Thom Stark on History, Government Spending and Isolationism   3 comments

Thom StarkThom and I took some time off because I’ve been formatting books. Please find the earlier conversation here and the post he is replying to here.

Let’s start with earmarks.

I don’t consider them a better solution than the present one, because they invite abuse like the Bridge to Nowhere. That said, I’m suspicious of block grants as well, because they merely push the abuse down to the state level, without solving the central problem of wasteful spending.

I’m not at all sure what the solution is, other than to institute Draconian sanctions for corruption on the part of elected officials at all levels: local, state, and federal. I’m not talking about longer terms in “country club” prisons, here. That’s a deterrent that does nothing to deter, much like California’s death penalty. I’m talking hard time, whopping fines, and being barred for life from both elective office and from involvement in government contracts of any kind.

Before I get to the issue of spending reform, however, I can’t help but address your mischaraterization of the USA’s supposed responsibility for WWII. While I’m willing to concede that the Wilson administration felt it was important to involve this country in WWI, and that the logic of that determination was questionable, I categorically reject your portrayal of the Roosevelt administration’s Lend-Lease program as somehow unjustified and manipulative.

Nazi Germany was exclusively responsible for the war in Europe. The Austrian Anschulss, the appropriation of the Sudentenland, and, particularly, the invasion of Poland were all acts of agression by a rogue state whose leader was determined to create a European empire. That last action was purposely provocative – designed to force the Allies into declaring war because of their treaty obligations to Poland, in order to give Germany a causus belli to invade France and the Benelux countries. If the US had not supplied Britain with … well … pretty much everything, including food, fuel, and weapons, Hitler would have succeeded in establishing complete hegemony over Europe, and would then have been free to concentrate on conquering Russia.

We very likely would have been next – except that the Japanese miscalculated our resolve (and were unlucky enough to launch their attack while the Pacific aircraft carrier fleet was out of port on maneuvers), and forced us into declaring war on them after their sneak attack on Pearl Harbor. Once again, treaty obligations (this time between Japan and Germany) forced Hitler to declare war on the USA … and there went the balloon.

The thing is, both Nazi Germany and Imperial Japan were ruthless imperialists. Without military opposition on our part, there is every reason to believe they would have targeted the United States in time – first by crippling trade sanctions (recall that Germany was only kept from seizing the Middle East oil fields by our entry into the North African theatre of the war) and, eventually, once we were sufficiently impaired by those sanctions, by military invasion.

And all that leaves aside the issue of the Nazi policy of systematic genocide, and the Japanese butchery of Philippinos at a time when the Philippines was a US possession, both of which constituted a moral imperative for the United States to intervene.

I don’t want to get too far off-topic, but I think it’s important to note that isolationism was a bad idea then – and would be a disastrous one now. Geopolitics, like the atmosphere, abhors a vacuum. Were we to withdraw militarily from Europe and Asia, that action would destabilize those regions sufficiently to practically guarantee a third world war – and this one would be fought by multiple state actors who possess nuclear weapons. Consider Russia’s annexation of Crimea and its ongoing attempt to wrest away control of Western Ukraine. Likewise, think about China’s ongoing confrontation with Japan over control of islands in the South China Sea. It’s pretty easy to see that our withdrawal of forces from Europe would constitute an open invitation to Vladimir Putin to try to grab back the Eastern European states who (like Poland, for instance) historically constituted buffer zones between Europe and Russia. Similarly, China would be encouraged to go on an acquisition spree were we to withdraw our forces from Japan, Thailand, and South Korea.

Oh, and North Korea – a rogue state which not only possesses nuclear weapons, but has been actively engaged in exporting nuclear weapons technology to the Islamic world – would undoubtedly launch an attack on South Korea. Again, treaty obligations would force the Chinese to intervene on North Korea’s behalf.

Once again, the result would be world war – only with nukes all around.

That is why we literally have no choice but to maintain our worldwide military empire, despite its enormous expense: because the alternative is a global war into which we could not help but be drawn, even were we to adopt an official policy of non-alignment. (Which we could not do, because of – yes, that again – existing treaty obligations. And a country can’t unilaterally abandon its treaty obligations without ensuring that no nation would ever again be willing to sign a treaty with that nation.)

So let’s talk taxation and spending reform.

First, disbursement of Federal tax receipts disproportionately benefits less-populous and poorer states at the expense of more-heavily-populated and richer states. Alaska, for instance, receives $1.49 in Federal spending for every $1.00 of taxes paid by its residents and corporations. That’s a fact. So, if you want to complain about income redistribution, it’s important to recognize that the very states you have, in previous essays, made a point of claiming are underrepresented in Congress nonetheless benefit substantially from that redistribution. Or, to put it another way, New Yorkers and Californians, who are the top payers in combined local, state, and Federal taxes (and are, not even coincidentally, among the wealthiest Americans) subsidize residents of states like Wyoming, Montana, and Alaska with their Federal tax payments. And, despite your thesis that imposing heavy taxation would cause a general exodus to low-tax foreign shores, that is simply not what happens in actuality. In the real world, businesses flock to those states, because their benefits to employers – large pools of technically-talented labor, attractive amenities, and tax breaks for research and investment in local employment and production – outweigh the incremental cost of additional taxation.

Second, Social Security is not really that far out of balance, financially. It’s future obligations could quite easily be met by simply raising (or, better yet, eliminating) the cap on taxes dedicated to the Social Security trust fund. There are hundreds of millions of American taxpayers who depend now, or who will depend in the future, on Social Security payments to enable them to retire without having to change to Fancy Feast-based diets. And “privatizing” Social Security is not the answer, for a number of reasons: because it’s unrealistic to require working people to become investment experts, because the stock market is currently the only remaining investment area that’s providing meaningful returns (interest rates are nearly down to negative numbers, so bonds aren’t a good investment, and the real estate market is still largely a disaster area – and would be a good deal worse, if the banks that hold the vast oversupply were not keeping their repossessed properties off the market), and because stock brokers and financial advisors conclusively proved in 2008 that they’re a pack of lying, swindling, conscienseless bastards.

The real problem is Medicare. That problem is, again, a product of a mismatch between the program’s obligations and its income – and that, in turn, is pretty much entirely the fault of the Bush administration’s drug benefit giveaway. There are two contributing factors to that debacle. The first is that the drug benefit was itself completely unfunded. Congress simply punted on paying for it. Worse still, that same Congress included a provision that forbids the Social Security Administration from negotiating with pharmaceutical companies over pricing of the covered medications.

Imagine that. The single largest buyer of drugs in the entire domestic medical economy is forbidden by law from using its purchasing power to negotiate discounts on those purchases – something every medical insurance company, PPO, and HMO in the country does routinely.

The fix for Medicare is, once again, dead simple: raise the Medicare premium to cover the actual costs of the program, and replace the ukase against the SSA bargaining for lower drug prices with a requirement that it do so.

Which takes us to the towering Federal deficit.

If you subtract Social Security and Medicare, the two largest sources of imbalance, from the equation – and the above solutions would do exactly that – the major remaining problem is military spending. Now, to my mind, the size of the military, and expenditures on its personnel aren’t the big issue. As we saw in Iraq and Afghanistan, our military is plenty big enough to fight two wars simultaneously. It’s simply nowhere near big enough to successfully occupy any even moderately-sized conquered territory. So we need to stop invading places we can’t hold afterward, especially for idiotic goals like “regime change” that replaces a distasteful dictator (who nonetheless provides a needed bulwark against the expansion of an active enemy state) with an unstable, corrupt government that’s a virtual captive of an enemy state.

Just as importantly, the military procurement system desperately needs a drastic overhaul. Currently, for instance, Congress has appropriated $181 million for upgrades to the Abrams M1A1 V2 tank force in 2015 alone. General Dynamics persuaded 150 Congressmen to co-sign a letter claiming that the Ohio plant where the tank is manufactured needs to remain open to ensure that the design and manufacturing expertise of its employees continues to be available in the future. GD also claims that closing the plant for a year would incur $1.6 billion in costs to reopen it.

Why did 150 Congressmen co-sign that letter? Because General Dynamics makes it a point to spread the manufacture of the Abrams’s components over as many Congressional districts as possible. Essentially, those Congresscritters’ argument boils down to “it’s a jobs program for my district.” The problem with that contention only begins with the fact that it’s an incredibly expensive jobs program. In fact, we spend about a half-million bucks for each job it provides. More crucially, the Abrams tank – and tanks in general – are pretty much entirely outmoded by the kinds of wars in which we are currently engaged, as well as the ones we’re likely to fight in the near future. (Sure, with the current situation vis-à-vis Russia, we might wind up in a shooting war in Eastern Europe, but the chances that war would last long enough for us to move additional tanks to the European theatre are pretty slim, given that both sides have lots of tactical nukes.)

That doesn’t even begin to address boondoggles like the F-35 Lightning II Joint Strike Fighter, or the Air Force’s upcoming next-generation stealth fighter.

We need to institute a policy of requiring weapons manufacturers to consolidate, rather than widely disperse component manufacture, just to start with. We also need to absolutely forbid military officers above the rank of Lieutenant Commander or Lieutenant Colonel to accept employment with military contractors of any kind for a minimum of 5 years after they leave their service. And we need a law that bars Congress from increasing any weapons acquisition budget above the figure the service that asked for it requested.

Good luck to us with that, of course.

DSC01494As for the national debt, I could not agree more that something needs to be done about it forthwith, because the problem is MUCH worse than you have indicated. Consider that we currently spend about a trillion dollars a year paying the interest on that debt. Just the interest, mind you. We’re not paying down the principle at all, because we can’t afford to do so, given our current level of Federal tax income. However, what nobody wants to talk about is that, once interest rates rise even slightly, we won’t be able to afford to pay the whole annual interest amount – which means we’ll shortly be paying interest on the interest.

Stabilizing Social Security and Medicare would go a long way toward freeing up money to pay down the debt. We still will need more tax income to get the debt under control, but that would at least be a start.

Of course, given the Congress will be Congress, regardless of how irresponsible “being Congress” is, they’ll likely choose to spend the surplus on something other than debt reduction.

Like more Abrams tanks.

3 responses to “Thom Stark on History, Government Spending and Isolationism

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