Military Industrial Plutocracy

From capitalistManifesto
"In bourgeois society, therefore, the past dominates the present; in Communist society, the present dominates the past. In bourgeois society capital is independent and has individuality, while the living person is dependent and has no individuality." - Karl Marx, Communist Manifesto (1848)
"It is part of the general pattern of misguided policy that our country is now geared to an arms economy which was bred in an artificially induced psychosis of war hysteria and nurtured upon an incessant propaganda of fear." - Douglas MacArthur


On Jan. 17, 1961, President Dwight Eisenhower gave the nation a dire warning about what he described as a threat to democratic government. He called it the military-industrial complex, a formidable union of defense contractors and the armed forces.

Eisenhower, a retired five-star Army general, the man who led the allies on D-Day, made the remarks in his farewell speech from the White House. As NPR's Tom Bowman tells Morning Edition co-host Renee Montagne, Eisenhower used the speech to warn about "the immense military establishment" that had joined with "a large arms industry."

Here's an excerpt: "In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists, and will persist."

Since then, the phrase has become a rallying cry for opponents of military expansion. Eisenhower gave the address after completing two terms in office; it was just days before the new president, John F. Kennedy, would be sworn in. Eisenhower was worried about the costs of an arms race with the Soviet Union, and the resources it would take from other areas -- such as building hospitals and schools.

Bowman says that in the speech, Eisenhower also spoke as someone who had seen the horror and lingering sadness of war, saying that "we must learn how to compose differences not with arms, but with intellect and decent purpose."

Another concern, Bowman says, was the possibility that as the military and the arms industry gained power, they would be a threat to democracy, with civilians losing control of the military-industrial complex.

In his remarks, Eisenhower also explained how the situation had developed: "Until the latest of our world conflicts, the United States had no armaments industry. American makers of ploughshares could, with time and as required, make swords as well. But we can no longer risk emergency improvisation of national defense; we have been compelled to create a permanent armaments industry of vast proportions."

The difference, Bowman says, is that before the late 1950s, companies such as Ford built everything from jeeps to bombers -- then went back to building cars. But that changed after the Korean War. Bowman says that it's important to note that during the Cold War, the U.S. military didn't draw down its troops like it did after World War II. "It kept a large standing army after the Korean War," he says.

America's new reliance on sophisticated weapons technology also helped bring about what Bowman calls "a technology race with the Soviets."

And that meant that weapons manufacturing became more specialized. "So [for] a company like Ford, going from cars to jeeps is one thing; cars to missiles is quite another," Bowman says.

In an effort to control the expansion of the military-industrial complex, Eisenhower consistently sought to cut the Pentagon's budget. The former general wanted a budget the country could afford, Bowman says. He upset all the military services with his budget cuts, especially the Air Force. Citing another quote from Eisenhower -- this one from another speech on military spending -- Bowman says, "The jet plane that roars overhead costs three quarters of a million dollars. That’s more than a man will make in his lifetime. What world can afford this kind of thing for long?"

In today's government, Eisenhower has a fan in his fellow Kansan Secretary of Defense Robert Gates -- who keeps a portrait of the former general in his office at the Pentagon, Bowman says. Speaking at the Eisenhower Library last year, Gates talked about America's insatiable appetite for more and more weapons: "Does the number of warships we have, and are building, really put America at risk, when the U.S. battle fleet is larger than the next 13 navies combined -- 11 of which are our partners and allies? Is it a dire threat that by 2020, the United States will have only 20 times more advanced stealth fighters than China? These are the kinds of questions Eisenhower asked as commander-in-chief. They are the kinds of questions I believe he would ask today."

But, Bowman says, it has only become more difficult to control the size of the nation's military industry. First, "there are only a handful of defense giants," he says, "which means you can't shop around for a better price."

And companies such as Lockheed Martin and Northrop Grumman are also adept at both lobbying and marketing to promote their interests. Bowman says, "they also spread the jobs around the country, to lock in political support."

Gates has also discussed the difficulty of cutting military spending: "What it takes is the political will and willingness, as Eisenhower possessed, to make hard choices -- choices that will displease powerful people both inside the Pentagon, and out."

Bowman says that some industry observers believe that "the one thing that could create that political will is the nation's huge deficit." Only that might force cuts in the overall defense budget.


Subsidy is a grift. Tax breaks can be a grift. Military industrial complex has its stamp all over this long-running grift of tax revenue into the offshore accounts of corporations and billionaires.


Money comes in from tax payers and a hundred other government revenue-generating avenues. Some of this money gets spent on public services, supposedly for the good of the people who need it. Often this is paid out as investment (or tax break) for big business, ostensibly to buy their expertise and capabilities, for the sake of the citizen. In reality, the dynamic itself is a grift. In most cases, the government hands taxpayer money to the corporate oligarchy, where it ultimately circulates into profits for big business and the big business owners.

No government spending is as perfectly evolved for public private partnership grift than the vast military budget. The government pours money into the coffers of multinational weapons manufacturers, increasing the nation's arsenal while shifting billions of taxpayer dollars into the hands of the oligarchy. Government pours money into the coffers of one of the branches of military, for recruitment and training and soldier equipment, increasing the nation's security and the government's power while pouring billions in taxpayer dollars back into the veteran circular flow.

Include some figures. Include some of the key government corporate grift dynamics.


The US dollar was woven into the Bretton Woods settlement, ensuring America's currency became the de facto world currency of exchange. Three-quarter of a century later the world has changed much. There are many developed nations and a handful of up-and-coming future economic superpowers (China and India). The world doesn't need America as peacekeeper or as provider of the stable currency of exchange. What's more, since 2008 the Fed has used quantitative easing in a profligate way, taking advantage of the dollar's privileged position: the US can print more dollars to pay its debts or fund government spending and pass on most of the consequences of the increased circulation (i.e. risk of devaluation of the currency or deflation of its purchasing power). All countries hold dollar assets. The dollar is the basis of 80 world currencies. Dollars are the global exchange currency. Wall Street is the dominant channel for capital flow. When the Fed prints more currency, the pain is diluted across the entire world. No other country is able to do this. All the other countries must, in some sense, balance their books - spend more cautiously, tax more assiduously - because if they're forced into quantitative easing (i.e. printing money in their own currency the pain can't be deferred or diluted.

The rest of the world is fully cognizant of the American advantage and attempts to escape from under the thumb of the US dollar occur now and then, especially in smaller nations struggling under the burden of IMF, World Bank and "Western" exploitation policy e.g. dominant market position for the "Western" multinationals imposed on the smaller nation under threat of economic sanctions. Sometimes economic sanctions aren't enough. Sometimes there's no time to wait for sanctions to bring their target to submission. At this point, America has the luxury of turning to its enormous military firepower, vastly over-stocked thanks to the military industrial complex mechanisms. The threat to a smaller nation of having to face the American military tends to force the most stubborn government of people to make terms; and these terms always include a degree of exploitation and an in-built advantage to the American or "Western" interests.

It's worth noting, in passing, that the huge American military defends the stability of the US dollar by safeguarding - in an aggressive and preemptive way - the borders of the United States and its allies. Better to ally into this system than push back against it, no?






Even when all the layers of the complex system have been laid out, including the nefarious and the cynical and the rampant grift, the simple question remains: is the military industrial complex a bad thing?