Is the American Empire really falling apart or failing? This empire consists of overseas colonies of puppet rulers mostly in the Arab world who are being overthrown by popular protests. Another pillar of this powerful empire was the almighty dollar which is losing its might steadily and will not be able to buy even one Swiss franc, one Canadian dollar, or one Australian dollar. Even with virtual economic meltdown in many European countries, it still requires $1.38 dollars to buy one euro. This steady fall can be attributed to many factors including economic mismanagement and fiscal and trade deficit staring American economy in the eye. And a quick fix is not in sight, not even in medium term.
The USA is a country which is ruled by its fears about its security and its military establishment’s obsession with international hegemony. These ambitions have a price; and that leads to failing economy which costs middle class and the poor and enrich the corporate world. According to Foreign Policy Journal, the projections of deficits are grossly understated because the deficits are likely to be substantially larger than forecast. The military/security complex, about which President Eisenhower warned Americans a half century ago, is more powerful than ever and shows no inclination to halt the wars for U.S. hegemony.
The U.S. media, being good servants for the government, only reports the out-of-pocket or current cost of the wars, which is only about one-third of the real cost. The current cost leaves out the cost of life-long care for the wounded and maimed, the cost of life-long military pensions of those who fought in the wars, the replacement costs of the destroyed equipment, the opportunity cost of the resources wasted in war, and other costs. The true cost of America’s illegal Iraq invasion, which was based entirely on lies, fabrications and deceptions, is at least $3,000 billion according to economist Joseph Stiglitz and budget expert Linda Bilmes. The same for the Afghan war, which is ongoing. If the Afghan war lasts as long as the Pentagon says it needs to, the cost will be a multiple of the cost of the Iraq war.
There is not enough non-military discretionary spending in the budget to cover the cost of the wars even if every dollar is cut. As long as the $1,200 billion ($1.2 trillion) annual budget for the military/security complex is off limits, nothing can be done about the U.S. budget deficit except to renege on obligations to the elderly, confiscate private assets, or print enough money to inflate away all debts.
The other great contribution to the U.S. deficit is the offshoring of production for U.S. markets. This practice has enriched corporate management, large shareholders, and Wall Street, but it has eroded the tax base, and thereby tax collections, of local, state, and federal government, halted the growth of real income for everyone but the rich, and disrupted the lives of those Americans whose jobs were sent abroad. When short-term and long-term discouraged workers are added to the U3 measure of unemployment, the U.S. has an unemployment rate of 22%. A country with more than one-fourth of its work force unemployed has a shrunken tax base and feeble consumer purchasing power.
Iraq war alone cost Americans one-fifth of the year’s gross domestic product. Instead of investing the resources, which would have produced income and jobs growth and solvency for state and local governments, the U.S. government wasted the equivalent of 20% of the production of the economy in 2010 in blowing up infrastructure and people in foreign lands. The U.S. government spent a huge sum of money committing war crimes, while millions of Americans were thrown out of their jobs and foreclosed out of their homes.
The U.S. government remains a champion of off-shoring, which it calls “globalism.” According to the U.S. government and its shills among “free market” economists, destroying American manufacturing and the tax bases of cities, states, and the federal government by moving U.S. jobs and GDP offshore is “good for the economy.” It is “free trade.”It is the same sort of “good” that the U.S. government brings to Iraq and Afghanistan by invading those countries and destroying lives, homes and infrastructures. Destruction is good. That’s the way our government and its shills see things. In America destruction is done with jobs off-shoring, financial deregulation, and fraudulent financial instruments. In Iraq and Afghanistan (and now Pakistan) is it done with bombs and drones. It is leading to the destruction of Social Security and Medicare. Ironically, Republicans have convinced a large percentage of voters that America is in trouble, not because it wastes 20% of the annual budget on wars of aggression and Homeland Security porn-scanners, but because of the poor and retirees.
Republicans tell us that our grandchildren are being saddled with impossible debt burdens because of handouts to retirees and the poor. $3 trillion wars are necessary and have nothing to do with the growth of the public debt. The public debt is due to unnecessary “welfare” that workers paid for with a 15% payroll tax. When you hear a Republican sneer “entitlement,” he or she is referring to Social Security and Medicare, for which people have paid 15% of their wages for their working lifetime. But when a Republican sneers, he or she is saying “welfare.” To the distorted mind of a Republican, Social Security and Medicare are undeserved welfare payments to people who over-consumed for a lifetime and did not save for their old age needs.
America can be strong again once we get rid of these welfare leeches. Once we are rid of these leeches, we can really fight wars. Republicans regard Social Security as an “unfunded liability,” that is, a giveaway that is interfering with our war-making ability.
The paper accuses the government of stealing mega billions to invest in inconclusive wars and senseless hegemonic initiatives.
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