Did you know?: the real Third Rail

We are an empire – and it’s killing us. The growth of this empire is not driven by any perceived need for actual defense – it is being driven by, to use Eisenhower’s phrase, the military-industrial complex pursuing its own interests. To assure control and growth, the defense industry has located plants and materials in all 50 states. Congress critters who vote against any military appropriation, are seen as killing jobs in the district. A brilliantly conceived Catch-22 in which we spin and over which we seem to be powerless.

“. . . the record $708 billion in military spending called for by the Obama administration for fiscal 2011 will be nearly equivalent to the military spending of all other nations in the world combined. When it comes to military appropriations, the U.S. government already spends about seven times as much as China, thirteen times as much as Russia, and seventy-three times as much as Iran.. . . During the Cold War, the United States confronted far more dangerous and numerous military adversaries, including the Soviet Union.   . . . in those years, U.S. military spending accounted for only 26 percent of the world total.  Today, as U.S. Congressman Barney Frank has observed, “we have fewer enemies and we’re spending more money.” 

Where does this vast outlay of U.S. tax dollars go?  One place is to overseas U.S. military bases.  According to Chalmers Johnson, a political scientist and former CIA consultant [the US has] some 865 U.S. military facilities in more than forty countries and overseas U.S. territories. The money also goes to fund vast legions of private military contractors.  A recent Pentagon report estimated that the Defense Department relies on 766,000 contractors at an annual cost of about $155 billion, and this figure does not include private intelligence organizations.  A Washington Post study, which included all categories, estimated that the Defense Department employs 1.2 million private contractors.”


36 responses to “Did you know?: the real Third Rail

  1. Read this book: http://www.amazon.com/Confessions-Economic-Hit-John-Perkins/dp/1576753018

    It shows how our government, in partnership with large engineering and energy firms, are building a global empire in our name.


    • Hey mcoville – welcome. I just put the book on my wish list, which is getting scary long!

      They are indeed buildiing a global empire and, like all empires, will become too broad to sustain itself and will collapse. And maybe us along with it. But that’s be okay for GE and GEn’ Dynamics and McDonnell Douglas et al – they’ll just move to China.


  2. I think you have a point, but the largest growth in government spending in the next 10-20 years will be in medicare and social security. Defense is huge but, I think it has fallen as a share of the federal budget over the last 25 -30 years.


    • You’re right Bruce, the big boys are the entitlements. But whatever our military budget, my point is that it’s way way out of whack. No country needs what we have. And it eats up a lot of our best talent – designing weapons instead of windmills and it adds to a sense of ‘don’t mess with us’ that makes me feel like a bully sometimes.


  3. Ms. Holland,

    I disagree totally. I believe you are only making this case to justify the entitlements which will destroy America. Wars end. Military budgets do get cut, look at the 1920s. A lot o good that did us against Uncle Adolph, Cousin Tojo, and Brother Benito. Entitlements are forever. Dependents are forever.

    Your Party has built up a dependent class strictly for political gain. The new Roman Mob that will fight for their bread and circuses. And Washington sure is a circus right now. As the Roman said ” Si vis pacem, para bellum “.


    • So Alan, you think Social Security was created “purely for political gain”?

      Check this out:
      ” . . . [in] a 1987 study from Eugene Smolensky, Sheldon Danziger, and Peter Gottschalk. The three researchers used data from the 1940 and 1950 Censuses to extend the poverty line back to 1939. How did things look back then? Among men 64 and older, the poverty rate in 1939 was 78 percent. For women, it was 77.5 percent. But what about 1935?

      “Even … 78% would probably be a slightly conservative estimate since poverty for all persons in 1939 was considerably lower in 1939 than in 1935,” Smolensky wrote us in an e-mail. He said that by his estimates, in 1935, the poverty rate for all families was 69.4 percent. For the elderly, it could have been up to 20 percent higher. Still, the paper also notes that due to changes in the survey methodology, “data presented here for 1939 are not directly comparable to the data for later years.”


      It’s a fact check of statements by a TX politician.

      So the data are very imperfect, but not wrong. Poverty was the default position in this country. We were deeply poor as a nation. And the elderly especially lived dreadful lives. And Social f**king Security fixed that. Good enough for me.


    • Also Alan, you say “Military budgets do get cut, look at the 1920s”. In fact, we disbanded the military almost entirely after WWI. Which was why gearing up for WWII was such an enormous undertaking (and the largest govt stimulus program of all time – brought us almost 40 years of prosperity).

      It was after WWII, when we DIDN’T disarm, that’s what Eisenhower warned about. But unfortunately, he waited till his 8th year in office to say anything.


      • This is what scares me, when people start thinking that war time military spending is “the largest govt stimulus program of all time – brought us almost 40 years of prosperity”. What will the Democrats do when people hold them accountable for their failed spending plan? I only hope Obama does not follow the advice of FDR.

        Before WWII voters replaced the majority of congress with Republicans and FDR felt pressure to reduce spending and rescind some of the newly formed entitlement programs. The only reason anyone even considers FDR a successful president is WWII.

        I know your reading list is getting long Moe, but consider reading one more: http://www.amazon.com/New-Deal-Raw-Economic-Damaged/dp/1416592229, the author is a bit biased in his personal opinion of FDR but the facts he presents are undeniable.


        • mcoville – I hope Obama doesn’t chose the FDR option either – by which I assume you mean getting into a world wide war. But teh war did function as a stimulus program with government as the customer. They created all the demand.

          And in the 30’s, indeed the depression persisted, but in the midst of it, FDR put people to work so they could support themselves and thier families. He went after unemployment which by itself was a great social threat. As we know from today’s conflicts, great numbers of unemployed mean great social unrest and often violence. Plus the work they did launched the modern infrastructure we’re still depending on today. Things like TVA.

          That all mattered a lot. And it was the right thing to do. But how did the war not serve as a stimulus. And doesn’t that show that a govt stimulus can work?


          • One of the biggest reason our unemployment dropped is the number of deaths in WWII. It was not the government spending that got us out, it was the supply and demand of employees.

            Government stimulus has never had a lasting effect on the American economy, it only looks good on paper. Once it is put in placed in the real world it fails. I know this is disputable, I would love to hear your review of the book I linked above.


            • Well, I did add it to my list but to tell you the truth I’m not sure that 300 pages that are sure to make me very angry is what I need to pursue right now. However, it stays on the list – readers gave it a lot of rave reveiws, although the blurb from Walter Williams made a tad wary as I find him to be an awful shill.

              Of hte few readers who panned the book at Amazon, this comment stood out to me as it tracks exacdtly with what we’ve been talking about:

              “On a purely economic level please explain to all of us non ideologically biased folks why a stimulus that was based on fighting a necessary war (WW2) is any different from a huge domestic spending program. I can see no difference economically, it’s basically spending a lot of money building a lot of things we wouldn’t otherwise build. Actually, it’s worse because if you spend billions on infrastructure here at home we not only have created jobs and jump started the private sector, we’ve build something that we can be proud of for another century. The Hoover dam & Golden Gate bridge are awesome but imagine what we could build now if only the conservatives joined the 21st century. If we spent a fraction on cancer research as we have in Iraq we’d have it cured by now. What has happened to our priorities as a people? It’s offensive that conservative ideology has literally flushed our resources down the drain by refusing to invest in things that are good for all of civilization while giving trillions of wealth that we all participated in creating via our labor to only a few percent of the population. If wages had kept up with productivity we could all work 20 hours a week for the same pay. I can hear the name calling about now but in no way am I a communist or whatever slanderous name you will call me on the comments section. But if I sacrifice my life, my labor, shouldn’t I, or you, or anyone, be paid commensurate to my contribution? Most people in the USA have lost touch with the essence of life; they have confused the rearranging of matter (work) with living and therefore do not value the reality of their limited time on Earth but instead give in to a pre arranged script without ever asking why.”


  4. Ms. Holland,

    SS. has morphed into an unaffordable Welfare program. I wonder if even FDR would approve of what happened to it. You can say whatever you want, the unfunded liabilities ‘will’ set off a generational war in our lifetimes.

    I wish I had saved all of my material from 8 years ago when I argued with your brother liberals who defeated Bush’s reforms to SS. At one time I had all of the facts and figures. I could probably research it all again for you. However, just like 8 years ago facts will not matter. You folks on SS ‘will’ not let anything touch your SS. I know the drill, I know every argument and then some that you will make. Tax the rich, the estimates are wrong, etc. You have been lied to big time by your leaders. Even Bernie Madof could not pull off a Ponzi scheme like SS.

    But never fear, even when Republicans regain Congress, Geezer Power will defeat all attempts to save SS. Gen Xers are really the ones who will get the shaft. As always,,,Prove me wrong. Cite facts and figures. I am an old hand at this.


    • [I know every argument and then some that you will make. Tax the rich, the estimates are wrong, etc.]

      Alan, thosee aren’t the arguments I’ve ever heard. The two things that fix SS – and they do fix it – are raise the cap and start edging the retirement age up. We did it before and bought ourselves another 30 years. And since SS is good till the mid 2030’s, we can do it again and be set till maybe 2060.

      Well before that time though, the Baby Boomers will have finished their journey through the system. It will never be as stressed as it will be for the next 30 years.


      • That being said, health care IS a problem. And until we move to Medicare for all, we’re sunk on that one.


        • medicare for all will only decrease the level of care you receive and push the cost onto others. There is a better way, sadly though they do not include giving more money to Washington so I have yet to find a Democrat that will even consider them.


          • With Medicare for all, everyone will be paying in and at a higher rate than they pay today because they wouldn’t be paying today’s insuracne rates. Medicare for all would spread the risk by bringing young healthy people into the program. Economies of scale could be implemented.

            And I am a broken record about this but as someone on Medicare, it is the best damn insurance I ever had. And far less paperwork. And I no longer have to haggle iwth the insurance company to get approval for a procedure or find an approved doctor. Medicare -for all the fraud and abuse – is one smooth running system. And the fraud and abuse is rampant because we just don’t do enforcement. That’s a failure of will, not of hte program.


            • The Center Square

              Here’s my drive by shooting, in response to this above dialogue.

              I have not read “New Deal or Raw Deal?: How FDR’s Economic Legacy Has Damaged America,” but I start by questioning the premise. During the decades that followed the New Deal, America has established itself as the world’s foremost power, and been on a mostly uninterrupted prosperity boom. We have taken on all political, military and ideological foes and prevailed. During the five decades following the New Deal, we won WWII and then paid off our huge debt from it. From there forward until the 1980s, we managed to exist with roughly balanced budgets and minimal federal debt. This represents damage???
              As for the future of Medicare and Social Security, the fix isn’t that difficult. Raise the age threshold, tighten our grip for a few decades while the boomers all get diabetes and Alzheimers, and we’re through to the other side.
              The criticisms of these programs are almost entirely ideological. That doesn’t mean they are unfounded, but take away the solvency debate — which is addressed by the age threshold — and the remaining debate is entirely ideological.


              • Well put. I’m pretty shocked by the widespread (ideological as you put it) belief that it is okay to have this country deep in poverty with lots of sick people and children with poor nutrition. This is what we’d have without government programs, whereby we address these problems as a people. Of course they’d deny that they believe these things. Their argument that somehow these things would not come to pass if only the market were free and taxes were lower is specious and nothing but a thinly vieled pretense at giving a damn.

                In spite of the recent anti-FDR books (what’s with that?) he was a giant by any measure. And the American people sure liked him! Elected prez four times? He was the prez the American people wanted.


                • Moe, I have to respectfully disagree with you. I have faith in the American people to take care of those in need, we do not need the government to do it for us and it is lazy to prefer the government take the place of personal effort in taking care of our neighbors.

                  There is plenty of evidence that in the past neighborhoods came together to help each other in times of need. This all stopped after the “new deal” because we became brainwashed in school that the government will take care of our neighbor and that we do not need to do anything. A lot of people look at a homeless person and instead of stopping and offering help, the think to themselves “why does that person not go to a shelter?”. We have become passive in our response to help others because the government has conditioned us this way.

                  As for FDR being so popular, let me ask you this… Why did the people vote for a constitutional amendment to make sure we never had a president that could serve more than 2 terms? I mean, if they loved him so much why not hope to have another leader like him in the future.


                • Oh boy mcoville, plenty to chew on there.

                  First of all, if you have faith in the American people to take care of themselves, why oh why were millions of Americans living in profound poverty before the New Deal?

                  [There is plenty of evidence that in the past neighborhoods came together to help each other in times of need]

                  I agree. There are endless stories of that happening and it still happens and it’s still wonderful. But heart warming stories are never the whole story. (Did you ever hear the phrase ‘history is written by the winners’? The ones who fell between the cracks – and they were millions including children – weren’t being celebrated in myth and song.

                  Further, in 1929, the year of the crash, the US population was only 121 million and we were still mostly an agricultural society. Today we are 308 million, well over twice hte size, mostly urban and instead of agriculture we have agribusiness.

                  And we are still people taking care of people – we do it differently – we combine our forces through our tax contributions and that way reach out to the less fortunate among us or those who are only down on thier luck.

                  As for the 2-term law after FDR, it was because we feared – as we always have – any move toward kings. We threw one of those over a few centuries back and have been vigilant since. It wasn’t becuase people didn’t love FDR, they did. It was because sensible legislators knew it wasn’t right to have the same prez for 16 years. It’s why WAshington stepped down voluntarily after two terms.


                • Moe, well thought out response and I appreciate your point of view. I will try and respond to your points briefly.

                  1. There are millions of Americans living in poverty after the new deal, its called life. There will be people living in poverty for one reason or another, always has been and always will be. The best we can do is help those we come in contact with that want our help.

                  2. Very few people feel they are helping others by paying their taxes. I never heard someone say “I want to pay more in taxes to help people”. Taxes as charity is amoral. Let a person keep their money and teach them to support a charity of their chosen and they will get more out of it than sending money to Washington and let the government worry about the needy.

                  I guess we will have to agree to disagree. I will end with one last thought on this. You learn more humility and compassion when you are personally involved in helping another human and, in my opinion, the current system we have of taxes to fund charity removes the personal interaction that most benefits both sides.

                  I look forward to reading more on your blog and hope I can contribute to the discussion.


                • Your contribution is most welcome. And we will disagree – I can see that. One thing for you to chew on – where you see ‘charity’ I see ‘the common good’. When there aren’t poor children running around on the streets as in Dickens’ day, we are all the better for it. Our quality of life is adversely affected by a large population of poverty stricken. That’s a bit too South American for me!


    • Alan
      Right now i have CSpan on and am listening to a panel at the Peterson Foundation (conservative I beleive) and a Bush SS trustee is talking about the entitlements and making the point htat yes, health care and Medicare are a serious problem, but SS is very fixable and really isn’t an issue. He said it’s really fine.


  5. The Center Square


    Here’s another third rail: taxes. But, I’ve caused you to read enough of my rantings on that subject.


  6. Ms. Holland,

    You are trusting Liberal Accounting. The same accounting that said Obama-care would not add to the deficit. The same accounting that President Obama just used to find $50billion in free money for his latest economic stimulus and tax cut for the middle class. He would take it out of waste. The same accounting that said Obama’s stimuli would keep unemployment under 8%.

    SS and Medicare are underfunded entitlements. Putting more people on Medicare will sink it even faster. Obama has not been right on anything involving numbers, yet.

    Let me tell you about your easy pain free answers to fixing SS. I am 54 and still working. Your answers are really amusing to me. No they really are.

    I have to go to 66 and a half. I work an outside physical job. I’ll be surprised to make it to 62. I know a whole lot of guys in my age group who are already on disability. I laugh when I hear the age raised. I think it is 70 for those behind me. You will have to raise it to 95 and nobody will ever reach that age. In this Obama depression a lot of people are going early. Did you account for them?

    No, no, no, it gets better. You will just raise the cap. You are already overtaxing the rich to pay for all of the other Obama crap. Wait, wait, I forgot, raise the cigarette tax. Sure everybody will give up smoking, you’ll lose that revenue and the non smokers ‘will never’ die.

    ” Well before that time though, the Baby Boomers will have finished their journey through the system. ” Medical science will keep us boomers alive forever. We will be watching tv with our depends on, and we will suck the system dry. I saw a woman who was 107 years old. She was not a happy camper.


    • Just one quick thing for now Alan. I think the top SS age right now is 67 and it would take new legislation to raise it higher. But I don’t think it should go over 68 in any case. There are people out there thinking ‘outside the box’ and some interesting new proposals are being tossed around. WE’ll be okay as long as we keep working on it.

      The military and the police and so many other gov’t workers retire at very young ages with very generous retirement packages. Regular DC bureaucrats work to the same age as us, but I guess those two I mentioned are considered to be in a diff category. But still, I knew a woman who took full retirement from the police dept at 52; she was the Chief’s secretary. Something needs fixin there!

      By the way Alan, Obama has not raised any taxes and you know it.


      • Those retirements are protected by the same unions that have our president by the “you know what”. The best part is, all the jobs Obama claims to create are more government union jobs that will make those retirement liabilities even worse in the future.


  7. For what it worth, I think the assertion that wars end is debateable since the end of the second world war. We went with in 5 years to Korea, Vietnam and the cold war in some form or another from 1945 to 1990 or so. After a short ten years, the war on terror began, and suspect it is a conflict that may never end. If we end up drawn into a war between Iran and Israel God know how long it may last.


    • Which brings us tidily back to the original point of the post. Our military is obscenly large. But today’s conflicts don’t bring the stimulus benefits of grearing up for WWII because htey were starting from zero; our weapons spening has – as you correctly remind us – been ongoing ever since.

      I don’t even want to think of Israel/Iran. That would truly launch the new Hundred Years War.


  8. America may posses a domineering military empire, but the sad thing is that this vast power went from being a neccessity to something used for the gain of a few at the expense of people’s lives.

    Moe, you mentioned in response to Alan that after WWI the United States demilitarized, as did most of the West, but refused to do so after WWII.
    However, the act of total disarmanent and the subsequent pacifism, allowed violent factions that rose to power in Germany, Italy, and Japan to engage in aggression and build their military power to the point where it required the deadliest war in human history to put them down. The United States did not demilitarize after WWII because it had learned, as did the rest of the world, that vigilance is indeed the price for peace.

    One of John Locke’s old principles was, as I’m sure you know, that in an “ideal” society, people would control themselves, order would prevail, and government would not be needed. However, because there is no such thing as this society, and that there are always evil or stupid people that will harm others, a group of people must devote themselves to maintain order by the threat of force for the good of all, thus, government.

    I believe that the same principle holds true for nations: in an ideal world, national governments would control their own impulses, would respect the rights of each and every nation, and therefore militaries would not be neccesary. But, since such a world is but a dream (although a noble one) nations, like individuals must be prepared to thwart evil or aggressive
    governments by force to preserve their rights and the rights of others. Wars may end, but if most nations are prepared to thwart any and all aggressors, many wars that could occur otherwise will not occur at all.

    WWII destroyed European hegemoty and removed European states from the top of the global pecking order. Many hoped that the new world that emerged from the ashes, through the agency of the United Nations, would be one of peace and of international order where the only war would be a war to prevent an even worse war.

    Nations would maintain decent standing military forces only as a detterence to war or to nip a worse conflict in the bud. Alas, the specter of
    Communism, as well as that of any and every other ideology that teaches aggression in the name of world domination ruined that dream. America was the only nation of great strength in a position to oppose this self-righteous and intolerant ideology, as its champion, the Soviet Union made the expansion of this ideology as its primary pillar of foreign policy. The
    Soviet Union was also in a position to quickly take over Europe. Under this grim reality, the USA assumed the responsibility of world leadership.

    In this period, from approximately 1945-1991, America led the Western world in a primarily defensive struggle, but, realizing that it could not wage a defensive war forever, also made moves for the collapse of Communism. It was during this period that the global military-industrial empire was built. During this time, high military spending was the order of the day, as was the increasing entanglement between the government and numerous corporate interests. The most important corporate interests in this age of hostilities were the defense and weapons industries, as well as the industries controlling strategic resourses for the production and use of weapons (eg, oil).

    To me, all of this was legitamate and wholesome for that period, but the American Empire is not wholesome for this period. To me, the story of the “Evil American-Corporate Empire begins with the fall of the Soviet Union.

    When the Soviet Union collapsed, the greatest threat to the Western ways of life died with it. Given this, it was assumed that the noble ideas expressed nearly half a century before could be realised, where different nations and their ideologies could coexist peacefully. All of those far-flung military instalations of the USA government where no longer necessary for national defense, as there was no major threat to the American way of life. NATO (and to a lesser extent NORAD) had lost its raison d’etre with the collapse of its main antagonist.

    By all that is right and reasonable, the USA should have slowly lowered its military budget and withdrawn from areas of the world where there is little or no critical American interests, as did most other Western nations. Unfortunately, corporate groups had encroached on many of these regions and pressured the US government to maintain a presence there to
    maintain their interests. In addition, many conservatives these days seem to tout “American Exceptionalism” and “spreading liberty to the oppressed” to a level that is eerily reminescent of “Master Race” and “the White Man’s Burden”.

    Thus began the American Empire, an entity forged out of an evil neccesity that evolved to deny fundemental American principles.

    There is nothing deeply wrong or ill about your nation or its creeds, Moe. All that is wrong is that some of the principles that built the old America have been forgotten. Were the USA to remember Washington’s words, “…peace, commerce, and honest friendship with all nations, entangling alliances with none…” , many of America’s problems would, I hope, rapidly disapear.


  9. Great comment DID. I may promote it to the front page if that’s okay with you – your point about the entrenchment after the cold war is right on – I hadn’t seen that myself until you described it. We had that military industrial complex before for sure and we had a ginormous military before, but the change from defense to profit indeed seems ot have happened after the Soviet Union collapsed. Another consequence of that momentous event was the anxiety that crept into the culture in the absense of an official enemy – that has been expressed since in any number of ways, not all of them good!


    • Thanks, I would be honoured if this went on the front page.

      I just hope that it isn’t to late for America to come to its senses. Hopefully the USA can detatch itself from its unwanted military-economic empire without causin great damage to itself. Those corporate groups, shady or not, are becoming increasingly vital to the American economy.


  10. Pingback: Food for thought on the eve of 9/11 | Whatever Works

  11. A small factual point. During Franklin Roosevelt’s term (according to Wikipedia) the democratic party never lost control of congress. The republicans obtained a majority in 1946 after Truman was president.


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