helped keep the peace during the Cold War.

To be sure, America’s defense industry makes some of the world’s finest and most advanced military hardware. But it’s expensive to develop and build that hardware, and since the end of the Cold War, the Pentagon has too often spent enormous sums on gear that takes too long to field and cannot be bought in sufficient quantities — leaving the U.S. military with aging combat aircraft, warships, and other equipment that costs more and more to maintain over time. Some programs like the B-21 stealth bomber have come in below projected costs, but general problems with production speed, scale, and cost remain pervasive across the industry.

And in major armed conflicts like the war in Ukraine, strategy scholar Phillips Payson O’Brien reminds us, “The military equipment with which a country starts a war is normally eaten up in short order, and the war becomes a desperate test to make, repair and recreate military force.”

There’s no silver bullet to fix these issues — they’ve been decades in the making and will require concerted efforts to rectify. But these three core ideas can help guide efforts to make America’s defense industry the arsenal of democracy once again:

  • Send strong, consistent demand signals
  • Work with partners and allies — don’t alienate and antagonize them
  • Reform defense procurement regulations

Read the full policy memo.

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