Military Industrial Complex and the Obama Administration

The military industrial complex is alive and well in the United States despite the deepest economic-financial crisis since the 1930s and unemployment levels topping 9%. And any threat from any quarter to the bloated military budget - which stands at $903 billion in 2011 - is dismissed by scare tactics of huge potential job losses - and of leaving the USA vulnerable to its enemies (without specifying who these enemies might be, given that the US spends vastly more on military hardware than practically the rest of the world put together). By using these arguments, the Obama administration merely shows how deeply embedded it remains in the militarised economy, culture and mindsets of the US foreign policy establishment. And that its attempts at solving the problem of unemployment do not include job-creating investment in education or other socially useful aspects of the domestic economy or society.

Interestingly, there are even voices on the Right, such as Republican hopeful Ron Paul, calling for deep cuts in military spending. Lawrence Korb, former Reagan adminstration appointee, also calls for the reallocation of parts of the huge military budget to domestic projects. Despite this, the 'centrist' Obama continues to pursue a militarist spending programme.

Obama claims that defense cuts will lead to massive job losses, raising a key question: where are the Obama administration's figures about the alleged effects of 'drastic' military spending cuts coming from? From research paid for by the Aerospace Industries Association, Inc, a lobbying organisation at the heart of America's military industries, citing figures generated at George Mason University, a university that comes closest to being a part of the 'conservative establishment'. And they paint a bleak picture of the future should the (very unlikely) military budget cuts transpire.

Yet, currently, the US military budget consumes 25% of the annual federal budget, representing the single largest item of government expenditure. While the health budget costs $882 billion, education comprises a mere $129 billion this year. On the other hand, interest on government debt eats up over $230 billion.

The Nobel Peace Prize-winning Obama administration has increased military spending in each year of its term of office - from almost $800 billion in 2009 to $847 billion in 2010 (USgovernmentspending.com is a brilliant website for such matters). On the other hand, the gung-ho George W. Bush administration spent a 'mere' $730 billion and $650 billion during its last two years in office.

Despite the shrill warnings from the Obama administration and its arms industry allies, Lawrence Korb, former Reagan era assistant defence secretary, argues that a cut to the military budget of $1 billion would do wonders for domestic unemployment levels: "Applying $1 billion to domestic spending priorities would create far more jobs than the same $1 billion spent on the military, according to a 2009 analysis by Robert Pollin and Heidi Garrett Peltier, economists at the University of Massachusetts". He argues further that "spending on educational services creates almost three times as many jobs as military spending, and health care creates almost twice as many." (Read more: http://www.politico.com/news/stories/1111/68505.html#ixzz1ejxeigVP)

Korb goes onto to debunk all AIA's, and the Obama administration's, claims of the impact of military budget cuts: he shows that potential job losses would likely stand at 600,000 not one million. But even more significantly, he exposes the AIA's alleged concerns for Americans' jobs:

Korb shows that in 2004 Congress tried to insert a clause into the National Defense Authorization Act that would have increased the percentage of US-made components of Defense Department purchases to 65 percent of the product, rather than the current 50 percent.

Korb declares that the proposal, which was supported by many small manufacturing companies and unions because it would create jobs in the U.S., "was vehemently opposed by AIA. Why? Because it would cut its members’ profits and make it harder to sell their wares around the world (The U.S. is the global leader in arms sales).

"As a result of AIA’s efforts, the 'buy American' provision, which would have increased employment in the U.S., was dropped. It is clear that the AIA study’s real purpose was to protect not U.S. workers but the group’s profits, which have exploded over the past decade, as spending on modernization doubled in real terms. Moreover, AIA fails to mention that, in the past decade, as a result of the industry’s own business practices, the Defense Department spent $50 billion on weapons that were canceled. Cost overruns of weapons exceeded $300 billion.

"Reducing the defense budget by as much as $1 trillion over the next decade will reduce defense spending in real terms to its fiscal year 2007 level. But it will still keep it above what we spent on average during the Cold War.

That $1 trillion, he argues, "could be used to create at least 2 million new jobs — to replace the 600,000 that could be lost."

Korb is no radical. He's a centrist at best, and the centre has shifted to the right in recent years.

In the Financial Times (23.11.11), Korb is quoted to the effect that US military spending had increased for 13 consecutive years up to 2011, and currently stands 50% higher in real terms than in 2001.

Obama's words about cutting unemployent are as hollow as those of the Aerospace Industries Association. He is the commander-in-chief of the world's sole superpower: and that demands, with his full support, continued massive trillion dollar military budgets. Running a global empire demands nothing less.

President brought needed sobriety to defense debate

By Marion C. Blakey, president 
and CEO of Aerospace Industries 
Association - 07/19/11 04:44 PM ET

President Obama did more Friday than effectively rule out trillion-dollar defense cuts (“Obama lays down new marker in Defense spending debate,” July 15). He also brought a needed dose of sobriety to the debate, reminding those calling to slash defense during wartime that any cuts must be “consistent with our defense needs and our security needs.”

For months, extreme figures on both the left and right have called for severe cuts that would undermine our dominance in the skies and gut our industrial base and research capabilities for decades.

Almost $200 billion in defense spending has already been placed on the chopping block, a remarkable figure for a nation fighting two wars as well as flying thousands of sorties a month over Libya. Those calling for indiscriminate additional cuts need to explain specifically how such cuts won’t cost jobs or compromise our national security.

The U.S. is second to none in aerospace and defense today. Budget proposals that fail to spell out how we maintain that second-to-none status are not proposals at all, but mere rhetorical posturing. And the abstract calls of some for hundreds of billions in additional cuts don’t seem very sober at all.