Friday, January 30, 2009

The Permanent War Economy

Harry Targ

(Excerpts from a presentation at the Deerfield Progressive Forum, Deerfield Beach, Florida, January 17, 2009)

In the Beginning

After suffering the greatest economic depression in United States history, this country participated in a war-time coalition with Great Britain and the former Soviet Union to defeat fascism in Europe and Japanese imperialism in Asia. As a result of the economic mobilization for war, the United States economy grew to become the most powerful one by war’s end. By 1945, Americans were responsible for three-fourths of the world’s invested capital and controlled two-thirds of its industrial capacity. Near the end of World War II, General Electric CEO Charles Wilson recommended that the U.S. continue the wartime partnership between the government, the corporate sector, and the military to maintain what he called a “permanent war economy.” He and others feared the possibility of return to depression.

To justify a permanent war economy-ever increasing military expenditures, bases all around the world, periodic military interventions, and the maintenance of a large land army, navy, and air force-an external threat was needed. In 1947 President Truman told the American people that there was such a threat, “international communism.”

Many liberals and conservatives remained skeptical about high military expenditures. But, just before the Korean War started, permanent war economy advocates threw their support behind recommendations made in a long- time classified document, National Security Council Document 68, which recommended a dramatic increase in military spending. NSC-68 also recommended that military spending from that point on should be the number one priority of the national government. When presidents sit down to construct a federal budget they should first allocate all the money requested by military and corporate elites and lobbyists concerned with military spending. Only after that should government programs address education, health care, roads, transportation, housing and other critical domestic issues.

When the United States entered the Korean War, Truman committed the nation to a permanent war economy. Each subsequent president did likewise. According to Chalmers Johnson (Blowback, Sorrows of Empire), between 1947 and 1990, the permanent war economy cost the American people close to $9 trillion. Ruth Sivard (World Military Expenditures) presented data to indicate that over 100,000 U.S. military personnel died in wars and military interventions during this period. And, in other countries, nearly 10 million people died directly or indirectly in wars in which the United States was a participant.

Some influential Americans raised criticisms of the new permanent war economy. For example, while he subsequently complied with many of the demands for more military spending, President Eisenhower declared in one of his first speeches in office that “every gun that is made, every warship launched, every rocket fired, signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed.” After eight years in the White House Eisenhower gave a prescient farewell address in which he warned of a “conjunction of an immense military establishment and a large arms industry” which was new in American history. And, he proclaimed; “We must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex.” Incidentally, his original draft spoke of a “military-industrial-academic complex.”

Seven years later, in the midst of the Vietnam War, Dr. Martin Luther King Jr. proclaimed “Somehow this madness must cease. We must stop now. I speak for those whose land is being laid waste, whose homes are being destroyed, whose culture is being subverted. I speak for the poor of America who are paying the double price of smashed hopes at home and death and corruption in Vietnam. I speak as a citizen of the world, for the world as it stands aghast at the path we have taken.”

The Permanent War Economy Today

So we find ourselves in the midst of two wars today-Iraq and Afghanistan-that are already more costly than any war except World War II, against an enemy magnified, demonized, and mythologized as much or more than the cold war enemy to justify a $3 trillion price tag, the deaths of more than 4,000 soldiers, ten times that number of disabled veterans, and casualties and deaths of Iraqis and Afghanis probably approaching a million people. 9/11 afforded the Bush Administration the opportunity to launch a “war on terrorism” and the justification of preemptive war on any human target defined as a possible threat to the United States.The “terrorists” became the post-Cold War “international communists.” This is what the permanent war economy has come to.

Did the vision of Charles Wilson and the framers and advocates of NSC 68 bear fruit in terms of the domestic economy? The answer to this question is complicated but in the end clear. The U.S. economy is subject to cycles of growth and decay; expansion and recession; and periods of increased consumerism and low unemployment versus periods of declining product demand, lower wages, and high unemployment.

Looking at the period since World War II, bursts of increased military spending brought the U.S. economy out of the recessions of the late 1940s and 50s. The 60s economy boomed as the Vietnam war escalated before the economic crises of the 1970s. The so-called Reagan recovery was driven by dramatic increases in military spending. 1980s military spending equaled the total value of such spending between the founding of the nation and 1980.

In addition, military spending has benefited those industries, communities, and universities which have been the beneficiaries of such largesse. In our own day, Halliburton, Bechtel, and Kellogg, Brown, and Root have done quite well. For example, when Dick Cheney left his post as Secretary of Defense in 1993 to become the CEO of Halliburton, its subsidiary, KBR jumped from the 73rd ranked Pentagon contractor to the 18th.

Military spending pumped money into the economy to the advantage of selected multinational corporations and some communities. Usually recipients of defense dollars were part of what C. Wright Mills called, “the power elite,” those powerful individuals who, at the apex of government, corporate, and military institutions, influence policy. On the other hand, most citizens have not been beneficiaries of military spending.

“Indirect effects” of military spending, overwhelm the short-term stimulative effects of such spending. Military spending is “capital intensive,” that is the investment of dollars in military goods and services require less labor power to produce than the investment of comparable dollars in other sectors of the economy. Robert Pollin and Heidi Garrett-Peltier refer to spending on Iraq as a “job killer.” They estimate that $1 billion spent on investments in education, healthcare, energy conservation, and infrastructure would create anywhere from 50 to 100 percent more jobs than comparable spending on the war. They say; “Taking the 2007Iraq war budget of $138 billion, this means that upward of one million jobs were lost because the Bush Administration chose the Iraq sinkhole over public investment”(The Nation, March 31, 2008).

Further, military spending requires government to borrow money from private sources. Consequently, the more borrowing for the military, the less funds are available for non-military economic activity. Non-military spending gets “crowded out” by investment in arms.

Paralleling this, expanding investments in military reduce the resources of society that can be allocated for the production of goods and services that have use values. Military spending constitutes waste in that the resources that go into armies, navies, air forces, and weapons of human destruction cannot be put to constructive use. Looking at government spending alone, the 2008 federal budget increased by $35 billion in military spending, bringing the total to $541 billion. At the same time federal aid to state and local governments fell by $19.2 billion. The war on Iraq has already cost $522.5 billion and it was projected by distinguished economists that the total cost for the war, including paying debts, veterans benefits, and replacing destroyed equipment, will top $3 trillion (Linda J. Bilmes and Joseph Stiglitz, Washington Post, March 9, 2008, p.B01).

As a new administration enters office in the context of a deepening depression, 2009 military spending for two wars, over 700 military installations, and contracting with private armies operating everywhere, will push towards a trillion dollars. This prospective allocation of scarce government resources has to be evaluated in the context of President-elect Barack Obama’s call for a massive green-jobs economic stimulus package and bailout programs for some 40 states suffering from their own budget deficits.

The Permanent War Economy in One State

Citizens of Florida so far have spent $36 billion on the Iraq war. And, the National Priorities Project (www. national priorities.org) estimated that for one year of Iraq war expenditures the state of Florida could have provided 12.7 million people with health care, 25 million homes with renewable electricity, 575,000 music and arts teachers, 11.2 million scholarships for university students, and 613,000 elementary school teachers.

Looking at Broward County, taxpayers have paid $3.9 billion for the war so far. Instead of expenditures for the Iraq war, this money could have provided for one year the following:

-1,385,189 people with health care or

-2,760,979 homes with renewable electricity or

-90,432 public safety officers or

-62,714 music and art teachers or

-1,224,540 university scholarships or

-28,953 affordable housing units or

-2,169,806 children with health care or

-535,663 head start places or

-66,937 elementary school teachers

Andrew Bacevich summed up this tradition of permanent war in reviewing a biography of 1940s Secretary of Defense James Forrestal in The Nation (April 23, 2007):

“From Forrestal's day to the present, semiwarriors have viewed democratic politics as problematic. Debate means delay. To engage in give-and-take or compromise is to forfeit clarity and suggests a lack of conviction. The effective management of national security requires specialized knowledge, a capacity for clear-eyed analysis and above all an unflinching willingness to make decisions, whatever the cost. With the advent of semiwar, therefore, national security policy became the preserve of experts, few in number, almost always unelected, habitually operating in secret, persuading themselves that to exclude the public from such matters was to serve the public interest. After all, the people had no demonstrable ‘need to know.’ In a time of perpetual crisis, the anointed role of the citizen was to be pliant, deferential and afraid.”

It is the task of the peace and justice activists today to build a mass movement, mobilizing the citizenry to reject the role of “pliant, deferential,” and fearful citizens. The people must insist that President Obama say “no” to the semiwarriors.

Tuesday, January 27, 2009

A Sea Change in Latin American Politics

A Sea Change in Latin American Politics Challenges the “Washington Consensus”

As the Soviet Bloc began to stagnate economically in the 1980s, the industrial capitalist giants led by the United States increased pressure on poor countries to shift from state-directed to so-called “market economies.” The G7 countries, the United States, Japan, Britain, France, Italy, West Germany, and Canada, launched a campaign to demand that countries downsize their governments, deregulate and privatize their economies, and shift from producing goods and services for domestic consumers to exports. These policies, known as the “neo-liberal policy agenda” or the “Washington consensus” were promoted by the International Monetary Fund, the World Bank, the World Trade Organization., and international bankers and CEOs of the major multinational corporations.

The theory behind the neo-liberal policies was that by opening their economies to foreign investors and stimulating exports, developing and former Socialist countries would receive scarce dollars, yen, marks and other international currencies to stimulate their own development. Unfortunately for these countries the reality became radically different from the theory. For example, in Latin America, there was over 80 percent economic growth between 1960 and 1980, before the neo-liberal policies went into effect and only 9 percent growth from 1980 to 2000. For almost all countries of the Western Hemisphere economic inequality dramatically increased and the percentages of the people living in poverty rose.

By the dawn of the new century about 1/4 of Latin Americans lived in poverty (less than $2 a day). Surprisingly, statistics indicated a direct relationship between productivity growth and the percentage of the population living in poverty; productivity and poverty increased at the same time. In addition, the work that most Latin Americans did has significantly changed. From 1950 to 1990 there was a 29 percent decline of those who worked in agriculture, a modest 5 percent increase in industrial work, and a 23 percent increase in service sector employment. In the 1990s, it was estimated that almost all job creation was in the so-called “informal sector.” That is, most new job seekers were engaged in street markets, drug dealing, prostitution, unregulated sweatshops in small facilities or people’s homes, or other low-paying, unregulated work.

Despite the dramatic decline in the quality of life experienced throughout Latin America, since the 1980s, the G7 countries, the international economic organizations, and the private banks and corporations continued to promote neo-liberalism through strident rules involving borrowing and inequitable trade agreements. However, over the last decade, resistance to neo-liberalism has generated a massive anti-globalization movement.

During its early stages, grassroots groups began to protest when their governments accepted loans with conditions attached from the IMF. Indigenous people mobilized to protest international energy and other corporations clear-cutting their land to extract natural resources and at the same time destroying communities.

Then, in 1994, the Zapatistas, a largely indigenous movement in the Mexican state of Chiapas, rose-up against their government’s participation in the NAFTA trade treaty with the United States and Canada. It gained international recognition and support from opponents of neo-liberal globalization everywhere.

In 1999, a coalition of environmentalists, workers, indigenous people, and others shut down the World Trade Organization in Seattle to protest so-called “free trade” which they saw as benefiting corporations and banks, rather than people. The so-called “battle of Seattle” made it clear that a new world movement was in formation. Since then, anti-globalization activists of all sorts have met in World Social Forum meetings in Brazil, India, Kenya, Venezuela and spread to Africa, Europe, and North America. This week the latest World Social Forum is meeting again in Brazil.

The latest stage of protest against neo-liberalism is reflected in a massive transformation of politics in Latin America. In a series of elections throughout the region candidates and parties have been elected to office opposing neo-liberalism and “the Washington Consensus.” These include anti-neo-liberal governments elected in Brazil, Argentina, Uruguay, Chile, Bolivia, Ecuador, Paraguay, Nicaragua, and, the most recent U.S. target, Venezuela. While these regimes vary in their opposition to neo-liberalism, they threaten economic “business as usual” U.S. interests.

Venezuela now is transforming its own internal economic and political life while building a coalition of states to stand up to U.S. regional dominance. The Venezuelan story began when its citizens elected a former army officer Hugo Chavez to the presidency in 1998. Chavez launched a so-called “Bolivarian Revolution.” At home it included a new constitution recognizing the rights of all citizens to a job, education, health care, and basic nutrition. Since then literacy and medical campaigns have dramatically transformed the quality of life of the 80 per cent of the population that were poor. Local planning councils and Bolivarian Circles have empowered the vast majority of Venezuelans to participate in political decision-making. The government has encouraged worker managed and owned factories and has redistributed 2.2 million hectares of state-owned land to 130,000 peasant families and cooperatives to revitalize agriculture.

Finally, Venezuela has made agreements with her neighbors, to trade oil for products that they produce. For example, thousands of Cuban doctors have been working in Venezuela in exchange for valuable oil. In addition, it has worked to build a South American common market, and with others, is constructing a regional development bank. It has initiated similar ties with countries in the Caribbean and Central America.

No doubt, Venezuela’s vast oil resource has underwritten its domestic reforms and community building in the region. But the country is historically among the few which have used profits from their scarce resource to redistribute wealth, income, and power to an underclass.

The Bush administration worked to undermine and overthrow the Chavez regime, including supporting an abortive military coup against him in 2002. It tried to threaten and isolate the regime in the region the way the U.S. has tried to do to Cuba since 1960.

Given the sea change in the politics of the entire region, a wiser policy for the new Obama administration would be to support Latin American regimes that promote and guarantee their citizens economic rights. It is time to give up old and discredited foreign policies based on market fundamentalism and covert interventionism. In an article describing a letter 200 Latin American scholars wrote to President Obama urging a new US policy for the region Cynthia McClintock, Professor of Political Science and International Affairs at George Washington University wrote: that “… the key goal of our letter was to encourage President-elect Obama to consider the ‘new left’ in Latin America as part and parcel of the movement for change in the United States.”

Friday, January 23, 2009

THE BUSH YEARS: THE END OF THE REAGAN REVOLUTION

THE BUSH YEARS: THE END OF THE REAGAN REVOLUTION

Our assessment of the Bush years (2001-2008) must be grounded in an understanding of the almost thirty years of a failed ideologythat guided domestic and foreign policy. This failed vision of government and public policy has its roots in the Reagan "revolution."

Domestically the Reagan administration embraced a governmental philosophy that claimed that government can never help solve social, political, and economic problems. Rather, government was the problem. In keeping with this philosophy, Presidents Reagan, George Herbert Walker Bush, Clinton, and the last Bush reduced government by cutting social services; redistributed more of society's wealth from the majority to the tiny minority by cutting taxes for the rich; reduced funding for mass transportation and public education, and attempted to gut long-standing programs that have served the needs of the population well, such as social security. This century government became disabled such that when an enormous tragedy such as Hurricane Katrina occurred, the Bush administration was totally unprepared to come to the aid of people in need.

Twenty-first century government served the people less than government did thirty or forty years ago. The Bush administration through taxes and selective government programs tilted societal resources further toward the rich. The top 1% of wealth holders in the United States control over 42% of the country's wealth, an increase of about 10% over the 1970s. On foreign policy, Bush embraced the neo-conservative global vision. Neo-conservatism became the basis for policy in the 1980s and beyond. Basically, neo-conservatives in the Bush administration- Dick Cheney, Donald Rumsfeld, Lewis Libby, Richard Perle, and a host of others- argued that as the last remaining superpower the United States has the right and responsibility to impose its wishes, its vision of government and public policy, and its institutions on the world. If people resist, the neo-conservatives said, the United States should impose its domination by force.

9/11 became a "transformative moment". It gave the Bush administration the excuse to make war on Afghanistan and Iraq and to embark on efforts to overthrow troublesome governments such as that of Hugo Chavez in Venezuela. In addition, the transformative moment led the president to declare what became known as the Bush Doctrine, the proclamation that the US has the right to act unilaterally and militarily when it thinks a group or nation might be thinking about attacking us. In other words Bush claimed that the United States had the right to engage in military attacks peremptorily. To facilitate preemptive strikes, the Bush administration maintains about 700 military bases in 132 countries.

In the end, this administration has tried to undermine and cripple government and expand militarily all around the world. As 2009 dawns we are in the midst of an economic depression that might become comparable to the Great Depression of the 1930s with massive unemployment, growing mortgage foreclosures, and declining social services. And we are bogged down in two wars and live in a world in which most nations and peoples no longer respect the United States.

The current economic crisis and unending wars are results of Bush administration policies and a thirty year tradition of government for the rich and visions of creating a global order based on US dominance. President Obama must return to the view that government can and must help those in need. He must shift his approach from a foreign policy based on threats and military interventionism to negotiation and working with other governments in international organizations.

January 23, 2009

Sunday, January 11, 2009

The Middle East Crisis Remains the Same in 2009 as 2006

This radio commentary was prepared during the Israeli war on Lebanon in the summer, 2006. Its portrait of the main actors in the tragic circumstances of Middle East peoples remains unchanged today.

The commentary hints at the fundamental role the United States has played in the Israel/Palestine conflict, the Israeli vision of a “Greater Israel” empire, and the need for a movement of progressives, particularly among Democrats, to mobilize to end US complicity with Israel’s violent policies which victimize Palestinian peoples while continuing to expose Israeli citizens to terrorist retribution. Unfortunately, none of these core features of the Middle East catastrophe have changed.

This time the peace movement must expand its militancy demanding that the incoming Obama administration end its support of Israeli militarism and promote two independent and economically viable states in the region. HT
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ASSESSING THE CURRENT MIDDLE EAST CRISIS:
CONSEQUENCES FOR EFFORTS TO REDUCE VIOLENCE
Harry Targ

The Crisis is Upon Us

The current Middle East crisis has emerged with shocking rapidity. We have seen a seemingly unending escalation of violence against expanding civilian targets in Lebanon, Gaza, and Israel. Neoconservatives such as Newt Gingrich, Bill O’Reilly, Shawn Hannity, and William Kristol, proclaim that the war in the Middle East constitutes the onset of “World War III,” a view that is in keeping with their vision of why the United States needs to exert military power globally.

Key Actors in the Middle East Drama

To better understand the immediate causes of this Middle East crisis and its relationship to United States foreign policy the major actors in the tense drama must be examined.

First, “Political Islam” refers to those movements, primarily in the Middle East, the Gulf, North Africa, and Asia that fuse the drive for political power with religious fundamentalism. In the main, Political Islam is profoundly reactionary in terms of democracy, human rights, and economic justice. Paradoxically, Political Islam drew much of its initial support from US global policy. For example, the United States provided massive aid and training to rebels fighting against the pro-Soviet government of Afghanistan in the 1980s, including today’s enemy icon, Osama Bin Laden. In fact, President Carter began funding the creation of Political Islam in Afghanistan before the Soviet Union sent troops to that country.

Hamas and Hezbollah, allied with outside actors Syria and Iran, formed in the 1980s. They sought to capture the support of Palestinians and their allies in response to growing Israeli brutality against the Palestinian people and the corruption of the Palestine Liberation Organization. These two formations have represented terrorism and religious fundamentalism and yet at the same time have provided significant social services and a political voice for the repressed Palestinian population.

Second, we need to reflect more systematically on Syria and Iran as regional political actors with ties to Political Islam. Both countries seek to expand their influence in the region and sympathize with local Islamic militants to do so. It is clear that both Syria and Iran are targets of the US. Israel receives huge military support from the United States and the two share an interest in destroying Syria and Iran: the US wants to control oil, and Israel territory and people.

Third, the Israeli government is driven by a vision of regional hegemony and the elimination of the Palestinian people as a political force. As Noam Chomsky has argued, Israeli governments (and the United States) have always envisioned a region based on a “Greater Israel,” that is Israeli control of the politics and economics of Southern Lebanon, Western Syria, and Palestine. Crushing the growing popularity of Hamas and Hezbollah is a necessity from the vantage point of this vision and ultimately as well destroying their base of support in Syria and Iran. Like the assassination attempt of an Israeli politician in London in 1982, the recent capture of Israeli soldiers in Gaza and Lebanon provided the excuse for Israel’s brutal and massive military escalation of violence causing the deaths of hundreds of men, women, and children with no connection to Hezbollah.

Fourth, the Middle East crisis has profound consequences for the United States and the Bush administration. President Bush by word and deed has given the green light to Israel to expand its violence in Gaza and Lebanon. He has forestalled diplomatic activity to bring a halt to the violence. He even has been slow to remove US citizens trapped in the war zones of Lebanon. Further, the six month escalation of tension between the United States and Iran suggests that the former would not oppose an Israeli strike on the latter. The US would get its war on Iran without having to carry out the war itself. In the end, this Middle East crisis could give renewed intellectual justification for the neoconservative vision of a globalization of American power.

Finally, this administration seems to be increasing support for militarism in the face of growing danger of war in virtually every region of the world: the Korean, Peninsula, East and South Asia, the Middle East and the Gulf, and Latin America and the Caribbean. The Bush administration, more than every other administration since World War II, seems wedded to the unlimited use of military force as opposed to diplomacy.

It remains to be seen whether the growing worldwide protest against the Israeli war on Lebanon and US acquiescence to it will bring a desperately needed ceasefire soon and, in the future, whether the election of anti-war candidates in the fall, 2006 US congressional elections will change United States policy in the Middle East and the Persian Gulf.

Tuesday, January 6, 2009

Israeli Genocide?

January 6, 2009

Dear Editors,

Is Israel Committing Genocide?

Below is the language of Article 2 of the United Nations Convention on Genocide initiated in 1948. Is there any doubt that the government of Israel is engaging in genocidal policies against the Palestinian people in the Gaza strip?

“In the present Convention, genocide means any of the following acts committed with intent to destroy, in whole or in part, a national, ethnical, racial or religious group, as such:

(a) Killing members of the group;
(b) Causing serious bodily or mental harm to members of the group;
(c) Deliberately inflicting on the group conditions of life calculated to bring about its physical destruction in whole or in part;
(d) Imposing measures intended to prevent births within the group;
(e) Forcibly transferring children of the group to another group.

Both Israel and the United States are signatories to the Genocide Convention. However, the Bush administration is fully supportive of Israel’s policies.

President Elect Barack Obama must be called upon to condemn the Israeli killing.

Harry Targ
West Lafayette

The Bookshelf

CHALLENGING LATE CAPITALISM by Harry R. Targ

Read Challenging Late Capitalism by Harry R. Targ.