Increased Military Spending During the Cold War Brought Stagnation to the Economy

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The increase in military spending is another argument that caused stagnation in the Soviet Union during the period. Brezhnev spent huge amount of money in the defense sector and according to Blanchard & Froot et al. (1994) the share of defense spending in GNP was 12% in 1960-70, and increased by 4% in 1975-80 to 16%, even though the country was is deep economic crisis. Brezhnev increased military spending each year; even as the country needed the spending in other “important” sectors, to boots the growth of the country, and caused low-level of economic development. Brezhnev increased the spending specifically on nuclear materials production plants, compared to weapons. During this time in history both the superpower, USA and Soviet Union had developed nuclear weapons. Soviet Union wanted to limit the possible war with the USA and the two countries came to an agreement on arms limitations in 1972 (IB Guide, 2014). In the period of 1965-1976 the growth of country spending was between 4-5 % per year on defense, but between 1977-1982 it declined the spending on defense to 2% (Strode, 2009). Brezhnev also spent huge and increase amount of money on the nation’s space programme during his time in office. The General funded generously both the space stations and Soviet Shuttle (Launius and Logsdon et al., 2000), as he wanted to keep up with the Americans progress in the field.
General Brezhnev also increased spending on the agricultural sector during his time in office. He…