Friday December 19th, 2014, 11:32 am (EST)

The Republican Candidate (Part Five and Last)

The articles introduced in yesterday’s reflection, on February 14, were written in the last two or three days.

More than two weeks ago, on January 27, 2008, the digital publication Tom Dispatch reproduced an article translated for Rebelión by Germán Leyens: “Why the Debt Crisis is Now the Greatest Threat to the American Republic” by Chalmers Johnson. This American author has not been awarded the Nobel Prize, as has Joseph Stiglitz, the famous and well-known economist and writer, or even Milton Friedman himself, who inspired neoliberalism and led many countries down that disastrous path, including the United States.

Friedman was the most intensive advocate of economic liberalism opposed to any government regulations. His ideas nurtured Margaret Thatcher and Ronald Reagan. An active member of the Republican Party, he advised Richard Nixon, Ronald Reagan and Augusto Pinochet, that man with a sinister story. He died in November of 2006 at the age of 94. He wrote numerous works, among them Capitalism and Liberty.

When I refer to Chalmers Johnson’s article, I am strictly abiding by the irrefutable arguments he used. I use the method of selecting essential paragraphs textually.

Going into 2008, the United States finds itself in the anomalous position of being unable to pay for its own elevated living standards or its wasteful, overly large military establishment. Its government no longer even attempts to reduce the ruinous expenses of maintaining huge standing armies, replacing the equipment that seven years of wars have destroyed or worn out, or preparing for a war in outer space against unknown adversaries. Instead, the Bush administration puts off these costs for future generations to pay –or repudiate.

This utter fiscal irresponsibility has been disguised through many manipulative financial schemes (such as causing poorer countries to lend us unprecedented sums of money), but the time of reckoning is fast approaching.

There are three broad aspects to our debt crisis. First, in the current fiscal year (2008) we are spending insane amounts of money on “defense” projects that bear no relationship to the national security of the United States. Simultaneously, we are keeping the income tax burdens on the richest segments of the American population at strikingly low levels.

Second, we continue to believe that we can compensate for the accelerating erosion of our manufacturing base and our loss of jobs to foreign countries through massive military expenditures…

Third, in our devotion to militarism, we are failing to invest in our social infrastructure and other requirements for the long-term health of our country…

Our public education system has deteriorated alarmingly. We have failed to provide health care to all our citizens and neglected our responsibilities as the world’s number one polluter. Most important, we have lost our competitiveness as a manufacturer for civilian needs –an infinitely more efficient use of scarce resources than arms manufacturing…

It is virtually impossible to overstate the profligacy of what our government spends on the military. The Department of Defense’s planned expenditures for fiscal year 2008 are larger than all other nations’ military budgets combined. The supplementary budget to pay for the current wars in Iraq and Afghanistan is in itself larger than the combined military budgets of Russia and China. Defense-related spending for fiscal 2008 will exceed $1 trillion for the first time in history. The United States has become the largest single salesman of arms and munitions to other nations on Earth…

The numbers released by the Congressional Reference Service and the Congressional Budget Office do not agree with each other…

There are many reasons for this budgetary sleight-of-hand—including a desire for secrecy on the part of the president, the secretary of defense, and the military-industrial complex—but the chief one is that members of Congress, who profit enormously from defense jobs and pork-barrel projects in their districts, have a political interest in supporting the Department of Defense…

For example, $23.4 billion for the Department of Energy goes toward developing and maintaining nuclear warheads; and $25.3 billion in the Department of State budget is spent on foreign military assistance…

The Department of Veterans Affairs currently gets at least $75.7 billion, 50% of which goes for the long-term care of the grievously injured among the at least 28,870 soldiers so far wounded in Iraq and another 1,708 in Afghanistan.

Another $46.4 billion goes to the Department of Homeland Security; $1.9 billion to the Department of Justice for the paramilitary activities of the FBI; $38.5 billion to the Department of the Treasury for the Military Retirement Fund; $7.6 billion for the military-related activities of the National Aeronautics and Space Administration (NASA); and well over $200 billion in interest for past debt-financed defense outlays. This brings U.S. spending for its military establishment during the current fiscal year (2008), conservatively calculated, to at least $1.1 trillion.

Such expenditures are not only morally obscene, they are fiscally unsustainable. Many neoconservatives and poorly informed patriotic Americans believe that, even though our defense budget is huge, we can afford it because we are the richest country on Earth… That statement is no longer true. The world’s richest political entity, according to the CIA’s World Fact Book, is the European Union. The EU’s 2006 GDP was estimated to be slightly larger than that of the U.S. However, China’s 2006 GDP was only slightly smaller that that of the U.S., and Japan was the world’s fourth richest nation.

A more telling comparison that reveals just how much worse we’re doing can be found among the “current accounts” of various nations. The current account measures the net trade surplus or deficit of a country plus cross-border payments of interest, royalties, dividends, capital gains, foreign aid, and other income. In order for Japan to manufacture anything, it must import all required raw materials. Even after this incredible expense is met, it still has an $88 billion per year trade surplus with the United States and enjoys the world’s second highest current account balance. China is number one. The United States, by contrast, is number 163 — dead last on the list, worse than countries like Australia and the United Kingdom that also have large trade deficits. Its 2006 current account deficit was $811.5 billion; second worst was Spain at $106.4 billion. This is what is unsustainable…

Our excessive military expenditures did not occur over just a few short years. They have been going on for a very long time in accordance with a superficially plausible ideology and have now become entrenched. This ideology I call “military Keynesianism” — the determination to maintain a permanent war economy and to treat military output as an ordinary economic product, even though it makes no contribution to either production or consumption…

The Great Depression of the 1930s had been overcome only by the war production boom of World War II…

With this understanding, American strategists began to build up a massive munitions industry, both to counter the military might of the Soviet Union (which they consistently overstated) and also to maintain full employment as well as ward off a possible return of the Depression. The result was that, under Pentagon leadership, entire new industries were created to manufacture large aircraft, nuclear-powered submarines, nuclear warheads, intercontinental ballistic missiles, and surveillance and communications satellites. This led to what President Eisenhower warned against in his farewell address of February 6, 1961: “The conjunction of an immense military establishment and a large arms industry is new in the American experience” — that is, the military-industrial complex.

By 1990, the value of the weapons, equipment, and factories devoted to the Department of Defense was 83% of the value of all plants and equipment in American manufacturing…

Even though the Soviet Union no longer exists, U.S. reliance on military Keynesianism has, if anything, ratcheted up…

Devotion to military Keynesianism is, in fact, a form of slow economic suicide…

The historian Thomas E. Woods, Jr., observes that, during the 1950s and 1960s, between one-third and two-thirds of all American research talent was siphoned off into the military sector…

Between the 1940s and 1996, the United States spent at least $5.8 trillion on the development, testing, and construction of nuclear bombs. By 1967, the peak year of its nuclear stockpile, the United States possessed some 32,500 deliverable atomic and hydrogen bombs…

Nuclear weapons were not just America’s secret weapon, but also its secret economic weapon. As of 2006, we still had 9,960 of them (of the most modern ones). There is today no sane use for them, while the trillions spent on them could have been used to solve the problems of social security and health care, quality education and access to education for all, not to speak of the retention of highly skilled jobs within the American economy…

Our short tenure as the world’s “lone superpower” has come to an end.

Today we are no longer the world’s leading lending country. In fact we are now the world’s biggest debtor country, and we are continuing to wield influence on the basis of military prowess alone.

Some of the damage done can never be rectified.

There are some steps that this country urgently needs to take. These include reversing Bush’s 2001 and 2003 tax cuts for the wealthy, beginning to liquidate our global empire of over 800 military bases, cutting from the defense budget all projects that bear no relationship to the national security of the United States, and ceasing to use the defense budget as a Keynesian jobs program. If we do these things we have a chance of squeaking by. If we don’t, we face probable national insolvency and a long depression.

In an Internet conference about Johnson’s work, the answer is already designed by him. What does he say? Something which I shall explain in a very brief summary:

Johnson is arguing that the United States is its own worst enemy. ‘Sooner rather than later, he assures us, the arrogance of the United States will result in its downfall’. Johnson’s book is largely made up by independent chapters on a number of vaguely related subjects.

“The time to avoid financial and moral bankruptcy is short”. Later, he arrives at the following conclusion: “We are on the edge of losing democracy in the name of holding on to our empire”. Johnson’s work is described as “polemical”…While many of us have become insensitive to the White House’s atrocities, Johnson’s indignation with the Administration –its torture memoranda, its disdain for free public information, its mockery of established treaties– is vivid. This could be due to his conservative background: Marine lieutenant in the 50’s, CIA adviser from 1967 to 1973 and a long-time advocate of the Vietnam War. Johnson became horrified by militarism and American interventionism late in the game. Now he is writing as if he would like to make up for lost time. The most outstanding of Johnson’s contributions to the debate about the American empire is his documentation of the vast network of U.S. military bases overseas…

“Many years ago we were able to trace the expansion of imperialism by tallying up the colonies’, writes Chalmers Johnson in Nemesis: The Last Days of the American Republic. ‘The American version of the colony is the military base…”

Nemesis is a book about hard power. By comparing the far-flung U.S. bases with Roman garrisons, Johnson hypothesizes that things haven’t changed much since the days of Caesar and Octavius. But with nuclear weapons scattered among the great and the lesser powers, military might can only achieve mutual destruction…Our troops are besieged.

Each one of Johnson’s erudite chapters teaches as much as it disturbs. But his underlying moaning about the death of democracy lacks analytic strength. Johnson looks incredulously at ‘those who believe that Washington’s governmental structure today is in any way similar to that which was sketched out by the Constitution of 1787.

Such pessimism seems exaggerated. The Republic has survived Richard Nixon and J. Edgar Hoover, and democracy, despite the blows it has received, will also survive Bush.

The arguments for concretely answering the article signed by Johnson on January 27th require more than a declaration of faith in democracy and freedom. Johnson did not invent the arithmetic that even a sixth grade student knows; nor was it invented by the great Chilean poet Pablo Neruda, also a Nobel Prize Laureate. He was very close to not getting his university degree: his biographer tells us that he was constantly asking how much 8 times 5 were; he could never remember that it was 40.

Several months ago, while carefully analyzing more than 400 pages of the translation of the memoirs of Alan Greenspan who for 16 years was the Chairman of the Federal Reserve of the United States, The Age of Turbulence –about which I promised to write some reflections and it is already water under the bridge– I learned about the secret of his enormous worries: what is beginning to happen today. In essence, I clearly understood the consequences, so terrible for the system, of printing paper bills and spending with no limits.

I deliberately did not confront any of the candidates from both parties on the very delicate subject of climate change to avoid disturbing illusions and dreams. Publicity does not affect the laws of physics and biology. These are less understandable and more complicated.

I expressed a few months ago the certainty that the most knowledgeable person on the subject of climate change and the most popular would not be running for president. He had already been a candidate and victory was snatched from him as the result of a scandalous fraud. He understood the risks of nature and politics. Obviously, I refer to Albert Gore. He is a good barometer. We have to ask him every day how he slept. His answers would doubtlessly be useful to the desperate scientific community which desires the survival of the species.

In my next reflection I will deal with a subject of interest to many compatriots, but I won’t give any hints.

I apologize to the readers for the time and the space that I took for five days with the Republican Candidate.

Fidel Castro Ruz
February 15, 2008

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