Rational Spending

The multiplier effect is an economic tool that measure how much additional economic activity a dollar spent will generate. For example, The New York Times tells us that, “Every dollar of additional infrastructure spending means $1.57 in economic activity.”

The article goes on to list the following multiplier effects for each dollar spent:
· General aid to states: $1.41
· Increases for food stamps: $1.74
· Unemployment checks: $1.61

It would appear that a viable social safety net—unlike the shredded remnant of the one now in place—pays economic dividends.

What is harder to pin down is the multiplier effect of the $57,000 per minute we are blowing in Afghanistan. Like all other concepts in the dismal science, multiplier effects are subject to a great deal of debate. So estimates of the multiplier effect of each dollar of defense spending range from eighty cents to $1.40. The high end figure is misleading because the expense involved in the care and rehabilitation of a young soldier suffering from a terminal brain injury (TBI) is listed as an asset since it adds money to the GDP. It doesn’t subtract the reduced input into the economy the young soldier will be incapable of providing. In light of this, the lower multiplier effect is probably more accurate.

One fact that is indisputable is that defense spending is a drain on the economy. The standard Keynesian approach of using government deficits to stimulate aggregate demand worked during the Great Depression because the country was not saddled with a DOD parasite that was draining its treasury.

As one writer points out:

Defense spending means that the government is pulling away resources from the uses determined by the market and instead using them to buy weapons and supplies and to pay for soldiers and other military personnel. In standard economic models, defense spending is a direct drain on the economy, reducing efficiency, slowing growth and costing jobs.

He goes on to list the number jobs produced by $1 billion in spending in various economic fields:

As we see, defense spending creates 8,555 total jobs with $1 billion in spending. This is the fewest number of jobs of any of the alternative uses that we present. Thus, personal consumption generates 10,779 jobs, 26.2 percent more than defense, health care generates 12,883 jobs, education generates 17,687, mass transit is at 19,795, and construction for weatherization/infrastructure is 12,804. From this list we see that with two of the categories, education and mass transit, the total number of jobs created with $1 billion in spending is more than twice as many as with defense.

The bottom line is that defense spending is a fool’s game characterized by the law of diminishing returns. We are getting nothing in return for the $57,000 a minute we are wasting in Afghanistan.

How many homes could be saved with the money spent over there is an hour, a day or a month? How many struggling states could be bailed out with the money being spent just to satisfy the egos of fools who equate military prowess with potency even though this prowess is slowly rendering us impotent. After all, who got Iraq’s oil and Afghanistan’s copper? It wasn’t us.

The money isn’t making us any safer as it finances the production of even more terrorists.

But when a country’s institutions are corrupt, madness stalks the corridors of power. Lord Acton’s corrupting power does not result in greed or oppression. It’s corrupting influence is brain rot.

Providence Rules!

Divine Providence is to the state what a chef’s knife was to Jack the Ripper, an instrument of policy. The beauty of Devine Providence is its long-term vision. No matter how disastrous the consequences of a given decision, providence promises that all will be well in the end as long as we equate the events with "God's will."

Divine Providence allows the leader who is up to his neck in shit to declare, “I did the right thing.” Alan Hart says of that statement, “In discourse analysis it’s known as the false dilemma. You can’t argue with somebody, particularly a leader who insists he was doing what was right because, implicitly, you invite yourself to be seen as arguing for what is morally wrong.”

The leader who believes that his nation is a manifestation of providence lobotomizes the brain’s feel for decency. As soon as he is convinced that God is behind him, the leader will not shrink from wading through a waist-high lake of blood and viscera because the slaughter his decision causes is justified by the noble end his policy is pursuing.

From whence does this Divine Providence come? It is really quite simple: The ego farts and the soul thinks the breath of the Spirit is upon it.

Buying Ourselves to Death

[W]e no longer have movements; we have thousands of people each clamouring to have their own vision adopted. We might come to together for occasional rallies and marches, but as soon as we start discussing alternatives, solidarity is shattered by possessive individualism. Consumerism has changed all of us. Our challenge is to fight a system we have internalized.
George Monbiot


Monboit’s observation explains a lot. In a society of possessive individualism, the only unifying force is greed, which explains why the Right has maintain its unity and force while the Left is in total disarray with any semblance of solidarity relegated to a footnote in a history book that is never opened. Consumerism has, indeed, “changed all of us.” Yet, consumerism is a word that is bandied about without any sort of understanding of its sordid history.

There was a time when we were a frugal people. The ruling mantra of the day was, “Use it up; wear it out. Make do or do without.” It was a frugality born of necessity. In the absence of an industrial plant, there wasn’t much stuff to go around. If tools and utensils had to be hand crafted by the local blacksmith, people made them last. Clothing was a product of the spinning wheel and hand loom, so people patched rather than replace. (Is there anyone still living who could darn a sock?)

All of this changed towards the end of the nineteenth century as the country’s industrial plant swung into gear. Now goods could be manufactured quickly and cheaply. But capitalism had a problem. It had to cure the public of its frugality. Thus, we saw the birth of the advertising and public relations industry, and the concurrent creation of wants in place of needs. People were encouraged to buy because they wanted, not because they needed.

Our industrialists and marketers made another discovery. Community and family put a damper on consumption. If I “want” a $300 shaving set, complete with a chrome-plated razor, brush and elegant stand to hold both, I am not going to tell my wife because her scornful anger would discourage me from purchasing it. But, if I say nothing, it’s mine.

So it was that we saw the gradual erosion of the family as consumerism replaced community, a process that was speeded up with the introduction of television. Soon, this fragmentation will be carried to a new level as television programs are streamed over people’s smart phones. Now, a family no longer has to gather around a single screen. Each can wander their empty house immersed in the tiny screens they can hold in one hand.

Consumerism built a head of steam during the twenties, only to make a crash landing when the Great Depression hit. Yet, that event was preparing the ground for the advent of consumerism's resurrection in the fifties and its transformation into the feral consumerism that has plunged us into our present economic meltdown.

Poverty is stressful. Never knowing if you’ll have food on the table or a roof over your head is a strain. Worry is your constant companion, a worry goaded by anger and resentment.

With the advent of World War II and the full employment created by the war industries, people once again had money in their pockets and a terrible burden was lifted from their shoulders. People naturally began to assume that money brought happiness, when all it really brought was a release from the stress of poverty, which is not the same thing as happiness. From that assumption came the belief that the more money one had, the happier one would be.

It was this assumption that drove the fifties and sixties. At the end of World War II, America was in the catbird seat. We were the only country in the world whose industrial plant hadn’t been blasted into oblivion. Coupled with that was a public whose savings had been gorged by wartime rationing and in whom memories of the poverty of the Great Depression were fresh.

It was in the sixties that the country started to realize that money doesn’t buy happiness. This was a factor that played into the youth rebellion that sought an alternative to materialism and consumption. Ironically, their mantra of “Do your own thing” was a marketers dream. Consumerism was off to the races.

As our prosperity began to fade in the seventies, consumption became an emotional prop as people tried to conceal their slowly sinking standard of living by plunging into debt to buy the trappings of prosperity to fill the vacuum left by its absence. A series of asset bubbles coupled with low interest rates facilitated this plunge.

Now all we are left with is a hangover, one we suffer in isolation because there isn’t a social movement in sight that we could join to seek redress for our grievances.

History is never stagnant. Out of the rubble of a dying system a new one emerges. This makes the unity of the Right frightening. We saw what happened as Germany plunged into the Great Depression. They turned to Hitler as their savior and the rest is history. Now, instead of Brownshirts, we have tea bags and Bibles.

The left is going to have to lose its ideological fragmentation if it wishes to be any sort of a counterforce to the Right. Right now it is too fragmented as individuals occupy their private ideological castles and refuse to leave them. You can neither organize nor fund-raise from a computer.

We will only cure this fragmentation if we are willing to leave our castles and engage in a political process that has been described as a process of compromise and conciliation between conflicting groups in a pluralistic society. And I’m not talking about compromise and conciliation with the Right; I’m talking about it within the left. Without it, we shall remain fragmented and impotent.

The "Times" strikes another blow for our National Security!

You can always count on The New York Times to fan the flames of war. They did it with Iraq’s WMDs and now they are doing the same with Iran’s nuclear program. The Wednesday edition carried a frightening headline that alerted us to the fact that “Iran Is Shielding Nuclear Efforts in Tunnel Mazes.”

Accompanying the story was an equally frightening photo of Iran’s President Mahmud Ahmadinejad, surrounded by a group of tieless functionaries, all sporting red hardhats, in a tunnel reinforced by a Byzantine network of equally red I-beams. The tunnel had “threat” written all over it—until you read the caption. They were standing in a newly constructed highway tunnel!

Now, there’s a scare.

The story went on to refer to Iran’s “notoriously opaque nuclear effort,” without the quotation marks.

The article highlighted a problem that has been plaguing the Beltway ever since it started grousing about Iran’s nuclear program: The program is perfectly legal under the Nuclear Nonproliferation Treaty to which Iran is a signatory.

This has forced the administration to obsess on the “possibility” that Iran is really trying to build a nuclear weapon. It’s Cheney’s old “one percent” doctrine. If there’s a one percent chance that a possibility is real we treat it as real.

In all the coverage the story has received, a few salient facts have been left out. Given the hostility the West has exhibited towards Iran and given an Israeli Air Force just chomping at the bit to bomb the hell out of the country, Iran would have to be brain dead not to bury its nuclear facilities beneath the deepest mountain it could find.

For that matter, Iran would have to be brain dead not to develop a nuclear bomb. Nothing changes a hostile nation’s attitude like a nuclear arsenal, as North Korea discovered.

However, such thinking would require commonsense, and that’s the last thing the Beltway can afford. There’s simply no profit in it.

A Dead Past Lives On.

When a country’s past is fable, the present veers towards unreality. The past is not static. It changes as we change, as we become more perceptive with the passage of time. Often times, this change is painful as we are forced to confront the ghosts of the past we have kept hidden.

Fable becomes a refuge from the pain of self discovery. Once we have exchanged the dynamic of an ever-changing past for a static world of make believe, the past ceases to be a source of growth and becomes frozen in amber, thus dooming the present to repeat the sins of the past over and over again.

America’s past became frozen with our victory in World War II, a victory that has turned out to be democracy’s swan song.

America’s past wars saw the mobilization of the citizenry followed by its demobilization once victory was achieved. World War II was different. There was no demobilization as we slowly morphed from a republic to a militarized security state.

Victory in World War II gave rise to the fable that we were a military superpower. From this, it followed that we made the error of equating hardware with strength. (Hardware is okay in an industrial war between two nation states, but it’s meaningless when dealing with an insurgency.) In the process we are slowly spending ourselves in to penury just to keep this fable of the past alive.

In order to keep a dead past alive, the mind needs a constant stream of delusions that protect it from the truth. This is why we need al Qaeda and terrorism. They protect us from the harsh reality that we are a hollowed-out shell. This delusion is abetted by Wall Street with its constant stream of asset bubbles, which maintain the illusion that we are the richest nation on earth when, in fact, we are broke.

We are like the aged dowager, living a life of gentile poverty, who maintains the illusion of wealth by plunging further and further into debt in the belief that her children will deal with it after she is gone.

Now, as we sink even deeper into the quicksand of delusion, we are being told that there is now a link between Columbia’s rebels and al Qaeda to smuggle cocaine into Europe via West Africa.

How wonderful! Now we have more countries we can “intervene” in as we continue with our Eternal War of the Empty Policy. Nothing shores up a bully’s ego like beating up on a kid smaller than he is. Each blow hides his fear and his weakness. His redemption is found in the blood of his victim.

Like the bully, we seek our redemption in the blood of innocent women and children as we continue to beat up on the weak. It’s a feel good thing, especially for the bureaucrat bored to tears by endless meetings and reams of policy papers. What a thrill it is to order wholesale slaughter and destruction with a nod of the head knowing full well that no blood will splatter his wingtips.

This is what happens when our leaders try to drag the past, kicking and screaming, into the present, thus corrupting the future as they do so.

Stoking Anxiety for Fun and Profit

Faced with the threat of exploding underwear, the administration has expanded our “Long War” to include the small country of Yemen. This is encouraging news for our corporate-military infrastructure as Iraq winds down and as we move closer to declaring victory in Afghanistan and splitting, thus threatening two of their revenue streams.

Couple this with increased saber rattling over Iran and it looks like its flush days for the Pentagon for several more decades.

It’s all part of the Beltway’s Terror Feedback policy in which we pick a small, impoverished Muslim country, start bombing it , thus creating another generation of terrorists who will provide the rationale for future military campaigns, though military campaign is a misnomer since you can mount a credible campaign against an elusive insurgency.

But campaign or no campaign, our Empty War provides one additional benefit: it stokes America’s anxiety level and turn flying into an even more wretched experience than it already is.

Even though recent attempts to blow up airplanes have been exercise in ineptitude, the Beltway’s response has been one of studied hysteria in which a remote probability is treated as an imminent threat. Personally, the benchmark I use is to ask if the probability of being blown up in an airplane is greater than the possibility of being wacked in an automobile accident. If the probability of death by airplane is less than death by car, I don’t sweat it.

Of course, Beltway couldn’t afford to take this attitude since it would endanger a very viable profit center.

It would also help if our leaders realized that the most effective way of fighting terrorism is to stop producing terrorists. But that would be too boring. It would mean our leaders would have to give up the adrenalin high that comes with bombing impoverished villages into oblivion.

Then there is the stimulation that comes with playing the Great Game, that nineteenth-century struggle between the White nations to control Central Asia and the Middle East. It’s a replay of an aged geopolitical chess game. What our leaders don’t realize is that the rules have changed. The lowly pawn now carries a Kalashnikov and can move with the same impunity as the queen. Not only that, the pawn can leave the board, hide behind the game box and blow away the queen as she passes.

But then, much of our thinking is mired in the nineteenth century, which was the acme of White male supremacy and we’re loathe to let go of it. So we will continue our march into bankruptcy and oblivion just to pump life into a dead past. It’s the only way to keep our credibility intact. Besides, our corporate-military infrastructure is the only one we have left. We’ve off-shored all the others.

Dubious Decades

Here we are three days into a new “decade” as pundits struggle to hang a name on it. If I took decades seriously, I’d call it the Potty Decade because of all the shit that’s been dumped on us over that last ten years.

But, therein lays the problem. I don’t do decades for the simple reason that they distort the past. The very word implies a discrete unit of time totally unrelated to the decades that preceded it and the ones that will follow. The implication is that when the clock struck twelve on New Year’s Eve, all the evils of the last decade vanished and the new decade would mean a clean slate and a new beginning.

The sad truth is that the old decade is still with us because it is part of a continuum that stretches back into the past. Nothing really new happened in the last ten years. All we saw was the strengthening of trends that run like toxic threads through our history.

Obama is tanking because he stepped into a raging torrent of momentum that quickly swept him away despite his noble and lofty intentions (if they ever existed in the first place.) We made the mistaken assumption that he would represent a clean break with the Bush administration. What we failed to realize was that the Bush administration was simply a farcical extension of a mob paranoia that began with the Cold War mentality of the late forties. And that had its antecedents in the Palmer Raids that followed World War I in which innocent people were swept up in a dragnet driven by hysteria.

It is in the Palmer raids that we find an antecedent for the further degradation of the law that has aided and abetted the erosion of our Constitution. The law is a positive force only when it is kept balanced by an ethical gyroscope that makes of the law a firewall against our baser mob instincts. 9/11 shattered that gyroscope and since then the law has run amok as it tramples over rights that had their birth in English common law.

Nor is there anything new about our paranoia. We have a long history of it. Woodrow Wilson was so frightened of dissent during World War I that Congress passed the Sedition Act of 1918 that made it a crime to protest against the war or to utter any statement that could be construed as a criticism of the United States government. As with the Patriot Act and the Military Commission Act, many an innocent person was jailed.

The law, once our protector, has become an enemy and a threat. But then as the scholar John B. Roche once pointed out, “The first precept of constitutional interpretation is whose ox was gored.” Our Supreme Court is as easily swept along by mob psychology as the Fox News fans.

Our knee-jerk military response to world problems is nothing new. It began with Wilson’s gunboat diplomacy and festered and grew with the birth of a military establishment to fight World War II. The irony is that we haven’t won a war since. (Sorry, Grenada and Panama don’t count,) But that hasn’t stopped us from trying. When you start thinking in decades, the past ceases to exist, so the same mistakes are repeated over and over.

When we view the past as a series of discrete decades, it is easy to convince ourselves that the Great Depression never happened, or that it was a unique phenomenon confined to a specific decade. This made it easier to set ourselves up for our current depression, which our leaders tell us isn’t since a depression is something that happened so far back in the past that it can never happen again because this is a different decade.

Karl Marx once said that history repeats itself—first as tragedy and second as farce. The last decade was the decade when farce came into its own.