Hope and wishful thinking have long plagued the US military’s mobilization of resources for great-power conflict. After the end of the Cold War, the Department of Defense consolidated the defense industrial base and downsized production to reap the benefits of the peace dividend. America’s pacing challenge of today, China, exploited the complacency of a distracted hegemon—closing key capability gaps through military-civil fusion and vast investments in industrial capacity. Meanwhile, Russia’s war in Ukraine and the coordination of other powers in an emerging “axis of autocracies” illustrate how adaptive adversaries can harness industrial ecosystems to leverage relative advantages in modern warfare.
Despite renewed attention that aims to rebuild the defense industrial base as the “arsenal of freedom,” US initiatives to expand production remain narrowly focused on domestic capacity. This inward focus ignores America’s strategic geography and its industrial fragility. The United States cannot sustain large-scale conflict alone—its supply lines are long, its factories too few, and its adversaries’ arsenals too deep.
The Department of Defense must therefore move beyond tactical adaptation and pursue strategic innovation. In a previous article, we argued that the US Army’s way of war and its organizational culture are incompatible with some of the drone innovations diffusing from the Russo-Ukrainian War, limiting the likely success of their implementation. Assuming that the US military ignores these words of caution and continues to adopt a drone-centric approach to war, each military service will face the challenge of sustaining an attritional war across vulnerable lines of communication. The central issue is that the United States lacks the manufacturing depth and raw materials to sustain a prolonged, drone-centric attritional war without allied industrial coordination.
To endure in this era of “precise mass,” the United States must pursue two complementary lines of effort: internal capacity building and external balancing with allies. By partnering with Indo-Pacific and European allies to coproduce drones, munitions, and naval platforms, while simultaneously revitalizing production at home, the United States can build redundancy into its supply chains, reduce the tyranny of distance, and sustain its forward-deployed forces. America’s industrial advantage lies not in isolation but in leveraging its global alliances to share burdens, shorten production timelines, and strengthen deterrence capability and credibility.
Innovation Decisions: The Impact of Financial Intensity and State Responses
Understanding the United States’ ability to implement drone and precise mass innovations stemming from the Russo-Ukrainian War once again requires an examination of the model that framed our analysis of US Army drone integration: Michael Horowitz’s adoption-capacity theory. According to Horowitz, states can integrate new military technologies only if they possess the requisite financial and organizational capacity. For the United States, this framework suggests that even with abundant resources, innovation will stall unless leaders overcome bureaucratic inertia and limits on organizational capital. Yet history shows that when power balances shift and the threat of conflict grows, even rigid institutions can reform under pressure.
Given that DoD’s current agenda is to overcome bureaucratic and organizational inertia, we must assume the military’s leadership will seek to overcome the problem of limited organizational capital—in particular, critical task focus— at any cost. There are significant hurdles to overcoming complex cultures and bureaucracies. Still, the innovation literature suggests that, though military organizations are typically resistant to change, leaders are more willing to consider transformation when the balance of power shifts. We must assume, then, that the changing character of warfare and shifts in the international balance of power have fostered the conditions for the military to overcome its typically stagnant nature and pursue the necessary innovations.
Removing organizational impediments leaves only one critical factor that the US military must overcome: financial intensity. On the surface, this should be a relatively easy innovation obstacle for the United States to overcome, given its status as the world’s largest defense spender. Unfortunately, financial intensity encompasses not only production cost but the mobilization of resources across time and space. This means that the United States must consider its ability to repurpose or rebuild large portions of the defense industrial base to produce the quantities of systems required, at a sustainable price point.
Resource mobilization also includes the challenge of sustaining forward operations across contested supply lines. In a future conflict, the US joint force’s lines of communication will be susceptible to interdiction and the development of bottlenecks. The attrition of sea- and airlift assets will slow the delivery of vital systems and reduce the speed of friendly adaptation. Thus, relying on mass places a long-distance force projector like the United States at a severe disadvantage and raises the second- and third-order costs associated with adopting the innovation. High financial intensity, therefore, does not merely slow innovation—it reshapes strategic behavior, nudging states toward coalition-based or external responses.
Because high financial intensity raises the costs of independent innovation, dominant powers often complement internal efforts with external balancing. As the dominant military power within its alliance system and the world’s largest arms exporter, the United States has historically preferred to act independently, wary of relying too heavily on its allies’ capabilities. Yet, as Horowitz notes, states facing prohibitive adoption costs must consider three external responses—neutrality, balancing, or bandwagoning. In direct competition with Russia and China, the United States cannot credibly choose neutrality or bandwagoning. Instead, recognizing that it will not achieve the economies of scale necessary to rival the integrated industrial networks of an adversary like China, the United States should pursue a hybrid innovation strategy: rebuilding domestic capacity while coordinating with allies to pool industrial and logistical resources.
Seeking External Responses: Resource Mobilization in the Twenty-First Century
History provides precedent for the salience of Horowitz’s idea of financial intensity and the need to seek external responses. During World War II, Britain relied on US industrial power through the Lend-Lease program, Liberty ship production, and the coproduction of vital equipment such as microwave radar—demonstrating how great powers can overcome resource mobilization shortfalls through allied industrial integration. With this historical example in mind, it is useful to once again apply the concept to the war in Ukraine, given its scale, the fact that it is ongoing, and the involvement of major military powers. The divergent wartime industrial behaviors of Russia and Ukraine illustrate how financial intensity and strategic industrial balancing determine resilience and innovation capacity in prolonged, high-attrition conflict. Russia’s approach is anchored in centralized, authoritarian-style mobilization, while Ukraine has pursued a distributed production and external balancing strategy. Each case provides crucial evidence for the United States as it faces its own industrial limitations in a European or Indo-Pacific conflict.
The Ukrainian Example: External Balancing and Supply Chain Flexibility
In 2022, Ukraine faced an industrial complex inherited from the Soviet Union, relying on large state monopolies and legacy technology ill-suited for the rapid attrition of modern warfare. Despite its short interior lines, its high financial intensity, and a contested logistics environment, Ukraine turned to multinodal production, private sector investment, and external balancing to compensate for its initial industrial limitations.
The centerpiece of this approach is the Brave 1 innovation cluster. This public-private ecosystem, primarily optimized for drone procurement, attracts angel investors, venture capital, and private corporations that shoulder the financial risk typical of government-led research and development. The success of Brave 1 and its ability to mitigate the financial intensity burden on the state is evident in the growing number of foreign investors and the increase in average amount of investment startups raise, from $500,000 to between $1 million and $3 million as of 2024.
However, the key to its resilience and quick reconstitution is a strategic focus on “Lego-style” modularity and an integrated, multinational supply chain. Ukrainian defense startups may drive design and development, but these products remain highly dependent on foreign commercial components such as US and Taiwanese semiconductors, European optics, and even Chinese motors and batteries, much like Russia. This reliance on the global commercial off-the-shelf market and decentralized assembly enables adaptation and innovation cycles comparable to or faster than Russia, while maintaining high resilience under attrition despite limited central capability. This successful use of partners to facilitate production demonstrates Horowitz’s idea that high financial intensity pushes states toward a need to balance externally.
The Russian Example: Internal Bottlenecks and Mitigation
From the outset of the invasion, the Russian government favored a centralized approach to military-industrial production, adapting its economy to wartime conditions starting in July 2022. This included mobilizing facilities, imposing labor controls, and redirecting over four thousand enterprises and more than 10 percent of the Russian population—many of whom were subordinated to state conglomerates such as Rostec—to fulfill state defense orders. Security and defense spending now account for over 8 percent of GDP and 40 percent of all federal expenditure as the Kremlin attempts to adopt a “fortress nation” posture.
Yet, this centralized model faces two critical limitations: bottlenecks caused by component dependencies and rigidity that hinders qualitative innovation. First, the lack of domestically produced, sophisticated components for drones and missiles has forced reliance on external suppliers. This resulted in the formation of a critical arms supply partnership with Iran, evolving from a monthly transfer of 200–600 drones of the Shahed 136/Geran-2 type to the establishment of a production facility at Alabuga capable of producing over five thousand drones monthly, with the airframes and major components now produced on site. Early limitations in mass production were also seen in conventional munitions stocks, forcing Russia to rely on its own “arsenal of autocracy” ally, North Korea, for shipments totaling upward of 5.8 million rounds, or potentially 40 percent of all Russian artillery shells, to meet expenditure demands.
Second, the rigid structure of centralization has stressed Russia’s defense-industrial complex, leaving it barely able to fulfill orders with anything other than mass-produced legacy equipment using more dual-use technology. This has resulted in Russia standardizing its drone production around a limited set of legacy models, in contrast to Ukraine’s use of dozens of different platforms. While Russia’s move to largely centralize its military production has increased its ability to produce mass quantities, the bottlenecks created by critical foreign dependencies and the focus on quantity over research and development investment leave its industrial base ultimately vulnerable.
Strategic Innovation: Building Redundancy in Allied Industrial Integration
History and contemporary events show the value of external responses to offset the burdens of resource mobilization. The United States must recognize that the strategic circumstances that enabled it to become the arsenal of democracy no longer exist. Although it remains an industrial power, it no longer enjoys vast production advantages over its rivals. China now surpasses the United States in manufacturing capacity and can mobilize faster near flashpoints. To compete, the United States must expand domestic production while deepening allied industrial cooperation.
Drawing on concepts such as expeditionary advanced basing and agile combat employment, the Department of Defense must prioritize decentralizing manufacturing through allied regional integration. Allied integration should initially focus on three areas essential to sustaining the precise mass innovation: drones, decoys, and ships. Doing so enables the United States to leverage allied proximity and capacity to close the gap between production and employment, keeping pace with the rapid adaptation cycles of modern warfare.
Drones and Loitering Munitions
Drones and loitering munitions are the centerpiece of ongoing innovations diffusing from Russia and Ukraine. Successfully adopting the innovation requires the United States not only to scale production rapidly but also to minimize the lag between production and delivery to the front. The war in Ukraine shows that shortened feedback loops between producers and warfighters are essential. Domestic investment alone cannot overcome these logistical limits. No amount of domestic investment will solve this challenge or overcome the resource mobilization challenges of a long-distance force projector. Treating drones as expendable munitions will encourage their tactical use, but it will not sufficiently replenish them when relying on domestic producers. Instead, the Department of Defense needs to collaborate deliberately with its allies and partners to increase drone production and minimize the vulnerability of the US joint force’s lines of communication.
Drone production capability among US allies and partners is uneven. In Europe, countries like France and Turkey have growing production capacities. In the Indo-Pacific, by contrast, America’s allies lack a robust drone infrastructure to challenge China’s drone production dominance. Defense planners and policymakers should coordinate with their allies in Europe and the Indo-Pacific not only to transfer drones, but also to develop coproduction initiatives. For instance, the United States should replicate its 2025 coproduction agreement with Australia—originally for 155-millimeter and Guided Multiple Launch Rocket System munitions—to expand drone manufacturing with allies, building regional depth and complicating adversary targeting.
Decoys
Second, the war in Ukraine underscores the value of decoys, which absorb enemy fire and drones, but must be produced in high volumes with increasing sophistication. Much like loitering munitions, decoys serve as single-use systems that are meant to draw enemy fire and increase the survivability of one’s forces. Decoys will need to be mass-produced and integrate increasing levels of complexity to complicate adversary targeting. As the US military increasingly deploys decoys in its tactical formations, it can tap allied domestic manufacturing to maintain pace with battlefield adaptations and integrate the sophisticated capabilities needed to deceive the adversary.
Sealift Capacity
Lastly, coproduction initiatives involving drones and decoys can help accelerate equipment delivery, but maintaining supply network redundancy through robust sealift is necessary because future conflicts will increasingly put industry at risk. Over 90 percent of US military supplies still move by sea, yet the nation accounts for just 0.1 percent of global shipbuilding, while China accounts for 53 percent. Unfortunately, the US military’s Sealift Command is unprepared for the bulk transportation requirements needed to sustain the mass employment of drones and loitering munitions. In addition to atrophying capabilities, the United States also lacks the shipbuilding infrastructure to bolster capacity or reconstitute losses. To close this gap and ensure consistent resource mobilization, the United States must partner with allies like South Korea and Japan, whose combined production can rival China and enable the US military to build the sealift capabilities it needs to sustain redundant supply systems. Domestic infrastructure investments are admirable and necessary, but they will take far too long to deliver the required capabilities over the next few decades. Joint production of crewed and uncrewed vessels with Japan and South Korea offers near-term redundancy and shared risk, while domestic efforts mature.
Overcoming the Resource Mobilization Gap
A single-track, internal innovation response will only further disadvantage the United States. The US military’s supply system is overstretched, vulnerable, and falling behind. As the Department of Defense seems apt to adopt the precise mass innovation diffusing from Ukraine, it is prudent to consider whether the US military possesses the resources to implement it. Due to its geography and the deindustrialization of its economy, the United States may be unable to serve as the sole source of production in the arsenal of freedom. To successfully implement the innovation, the United States must develop a dual-track strategy that prioritizes domestic investment and allied coproduction. Though too much reliance on allies risks reducing US strategic autonomy and raising the potential for coercive leverage, it enables the United States and its allies to build a responsive defense supply network that matches the challenges of the modern battlefield. Additionally, it bolsters deterrence by reassuring allies of the credibility of American commitment, enables the mobilization of resources near potential flashpoints, and enhances allied capabilities. Expanding our conception of the arsenal of freedom can build a lasting advantage that addresses the burden-sharing gap that has long plagued allied relations. The rapid advancement of battlefield technologies necessitates that the United States broaden its conception of available state responses to innovate before, not during, the next conflict.
Matthew Revels is an Army strategist who serves as the Modern War Institute’s plans officer and as a senior instructor at the United States Military Academy. He currently teaches courses on military innovation and forecasting and gaming in decision-making.
Eric Uribe is a major in the US Army and a foreign area officer with an area concentration in Europe. He holds a master of arts in security studies from Georgetown University’s Walsh School of Foreign Service with a concentration in international security.
The authors would like to thank Dr. Kelly Grieco for her feedback and assistance with the early versions of this article.
The views expressed are those of the authors and do not reflect the official position of the United States Military Academy, Department of the Army, or Department of Defense.