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Entries tagged "military spending"

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Demilitarizing the Economy: A Movement is Underway

December 19, 2013 ·

Military vehicles (MRAPs) being produced in a Charleston, SC factory (Photo: New York Times)End wars. Shrink the Pentagon budget. Reinvest the savings in neglected domestic priorities. It’s a logical progression. Right?

Yes, though we’d be fools to expect too much logic out of our current federal legislature. As we end the longest period of war in our history, we should be entering a period of postwar downsizing—the first since the end of the Cold War. And we are, though it’s been driven as much by budget squeezing generally as by a sense of postwar possibility.

And it’s a shallower defense downsizing than the last one. And the December 2013 budget deal will make it even shallower.

But communities that have been living off post-9/11 military budget surges are beginning to feel the effects of this (so far) modest shrinkage. This is the moment to deepen the defense downsizing, and make it endure. An essential piece of this task is to focus on helping communities and workers build alternatives to dependency on building weapon systems we don’t need.

The Institute for Policy Studies has developed a comprehensive strategy (PDF) for building this alternative economic foundation, linking action at the federal, state and local levels.

Here are two of the most exciting developments pushing this forward. They look like the sturdy supports of a movement to me.

State commissions planning for diversification

Connecticut—one of the most defense-dependent states in the nation—is providing one new model for action. In May of this year, peace, environmental and faith groups joined with labor unions to push the legislature to pass “An Act Concerning Connecticut’s Future.” This vague-sounding law contains a visionary mandate: convene a broad-based Commission to come up with a plan to diversify Connecticut’s overly defense-dependent economy. This commission—made up of state economic development directors, legislators, representatives of business groups, the state AFL-CIO, and representatives of peace and environmental organizations—is beginning to meet and will reveal its plan by the end of next year.

Other states are following suit. Maryland will vote on a similar bill in its next legislative session. Wisconsin has one in the works. Activists are pushing the process in Massachusetts, Ohio, Michigan and Minnesota. It’s a growing movement that can become a model for the kind of postwar planning that needs to happen on the federal level.

New federal supports for local transition planning

Since the 1980’s the Defense Department has housed a small office dedicated to helping communities plan an economic transition following a base closing or defense contract cancellation. As the Pentagon budget soared during the post-9-11 years, this office focused almost exclusively on the base closings-half of its mission. Now it is refocusing on developing new tools for defense transition assistance (PDF) that would helping communities adjust to defense contract losses with planning grants and technical assistance.

The Obama administration is beginning to expand this Office of Economic Adjustment, as it’s called, and turn it into a gateway for assistance from other federal agencies, including programs in the Departments of Commerce, Energy and Transportation, for communities in transition.

Local activists can work with their local public officials to put together broad-based community coalitions and use these funds to build models of peace economy transition. The more we do, the more lessons we learn about the best practices for doing it, and the stronger this foundation for a demilitarized economy becomes.

New Economy Transitions From the Bottom Up

In the face of federal legislative dysfunction, more and more progressive initiatives are coming from the state and local levels. The effort to build a peace economy, following the longest period of war in our history, is taking its rightful place in this constellation of progress from the bottom up.

Miriam Pemberton is a Research Fellow at the Institute for Policy Studies. Defense Transition Assistance fact sheets (PDF) from IPS’ Green Security Project outline the exciting new routes to a peace, rather than military, economy. For more information and help in getting started, contact Miriam Pemberton, Miriam@ips-dc.org, 202-787-5214.

Sequestration: Our Military is Due for Downsizing

February 22, 2013 ·

Sequestration wouldn't gut military

This strange animal called sequestration is certainly wreaking havoc with our customary ideological boundaries. 

If you’re an advocate, Iike I am, for revamped federal priorities that shift resources from a bloated Pentagon budget toward neglected domestic priorities, your take on this animal can’t be simple. You say cutting everything indiscriminately is a bad way to run a government (this view is nearly universal). You oppose the cuts in the domestic budget that will leave us with fewer food safety inspectors, medical researchers, Head Start teachers, and airport baggage screeners on the job. But you can reel off long lists of ways to cut waste in the Pentagon budget to the levels prescribed by sequestration, and show that these cuts will leave us completely safe.

But you also know that the whole conversation is focused on the wrong topic. It’s past time to shift this conversation away from austerity and toward investment to create jobs, as clear majorities of voters said in November was what they wanted.

Now let’s look at the Washington Post’s blogger who says he writes “from a liberal perspective,” Greg Sargent. On Wednesday he went at the Republican position on sequestration, wielding a new report from the non-partisan Congressional Research Service. The report found that the single most important cause of increased income inequality in recent years is the favored tax treatment given to capital gains and stock dividends — i.e. what the rich have used to get richer.

The Democrats, as Sargent points out, want to change this, taxing the rich and using the proceeds to replace the sequester cuts. The Republicans want to stick with sequestration and keep this favored treatment for the rich.

But all of this puts the Republicans, says Sargent, in the position of “openly conceding that the sequester will gut the military.” It’s a concession that Sargent appears to be taking at face value. Or at least not calling into question.

Gut the military? That’s what the Joint Chiefs of Staff have been saying any chance they get. Sequestration would “invite aggression,” says lingering Defense Secretary Leon Panetta. It will “put the nation at greater risk of coercion,” says the Joint Chiefs Chair, Martin Dempsey. When asked at a recent congressional hearing which nation might coerce us, though, he couldn’t say.

In fact, sequestration will not “gut” our military. Our military budget has nearly doubled since 2001. Sequestration would take it back to the level it was in 2007 — when we were still fighting two wars. Adjusted for inflation, it would leave that budget higher than its Cold War average — when we had an adversary that was spending roughly what we were on its military. Now, as Michael Cohen notes in The Guardian, the closest thing to a peer adversary we have is China, and we are spending more on research and development of new weapons than the Chinese are spending on their entire military. We spend more on our military, in fact, than the next 14 countries put together.

After the longest period of war in our history, we are due for a defense downsizing. Sequestration would create a shallower downsizing than any of the previous postwar periods since World War II. We can do this, and we should. We need the money for other things.

As sequestration threatens to confuse us all, let’s be sure to stay clear on that, at least.

7 Ways to End the Deficit (without Throwing Grandma under the Bus)

September 5, 2012 ·

This post originally appeared on Yes! Magazine's New Economy blog.

This fall, the U.S. Congress is going to wage a pitched, dragged-out battle over cutting roughly $120 billion a year to solve the so-called deficit crisis. Vital things like teachers’ jobs and Medicare could well get cut.

The Right is already launching new coalitions to push for an austerity budget, calling for cuts in “wasteful government spending,” including key safety-net programs like Medicare, Medicaid, Social Security, and food stamps. America has overspent, they say. America is broke. But at the same time, they are calling for an extension of the Bush tax cuts and ruling out cuts in military spending—both policies that will increase the deficit.

It doesn’t have to be this way. My colleagues at the  Institute for Policy Studies (IPS) have identified seven steps that, together, more than eliminate the deficit while making the country more equitable, green, and secure.

America is not brokeThese proposals, from the IPS study called “America is Not Broke,” would also address the two deficits that author David Korten says do more to erode our society than the fiscal deficit does: our social deficits (rising poverty and inequality) and environmental deficits (starting with the climate crisis).

More Fairness, Less Deficit

Our first three proposals could bring in $329 billion a year; this alone would solve the deficit problem while helping to close the yawning inequality gap.

  • 1.  Tax Wall Street: $150 billion per year. A tiny tax on stock and derivatives transactions, which several European countries are on track to adopt, would discourage Wall Street speculation, fill the hole in the deficit left by the Bush tax cuts, and leave plenty left over to fund lots of programs. The National Nurses Union and many other allies are fighting hard for this.
  • 2.  Tax Corporations and Stop Tax Haven Abuse: $100 billion per year. The Financial Accountability and Corporate Transparency coalition has pointed out that one of the main ways that corporations avoid paying taxes is by declaring their profits in overseas tax havens like the Cayman Islands.  
  • 3.  Tax the Wealthy Fairly: $79 billion per year. Our rigged tax code lets CEOs pay a lower tax rate than their secretaries do (as Warren Buffett keeps pointing out). The proposed Fairness in Taxation Act (HR 1124) would address this by adding five additional tax brackets for incomes over $1 million.

These three policy changes would go a long way toward making our society more equal, and that means better health, too. There is a terrific body of global evidence, a lot of it compiled by British researchers Richard Wilkinson and Kate Pickett, that more equal societies are much healthier. People at all income levels live longer; they are more fulfilled; and there is less violence. The United States, a relatively equal society as recently as the 1970s, is now off the charts in terms of wealth and income inequality. It doesn’t have to be that way. Just as we created a more just and vibrant economy and a strong middle class through fair taxes between 1940 and 1980, we can do it again through progressive taxation.   

More Green, Less Pollution

The second source of revenue would make the economy more green, a key imperative in a world where the environmental crisis is now as deep as the economic one. We found two simple ways to raise revenues and help save the environment.

  • 4.  Tax Pollution: $75 billion per year. A tax on the carbon content of fossil fuels would reduce our dependence on oil while cutting air pollution and emissions of greenhouse gases. And, as economist Robert Frank pointed out on August 25 in The New York Times, “News that a carbon tax was coming would create a stampede to develop energy-saving technologies.”
  • 5.   End Fossil Fuel Subsidies: $12 billion per year. This call should unite left and right. Why would anyone want to maintain a giant government subsidy to an industry that is the world’s major contributor to fossil-fuel emissions? 350.org has made this a centerpiece of their work. We should be able to win this.

More Savings, Less War

Finally, there are simple ways to cut the military while making the country and the world more secure. More than half of government discretionary spending now goes to the military. Congress has long avoided cuts, in part because they equate military spending with jobs, but IPS has pointed out that almost every other industry employs more workers per dollar than the military. Plus, there is now bipartisan support for two sets of significant cuts.

  • 6.  End Military Waste: $109 billion per year. A broad spectrum of experts has found over $100 billion a year in waste that could be eliminated with no sacrifice in security. Three recent commissions, two of them bi-partisan, have recommended roughly $1 trillion in military cuts over 10 years.
  • 7.  Close a third of our overseas bases and our Iraq operations: $21 billion per year. Over two decades after the Cold War ended, the United States still maintains roughly 1,000 military installations in other countries. A majority of the President’s own deficit commission, which includes three Republican senators—the National Commission on Financial Responsibility and Reform—backed a proposal to close one third of our overseas military bases.

These seven simple steps would raise close to $550 billion a year. They would quickly erase the fiscal deficit  and return the country to a healthy budget surplus. There would be hundreds of billions left to invest in key sectors that could make the country more secure, more green, and more equitable: care jobs, green jobs, infrastructure jobs.

In other words, this plan could help erase the nation’s dangerous social and environmental deficits.

Many groups—from Jobs with Justice to National People’s Action to the AFL-CIO—are organizing to counter a push by the Right to use the deficit crisis to shred social programs and our nation’s safety net. Let’s up the ante and spread the message. America is not broke. We have plenty of resources to rebuild shared prosperity in the U.S.

Top 10 Myths of the Jobs Argument Against Military Cuts

August 14, 2012 ·

Military

Members of Congress, led by the team of Senators McCain, Graham and Ayotte, are touring military contracting plants, bases and defense-dependent communities this summer raising the alarm about “sequestration.” This is the part of the current budget deal that will force $1.2 trillion in across-the-board cuts to federal spending, unless Congress comes up with the same amount of money some other way. Half is supposed to come from the military, half from domestic programs, beginning January 2.

It is true: cutting everything indiscriminately is no way to run a government. But this alarm-raising campaign, buttressed by defense industry spending to buy and promote “independent”studies, and mount lobbying campaigns, is focused not on federal spending in general, but on military cuts in particular. And the centerpiece of their pitch against these cuts is not the standard line that we need to spend ever more on the Pentagon because it needs every penny to keep us safe. Instead the focus is: jobs.

We're in the process of ending two wars. Since 9-11, spending on the Pentagon has nearly doubled. Clearly we're due for a military budget downsizing.

And the urgent need for job creation is on everyone's mind.

That's why the military contractors and their congressional allies are departing from the usual script to argue for more military spending. 

From the crowd that wants to shrink government because this will create jobs, we are now hearing that we can't shrink the Pentagon because that would cost jobs.

Here are main points of their case, rebutted one by one.

Myth # 1: The military cuts will cost a million (or, according to the Pentagon, a million and a half) jobs.

You don't need to get into the details of the many reasons to question these figures to recognize the big flaw: Cutting military spending will only cost jobs if nothing else is done with the money. As economists from the University of Massachusetts have shown, (findings recently corroborated by economists at the University of Vienna [i]) military spending is an exceptionally poor job creator.  Taking those cuts and investing them in other things—clean energy, education, health care, transportation—will all result in a net gain in jobs. Even cutting taxes creates more employment than spending on the military.[ii]

Myth # 2:  More Pentagon spending will create more jobs.

A researcher at the Project on Government Oversight recently exposed the shaky foundation of this argument. He found that since 2006 the largest military contractor, Lockheed Martin, has increased its revenues from military contracts, even as it was cutting jobs.[iii]

Myth # 3: Defense sequestration will gut our military industrial base.

Hardly. The Pentagon cuts contained in the budget deal will bring the military budget, adjusted for inflation, to where it was in 2006. Close to its highest level since World War II. More than the next 17 countries (most of them our allies) put together.[iv] 

These cuts are easily doable, with no sacrifice in security, because they are being made to a budget that has nearly doubled since 2001.

Myth # 4:  The public is buying the myth.

President Obama is actually running an ad criticizing his opponent for advocating military spending increases. The clear pattern in recent polling shows that this is a smart move. Majorities agree military spending is too high.[v]

Myth # 5:  The military economy is part of the bedrock of our jobs base.

A researcher at the Project on Defense Alternatives looked at this one. He cited a Congressional Research Service study of aerospace employment. More than 500,000 Americans are employed in aerospace manufacturing. About two-thirds of this is commercial, however. Though the defense industry has worked hard to spread itself around for maximum political effect, more than half (61%) of the nation’s aerospace industry jobs are concentrated in six states.[vi]

By contrast, more than 8 million Americans are employed in education, law enforcement, fire fighting, and other emergency and protective services -- working in every community in America.

The effects on the jobs base from cuts on the domestic side of the budget, in other words, will be much larger and more widespread than the effects of military cuts.

Myth # 6:  The military economy is part of the bedrock of our overall economic health.

Alan Greenspan, among many others, has contrasted spending on infrastructure, education, and health care with military spending. The former, he noted, strengthens the productivity—the performance—of the economy as a whole; the latter does not.

Military spending is like a family's insurance policies, he said. The family should spend enough to insure against disaster, but not a penny more, because that family should put as much as possible toward increasing its well-being through education and other enhancements to its quality of life. 

Myth # 7:  Military workers have already taken their share of the hits.

No. The global outplacement firm Challenger, Gray and Christmas tracks layoffs month by month. For the past three years, while military spending has absorbed more than half of the discretionary budget (the part Congress votes on every year), the private sector contractors it supports have absorbed an average of only 4% of the nation’s job loss. See this spreadsheet (docx).

During those three years, the defense industry laid off a total of 106,000 workers. During the same period, state and local governments laid off more than 500,000 workers.

Myth # 8:   The political campaign against sequestration is consistent with the dominant economic philosophy of the politicians doing the campaigning.

No again. The free marketeers who think shrinking government will create jobs are preaching that the Pentagon budget can’t be shrunk because this will cost jobs.

Congressman Barney Frank has summed up nicely what they are asking us to believe: “that the government does not create jobs when it funds the building of bridges or important research or retrains workers, but when it builds airplanes that are never going to be used in combat, that is of course economic salvation.”

Myth # 9:  The contractors have their workers' interests at heart.

If they did, they might narrow the gap a bit between the CEO’s and the average worker’s salary.  For Lockheed Martin (CEO: $25 million[vii]; average worker: $58,000[viii]) this gap is more than 400 to 1.

Myth # 10:  Sequestration will force contractors to warn most of their workers of an impending layoff. 

Lockheed is threatening to send these notices a few days before the November election.  The argument for this bit of political blackmail is that since the cuts aren’t specified, all workers are at risk.  While Lockheed claims these notices are required by law, the Labor Department, i.e. the controlling legal authority, says they are not.

In fact, as researchers from Win Without War and the Center for International Policy recently pointed out,[ix] the defense and aerospace industry is sitting on a pile of cash from yet another year of record revenue and profits in 2011.[x] Lockheed alone has $81 billion in backlogged orders, and more coming in.[xi] They have it a lot better than most companies.

And this cushion gives them time to plan for the downsizing, and keep the workers they profess to care about employed, by developing new work in other areas. See Fact Sheet: Replacing Defense Industry Jobs for some ideas on how.

Footnotes

[i] https://www.dropbox.com/s/6s4ix8muj2kmhhx/a%20non%20linear%20defense%20growth%20nexus.pdf

[ii] http://www.peri.umass.edu/236/hash/0b0ce6af7ff999b11745825d80aca0b8/publication/489/

[iii] http://pogoblog.typepad.com/pogo/2012/08/defense-contractor-time-machine-less-spending-more-jobs-analysis-reveals.html#more.

[iv] http://www.usnews.com/debate-club/should-congress-repeal-the-scheduled-cuts-to-defense-spending/7-reasons-to-keep-the-defense-budget-sequestration-cuts

[v] http://www.slate.com/articles/news_and_politics/frame_game/2012/08/obama_s_ad_against_military_spending_have_polls_shifted_on_the_defense_budget_.html?utm_medium=referral&utm_source=pulsenews

[vi] “US Aerospace Manufacturing: Industry Overview and Prospects,” Congressional Research Service, December 3, 2009. http://www.fas.org/sgp/crs/misc/R40967.pdf.

[vii] http://www.businessinsider.com/the-highest-paid-ceos-at-the-largest-us-based-financial-companies-2012-6#2-george-roberts-kkr-49

[viii] http://www.peri.umass.edu/236/hash/0b0ce6af7ff999b11745825d80aca0b8/publication/489/

[ix] http://www.huffingtonpost.com/william-hartung/lockheed-martin_b_1625183.html

[x] http://www.pwc.com/en_US/us/industrial-products/assets/pwc-aerospace-defense-review-and-forecast.pdf

[xi] http://online.wsj.com/article/BT-CO-20120620-709424.html

A Stunning Victory

November 22, 2011 ·

Near the end of George Bush’s eight years in the White House, the president and his Iraqi counterpart, Prime Minister Nouri al-Maliki, shared a big problem. Both of them wanted U.S. troops to stay in Iraq, but both faced widespread domestic opposition to the U.S. occupation.

Obama is bringing the troops home, but will he leave behind the military contractors? Photo by U.S. Army.

Feeling the heat, they settled on a “status of forces agreement” (SOFA) calling for full withdrawal of all 150,000 or so U.S. troops and all Pentagon-paid contractors by Dec. 31. In his first 18 months in office, President Obama did significantly reduce the numbers of troops in Iraq, down to about 50,000 by August 2010. But there it stuck. A year later, more than 40,000 U.S. troops were still occupying Iraq. The number of Pentagon-paid contractors still there was even higher—as of March, more than 64,000.

Even worse, the Obama administration continued to pressure the weak and corrupt Iraqi government to renegotiate the SOFA and “invite” the U.S. to keep troops in Iraq for the foreseeable future: a permanent occupation in all but name.

At the end of the day, none of those efforts worked. The official reason for not agreeing to keep 5,000 to 10,000 troops in Iraq was the refusal of the Iraqi government to guarantee U.S. soldiers immunity from criminal prosecution, but the real reason was that anti-war public opinion in Iraq and the U.S. was simply too strong. Al-Maliki certainly hoped some U.S. troops would remain, to help his unpopular government stay in power; Obama was under pressure from some in the Pentagon determined not to “lose” the supposed “gains” the occupation had achieved. But neither Iraq’s parliament nor the American people were prepared to allow thousands of U.S. soldiers to continue occupying Iraq. It was a stunning victory for those who have fought for peace all these years.

But. We’re not out of the woods entirely. Remember those contractors? Turns out the SOFA drafters were cleverer than anyone knew. The agreement said all Pentagon-paid military contractors had to leave by the end of this year, but didn’t mention those paid by the State Department. So guess which U.S. government agency is taking over the check-writing to pay thousands of U.S.-hired mercenaries to stay in Iraq for the long haul?

President Obama campaigned on a promise to end the war in Iraq, calling it a “dumb war.” So why did his administration try so hard to continue the occupation? It seems the strategic reasons that began during the Bush administration—the real causes underneath the fallacious claims that Iraq had weapons of mass destruction or responsibility for 9/11—didn’t go away. Control of oil contracts, strategic reach in a vital region, access to bases, surrounding Iran: All remain operative, whoever is in the White House.

The war cost way too much in Iraqi and U.S. deaths and in our tax dollars. We paid almost $50 billion just this year for this war. That’s enough to provide health care for 24 million children for a year, or to create and fund new, green jobs for a million workers—maybe including those thousands of soldiers supposed to be on their way home.

The U.S. role in the Iraq war has gotten smaller, but it sure isn’t over. We need to bring home all U.S. personnel and dollars. It’s really “dumb” if we don’t. And we still can’t afford dumb wars.

“Reprinted with permission from Sojourners, (800)714-7474, www.sojo.net." 

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