MAKE JOBS, NOT WAR ... by The Cosmic Messenger

With dismal economic numbers emerging lately, it has become fashionable among Washington insiders to try and reshape the unpleasant data by suggesting the widening U.S. economic deficit is manageable. Don't believe this rhetoric and consider the source. Our two top elected leaders, President Bush and Vice President Cheney are suggesting we stay the course with such policies as permanent tax cuts for the super rich, monetary stimulus from the Federal Reserve and investing in war. However, those benefits have peaked while leaving the nation with a projected $440 billion dollar deficit.

The United States stands at the crossroads of financial solvency and its citizens must decide if a different approach to economic policy is necessary to avoid burdening our children with debt for well into the future. At stake in November will not only be the choice of a President but deciding whether more military spending can sustain the economy through the current downturn or directing government investment toward the American middle class through job creation and improvements to domestic infrastructure.

Economists have described the worsening of 2nd quarter activity in 2004 as a temporary "soft spot" and expect positive progress to resume again in the near future. Although technically not considered a recession there is cause for alarm. Industrial production, employment and consumer spending have all flatlined. If this trend were to continue or spike into deeper negative territory over the next several months, measures will have to be taken to energize the system of production, distribution and consumption. The current decline of the business cycle couldn't have come at a worse time for the Bush administration as they seek affirmation from voters their economic policy the past four years is worthy of reelection. My guess is they'll propose nothing new in the interim between now and November hoping to stabilize the situation with confident rhetoric.

If returned to office, Bush would likely opt to lift the economy from further stagnation without deviating his approach by accelerating expenditure for the enterprise of armed conflict. Interest rates cannot be pared further if the government expects to attract foreign purchasers of our skyrocketing financial obligations. Although home financing rates could dip slightly lower as occurred recently, there is little stimulative effect left in this area as domestic consumers faced with rising debt levels are unwilling to take on additional liability. By intervening in the economic slowdown with increased government spending for war, Bush would be employing a philosopy known as "Military Keynesianism"to perk up the economy. It's appeal is targeted towards his Republican constituients who would benefit the most from this method according to journalist Andrew Gumbel of The Independent UK.

"Instead of growing the government in general - pumping resources into public works, health care and education, say, which would have an immediate knock-on effect on sorely needed job creation - the policy focuses on those areas that represent obvious conservative and business-friendly constituencies. At the same time, it fits into the broader ideological goals of the administration because they can paint it as part of a national emergency, the fight against terrorism, the fight against Saddam Hussein, and so on."

Kent Sims, a San Francisco economic consultant and public policy expert agrees with Gumbel's assertion and considers the plan inept.

"The administration is conducting a highly irresponsible fiscal policy. The chosen weapon for dragging the economy off the floor - now that an election is coming - is the deficit. Military expenditure is usually the least effective of short-run ways of spending money, because it doesn't build infrastructure that give you returns over time. But it does create a short-term lift."
Bush's reliance on "Military Keynesianism" is nothing new and the most recent example of its utilization was during the Reagan administration when "talk of the Evil Empire and communist threats from Central America became an excuse to ratchet up the military budget", Gumbel claims. More significant than Presidential rhetoric though, is a force described as the "Iron Triangle" formulating policy dedicated to insuring military spending takes priority over outlay for domestic social costs. This axis consists of an interlocking relationship between Congress, the Pentagon and defense industries backed by conservative think tanks who provide the rationale for what has become known as the "Arms Lobby."

Disinfopedia, an internet encyclopedia of people, issues and groups shaping the public agenda and a project of the Center for Media & Democracy summarizes this complex dominating government today.

"Each major element of the George Walker Bush administration's national security strategy -- from the doctrines of preemptive strikes and "regime change" in Iraq, to its aggressive nuclear posture and commitment to deploying a Star Wars-style missile defense system -- was developed and refined before the Bush administration took office, at corporate-backed conservative think tanks like the Center for Security Policy, the National Institute for Public Policy and the Project for a New American Century. Unilateralist ideologues formerly affiliated with these think tanks, along with the 32 major administration appointees who are former executives with, consultants for, or significant shareholders of top Defense contractors, are driving U.S. foreign and military policy. Exploiting the fears following 9/11, and impervious to budgetary constraints imposed on virtually every other form of federal spending, the ideologue-industry nexus is driving the United States to war in Iraq and a permanently aggressive war-fighting posture that will simultaneously starve other government programs and make the world a much more dangerous place."

Corroborating this contention was the announcement in July a group of neoconservative foreign policy hawks had reinstituted an organization known as the "Committee On The Present Danger." (CPD) The group, which had two successors dates back to 1950 and has provided an influential voice lobbying Presidents Nixon, Ford, Carter and Reagan about threats posed by Communism. Current CPD III members favor expanding the war on terrorism to neighboring countries such as Iran, Syria and Saudi Arabia. All are aligned with the policies of the Project For The New American Century (PNAC) whose past alumni include Donald Rumsfeld and Richard Cheney.

The ability of groups like The "Committee On The Present Danger" and "The Project For The New American Century" to infiltrate the White House both from within and externally demonstrates how budgeting decisions have been hijacked by right wing ideologues intent on channeling funds to support the military/industrial union at the expense of the domestic needs of U.S. citizens.

Their arguments for fighting a global war on terrorism unilaterally has helped undermine public confidence in the economy as Americans witness a growing national deficit and rising interest rates. Jeffrey Sachs of the Earth Institute at Columbia University feels the budget surplus from the Clinton years has been wasted needlessly and an expanding deficit will end cheaper home mortgages and auto loans.

A report released in March by a task force of nine national security experts describes where military budgeting has gone under the Bush administration and how present trends are unlikely to change. Titled, "A Unified Security Budget For The United States," it reveals much of the defense spending is wasteful and directed towards projects for building weapons totally unrelated to terrorism threats confronted by the United States today.

"The nature of today's threats, according to the report, should, among other things, permit the Pentagon to reduce the pace of investment in the next generation of conventional weapons, such as fighters, helicopters, ships, submarines, and tanks, where the U.S. already enjoys a substantial technological edge over any conceivable adversary. Most of these weapons were designed for war against the Soviet Union. In addition, the report calls for stopping deployment of the national missile defense (NMD) system until the technology is proven, reducing the U.S. strategic nuclear arsenal, closing unnecessary military bases, and overhauling the Pentagon's financial management operations."

The war on terror has become a convenient means for the arms industry and war proponents to pack the defense budget with appropriations whether legitimate or not. In an election year, indications are both the President and Congress are listening. Since the start of August, Bush and his Cabinet members have indicated they favor policies which perpetuate building Cold War weapons systems profitable for defense contractors. They agreed to upgrade an early warning radar system in Greenland, a component of an antimissile system which critics say is inconsistent and unnecessary in the age of suitcase bombs. Also, they've proposed opting out of international nuclear treaties while advocating building tactical, miniature atomic weapons to the delight of the bomb manufacturers. They justify these actions by citing the nuclear threat from Iran pleasing think tanks who favor expanding the Middle East war to that country.

Whoever assumes the office of the Presidency in January will be faced with the unenviable task of reducing government spending, lowering the deficit and returning the country to a balanced budget. Cutting a pork barrel defense budget to limit appropriations only necessary for ongoing efforts in Iraq and Afghanistan would be a good start. However, this is unlikely because President Bush has ignored the 911 Commission's recommendation to appoint an intelligence director with budget authority over defense spending. In addition, his nomination of Porter Goss as CIA director signals his desire to place someone who won't challenge his channeling of budget money to contractors who support his war goals.

What would John Kerry do different ? Hopefully, he would limit the influence of the "Iron Triangle" to formulate policy and return the United States to rebuilding America's facilities and capital equipment for job growth in this country. In, "Taking The Rich Off Welfare," a book published in 1996 the authors assert building unnecessary weapons is wasteful and contributes nothing toward the long term stability of the economy.

"If new weapons systems are nothing more than make-work programs, they're really inefficient ones. A 1992 Congressional study estimated that shifting money from the Pentagon to state and local governments would create two jobs for every one it eliminates. Building weapons we don't need is so wasteful that the economy would probably be better off if we just paid people the same money to stay at home. The Congressional Budget Office concluded that a billion dollars spent on successfully promoting arms exports creates 25,000 jobs, but if that same billion is spent on mass transit, it creates 30,000 jobs; on housing, 36,000 jobs; on education, 41,000 jobs; or on health care, 47,000 jobs. Aside from the cost, using federal money to prop up military contractors creates a disincentive for them to convert to civilian products. Shifting Pentagon funds to urgently needed domestic uses would be good for both the US and the rest of the world."

Aside from controlling defense dispersals, Kerry has several other options he could exercise which are contrary to Bush's present methods. Robert Kuttner, editor of the American Prospect magazine argues tax reform on corporate profits could bring in $200 billion annually by eliminating domestic/foreign tax havens and giving the IRS the tools to enforce them. Other proposals by Senate Democrats would reinstate the top marginal tax rate back to 39.6% and restore the estate tax.

The Bush approach to stimulating the economy has focused on unproductive methods based on war spending and tax cuts to people who bank the savings rather than using it for consumption. The consequence has been a decline in national, state and local services while creating red ink for future generations to come. Jobs are disappearing for Americans while the future of such programs as Social Security and Medicare are in jeopardy. We've seen what Bush can do. Now voters must demand from John Kerry alternatives to the economic quagmire that's embraced us all. We probably won't learn his answers until the September and October Presidential debates.