Walter Russell Mead's Global View column today, written from Kyiv on his third visit since the Russian invasion, lays out something investors should pay attention to: the nature of war has changed faster and more radically than most observers — and most of the world's militaries — yet understand.
Three things from the column are especially relevant to how we're positioned:
First, drone warfare favors defense. Ukraine's smaller armed forces are holding off larger Russian formations, and extracting a high price for every acre of ground gained. Medics no longer treat bullet wounds because drones have supplanted rifles. Evacuating wounded from the "gray zone" can take weeks because teams of drone and unmanned-ground-vehicle operators must navigate winding paths through swarms of hostile drones.
Second, this is a revolution in military technology happening in real time. Rifles, mortars, and tanks are going the way of sword fights and cavalry charges. Thumbs on joysticks have largely replaced fingers on triggers. Every assumption about what armies are and how they fight is being challenged and reshaped daily.
Third, Ukraine is forging a powerful and competent state under fire. If Ukraine survives, it will likely emerge as a major force in military technology — and a significant factor in the Eurasian balance of power.
Mead's piece pairs with what the Journal has been reporting all year about the U.S. defense budget. Steve Feinberg is selling the largest wartime defense budget in modern history to contractors using private-equity turnaround tactics. The numbers — $1.5 trillion and rising — line up with a multi-year industrial expansion, not a one-off cycle.
The Ukraine read-through is what's missing from most domestic defense coverage. We're not just buying more F-35s. We're buying drone swarms, autonomous systems, AI targeting, electronic warfare, satellite-relay communications. The tier-2 names — Kratos Defense (KTOS), AeroVironment (AVAV), Palantir (PLTR) on the software side — are getting more contract flow per dollar than the primes.
The closing line of the column is worth pasting: "Russian power, and the authority and integrity of the Putinist state, is being ground down. Ukraine, by contrast, appears to be gaining coherence, capacity and energy — even as it fights for its life."