One of the more fascinating sidelights of our war of choice in Iran is how it has reinforced the devastating consequences of our hollowed-out industrial base, consolidated commercial sector, and overreliance on long intermediated supply chains.

For example, the effective closure of the Strait of Hormuz carries implications for not only oil but also fertilizer, right at the height of the spring planting season. About one-third of the world’s fertilizer ships through the strait, and without access, prices have jumped and farmers are anxious. Yet there are enough natural resources in the United States—nitrogen, phosphate, potash—to serve all our fertilizer needs; in fact, in the 1930s and ’40s one of the largest fertilizer producers in the world was the Tennessee Valley Authority. This production was wound down in the 1970s; today the industry is dominated by two to four firms, and that may end up having existential implications for hungry people the world over.

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A more comically shortsighted example concerns our depleted stock of munitions, one of the few industrial capacities America has retained but which still is imperiled by concentration and outsourcing. These are of course the basic materials necessary to prosecute a war, and you’d think it would be the one item countries would retain the ability to produce themselves. But our trillion-dollar military operates more like a welfare program to help underprivileged Northern Virginia contractors buy second homes and luxury yachts, not as a force that has what it needs when it needs it. Pacifists should rejoice; stupidity in military supply chains puts a binding limit on how many brown-skinned people we can kill.

In the 1990s, dozens of military contractors were reduced to five prime integrators, something demanded by Clinton Defense Secretary Les Aspin and his deputy (and future defense secretary) William Perry at a meeting known as the “Last Supper.” Nearly all weapons and delivery systems now flow through Boeing, Raytheon, Lockheed Martin, Northrop Grumman, and General Dynamics. Executives at these companies were called into the White House last Friday—less than a week after the war began—to discuss how to accelerate offensive and especially defensive weapons production amid a shortage that already was weighing on the military. This was after Defense Secretary Pete Hegseth said that the war was saved by shifting to smaller bombs rather than “exquisite” munitions for the campaign. If that was the case, why have the meeting?

America lacks the components for these weapons as much as it lacks the capacity to build them.

Specifically, the Terminal High Altitude Area Defense (THAAD) missile systems are so complex that only 96 get built per year; about one-quarter of the U.S. stockpile was used last year in Israel’s brief war with Iran, with many more flying every day as this war continues. Patriot interceptor systems are cheaper and easier to build, but inventories were a quarter full before the war started. Offensive Tomahawk missiles can be produced with greater frequency as well, but as of October last year the stockpile of that weapon was far short of its target. Something like $5.6 billion in weaponry was burned off in just the first two days of the Iran campaign. Trump’s lying aside, analysts who know something are clear on this point: The nation has a few weeks of bombing left before running out of the precision munitions typically used in modern warfare.

To be sure, the shortage has much to do with the U.S. selling off weapons to Ukraine and Israel to prosecute their wars. (Ukraine is trying to pull off a trade of Patriot missiles for instruction in intercepting drones.) But it seems impossible that a military that spends more than the next nine militaries combined would reach a point of shortage so rapidly. But that’s what happens when military contractors are really financial market optimization machines.

As The Lever has reported, leading military contractors have spent $110 billion on stock buybacks over the last five years, something so repugnant that even Trump has issued an executive order trying to ban it. Meanwhile, contractual overrun-by-design has become the industry standard. As I wrote last year, Lockheed has an F-35 Joint Strike Fighter that has cost $2 trillion over its lifespan and can’t travel long distances or be used in close-range combat, with hundreds of continuing defects that have not derailed its production. All this cash eventually ends up in the pockets of executives and shareholders.

This is why we have to race to take out opposing defenses quickly before we run out of the products that can do that. If we have a trillion-dollar military, but a week after you start to use it everyone screams that they’ve run out of everything and that more money is needed, then you don’t have a trillion-dollar military; you just have a contractor enrichment factory.

The White House has been rumbling about a $50 billion supplemental funding request, something they obviously find so critical that Republicans might burn up their last reconciliation bill of the year on approving it. Lockheed came out of the White House meeting saying they would “quadruple” Tomahawk production, though they didn’t give a timeline. It’s important to note that current production lines are generally too small for an extreme ramp-up, a fact magnified by the lack of competition. This isn’t about “underperforming” contractors, it’s simply about too few of them.

Why China Can Collapse the U.S. With One Decree

But there’s a far bigger problem here, as Mark Bowden has written about: America lacks the components for these weapons as much as it lacks the capacity to build them. And the biggest missing components are the rare earth minerals used in missile guidance and other essential systems.

According to the South China Morning Post, the U.S. has just two months of rare earth supply left for its military needs. Now, a Chinese-owned paper may be intentionally saying that, because China has a near-monopoly on the processing of rare earths, the raw materials of which are not that rare. But it certainly wouldn’t be surprising, since rare earths have been used as a tool for leverage in the endless U.S.-China trade wars. China has been turning export controls off and on over the past year, though they were up in January and February by about 20 percent relative to 2025. A high-level meeting will be held on rare earth exports next month.

The Trump administration has been buying stakes in domestic rare earth companies and mining operations, and they are generally aware of the need for resiliency and self-reliance, as the Biden administration was. But destroying the electric-vehicle sector in America, as the Trump administration did, eliminated an additional market for rare earths that might have sustained domestic producers. And the cronyism at work in these financing deals—the recent stake in USA Rare Earth is marred by the fact that Howard Lutnick’s former bank Cantor Fitzgerald is the company’s chief placement agent—suggests that the main goal is less restoring domestic supply chains and more nest-feathering.

Even if they were legitimate deals, rare earth mining and processing can take years to set up, with bombs dropping every day. This means the duration and intensity of our war effort is in some very real way at the discretion of China. That will almost certainly become a subject in upcoming trade negotiations, as the SCMP report indicates.

The U.S. invented rare earth magnets used in all these technologies. We gave away the industry and closed the last processing plant over 20 years ago. The business mantra of moving production to where it is cheapest has bitten us in the ass in countless industries over the years. Bombs are probably the least sympathetic one, but since they’ve become Trump’s go-to means of geopolitics—he’s bombed enough countries in his second term to fill more than two World Cup brackets—it’s worth noting how monopolization, financialization, globalization, and weakened industrial capacity are ruining that imperative, just as they have destroyed our self-sufficiency and pillars of our economy. And if we ever have a national-security threat to the country, it’s been made far more perilous by these forces, which have created unacceptable dependencies on foreign nations.

This was a choice, and like any other choice it can be reversed. But that would require dislodging our lords of capital.

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David Dayen is the executive editor of The American Prospect. He is the author of Monopolized: Life in the Age of Corporate Power and Chain of Title: How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud. He co-hosts the podcast Organized Money with Matt Stoller. He can be reached on Signal at ddayen.90.