|| -----Original Message-----
|| From: Dennis Breslin
||
||
|| This from Raimondo's latest:
||
|| "The leftist dogma that it doesn't matter which wing of the
|| 'ruling class,'
|| the capitalists, wins out in the end is refuted by this
|| reality. Capitalism,
|| per se, doesn't breed war: indeed, laissez-faire requires quite the
|| opposite. And don't think the ordinary capitalist profits from war: this
|| privilege is reserved for those with the right government connections.
||
|| "The very real economic harm done by war - the cost in wasted wealth, as
|| well as wasted lives - could pull the US, already mired in a sharp
|| recession, into a full-fledged depression. (...)
|| The Vietnam War drained the life out of the US
|| economy during
|| the late sixties and early seventies, and the financial shock
|| of a prolonged
|| Mideast conflict could well be far worse. In the end, the markets are
|| vehemently antiwar - a phenomenon that must mystify Noam
|| Chomsky to no end." (...)
|| And isn't the greatest threat to a
|| thriving economy
|| any impediment that keeps me from my appointed rounds in Walmart?
|| That I might be reluctant to shop has more to do with my actual
|| or imminent unemployment and that may have little to do
|| with war - the layoffs were coming anyway. War, indeed, gives
|| employers a tad more cover.
||
|| Dennis Breslin
||
There are crucial features of the military-industrial complex and the US economy that you're missing here:
1. The US economy is not globally competitive, as evidenced by the US current account deficit. E.g. the only US products I own are a few Intel & AMD chips. Despite its tariff barriers, the US domestic market is awash in imports.
2. Nevertheless, you and I regularly pay hefty chunks of cash for overpriced US products that we don't own and don't want: Fighter planes, missiles, etc. This is why Boeing is still the biggest US exporter despite Airbus's sturdy competition in the civilian market. US military exports have nothing to do with free-market competiton and everything to do with bribes, blackmail, and US hegemony, obviously.
3. World peace - as in Clinton's NWO - would kill the market for the main US exports and incite foreign governments to forgo US "protection". The last thing that the huge defence and energy lobby (Oil & arms sales are intimately linked: See below) wants is a world of independent, nonaligned states with minimal defence worries. It's no accident that Carlyle and Halliburton have become household names. Through the instrument of security pacts, the US maintains intimate links with defence and intelligence decision-makers throughout the world, thus guaranteeing, among other things, a lucrative client base for its overpriced and frequently overhyped weapons.
See: Asia-Pacific Security & US-led Neoliberal Globalization & Militarization in Historical Perspective by Thomas Reifer http://www.focusweb.org/publications/2001/Asia-pacific-secuirty.html.
The above document outlines the US efforts since WWII to create global conflict and thereby a market for its "protection" goods & services. The post-cold-war US efforts to conjure up "rogue states" and mobilize multinational coalitions to fight them is a product of the same strategy that Reagan once sold to the public with his quaint "evil empire" spiel.
4. Although wars may impact the domestic US economy negatively by increasing the national debt and therefore interest rates, they represent huge shots in the arm for globally uncompetitive US capitalism, in the form of gigantic government contracts with little or no democratic oversight. There is nothing as profitable as a wartime defence contract and hi-tech capital-intensive zero-casualty warfare is making those contracts fatter and fatter all the time. The profit margins are outrageous and don't do the economy any good, but who cares? If the economy falters, the dems are allowed a term in office to cut defence spending and balance the budget, so that the right can come back and plunder the treasury some more. The military-industrial complex, the national security state: All these designate the same phenomenon, viz an uncompetitive, redundant capitalism that is kept alive through gigantic defence contracts ladled out by a profoundly corrupt political system.
5. Such a system would normally lead to an economic debacle in short order but the US enjoys imperial privileges that allow it to export its economic problems. One of the key privileges is the dollar denomination of oil prices, which bolsters the US right of seignorage (the right to print money and not suffer the consequences). This creates an ocean of overseas dollars that can be used to finance the US debt and purchase US military hardware. Another economic advantage is the following:
"As the world oil price is now set in dollars, the United States is buffered from the effects of currency fluctuations on its energy imports. If, for example, oil prices were denominated in Japanese yen, America's energy bill would increase as the value of the dollar against the yen fell, even though nominal oil prices remained unchanged. During another episode where the dollar fell in relation to other major currencies, in the mid-1970's, there was much talk in OPEC about changing the basis of oil pricing from the dollar to a basket of currencies. Loud complaints could be heard from the Gulf about the decline in returns from oil sales because the dollar was not worth as much as it used to be. The Iranian Revolution put a halt to such talk by re-emphasizing the security dependence of the Gulf monarchies on the United States. The recent fall of the dollar since the Gulf War has not elicited similar comments. Were the security link between the United States and the Gulf monarchies to be broken, their incentives to maintain the dollar as the benchmark currency for oil pricing would be reduced." Oil Monarchies:Domestic and Security Challenges in the Arab Gulf by F. Gregory Gause III, University of Vermont www.arts.mcgill.ca/programs/icas/gause/chapter7.html
More on this in David E Spiro, The Hidden Hand of American Hegemony:Petrodollar Recycling and International Markets. Cornell University Press, 1999
Hakki