You can’t open a newspaper or watch a TV news program anywhere in the U.S. these days without endless speculation about the impending “fiscal cliff” – a combination of automatic spending cuts and tax increases that will occur if Congress and the President don’t come up with a deal to cut the federal budget deficit.
The first thing to know is that for the most powerful sectors of U.S. society, there will be no “fiscal cliff” – they are sitting on plenty of cash and can easily weather any short-term reductions in their revenues. This is certainly true for the top 1%, who have benefited from the lowest tax rates in modern history even as they control an obscene percentage of the country’s wealth and income. As noted by Sen. Bernie Sanders, and independent from Vermont, the United States now has the most unequal distribution of wealth and income in the world. The idea that raising the tax rates of the rich by about 3%, as President Obama proposes to do, will in some way harm the U.S. economy is absurd.
As it is for the wealthiest in the United States, so it is for the military-industrial complex. For example, Lockheed Martin, the largest U.S. weapons contractor, received $36 billion from the Pentagon last year– the largest sum in history. This is two and one-half times what the company received in 2001, before the Bush administration’s military buildup began.
Other Pentagon contractors like Boeing, Northrop Grumman and General Dynamics received billions from the Pentagon as well. It is this reality, combined with the continued production of weapons systems that are unnecessary, unworkable and unaffordable that led Rep. Barbara Lee, (Democrat of California), to demand that we throw wasteful Pentagon programs “over the cliff.”
The automatic cuts that would be part of going over the so-called fiscal cliff would be less than 10% of the Pentagon’s current budget. This is a modest adjustment when one considers that in recent years U.S. military spending has been close to its highest levels since World War II. The United States spends more on its military than the next 14 countries in the world combined, including four to six times its alleged rival of the future, China. Even with the automatic cuts, the Pentagon budget will be at the levels it achieved in 2006, well into the Bush administration’s military buildup.
Despite these figures, the arms industry has teamed up with its allies in Congress to fight against any cuts in Pentagon spending. During the 2012 presidential elections, Senators John McCain (Republican of Arizona), Kelly Ayotte (Republican of New Hampshire) and Lindsey Graham (Republican of South Carolina) toured the country trying to scare voters into voting for Mitt Romney by falsely claiming that the Obama administration was supporting cuts in Pentagon spending that would undermine U.S. defenses and devastate the U.S. economy.
They focused their efforts on states like Virginia and Florida that have large numbers of military bases and weapons manufacturers. The speaking tour was reinforced by a series of misleading arms industry-funded studies that claimed that the 10% in automatic cuts that would occur under what is now known as the fiscal cliff would eliminate 1 million jobs.
The arms industry’s propaganda campaign was unsuccessful, at least this time around. President Obama won all of the states that McCain and his colleagues visited. But the battle isn’t over.
Lost in the election rhetoric was the fact that the Obama administration itself has so far proposed only minuscule reductions of Pentagon spending from current levels, about -.3% over the next five years. But there is a growing network of organizations pressing for real reductions in Pentagon spending, of as much as $1 trillion over the next 10 years. This would be about the same level that would occur under the automatic cuts required under the so-called fiscal cliff. These cuts would be smaller than those imposed at other key historical moments, like after the Vietnam War or at the end of the Cold War. But achieving them in the current political climate in Washington would be a genuine victory for critics of Pentagon spending.
The $1 trillion figure is backed up by a series of studies from think tanks across the political spectrum, from the libertarian Cato Institute to the moderate Stimson Center to the democratic-leaning Center for American Progress to the progressive Institute for Policy Studies. In fact, in a recent briefing at the National Press Club in Washington, David Langstaff, the CEO of the defense contractor TASC, acknowledged the need to reduce Pentagon spending below current levels. His proposal — $150 billion over ten years – is far less than what is needed, but the fact that he called for cuts at all indicates that the political winds may be starting to move against the military-industrial complex.
The next stage of the battle over Pentagon spending will come when the Obama administration introduces its new budget proposal early next year. Will Obama propose cuts in Pentagon spending, however modest? Will an emerging coalition of progressive and moderate Democrats working with Republican “deficit hawks” cut back Obama’s proposed Pentagon budget? The campaign to cut Pentagon spending will have a lot to say about that, and for the first time in two decades, it may be in a position to achieve its goals, if not this year then soon thereafter.
William D. Hartung is the director of the Arms and Security Project at the Center for International Policy and the author of Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex. And a regular columnist for the Americas Updater of the CIP Americas Program www.americas.org