Let's talk about REAL Government spending, not our piffling amounts...

Total defense spending $1.2 Trillion a year.
GDP around the $15 trillion mark.
That's an 8% spend on defense (that includes the Iraq and Afgan conflicts as will as pensions and healthcare costs for veterans and disabled that would be covered by general healthcare budgets in Europe). It also includes Homeland Security etc.
High by European standards but the yanks will argue that that's because they are spending money that European countries should be spending.
 
There are other justifications for the spend.

The military (I use the term in its broadest sense to include the marines, navy, air force, and the army) in America is a major employer in and of itself both at the basic level of private in the army (which is their viable alternative to the unemployment line) rising through the ranks of commissioned officers, specialists to strategists at the highest level.

Outside of the military proper are the military contractors and suppliers, which again cover a huge range of industries from supplying nutritious pre-packed food to their soldiers in the field right through to advanced aeronautics, avionics, GPS engineering and design, covering from high spec component design and supply to military surveillance satellites, ground hardware and software.

In other words, the military budget, much of which seems to be spent at home, supports American industry, some of which under the security blanket, simply cannot be outsourced to Ahmed in the UAE or Mr. Han in China. Cutting a budget like that could cause serious harm to an economy, assuming that's where the money ends up.

There is a question mark over this.

Only this week I was told by a guy about an European company that bid on a contract in Iraq where the bid was under 10 million dollars, but the contract was awarded to an American company at a multiple of that cost.

So is this a genuine reflection of the cost of additional security, or is it a way funnelling money to "the boys" who are running the show back home - hard to say, but it looks damned suspicious, especially where there is no transparancy and no proper accounting for the monies from the tax take.

It seems to give credibility to the assertion that war is a racket.
 
I've been to Afghanistan and I'm involved in some US projects there. The volumes of money, materials and food that is consumed there, and in Iraq, would shock you.
 
There is a strong link between having a defence industry and having a hi-tech engineering sector. The strongest link is between the defence and medical sectors. The reasons for this are obvious; the R&D, development, approval and manufacturing processes for both sectors are almost identical. In other words the guys who cut their teeth in the state funded defence sector can move seamlessly into the medical device sector. The defence sector in the USA doesn’t just create jobs, it links industry to universities, teaches engineers and scientists how to conduct R&D from concept through to manufacture, it provides a template for how cash flows from government to industry to academia and back again. It is impossible to overstate how important this is to the American economy.

Our lack of such a structure in Ireland seriously limits our ability to be a serious player as a country that can be both the originator of a concept and the base from which it is commercialised.

None of the above makes the points made by ONQ about waste and unaccountability any less valid but the USA is not alone in that. The UK armed forces use British made standard infantry assault rifle and body armour. The SAS are allowed to buy their own equipment. They use an off the shelf American gun which is less than half the price and they buy their body armour off the internet, also at a fraction of the price of the inferior standard kit. The monolith that is BAE swallows billions in tax payers money and is, in effect, a totally unaccountable branch of the public sector.
 
Purple said:
There is a strong link between having a defence industry and having a hi-tech engineering sector. The strongest link is between the defence and medical sectors. The reasons for this are obvious; the R&D, development, approval and manufacturing processes for both sectors are almost identical.
Click to expand...

Very true, we are still reaping the rewards of technological progress made in a very short space of time during World War 2.

Purple said:
The UK armed forces use British made standard infantry assault rifle and body armour. The SAS are allowed to buy their own equipment. They use an off the shelf American gun which is less than half the price and they buy their body armour off the internet, also at a fraction of the price of the inferior standard kit.
Click to expand...

I've seen this first hand, not the SAS, but the British forces and US forces have a healthy black market for this stuff wherever they are.

Purple said:
The monolith that is BAE swallows billions in tax payers money and is, in effect, a totally unaccountable branch of the public sector.
Click to expand...

+1 :I recall a colleague telling me about their available budgets at BAE, figures universities and hospitals could only dream of, but allocated with a stroke of a pen at BAE. The success rate of many projects was average at best when compared to the input cost and duration.
 
bullbars said:
+1 :I recall a colleague telling me about their available budgets at BAE, figures universities and hospitals could only dream of, but allocated with a stroke of a pen at BAE. The success rate of many projects was average at best when compared to the input cost and duration.
Click to expand...

The success rate it's even the worst of it; they usually produce an inferior and more expensive product to what's on the market already. All on the pretext of maintaining a stand alone defense industry. This, or course, is a nonsense since so much of their kit uses US technology which constrains who they can sell the finished product to and what the availability will be in a conflict.
 
ringledman said:
And the 'real' economic benefit to the USA is what?

<snip>

As Marc Faber once said:

"The federal government is sending each of us a $600 rebate. If we spend that money at Wal-Mart, the money goes to China. If we spend it on gasoline it goes to the Arabs. If we buy a computer it will go to India. If we purchase fruit and vegetables it will go to Mexico, Honduras and Guatemala. If we purchase a good car it will go to Germany. If we purchase useless crap it will go to Taiwan and none of it will help the American economy. The only way to keep that money here at home is to spend it on prostitutes and beer, since these are the only products still produced in US. I've been doing my part."
Click to expand...

(chuckle)

Your point is well made, but its not accurate.
That is a separate argument about globalization.
I totally agree and I have commented on it elsewhere.

Most of the defense contractors are American companies.
You can argue that they sub-contract out to foreign countries.
This below link gives the top 100 contractors and their countries.

http://en.wikipedia.org/wiki/List_of_United_States_defense_contractors

As for Marc Faber himself, he frightens me.
Not because I disagree with him -on the contrary.
Because I now find I've been saying the same things for a year.

http://www.infiniteunknown.net/2010...uy-farmland-and-gold-prepare-for-a-dirty-war/
 
Purple said:
The success rate it's even the worst of it; they usually produce an inferior and more expensive product to what's on the market already. All on the pretext of maintaining a stand alone defense industry. This, or course, is a nonsense since so much of their kit uses US technology which constrains who they can sell the finished product to and what the availability will be in a conflict.
Click to expand...

We're looking at poor products costing a lot of money.

Japanese car manufacturers knowhow to achieve affordable reliability.
Accept 0% faults per 1,000 items from suppliers.
Economies of scale drives down price.

It goes without saying that if the private sector can do this then so can the military.
This seems to speak more to corruption than incompetence.
 
onq said:
(chuckle)

Your point is well made, but its not accurate.
That is a separate argument about globalization.
I totally agree and I have commented on it elsewhere.

Most of the defense contractors are American companies.
You can argue that they sub-contract out to foreign countries.
This below link gives the top 100 contractors and their countries.

http://en.wikipedia.org/wiki/List_of_United_States_defense_contractors

As for Marc Faber himself, he frightens me.
Not because I disagree with him -on the contrary.
Because I now find I've been saying the same things for a year.

http://www.infiniteunknown.net/2010...uy-farmland-and-gold-prepare-for-a-dirty-war/
Click to expand...

Sorry had to get that one in;-) Faber cracks me up but talks a lot of sense. His grasp of economic history is fantastic (his book tomorrow's gold is excellent). Also agree regarding a dirty war soon. He says that history shows that secular commodity booms as we have now lead to wars.

The point I make is that surely a nation cannot believe that:

'our economy and future wealth will improve greatly if we go to war and spend trillions on fighting and developing new technology over investing this cash in manufacturing and infrastructure for peaceful purposes'.

I don't doubt that wars improve technology but surely a $ spent at home on productive capacity is better than a $ spent fighting a war in some foreign land?

I just dont buy the notion that defence spending is a better allocator of capital than using the cash to invest in long term productive capacity.
 
(nods)

Gave me a real lift today, thanks. :)

Here we're totally ad idem on this .

I've posted about the relation between financial disasters and wars before

Banking Crisis 1907 --> WWI 1914
Wall Street Crash 1929 --> WWII 1939
Global Economic Crisis 2008 --> WWIII 2018?

To me this is the big picture and it seems to be we're all under pressure with our eyes off the ball arguing over details - this is mere distraction while others pursue a war-mongering agenda.

The Masters of the Universe like wars.
Wars stimulate innovation and enterprise.
Wars allow for dramatic re-positioning of global influence.
Wars wipe out old established regimes and clear the ground
War create chaotic situations that the unprincipled can exploit.

Think of the contracts with the Chinese and French that were thrown into disarray by the Iraq Invasion and the wide scale looting of priceless treasures that took place during it.
Look at how accepting people are of the current Libyan Invasion supposedly to support some cobbled together "resistance" whose claim to fame seem to be pickups with field guns on the back.
When America goes to war all the financiers pockets suddenly deepen and a massive injection of capital goes into the defense economy - this is how it will survive the disaster it has brought on the rest of us.

If America doesn't wage war and renew its indigenous industries with new technologies that others desire in the later peacetime, it will fail.
If it stays in peace it will disappear into a double dip recession and it may not recover for a generation.
Its profligate over-spending leads to war and its wars lead it to recovery.

I'm not someone who accepts that this is the only route to progress.
People are inventing all the time, but in peace time vested interests can restrict development.
Look at the antics of Microsoft in the browser wars and the subsequent anti-trust cases in America and Europe.

I'd like to find some other way besides war to

(i) inject huge amounts of capital into an economy
(ii) create new technologies and products to stimulate demand
(iii) restore jobs and consumer confidence and replace austerity with good planning.

In that regard I think Minister Howlin's initiative of bringing in change managers and starting with a blank sheet on budgets and then justifying expenditure on each item is a good proposal.

Perhaps America would try it, that is if it had and honest and accountable Dept of Defense budgeting procedure.
You can help wondering how much of their "overspend" is actually buying influence and favours in advance of WWIII.
 
You'd think with all this spending, they'd have this war won already, instead of being bogged down for years to come.
 
You're assuming they want to win.

The worst thing for a soldier to face is an era of peace.
A military machine needs constant sources of enemies to justify its vast budgets.

They all looked forward to the "Peace Dividend" following the collapse of the Soviet Union.
How long did it "the Allies" them to find other conflicts/ fronts to justify their endless military spending?

- Operation Desert Storm/ Gulf War 1

- The Balkans Conflict - Serbia/Croatia/Kosovo

- Global Terrorism (one that can never really go away if you keep persecuting sub-groups)

Its a bit like capturing Saddam Hussein, or Bin Laden - or currently, Ghadaffi.
Its inconceivable that a military machine like the United States' could not take out a terrorist leader on the first salvo.
But that wouldn't allow him to be paraded first as the bogeyman, then as the defeated terrorist enemy, or in Bin Laden's case, simply taken out of the picture to avoid inconvenient revelations.

Its equally unbelievable that America cannot position itself globally to avoid people hating it by sticking to defending its borders, as opposed to attacking everyone else's.
That kind of cost-effective, budget conscious strategy is where the rest of the world would like it to be heading, but I suspect that's unlikely to be on the cards any time soon.

That's another discussion.
 
onq said:
Its equally unbelievable that America cannot position itself globally to avoid people hating it by sticking to defending its borders, as opposed to attacking everyone else's.
Click to expand...

I don't think thats a fair accusation to make against the Yanks. While ethnic cleansing was going on in the Balkans, on the EU's doorstep, in 20th century europe....what did the major local powers do!
The Yanks sorted that out and brought it to a halt or God knows how it would have ended. There was no oil at the end of the rainbow, Clinton knew he was'nt going to get brownie points at home from the electorate or make any extra friends globally from it...but he put the US in and fair play to them.
 
That's not an accusation.


The profits American companies made from the First World War.

http://www.ratical.org/ratville/CAH/warisaracket.html


The pipeline(s) they wanted through the Balkans.

http://u2r2h.blogspot.com/2008/02/kosovo-protects-us-pipeline.html


The alternative - the Afghan pipeline.

http://en.wikipedia.org/wiki/Afghanistan_Oil_Pipeline


Union Banks financing of Germany prior to and during WWII.

http://en.wikipedia.org/wiki/Union_Banking_Corporation


I'm sure you'll recognize at least one surname on the board of directors.
 
surnames on boards or not....ethnic cleansing was happening in Europe less than 20 years ago and 'twas the Yanks that stopped it, not the euro-weenies!
 
The name was Prescott Bush, whose Union Bank financed the greatest ethnic cleansing ever to take place in Europe.
 
Tarpley is a good place to start reading about the precursors to current events.

http://tarpley.net/online-books/george-bush-the-unauthorized-biography/chapter-2-the-hitler-project/
http://tarpley.net/online-books/geo...r-3-race-hygiene-three-bush-family-alliances/
http://tarpley.net/online-books/geo...apter-4-the-center-of-power-is-in-washington/

Just remember, this is about as relevant to current events as listening to sixties' music is to critiquing a new release by The Prodigy.
But unless you learn the influences and the ways of thinking that persist from the early twentieth century in America, you won't learn much.

The current economic disaster is the inevitable legacy of military overspend conducted by the previous president and persisted by the current one.
There are no "sides" here - just one nation consuming unsustainably - because it can - and because this gives it internal justification to spread its influence.

The rise of China adds more complexity - China's increase in military spending was recently criticised by a Defense Department Report, whose actions China had previously criticised.
The likelihood of the abandonment of the US Dollar as a reserve currency - possibly replaced by the Euro by 2020 - introduces more uncertainty to the mix and a general destabilization of the US economy.

As you can see above, all my links are in the public domain, Tarpley's book has been in print and not rebutted to any degree for a decade and more, and the later links are current and verifiable.
The real fear is that America will react violently to any diminution of its power and influence.
 
onq said:
The name was Prescott Bush, whose Union Bank financed the greatest ethnic cleansing ever to take place in Europe.
Click to expand...

Giving money to a state by buying their bonds and financing genocide are two different things. It is nonsense to link them.
If you want to see direct support of genocide read up on France in Rwanda.
 
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