(February 10, 2012: This is a re-write of the original as many readers on the Internet are finding their way to this article. The points are the same as before, but now written for better readability. Also, with infographic courtesy of militaryeducation.org at the bottom of this post.)
After having won the Cold War, the U.S. has embarked on a global grand strategy of “full spectrum” domination. The U.S. continue to expand her military footprint in countries where no prior troop presence before, adding automatically Iraq and Afghanistan through recent wars. Below is the map of U.S. military bases around the world as of 2008 (source: From the Left). The yellow colored countries represent planned base expansions under negotiation. In our human history, no civilization has ever been so dominant. Glimpse at the map and awe at this awesome power!
Is this footprint sustainable? Former president Dwight Eisenhower warned his fellow Americans of the potential for the military industrial complex growing out of control. His fear was it becoming too strong a political force in America such that it would indulge in maintaining its size and influence at the expense of other needs of society. At $700 billion a year (excluding the recent war costs), and considering the the $13 trillion now nearing $15 trillion national debt, Eisenhower couldn’t have been more right. The U.S. either cut back on spending, increase taxes, or print more USD. There aren’t many other options.
The U.S. have also been trying to find other creative ways to offset that cost. In the last decade, Japan has been increasingly pressured to shoulder some of the cost as “host nation support.” Think about that for a second. Imagine if the United States is occupied and is forced to her occupier. Sooner or later, the Japanese will question that arrangement. Is 100 years long enough? 1000 years?
In a recent NPR: Talk of the Nation interview titled, “Burdens Of War Unevenly Shared In U.S.,” Ted Koppel observed that the Iraq and Afghanistan wars were seemingly magically paid for without much backlash from the American public.
There was no new tax imposed on the American public to finance those two wars. Obviously, if each American was asked to fork over $3000 to fund the wars, would there be enough public support? Koppel’s point is precisely that the American democratic process is bypassed to allow wars to occur.
So, where do the funds come from? The war funds are achieved through issuing bonds to countries like China, Japan, and OPEC. The American public also buys them. The rest comes via printing. Between 2008 and 2010, the Fed has simply conjured $1.4 trillion dollars out of thin air. (See “The U.S. and the Dollar in numbers; how crazy, you decide.”)
Not only is the democratic process bypassed, the majority of the American public also loses. It’s the dilution of their USD – the existing USD owned by foreigners and Americans alike now being worth less.
With the current unemployment rate, at around 9%, President Obama is pressured to spend more. The idea is to invest in the short term despite mounting debt, as a stop-gap measure to stem unemployment. Otherwise Obama’s rating continues to tank and his 2012 election prospects disappears. Worse might be the Occupy Wall Street movement becoming much bigger and at which point the outcome is unknown.
As I’ve written previously, “Dagong rates U.S. credit worthiness below China’s and the impeccable timing of the report,” U.S.’s credit-worthiness is likely to deteriorate and the cost of borrowing likely to increase.
Given this climate, what else can the U.S. do? One is certainly to look at this footprint and decide for how long it must be maintained. Former defense secretary Gates and now Panetta are trying to shave about $45 billion off the U.S. military budget each year for each of the the next ten years.
However, remember former U.S. President Eisenhower’s warning to his fellow Americans. War hawks supporting the military industrial complex in the U.S. will hype up threats from around the world to counter the cuts. With declining revenue, U.S. media will also hype up threats from abroad. A public that is gripped by fear will watch more news and buy more papers. American media elites in fact have their interests aligned with this military industrial complex.
Below is an infographic courtesy of militaryeducation.org in showing what this cost meant as an opportunity cost to American society:
This infographic takes a look at the amount of tax payer money that goes into funding specific military equipment ranging from the ‘small’ items to the truly gargantuan in price. The graphic then compare these prices to things that the average American can relate to such as median income, cost of a college education, health insurance, or the price of buying a home. The goal of doing this is to show the viewer how their tax money is being used compared to various other things it could be used to acheive.
While we believe that there is a need to maintain US military supremacy, we also feel that the spending that goes on by the Department of Defense is often unjustified and is rather a consequence of the military-industrial complex that Dwight Eisenhower famously warned about.
From: MilitaryEducation.org
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