August 9, 2010
The US Military Industrial Complex became a very important piece of the US economy for about the last 70 years, since the 1940’s.
For a long time the United States has been the number one arms dealer around the world.
Why peace on the Middle East it is just a mirage?
Here is the actual US government strategy for a few decades:
The US taxpayer supplies Israel with foreign aid – mostly military armaments. In turn that creates more demand from the US Military Industrial Complex to supply armaments to countries such as Saudi Arabia, UAE, Kuwait, and so on…
Now we go back to the original question: What is the role of the state?
Is it part of the role of the state, as it is the case in the United States, to cause conflict around the world to keep its Military Industrial Complex busy at home building all kinds of toys to sell around the world?
The US government has been doing a great job in that area: Iraq, Afghanistan, Middle East in general, Taiwan, North Korea, Iran, many parts of Africa, Venezuela, Colombia, Germany, Japan and so on…
In a Nutshell:
Today the United States has an old and aging economy which is becoming obsolete very fast with a dying manufacturing sector, and many parts of the economy is being outsourced to other countries – there's only one area that still surviving and doing well, and today makes the core of the United States economy: the Military Industrial Complex.
The reality is, the US government needs to create on a constant basis the perception that some kind of threat is out there against the United States.
The Military Industrial Complex is a very important part of the US economy. This is one of the few remaining areas that the United States still has a comparative advantage regarding the other countries around the world.
Today we can define the core of the US economy as being: War, Inc.
Just in the next 2 years the US Military Industrial Complex is going to supply about US$ 100 billion in new toys to countries such as Saudi, Arabia, UAE, Qatar, and Kuwait. The Military Industrial Complex is an important source of business for American banks, and for job creation in the old USA.
It's a waste of time to talk about peace on the Middle East, since there are too many American businesses that are interested that the Middle East mess keep going on forever.
The Military Industrial Complex in the United States it is a very interesting subject for anyone to study in itself. From the US annual Defense Budget – a source of money for important research and development done in companies and universities in the United States – to the impact that the arms industry (industry that manufacturers weapons of war) has in the creation of jobs and economic activity.
Various corporations in the US, some publicly held, others private, bid for these defense contracts, which are often worth many billions of dollars. Then there is the global arms exports, and the United States has over 60 percent share of the international market.
Looking at the changes in the regional distribution of the Top 100 arms-producing companies, the dominance of US-listed companies is consistent: they made up 60 per cent of arms sales in 1990 and 63 per cent in 2003. The share for European companies declined from 33 per cent to 29 per cent over the same period.
Concentration of arms production in the USA
In the United States, there was an intensive period of concentration between 1993 and 1998, when a number of large-scale mergers and acquisitions took place. While this was made possible by changes in government policy, the financial sector also had a major role in this process. The catalyst of this development was a change in US defense industry policy in 1993 when the Deputy Secretary of Defense, William J. Perry, addressed a dinner attended by defense industry executives and openly encouraged consolidation—this became known as the ‘last supper’. The presence of financiers at this meeting illustrates the increasing role of financial capital in the arms industry. To promote the consolidation, the DOD allowed companies to write off restructuring costs against military contracts, with the expectation of large costs savings which never materialized.
The policy ended when the DOD decided it had gone far enough and blocked the merger of Lockheed Martin with Northrop Grumman in early 1997. This left four major US contractors in 1998: Boeing, Lockheed Martin, Northrop Grumman and Raytheon—which are now four of the top five arms-producing companies in the world.
The concentration of the arms industry in the USA and Western Europe since the early 1990s has resulted in some very large companies, comparable in size to the national output of most developing countries and even exceeding many of them.
Sustained high levels of military expenditure (especially in the USA―the largest military spender and arms procurer) and the ongoing conflicts in Afghanistan and Iraq partly explain the continuing increase. However, the monopsonistic* structure of the arms industry, the consequent strong relationship between arms producers and governments and the industry’s perceived importance to national security also shield it from the immediate impact of severe economic downturns. This status is reflected in the continued high levels of arms sales, high profits, large backlogs and strong cash flows generated by arms production.
The global arms exports, which the United States has over 60 percent share of the international market it's also a very profitable business for the financial sector including the major players in banking and the insurance industry.
It is very important for the US economy that the US government creates on a constant basis the perception that some kind of threat is out there against any self-interest of the United States anywhere around the world.
For example: Even though the United States depend on China for financing of it's massive annual US government budget deficit – The US government a few months ago sold billions of US dollars in armament to Taiwan's military – an arms deal that pissed the Chinese government of Mainland China.
I remember about 4 or 5 years ago when the president of South Korea came to the United States to announce that the 2-Koreas were going to start official talks about the merge of the 2-Koreas.
The president of South Korea thought that this was a very good news that would please the United States. Then he got a ear full in Washington that in no way in hell the United States approved the merge of the 2-Koreas – and the president of South Korea went back to his country really pissed with the Bush administration.
In the last few months Hillary Clinton has been going nuts and made a big deal about the accusation of the sinking of the South Korean navy ship by the North Koreans. The US government still are harping on that false news on their efforts of creating a crisis between the 2-Koreas.
Turned out North Korea was telling the truth all along when they said they had nothing to do with the sinking of the South Korea navy ship.
The politicians in South Korea investigated the evidence presented regarding that ship, the recovered body of the sailors, and the bomb that they were claiming that had hit that ship, and they found out that there was no evidence that the ship had been sunk by a bomb, the ship had actually hit a reef and split into 2 pieces, and the body of the sailors that they recovered head died from drowning and not a single one had evidence that his body had been damaged by a bomb of any kind.
Then they found out that the South Korean government had made up that story for local political purposes, and the bomb that they had provided for evidence of the sinking of that ship, the recovered pieces of the torpedo had been recovered from the bottom of the sea many decades ago, and had been in storage in some warehouse for the last 40 years.
Since the fiasco became public, a few days later he proposed a new business tax in South Korea to finance the future merge of the 2-Koreas.
But to this day the American mainstream media, and Hillary Clinton for that matter still are talking about North Korea sinking that South Korean navy ship.
If you connect the dots we still are talking about the same subject; the US Military Industrial Complex and its importance to the US economy, and when we are talking about the Middle East, we are talking about US made armament to Israel, Saudi Arabia, Qatar, UAE, Egypt, Iraq, and US military bases in many places around the Middle East.
And when we are talking about China and North Korea, we are talking about also the US Military bases in Japan, and in South Korea, and a very good business in arms trade with Japan, South Korea, and Taiwan.
We are talking about how important the US Military Industrial Complex has become to the US economy; if they are selling their military toys for the US Defense Department, or selling to governments around the world.
I am sure that if they could get away with they would sell armament for war to both sides of a conflict and let them kill each other.
In the United States the US Military Industrial Complex has become a major juggernaut, but in Brazil we need to increase the budget for Defense spending to around US$ 80 billion per year.
There's very important benefits for the Brazilian economy that would be the result of this massive new defense spending.
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monopsonistic*= a market in which goods or services are offered by several sellers but there is only one buyer
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Note: all the above I wrote on the comments section of an article on Brazzil Magazine when we were discussing this subject in August/September 2010.
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Originally, I had posted this information on the web site of the Financial Times (UK) when Martin Wolf had raised that question on his Financial Times forum: “What is the role of the state?”
Martin Wolf asked the following question on his forum: What is the role of the state?
I posted the following in response to his question:
August 8, 2010
It is my understanding that our modern notion of the role of the state started in France at the time around the French Revolution.
The French Revolution was a major turning point in world history, and that was the revolution that changed the world.
What is the role of the state? What is the number one priority?
Most people would say it is defense of the country against foreign invasion of any kind.
One hundred years ago we had the saying “the sun never goes down on the British Empire” – because at that time we had 25 percent of mankind under British domination.
What happened to such a powerful empire?
That Empire was not beaten on the battlefield by another country. That empire imploded – death by taxes – at the end of the day someone had to pay the bills for the British adventurers around the world.
Here is another example: the Soviet Empire.
In the case of the Soviets as well – a long term of over spending on military expenses also placed the Soviet Union on the poor house.
Overblown defense expenditures year after year were the “Achilles heel” that put the last two superpowers on the poor house and out of business – first, the British Empire, and second the “Soviet Union Empire”, and now the United States it has been following on the footsteps of these former superpowers, and the United states is on the same path and right on schedule to also become very soon a former superpower.
Did Americans learn a lesson from past history?
No, Americans have adopted the same path into extinction. Here is just a reminder on the road to extinction:
It is a very sad state of affairs - Living on borrowed money from foreigners and at the same time thinking that they are very wealthy. Since George W. Bush became president on January 20, 2001 to the day when he ended his 2nd term, the US government added to its outstanding debt $ 5 trillion dollars.
It is no coincidence, but as you can see by the enclosed actual figures the total adjusted amount of US defense spending during the 8-years of the Bush administration was over US$ 4 trillion dollar.
My question is: for how many more years do you think foreigners are going to continue funding the defense spending of the United States?
Never mind foreigners funding American military adventures around the world – who is going to fund all the trillions and trillions of dollars of US domestic expenses that are coming due very fast from now on – liabilities related to the Baby Boom generation?
The Soviet Union economic system collapsed around 1990. The US capitalist system collapsed in 2008. Today China is reinventing a new economic and social system for its people.
I have no idea what the world is going to look like in 20 years when you take in consideration that the largest economy in the world today – for all practical purposes – is on a imploding mode and it will become less and less important over the coming years in terms of the total global economy.
We have passed the point of no return, and I don’t care about anybody say “That is the real truth for the US economy. On top of all the problems that we already had related to the US economy, what happened in the last 3 years when Wall Street had to be bailout from its massive bets that went sour to the tune of trillions of US dollars, plus incompetence in the US financial markets that are mind boggling to me – there is only one word that comes to mind when I think about the future of the US economy: Titanic.
In 2004 I read with interest the book by Immanuel Todd “After the Empire” - The Breakdown of the American Order.” Six years later the sinking of the Titanic is right on schedule.
After reading the book by Nomi Prins “It Takes a Pillage” published in October 2009 then one understands the magnitude of the Wall Street bailout – basically the last nail on the coffin of the US economy.
If you want further information about how Wall Street is laughing all the way to the bank at the expense of American taxpayers, and how Wall Street went back to business as usual then you should read the latest article by Matt Taibbi on Rolling Stone magazine “Wall Street Big Win”. ( http://www.rolling.../news/17390/188551 )
Anyway, all I can say is that during the coming financial and economic collapse we are not going to have the safety net of the US government anymore. This time around we are going to go down to hell in a hand basket – with the compliments of an incompetent US government and all the welfare programs that the US taxpayer is giving to Wall Street.
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As of Date - US Government Total Public Debt Outstanding
05/07/2009 $11,256,266,640,050.20
01/16/2009 $10,628,881,485,510.23
09/30/2008 $10,024,724,896,912.49
09/28/2007 $9,007,653,372,262.48
09/30/2006 $8,506,973,899,215.23
09/30/2005 $7,932,709,661,723.50
09/30/2004 $7,379,052,696,330.32
09/30/2003 $6,783,231,062,743.62
09/30/2002 $6,228,235,965,597.16
09/30/2001 $5,807,463,412,200.06
01/19/2001 $5,727,776,738,304.64
Total public debt outstanding on 01/19/2001 was $5,727,776,738,304.64 and since George W. Bush became president on January 20, 2001 the US government added to its outstanding debt $ 5 trillion dollars.
http://www.treasur...gin?application=np
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United States government actual budget figures during the 8-year Bush administration.
United States Government Annual Budget during the Bush administration. Each year, on the first Monday in February, the President of the United States submits his budget request to Congress for the following fiscal year:
United States federal budget, 2009 - $3.0 trillion (submitted 2008 by President Bush)
United States federal budget, 2008 - $2.9 trillion (submitted 2007 by President Bush)
United States federal budget, 2007 - $2.8 trillion (submitted 2006 by President Bush)
United States federal budget, 2006 - $2.6 trillion (submitted 2005 by President Bush)
United States federal budget, 2005 - $2.4 trillion (submitted 2004 by President Bush)
United States federal budget, 2004 - $2.2 trillion (submitted 2003 by President Bush)
United States federal budget, 2003 - $2.1 trillion (submitted 2002 by President Bush)
United States federal budget, 2002 - $2.0 trillion (submitted 2001 by President Bush)
Total US government Budget for period year 2001 to year 2008 = US$ 20 trillion.
The cumulative total actual US Government budget for the 8-year period of the Bush administration was US$ 20 trillion dollars.
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Here is Bushes’ actual military spending - this does not include ANY costs related to Afghanistan or Iraq as they are all in supplemental spending bills:
For Fiscal Year 2008 it is $481.4 billion
For Fiscal Year 2007 it is $470.0 billion
For Fiscal Year 2006 it was $441.6 billion
For Fiscal Year 2005 it was $420.7 billion
For Fiscal Year 2004 it was $399.1 billion
For Fiscal Year 2003 it was $396.1 billion.
For Fiscal Year 2002 it was $343.2 billion.
For Fiscal Year 2001 it was $ 296.0 billion
Note: The Iraq and Afghanistan supplementary spending as of end December 2008 = over $ 650 billion.
Total Bush administration actual defense spending for 8-year period 2001 to 2008 = US$ 3,898 billion
Plus other supplementary amounts that the government requested the total adjusted amount for defense spending for the 8-years of the Bush administration it will reach over the US$ 4 trillion dollar level.
Note: The cumulative total actual US Government budget for the 8-year period of the Bush administration was US$ 20 trillion dollars and the actual defense spending for the 8-years was US$ 4 trillion dollar equal to 20 percent of the total.
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Here are the actual figures for US Defense Spending from the Clinton years up to today, including Barack Obama as follows:
United States Government Annual Budget during the Obama administration. Each year, on the first Monday in February, the President of the United States submits his budget request to Congress for the following fiscal year:
United States federal budget, 2012 - $3.73 trillion (submitted 2011 by President Obama)
United States federal budget, 2011 - $3.83 trillion (submitted 2010 by President Obama)
United States federal budget, 2010 - $3.55 trillion (submitted 2009 by President Obama)
Total US government Budget for period year 2009 to year 2011 = US$ 11.11 trillion US dollars
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Here is Obama’ actual military spending:
For Fiscal Year 2011 it is $ 708 billion
For Fiscal Year 2010 it is $ 691 billion
For Fiscal Year 2009 it is $ 515.4 billion
Note: An additional $37 billion supplemental bill to support the wars in Iraq and Afghanistan was passed in 2010.
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Total Obama administration actual defense spending for 3-year period 2009 to 2011 = US$ 1,951 billion US dollars.
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Total Bush administration actual defense spending for 8-year period 2001 to 2008 = US$ 3,898 billion
Total Obama administration actual defense spending for 3-year period 2009 to 2011 = US$ 1,951 billion US dollars.
Total Defense Spending 2001 – 2011 = US$ 5,849 billion US dollars = US$ 6 trillion
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Note: By the way, here are the actual figures for Defense Spending for the Bill Clinton years and the estimated figures for the following 7 years.
President Bill Clinton administration (Jan’93 – Jan’01)
Actual figures total annual defense budget during the Clinton administration.
Year - Amount in billions of US dollars
1993 - US$ 267.4
1994………251.4
1995………255.7
1996………251.8
1997………242.6
1998………250.7
1999………257.3
2000………263.6
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Total cumulative actual amount for 8-year period Jan’93 – Jan’01 = US$ 1,773.1 billion.
On the year 2000 Defense Department Annual Report – The Defense Dept. projected the following amounts for Defense spending for the 7-years period from 2001 to 2008.
Year - Amount in billions of US dollars
2001 - US$ 272
2002………276
2003………285
2004………292
2005………299
2006………307
2007………314
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Total cumulative amount for 7-year period Jan’01 – Jan’08 = US$ 2,045 billion.
1994………251.4
1995………255.7
1996………251.8
1997………242.6
1998………250.7
1999………257.3
2000………263.6
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Total cumulative actual amount for 8-year period Jan’93 – Jan’01 = US$ 1,773.1 billion.
On the year 2000 Defense Department Annual Report – The Defense Dept. projected the following amounts for Defense spending for the 7-years period from 2001 to 2008.
Year - Amount in billions of US dollars
2001 - US$ 272
2002………276
2003………285
2004………292
2005………299
2006………307
2007………314
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Total cumulative amount for 7-year period Jan’01 – Jan’08 = US$ 2,045 billion.
Note: Based on these estimates they probably would have estimated the year 2008 for US$ 321 billion for a total cumulative amount for 8-year period Jan’01 – Jan’09 = US$ 2,366 billion.
These figures were provided by the US government as part of the last Budget of the Clinton administration – these figures were included with the Defense budget for that year, and they also provided the best estimates for Defense budget for the following 7 years – when the Clinton administration passed that final budget they did not know as yet which political party was going to win the election of year 2000.
If Al Gore had become the new president of the United States in 2000, then the Defense budget probably would have keep its downward trend, or would have been closer to that final Defense budget estimate from the Clinton administration.
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Anyway, at the end of the Clinton administration they were talking about cutting the Defense Budget in the coming years.
Actual Bush administration 8-year cumulative Defense Spending = US$ 3,898 billion
Clinton administration estimated figure for total cumulative Defense Spending for 8-year period Jan’01 – Jan’09 = US$ 2,366 billion.
Osama bin Laden effect on US Defense spending during the 8-year Bush administration = US$ 1,532 billion.
Then if you on top of that the Osama bin Laden effect on the 3-year Obama administration = US$ 1 trillion.
The total Osama bin Laden effect on the US Defense budget from 2001 to 2011 is at least = US$ 2.5 trillion
Conclusion: Out of the total US$ 6 trillion dollar US Defense spending for 2001 to 2011 the figure includes US$ 2.5 trillion dollars as the Osama bin Laden effect.
That means that without Osama bin Laden and 9/11, instead of spending $ 6 trillion US dollars in Defense spending for the period 2001 – 2011, the United States would have spent US$ 3.5 trillion dollars or less in Defense spending for that same period.
The “Bin Laden effect” it would be even greater if we add on top of the Defense budget, the budget for the Department of Homeland Security for all these years.
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Noam Chomsky has suggested that "military-industrial complex" is a misnomer because (as he considers it) the phenomenon in question "is not specifically military." He claims, "There is no military-industrial complex: it's just the industrial system operating under one or another pretext (defense was a pretext for a long time)." Though this might be true, the problem is that different forms of power are extended by real, exaggerated or imagined crises, and in the state military-capitalist society, there is a hierarchy between political (state) and economic (market) power, where state capitalists have directive power in orchestrating crises. In other words, the power of the military machine is somewhat autonomous from corporate-sponsored politicians, and this autonomy is used to reproduce the system through a differential and superior ability to generate crises. Furthermore, the autonomy is supported by economic exchanges in which the military state bureaucracy extends power by producing commodities.
The privatization of the production and invention of military technology also leads to a complicated relationship with significant research and development of many technologies. The defense industry tends to contribute heavily to incumbent members of Congress.
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March 29, 2011
Ricardo: A few months ago I was watching C-Span and during the debate one of the senators mentioned that 60 percent of US government jobs has something to do with the US military Industrial Complex.
Here is a documentary produced by the BBC on the commerce of war, and how the military industrial complex profits so much from war, that it must create wars to continue the growth of it's business.
Why we fight Part 1 of 12
http://www.youtube.com/watch?v=Xm1B7x5JZfEWhy we fight Part 2 of 12
http://www.youtube.com/watch?v=b2N3BuDAT0k&NR=1Why we fight Part 3 of 12
http://www.youtube.com/watch?v=nbdUZPdqQjk&NR=1Why we fight Part 4 of 12
http://www.youtube.com/watch?v=Uqnkj9m_m9c&NR=1
Why we fight Part 5 of 12
http://www.youtube.com/watch?v=ZKp3FhD5vUY&NR=1Why we fight Part 6 of 12
http://www.youtube.com/watch?v=s9wMa5q0JGc&NR=1Why we fight Part 7 of 12
http://www.youtube.com/watch?v=djebtXs1Wl4&NR=1Why we fight Part 8 of 12
http://www.youtube.com/watch?v=chs9NJGN4Og&NR=1Why we fight Part 9 of 12
http://www.youtube.com/watch?v=CGK3ZdlqTiM&NR=1Why we fight Part 10 of 12
http://www.youtube.com/watch?v=0dzQNWKwlM0&NR=1Why we fight Part 11 of 12
http://www.youtube.com/watch?v=eAhhlzJrMlw&NR=1Why we fight Part 12 of 12
http://www.youtube.com/watch?v=9pxETccMtkQ&NR=1********
Overblown defense expenditures year after year were the “Achilles heel” that put the last two superpowers on the poor house and out of business – first, the British Empire, and second the “Soviet Union Empire”, and today the United States is following the same path – the path to extinction.
Crash Course: Chapter 10 - Inflation (Part 1 of 2)
http://www.youtube.com/watch?v=-xCy6sDxnhs&NR=1&feature=fvwp
Time: 9 min.
Crash Course: Chapter 10 - Inflation (Part 2 of 2)
& Chapter 11 - How Much is a Trillion?
http://www.youtube.com/watch?v=FzEDkFDeJ_A&NR=1&feature=fvwp
Time: 6 min.
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Red Flag:
After reading all the above material and watch the videos, then you will understand why the United States might be setting the stage to create another Vietnam War - this time around in South America.
Alarm bells are ringing:
The U.S. is setting the stage to wage war against South America
http://thefinalcollapseoftheusdollar.blogspot.com/2011/05/collapsing-us-economic-and-financial.html
What has been happening in Libya in the last few months can happen to any country around the world - as long as your country is rich in natural resources, then your country might be the next prey of the United States.
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This video gives a very good explanation about what is behind the war against Syria.
In the second half of the video they also give interesting information about "War Inc."
Corbett Report – August 30, 2013
Given that the pretext for attacking
Syria is falling apart before the public's eyes, why is the US
preparing to wage war on that country? Who benefits from the ongoing
destabilization of Assad's government? What will the Middle East look
like if the Sunnis take over Syria? What is Israel's role in this?
What do Turkey, Qatar and Saudi Arabia have to gain from a war in
Syria? And what does Bandar Bush have to do with all of this? Join us
today on The Corbett Report as we discuss these and other pressing
issues as the world stands on the brink of yet another US-led Middle
Eastern military adventure.
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