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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

The Lineup: Week of August 13-19, 2012

August 13, 2012 ·

This week's OtherWords editorial package features an op-ed by Robert G. Gard, in which the retired lieutenant general urges Congress to take action to avoid the upcoming "fiscal cliff."

We're still getting letters for Donald Kaul, most of which are from readers of newspapers that picked up his column from this editorial service. Please check out this tribute by his old friend and former colleague, Van A. Tyson, on the OtherWords blog. As always, I encourage you to subscribe to our weekly newsletter. If you haven't signed up yet, please do.

  1. How Romney Could Blow Iowa / Andrew Korfhage
    The wind energy industry relies on a soon-to-expire tax credit that protects American jobs and our health.
  2. Steering Clear of the Iceberg Ahead / Lt. General (USA, Ret.) Robert G. Gard
    It's time for Congress to get real.
  3. Why We Need the Food from Family Farms Act / Ben Burkett
    Had Congress heeded our advice, farmers and taxpayers would be far better able to deal with a lack of grain, grass, and water from the drought.
  4. Fracking Exports / Deb Nardone
    Selling liquefied natural gas to foreign markets doesn't serve U.S. interests.
  5. The 64-Gazillion-Dollar Question / Sam Pizzigati
    A top authority on poverty has changed his mind about the urgency of fighting inequality.
  6. Drone on the Range / Jim Hightower
    Those very same pilotless, remote-controlled, undetectable planes that the CIA has been secretly using to spy on and bomb people in Pakistan and elsewhere are headed to our local police departments.
  7. Occupy Wall Street Paved the Way / William A. Collins
    When will the really huge crowds come out to the streets?
  8. Caution, Fiscal Cliff Ahead / Khalil Bendib (Cartoon)

Caution, Fiscal Cliff Ahead, an OtherWords cartoon by Khalil Bendib

On D.C.'s U Street, Can't We All Just Swagger Along?

August 12, 2012 ·

Published in the Washington Post, August 9.

Stephen A. Crockett’s article about “swagger-jacking” on U Street [“Stealing home?,” Metro, Aug. 3] got me all jacked up. I am one of the so-called “swagger-jackers” to whom he was referring. I own two of the restaurants mentioned in the article, and although Mr. Crockett assumed I am not black, frankly, I am not sure what I am. Neither are most of my customers, though most of them seem to find my race irrelevant.

My places were never meant to be black establishments catering to black customers; they are meant to be community cultural hubs that preserve the legacy and history of the District and uplift racial and cultural connections. These connections are essential for a city whose discourse too often digresses into a racial abyss that is neither healthy nor constructive. My places and others named in Mr. Crockett’s article are essential cultural watering holes that can help create community and reconfigure the discourse.

Just days before opening my restaurant at 14th and V streets NW, I was inside waiting for my final inspections. I saw two elderly black women peering through the window. I opened the door and invited them in. They entered with some trepidation, trying to assess my swagger. Standing at the center of the space, they took in the artwork all around them. They saw the mural that depicts the civil rights struggles of the area and the history of the District. I was somewhat nervous about what they thought until I saw a tear come down one of their faces. That’s when I knew that I wasn’t “swagger-jacking.”

Andy Shallal is the owner of Busboys and Poets and Eatonville restaurants, and serves on the board of the Institute for Policy Studies.

Mr. President, the Elephant in the Room Is Not a Republican

August 8, 2012 ·

Illustration by DonkeyHotey/FlickrThe recession has been hard on everyone. Tens of millions of people lost their jobs. Many of those who didn't lose their jobs suffered salary cuts. Retirement savings and home values have plummeted.

Even people who have kept their jobs and homes have had to worry about the possibility of losing them.

But the recession is officially over. In fact, it has officially been over since June 2009, according to the National Bureau of Economic Research. Last month, we entered the fourth year of recovery.

The reality, though, is that in America there are two of everything. There are white and black schools. There are white and black stores. There are even white and black rappers.

And of course there have been two recessions: a White Recession and a Black Recession.

The White Recession was sharp and painful, but soon over. White America is slowly returning to normal. It's a shade poorer normal to be sure, but normal all the same.

For white men, October 2009 brought the highest unemployment rate of the past sixty years. White male unemployment maxed out at 9.7 percent. It's now stable at 6.9 percent.

This rate is still too high, but it's not catastrophic - unless you're one of the 6.9 percent.

The white female unemployment rate is now even lower: just 6.8 percent. Throughout the recession, it never rose above 7.3 percent.

The White Economy is weak, but it's been weak for a long time. It's been dragged down by long-term wage stagnation, cuts in government professional employment and declining union membership.

The Black Economy, on the other hand, is still in full-blown recession.

The Black Recession has now dragged on for four years, if not forty. Black male unemployment is 14.8 percent, and the current trend is up.

The unemployment rate for black men maxed out at 18.0 percent in August 2011, but even that wasn't a record. In the early 1980s recession, the black male unemployment rate went over 20 percent.

The black male unemployment rate has now been over 10 percent for 49 consecutive months. But that's normal. It's been over 10 percent in more than half of all months on record since measurement began in 1972.

That 10 percent figure is for men who are in the labor market and actively seeking work. It doesn't include, for example, the 5 percent of black men who are currently in jail.

Black women also face serious challenges in the job market. The black female unemployment rate is 11.5 percent, down from a recession high of 13.9 percent in December 2011.

The unemployment rate for black women has now been over 10 percent for 42 consecutive months. Like the black male unemployment rate, it's been over 10.5 percent for over half of all months on record since 1972.

The Black Recession is the proverbial elephant in the room. No one talks about it, but it's there. It's been there for four years, or forty years, if it's been there a day.

In America's cultural and racial climate, it's understandable that President Obama prefers to avoid the subject of the Black Recession. But as he is fond of pointing out, he is the president of all Americans, and that includes black Americans.

Mr. President, the elephant in the room is not a Republican. It's long past time to put an end to the Black Recession. Above all, that means jobs. If the private sector won't provide them, the government should. That means you.

We can't have a jobs program that's just for blacks. But we can have a jobs programs that provides work with dignity to all Americans and that includes black Americans. Roosevelt did it. Johnson did it. Obama can do it.

Mr. President, put America back to work.

Encounters With Gore Vidal (1925-2012)

August 7, 2012 ·

In 2005, I interviewed Gore Vidal for my weekly TV-radio show Hot Talk. We had first met years before at a dinner party at Marc Raskin's house in Washington, D.C., where I had watched him monopolize the conversation by verbally destroying the head of a major museum. "He’s a phony, you can smell it," explained Vidal later as the reason for his ferocity.

Gore Vidal (1925-2012). Photo by David Shankbone."And he does so little for the public's benefit. He thinks only of each exhibit in his museum as another notch on his career gun – a typical Washington bureaucrat. I despise them."

In the TV interview he showed his loathing again, this time for the people who ran the country, not a museum. "The Founding Fathers feared kings and tyrants, so they made it clear in the Constitution that no one man can declare war; only Congress. We've had many wars after World War II: Congress has not declared one of them."

The man who wrote Perpetual War for Perpetual Peace and Dreaming War: The Bush-Cheney Junta excelled at essay writing, but became better known as America's historical novelist and play and screen writer. His script for The Best Man, a fine movie, is currently re-running on Broadway.

In 2006 I escorted Gore through Cuba. He was 80 and could not walk well, but used a wheel chair. The Cubans interviewed him on TV, arranged for him to give a literary address at their aula magna at the University of Havana and answer questions. The audience was replete with scholars and literary mavens who had read his books and asked him interesting questions. "The Cubans have treated me more kindly and reverently than my own countrymen," he remarked.

At an informal dinner at the U.S. Interest Section mansion (there is no formal embassy because we have no formal relations with Cuba), a U.S. diplomat began boring his guests, all members of Gore Vidal's expedition. Not tolerating the diplomat's tedious small talk, former California Senate President John Burton interrupted the diplomat: "So, what did Cuba do to us again to merit so much punishment?"

The diplomat began a litany about human rights abuse. Burton interrupted. "The Chinese killed thousands of Americans in Korea, the Vietnamese killed tens of thousands in the Vietnam War. Both countries are run by single party Communist governments and neither has a good human rights record. So what did Cuba do to us?"

The diplomat began again on Cuba's human rights record. Burton cursed and stormed out of the mansion. Vidal clapped. "My kind of politician," he exclaimed, "unfortunately termed out of office."

Later, Vidal opined about the curse of "national security." Those two magic words make the Bill of Rights disappear at the President's will. Lincoln used them to suspend habeas corpus, shut down newspapers and to preside over the bloodiest war in history because he took an oath registered in Heaven to wage war to preserve the union. Look what Truman, Eisenhower, Kennedy, Johnson, Nixon, et. al. have done in the name of those two magical words. Reagan took them to new depths in Iran-Contra. He turned the preamble of the Constitution into Swiss cheese: "put lots of holes in it."

"Oh well," he finished his discourse, "here I am in the springtime of my senility."

The Cubans showed him Old Havana, its architectural wonders and its ancient streets and brought him to the Latin American Medical School to meet the students, including a group from the United States who received a free medical school education.

His entourage included two government ministers, the President of Cuba's Parliament and various regular Cubans he had met and liked.

On the ride to the airport going home, Vidal talked about his pessimism for America's future. "The stupidity of our Cuba policy is matched elsewhere as in wars in Iraq and Afghanistan. We're at war with the people and the earth and we’re losing control of the economy. The tide has turned against us."

Back in the United States, at a restaurant, a waiter told Gore "Have a nice day," to which the great writer replied. "Sorry, but I have other plans."

In his life he wrote twenty three novels, countless essays, screen and theater plays. He ran for office, acted in films and served as the witty TV commentator for politics and culture. He lived for decades with his partner Howard who died in 2003. When asked how he sustained such a long relationship, he quipped: "no sex."

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