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 Editor in chief: 
Abdus Sattar Ghazali

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Mertze Dahlin   

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Military/industrial complex: nature/implications

By Arthur Scott

Building the American Empire has been terribly costly to the American people. Economically, the Empire has impoverished the nation. Impoverishment of the nation by war started with the Vietnam conflict of the 60’s and 70’s. It reached its zenith during the Reagan-Bush years when the federal debt rose from less than a trillion dollars to more than 9.5 trillion dollars in 2008. The major impetus for this exploding indebtedness in the 1980s flowed from military spending - the Department of Defense budget grew from $150 billion dollars in 1981 to $370 billion dollars in 2009. America today has more than three million Americans involved in defense industry and troops in uniform are stationed in 147 countries and 10 territories.  Two former Secretaries of Defense indicated that the cost for national security could have been much less. The military–industrial complex, as President Dwight D. Eisenhower warned America in his Farewell Message to the country in January 1960, grew fat at the taxpayer's expense because of practices like cost plus contracts, in which companies were encouraged to spend more on their manufacturing/delivery costs and were even rewarded for cost overruns by receiving additional funds. Such boondoggles as the MX Missile and the Star Wars initiative, characteristic of Reagan's attempt to counter the "Evil Empire," greatly benefited the military-industrial economies of California and Texas as has the Iraq /Afghanistan War, called by some as the “Three Trillion War.”  The use of private contractors such as Halliburton, KBR, Parson, Titan, Black Water and others have accelerated costs.  America today spends more on defense than Russia, China and Europe combined.  The military/industrial complex has transformed America into the largest seller of armaments in the world, valued in billions, which after drugs is the second most lucrative global industry.


1. In 2006, the five largest defense contractors were Lockheed Martin, Boeing, Northrop Grumman, Raytheon and General Dynamics. Their earnings in 2006 came to $129 billion in revenues with a whopping profit of $8 billion. Other significant players involve GE with contracts in 2008 worth at least $47,319,627.  GE as a major contractor also controls NBC which like Rupert Murdoch’s Fox News tends to be hardly objective in its Empire reporting.  There are literally thousands of engineering, electronic firms to be found in every state/congressional district that are part and parcel of the DOD military/industrial welfare network that receive lucrative contracts for R& D, weapons development/testing and manufacturing, making reining in the Defense budget by Congress very difficult as their political future can be jeopardized by a loss of jobs. Halliburton and its subsidiary Kellogg-Brown–Root has received billions from the Pentagon to provide logistic support for American military personnel in Iraq/Afghanistan even though there was no competitive bidding for the contracts and questions have been raised about quality of their work and cost overruns.

2. How does this happen?  Politics in large part make it happen.  Vice-President Dick Cheney was, for years, CEO of Halliburton and when war was declared on Iraq he decided to privatize the war to the benefit of Halliburton.  Over the decades there has developed what “Washingtonians” call a military-industrial “iron triangle” that involves the Pentagon, Congress and K street consulting /lobbying firms in which politicians or military leaders through a revolving door system end up as lobbyists for defense contractors thereby wielding tremendous influence on budgetary decisions impacting DOD.   Cheney is an excellent example.  During George H. Bush‘s presidency, Cheney served as Secretary of Defense during the first Gulf War.  In the 90’s, he served as head of Halliburton and when GWB was elected President in 2000 he received the nod to be Vice- President which opened the door for Halliburton to receive $18.5 billion dollars in contracts from the Pentagon to provide logistics (food/shelter) for the military in Iraq. 

Donald Rumsfeld, his counter point at Defense, has a similar governmental/ corporate background serving as head of Searle Pharmaceuticals, General Instrument Corporation (satellite/cable) and later Gilead Sciences.  Rumsfeld, too, was central to establishment of the neo-con “New American Century” think tank in Washington DC that lasted from 1997-2006 and which authored PNAC (Project For A New America Century) calling for the expansion of the American Empire especially into the Middle East.   Think tanks, many University-connected, have vastly increased the influence of the “Iron Triangle” by providing their lobbyists with powerful jingoistic rationalizations for expanding the largess of the American Empire and its concomitant military-industrial complex. Major think tanks include American Enterprise Institute, Jewish Institute for Security Policy, Center for Security policy, The Hudson Institute, The Institute for Advance Strategic and Political Studies. The power of the military-industrial complex is compounded by its close ties to Wall Street.  

A striking metaphor for this tie-in comes with the Carlyle Group.  The Carlyle Group is a global private equity investment firm based in Washington, D.C., with a portfolio valued at more than $88.5 billion with significant holdings in defense and telecommunications including United Defense Industries and Voight Aircraft Industries as well as through its worldwide connections in Europe, Canada, Mexico and Asia and even the Bin–Laden’s industries.   Its major share holders consist of Washington insiders including ex-president George Walker Bush, James Baker, Regan Secretary of Treasure, Richard Darman former White House Budget Director who have made fortunes in Empire Building.  Unfortunately even the California retirement program is tainted as it too is a major investor in the Carlyle Group which demonstrates just how insidious militarism has become in the economic life of America.  Global Pax Americana is transforming America from a First World country into an impoverished country as the recent debacle on Wall Street, accompanied by toxic mortgages, soaring unemployment, collapsing state budgets, a broken health system and deteriorating education system and transportation infra–structure reveals. When will America wake up to the fact that it can no longer afford the costs of Empire; an Empire that feed the pockets of only the high rolling “two percenters”, those who control 80 percent of the wealth.


In the 1980s, the military requirements of Empire building dropped the per capita income of Americans to 11th in the world, and discretionary income for most Americans fell by 18 percent from 1973. The middle class was transformed into the anxious class, and because of inflationary pressures have come to rely on the combined income of two adults to generate the same income as one adult made in the early 1970s. More women work today because of economic necessity than because of feminism. Only one in five married couple by 2000 had a single male breadwinner.  The mean average for a middle-class family in 1989 was only $34,213, whereas half of the working population made less than $20,000/year. Ironically, the income of most people rose by only 1.4% in the 1980s through Reaganomics, while wages for the rich advanced a whopping 24.3% a year.  Reagan's tax cuts favored the rich at the expense of the middle class. 

The gap between executive salaries and stakeholders was compounded by corporate acquisitions and mergers, and this pattern polarized income levels between management and employees. The tax reform bill of 1986 gave to the upper two percent of the nation a tax break from 22 to 34 percent, whereas most Americans received only a break of 11 percent. Minorities under Reaganomics also saw their situation stagnate vis-a-vis white income.  The per capita median for blacks in 1994 was $14,982, as compared to $22,669 for whites.  Almost half of all blacks-as compared to one in three for whites -- were earning less than $15,000 a year.  Twenty percent of all black families were below poverty level, compared to 27 percent for whites.  Reaganomics divided America both in terms of income and race. This pattern of socio-economic polarization of wealth continued and then worsened under free market, wheeling dealing capitalism of George Bush compounded by the Iraq-Afghanistan, the “Three Trillion Dollar War”, and its unlimited military spending flowing into the coffers of the military–industrial complex to say nothing of the unbridled greed that consumed Wall Street leading it to bundling toxic mortgages into questionable derivatives costing the taxpayers billions and billions for bank bailouts.

During the same time, there was a proportionate decline in per capita income investment in education because of military expenditures. America today is ranked 17th in literacy in the world. Globalization, inflation, high unemployment, drugs, the decline of smoke stack industries of the Northeast-Midwest as well as the collapse of the automotive industry has further impoverished America, and explains in part why America has the highest crime rate among industrial nations with prisons becoming a growth industry.  Generation Xers, millennial teenagers, and minorities have been devastated by the machinations of the "Garrison State."  They are confronted with an immense national debt, a graying population, and a soft economy which, except for the information and telecommunication fields, offers less opportunity for economic growth and wage increases.  On top of all this, America has one of the worst health systems of any major industrial nation, a system rife with inefficiency, which freezes out 35 to 40 million Americans, 10 million of whom are children, because of exorbitant insurance rates. Guns are preferable to humanity.


The psychological costs of the Empire/Military/Industrial complex run even deeper than the economic costs. Americans have become deeply cynical of government and the people who participate in government, after having been skewered for 45 years by a litany of half-truths and exaggerations, beginning with the Gulf of Tonkin facade through Watergate ("I am not a crook" comment by President Nixon) to the Iran-Contra hearings of the 1980s and the “Weapons of Mass Destruction” manipulation by Bush before the United Nations in 2002. Executive privilege, national security, a complacent press, and secrecy have created a national suspicion by which, in the name of freedom, American liberties have been slowly whittled away by national agencies: NSA, Homeland Security, CIA, FBI, IRS, DTF, and DEA and of course the Patriot Act. The behavior of the “Imperial Presidency” has been guided by the maxim of Brooks Adams: "The most difficult problem of modern times is unquestionably how to protect property under popular governments," and his answer:  "Either coerce or else bribe the masses -- carrot or stick."  Those who dared to challenge the Imperial Presidency’s ability to go to war have been painted as either disloyal or were demonized as pinkos, fags, or pimps, and have encouraged the wrath of the entire federal establishment.

In 1969, Nixon's central staff created an enemies list.  In 1971 the President ordered the Daniel Ellsberg break-in to show that the former DOD employee was mentally unreliable and therefore not a credible critic of Washington's policy (Ellsberg was responsible for making public the Pentagon Papers, showing governmental deceit in its conduct of the Vietnam War). The Ellsberg Affair, a Metaphor, showed that Americans were no longer protected by the constitutional guarantee of "innocent until proven guilty." Rather, individual rights are violated constantly by the federal government.  The Patriot Act which passed six weeks after 9/11 gave to intelligence agencies unfettered access violating “due process” and “equal protection” under the law by allowing enforcement agencies to share information, to conduct unlimited electronic eavesdropping as well as to enter a person’s home under “Sneak/Peak” provision without requirement of a search warrant.  Even Eric Holder, the newly appointed Attorney General, in the spring of 2009 before a Congressional Hearing waffled about the illegality of the Patriot Act.  What this indicates is that the Imperial Presidency and its military-industrial complex transcends politics and affects all players whether they are democrats, Republicans or Independents. Ironically Loss of personal freedom and the hysterics of a powerful gun lobby, NRA, have led to the emergence of a significant “Far Right” grass roots paramilitary movement that sees its mission to defend American liberties from the "New World Order" proclaimed by President George H. Bush following the defeat of Saddam Hussein in the Gulf War in 1991.

In addition, there exists a growing sense that there are many tiers of justice in America.  Equality before the law has been altered in favor of the rich, large corporations, and the powerful. White collar crime flourishes and its punishment is a joke.  The Wall Street scandals of the 1980s, led by Michael Milken, the Savings and Loans debacle of the early 1990s, the nefarious scandals around the BCCI (Bank of Commerce and Trade), and even the Watergate cover-up, proved that even when caught, the punishment is not too bad, as millions can be made writing memoirs, lecturing, and appearing on talk shows. This pattern has been confirmed by the Wall Street/Banking Debacle of 2007-08 in which executives after compensating themselves with millions then had the audacity to ask taxpayers to bail them out without any accountability.  The same, however, is not true of street crime, where punishment is swift and harsh.  American jails are overcrowded with a disproportionate number of blacks and Latinos.  But no serious attempt is made to re-energize the inner cities of America, where the angst of poverty spawns drugs, violence, and death.  The multiple tiers of American justice were forever emblazoned in the OJ Simpson trial, described by some in the media as "the Crime of the Century." What it proved was that money and stardom put people into a different class of legal status not shared by middle-class and poor Americans.  Or the case I. Lewis “Scooter” Libby, Cheney’s Chief of Staff/National Security Advisor, who was responsible for compromising CIA operative Valerie Plame Wilson because her husband Ambassador Charles Wilson refused to play ball with the Bush administration that Nigeria was shipping uranium material to Saddam Hussein.  Despite an investigation by Special Prosecutor into the matter leading to conviction, President GW Bush intervened in 2008 commuting Libby’s thirty month jail sentence.  This action bears out the main street belief that justice is hardly “blind” but operates on the basis of “who you know.”


Sociologically, the family carries the burden of empire. Feminism swept across the land when baby boomers challenged the patriarchal orientation of the Kennedy-Johnson-Nixon generation. The statistics are dramatic:  60 percent of the women went into the workforce; single parents raised 40 percent of all children by the 1990s.  In the 1970s and 1980s, one million children a year were touched by divorce.  The sociological changes have fallen heaviest on the generation Xers, who, to a large extent, have been forced to raise themselves because many of their baby boomer parents no longer saw children as being emotionally meaningful.  The abortion rates skyrocketed in the 1970s to one fetus in three; 21 million women have had 35 million abortions since the passage of Roe v. Wade.  Many of the older boomer parents, self-absorbed with awareness and encounter groups, were distracted and shattered by Vietnam and Watergate, and found parenting their Xers children to be difficult.  These children in turn found their parents either lacking interest in their development or the confidence to set boundaries or be role models. A growing number of Xers because of their childhood experience however, have delayed marriage either due to mixed feelings about relationships or to the economic necessity of having both parents work fulltime jobs; it's not unusual to see Xers in the forties as parents of millennial children.

The world the Xers was born into was so grim that in the late 1970s, their generation had the highest suicide rate for any American generation.  Child abuse was a mounting problem; in the U.S. News dated September 18, 1996, the Department of Health and Human Services said that the number of confirmed child abuse cases rose from 737,000 in 1986 to more than one million in 1993.  But by factoring in cases not reported, the study estimates that the number of cases actually doubled.  Xers' cynicism has been compounded by the violent images from television, as the media has discovered that R-ratings were more lucrative than the G-ratings.  By the time Xers reached 18, most had seen 200,000 acts of violence, including 30,000 murders on TV.  There was a growing belief in the 1970s that American had seen better days and was on the verge of a terrible moral collapse.

Similarly generation “Y” or the “Millennial” have been equally impacted by cost of Empire and feeding the beast of the Military–Industrial complex.  There are 70 million Millennials and one-third are people of color.  Half come from divorced families with the father absent and many times absence is driven by economics connected by diversion of resources into war.  As a generation, they tend to be skeptical and their skepticism is driven by their digital mastery, including You Tube, Face Book and Twitter, which brings the horrific images of the world into their thought a la Iranian election in summer of 2009.  Cell Phones and I-Pods are dominant in their world allowing for “real time “communication.  They demand greater transparency. Women have become significant with this generation as their numbers now surpass men in colleges/universities, graduate and professional schools.  Two events which have shaped their world view are 9/11 and “Climate Change”.  Unfortunately 16 percent of Millennials are impoverished finding themselves falling behind not only economically but in education because of the computer divide. 


America’s Empire is the “elephant in the room” that siphons away billions required for education, health service, and a crumbling transportation infra-structure polarizing America economically into different classes most of whom are fighting over crumbs.  The dominant class, the “2 percenters”, including Defense Contractors, Aerospace, Military-Industrial Complex and its Wall Street/Congressional allies  puts  a “3 Trillion” war hit as well as a Wall street collapse upon the American people  driving down the nation’s standard of living while laughing all the way to the Bank.  Most Americans are blinded to the role the Military-Industrial complex plays in its cultural life, neither seeing its connection to the financial meltdown on Wall Street nor the decline in educational and social services that has been occurring over the last thirty years as American corporation supported by the military-industrial complex has become a global enterprise promoting its  financial goals at the expense of Americans through neo-liberalism of supra-national agencies including GATT( General Agreement on Tariffs/Trade), NAFTA (North Atlantic Free Trade association), World Bank, International Monetary Agency. 

These organizations have contributed to the polarization of wealth between poor and rich nations so that half the world’s population lives on $ 1 dollar a day.  Congress bemoans the loss of jobs to outsourcing but fascinatingly few Americans are aware that Corporate America including the Defense Industry, exemplified by Boeing, is a major player in the loss of jobs for Americans as more and more work on aircraft is contracted to Asia/Europe.  Jets today cost $25-30 million dollars each and just imagine what California could do with $300 million dollars.  A Nimitz aircraft carrier costs $4.5 billion to construct and $160 million a year to operate.  Five aircraft carriers would end the California budget crisis – a fiscal crisis that will have devastating consequences on Californians, especially the poor, and will badly weaken the middle class - the core of American Democracy by robbing it of the education, transportation, research, health services critical to economic renewal.

Even President Barack Hussein Obama who has promised reform in energy, health and banking as “Imperial President” finds himself in the clutches of the insidious Empire and its minions.  Obama backed down regarding the release of more incriminating pictures of torture; he refused to hold CIA operatives responsible for their conduct during the Bush administration and to sustain the Afghanistan war effort.   In July 2009, he persuaded Congress to pass a war supplemental appropriation of $106 billion dollars over and above the DOD budget of $370 billion.  Again $106 billion dollars could go a long way to relieve the suffering of ten percent of American who are unemployed or the fiscal crises that many states across the Union face impacting the elderly, the poor, single parents, and inner city kids. Unfortunately the Empire-building, Imperial Presidency, ”Military-Industrial” complex combines to drain the soul of America captured so eloquently by Mr. Lincoln at Gettysburg “that government of the people, by the people, for the people will not perish from the face of the earth”.  Unless America wakes up now to the danger of militarism/empire our democratic values will be forever lost to the nightmare of a powerful centralized omnipresent Militaristic/Financial Oligarchy.  “Where goest thou America” - hopefully not in the direction of Rome.  The parallels between America and Rome are simply uncanny and as Spanish historian Santayana warned us “those who cannot remember the past are condemned to repeat it.”

Arthur Kane Scott is Professor of Humanities and Cultural Studies at the Dominican University of California
and Fellow of American Institute of International Studies.