How The Billionaires Control American Elections-- A Guest Post From Eric Zuesse

-by Eric Zuesse

The great investigative journalist Glenn Greenwald gave an hour-long lecture on how America’s billionaires control the U.S. Government, and here is an edited summary of its opening twenty minutes (the best part of it), with key quotations and assertions from its opening-- and then its broader context will be discussed briefly:

The Intercept, 9 July 2020

2:45: There is “this huge cleavage between how members of Congress present themselves, their imagery and rhetoric and branding, what they present to the voters, on the one hand, and the reality of what they do in the bowels of Congress and the underbelly of Congressional proceedings, on the other. Most of the constituents back in their home districts have no idea what it is that the people they’ve voted for have been doing, and this gap between belief and reality is enormous.” Four crucial military-budget amendments were debated in the House just now, as follows:

1. to block Trump from withdrawing troops from Afghanistan.
2. to block Trump from withdrawing 10,000 troops from Germany
3. to limit U.S. assistance to the Sauds’ bombing of Yemen
4. to require Trump to explain why he wants to withdraw from the Intermediate Nuclear Forces Treaty

On all four issues, the pro-imperialist position prevailed in nearly unanimous votes-- overwhelming in both Parties. Dick Cheney’s daughter, Republican Liz Cheney, dominated the debates, though the House of Representatives is now led by Democrats, not Republicans.

Greenwald (citing other investigators, which I shall link to below) documents that the U.S. news-media are in the business of deceiving the voters to believe that there are fundamental differences between the Parties. “The extent to which they clash is wildly exaggerated” by the press (in order to pump up the percentages of Americans who vote, so as to maintain, both domestically and internationally, the lie that America is a democracy-- actually represents the interests of the voters).

16:00: The Chairman of the House Armed Services Committee-- which writes the nearly $750B annual Pentagon budget-- is the veteran (23 years) House Democrat Adam Smith of Boeing’s Washington State. “The majority of his district are people of color.” He’s “clearly a pro-war hawk” a consistent neoconservative, voted to invade Iraq and all the rest. “This is whom Nancy Pelosi and House Democrats have chosen to head the House Armed Services Committee-- someone with this record.” He is “the single most influential member of Congress when it comes to shaping military spending.” He was primaried by a progressive Democrat, and the “defense industry opened up their coffers” and enabled Adam Smith to defeat the challenger.

That’s the opening.

Greenwald went on, after that, to discuss other key appointees by Nancy Pelosi who are almost as important as Adam Smith is, in shaping the Government’s military budget. They’re all corrupt (campaign-financed by the megacorporations that sell billions to the ‘Defense’ Department). And then he went, at further length, to describe the methods of deceiving the voters, such as how these very same Democrats who are actually agents of the billionaires who own the ‘defense’ contractors and the ‘news’ media etc., campaign for Democrats’ votes by emphasizing how evil the Republican Party is on the issues that Democratic Party voters care far more about than they do about America’s destructions of Iraq and Syria and Libya and Honduras and Ukraine, and imposing crushing economic blockades (sanctions) against the residents in Iran, Venezuela and many other lands that those billionaires also want to control. Democratic Party voters care lots about the injustices and the sufferings of American Blacks and other minorities, and of poor American women, etc., but are satisfied to vote for Senators and Representatives who actually represent ‘defense’ contractors and other profoundly corrupt corporations, instead of represent their own voters. This is how the most corrupt people in politics become re-elected, time and again-- by deceived voters. And-- as those nearly unanimous committee votes display-- almost every member of the U.S. Congress is profoundly corrupt.

Furthermore: Adam Smith’s opponent in the 2018 Democratic Party primary was Sarah Smith (no relation) and she tried to argue against Adam Smith’s neoconservative (pro-U.S.-imperialism) voting-record, but the press-coverage she received in her congressional district ignored that, in order to keep those voters in the dark about the key reality. Whereas Sarah Smith received some coverage from Greenwald and other reporters at The Intercept who mentioned that “Sarah Smith mounted her challenge largely in opposition to what she cast as his hawkish foreign policy approach,” and that she “routinely brought up his hawkish foreign policy views and campaign donations from defense contractors as central issues in the campaign,” only very few of the voters in that district followed such non-mainstream national news-media, far less knew that Adam Smith was in the pocket of ‘defense’ billionaires. And, so, the Pentagon’s big weapons-making firms defeated a progressive who, if elected, would have helped to re-orient federal spending away from selling bombs to be used by the Saudis to destroy Yemen, and instead toward providing better education and employment-prospects to Black, brown and other people, and to the poor, and everybody, in that congressional district, and all others. Moreover, since Adam Smith had a fairly good voting-record on the types of issues that Blacks and other minorities consider more important and more relevant than such things as his having voted for Bush to invade Iraq, Sarah Smith really had no other practical option than to criticize him regarding his hawkish voting-record, which that district’s voters barely even cared about. The billionaires actually had Sarah Smith trapped (just like, on a national level, they had Bernie Sanders trapped). (Furthermore, she campaigned against the billionaires, but many Democrats-- even lower-income ones who struggle to make ends meet-- respect billionaires and are not opposed to voting for billionaire-backed candidates; many of these people simply don’t even want to know how corrupt the system is. They want to believe that the only political problem is bigoted individuals-- not the entire crony economic system in which they are embedded and which provides them their ‘news’, and which systematically promotes all types of bigotry. So, campaigning against the system drives away more voters than it attracts.) (After all, the system itself is supremacist: it supports any type of supremacism.)



Of course, Greenwald’s audience is clearly Democratic Party voters, in order to inform them of how deceitful their own Party is, against themselves. However, the Republican Party operates in exactly the same way, though using different deceptions against its voters, because Republican Party voters have very different priorities than Democratic Party voters do, and so they ignore and allow different types of deceptions and atrocities than Democratic voters do. Each Party plays the “good cop, bad cop” routine against the other: “Vote for me because my opponent is so bad (on the things you really care about).”

Numerous polls (for examples, this and this and this) show that American voters (except for the minority of them that are Republican) want “bipartisan” government (Republicans are the exception: they tend to view their opponents as enemies that must be conquered instead of compromised with); but the reality in America is that this country actually already does have that: the U.S. Government is actually bipartisanly corrupt, and bipartisanly evil. (This is the reason why members of Congress, even of opposite Parties, get along very well together, amongst themselves: it’s “us against them” and the “them” is the voters, who need to be controlled; and the “us” are the rulers.) In fact, it’s almost unanimous, it is so bipartisan, in reality. That’s the way America’s Government actually functions, especially in the congressional votes that are nearly unanimous and that the ‘news’-media don’t publicize (except to fudge what the bill was actually about). However, since it lies so much, and its media (controlled also by its billionaires) do likewise, and since they systematically cover-up instead of expose the deepest rot, the public don’t even know about this bipartisanship. They don’t know the reality. They don’t know how corrupt and evil their Government actually is. They just vote and pay taxes. That’s the extent to which they actually ‘participate’ in ‘their’ Government. They tragically don’t know the reality. It’s hidden from them. It is censored-out, by the editors, producers, and other management, of the billionaires’ ‘news’-media. These are the truths that can’t pass through those executives’ filters. These are the truths that get filtered-out, instead of reported. No democracy can function this way-- and, of course, none does. But the voters can’t figure that out for themselves. And the media they receive don’t explain it to the public, because their owners require them to hide it from the public. In fact, this is what they require their media to hide above all else. And that’s why they hide this fact 100%, not only 99%, but actually 100%-- totally hide it, won’t even allow it to be discussed in their media. (Incidentally: this article is being submitted to virtually all English-language media for publication free of charge. If you don’t see it being published in places such as CNN, the New York Times, or The Atlantic, then you might want to watch the remainder of the complete presentation by Greenwald there, in order to understand in more depth how billionaires control America. Greenwald’s discussion focuses only on the imperialism issue, but in a recent article I explained the mechanism by which the billionaires police the censorship, on all issues.)

A Country With Two Pro-War Parties Passes An Obscene War Budget-- Biggest Ever

Tuesday evening Pramila Jayapal (WA-07), co-chair of the Congressional Progressive Caucus was one of 43 Democrats with the guts to vote against the bloated $740 billion National Defense Authorization Act. She was one of the champions of the bicameral amendment that would have cut the budget by 10 percent-- reinvesting the $74 billion into communities across the country-- but the amendment, which garnered 93 votes, failed.

"We are simply spending far too much on the Pentagon," she told her Seattle constituents, "and have been for far too long-- while at the same time, cutting the budgets of the State Department, EPA, Department of Education and Department of Housing. This is completely upside down. Instead of investing in going to war all around the world, we should be investing in strengthening communities all around this country. We are in the midst of a global pandemic with more than 3.8 million Americans falling ill to COVID-19 and 141,000 losing their lives-- more American lives lost than during World War I or the Vietnam War, and in just a short five months. More than 48 million Americans have filed for unemployment. At least 27 million people have lost health care during the pandemic, joining the 87 million who were already uninsured or underinsured. And this is all happening as the Administration refuses to acknowledge the scale of the crisis, and continues to cut funding for education, housing, transportation, infrastructure and public health. We must redefine and reimagine what it means to be strong. Being strong is not funding a bloated Pentagon budget that is larger than the military budgets of the next 11 countries combined. Being strong means an end to endless wars. It means investing in diplomacy, international development and coalition building. It means guaranteeing health care for everyone in this country. It means investing in our communities-- putting more resources towards public health, affordable housing, universal child care, renewable energy, public transit, infrastructure, public education and giving educators a raise. I was proud to champion an effort to cut the Pentagon’s budget by 10 percent because there are so many ways we could invest that $74 billion, which is greater than the budgets of the CDC, EPA, Department of Housing, and National Parks Services combined. But what we should not do is give it away to corrupt defense contractors who relentlessly lobby for and profit off of our country’s excessive military budget. Unfortunately, that’s exactly what this legislation would do. I won’t support it."

The amendment failed in the House 93-324, all the Republicans and the Democratic Party's immensely dominant Military Industrial Complex wing-- led by Nancy Pelosi and Steny Hoyer-- firmly behind the Pentagon waste and bloat... and the immense bribes that flow to members of Congress who back it. It was no surprise to see most of the members of the most disappointing freshmen class in history-- your Joe Cunninghams, Anthony Brindisis, Jared Goldens, Mikie Sherrills, David Trones, Max Roses, Kendra Horns, Harley Roudas, Cindy Axnes, Abigail Spanbergers, Gil Cisneroses-- join with the corrupt Democrats like Josh Gottheimer (Blue Dog-NJ), Cheri Bustos (Blue Dog-IL), Jim Cooper (Blue Dog-TN), Cedric Richmond (New Dem-LA), Pete Aguilar (New Dem-CA), Raja Krishnamoorthi (Senate wannabe-IL), Tom O'Halleran (Blue Dog-AZ), Debbie Wasserman Schultz (New Dem-FL), Val Demings (New Dem-FL), Dan Lipinski (Blue Dog-IL), Eliot Engel (New Dem-NY) and the GOP to vote down the amendment.

The only freshmen with the courage and conviction to back the amendment were AOC D-NY), Andy Levin (D-MI), Katie Porter (D-CA), Rashida Tlaib (D-MI), Chuy García (D-IL), Jahana Hayes (D-CT), Ilhan Omar (D-MN), Ayanna Pressley (D-MA), Kweisi Mfume (D-MD), Lori Trahan (D-MA) and Joe Neguse (D-CO). And only one of them-- Katie Porter-- was among the freshmen dubbed a "majority maker" by the corrupted Pelosi-Hoyer-DCCC fraction of the Democratic Party. Many people were shocked to see establishment conservatives Richie Neal (MA), Lacy Clay (MO), Stephen Lynch (MA), and Emanuel Cleaver (MO) vote with progressives for the 10% reduction... but each has a primary coming up in the next few weeks, and it was a cheap ploy to make.

When it came to approving the Pentagon budget itself-- without the 10% reduction-- 43 Democrats, 81 Republicans and independent Justin Amash voted no. Watching which Dems who voted for the amendment then voted for the budget anyway, tells you a lot about those members and their motivations, among them... Richie Neal, Lacy Clay, Stephen Lynch and Emanuel Cleaver. Oh, that's a familiar little list!

Liam O'Mara, progressive Democrat running for a congressional seat held by Trump puppet Ken Calvert in Riverside County, wasn't surprised that Calvert voted against the 10% cut and for the bloated Pentagon budget. "As usual," he told me after the vote, "Crooked Ken Calvert is all too happy to put the needs of his donors in the defense industry above the needs of the American people. That anyone tolerates this level of corruption in a so-called 'Representative' is unfortunate. Calvert couldn't care less that people are losing their income, losing their homes, losing their healthcare, or even that we have veterans sleeping outdoors-- all he cares about is shoveling taxpayer dollars into Lockheed Martin's waiting cash-bag."

Arizona progressive Eva Putzova favored the amendment and told me that her opponent, Blue Dog "Tom O'Halleran tweeted about his vote to pass the NDAA, saying he did so to 'strengthen our national defense' and 'protect the A-10 Warthog & the KC-135.' Meanwhile,  he takes thousands from the top five profiteers of the War in Yemen-- Raytheon, Lockheed Martin, Boeing, General Dynamics, and General Electric. He profits by protecting the military industrial complex, all while staying quiet on bold legislation to solve the many crises within our borders, including COVID-19. I will do what he chooses not to-- put people first. I will fight to end all wars of choice and cut the bloated Pentagon budget to reinvest in our communities.

The next day, the Senate took up the same amendment, which had been written by Bernie. It failed-- dismally, 77-23, every single Republican voting against it-- as well as Kamala Harris, probably to please the Biden VP search team, and all the conservative fake Dems like Joe Manchin (WV), Kyrsten Sinema (AZ), Dianne Feinstein (CA), Mark Warner (VA), Michael Bennet (CO), Tom Carper (DE), Doug Jones (AL), Jackie Rosen (NV), Tammy Duckworth (IL)... all the usual suspects + Sherrod Brown (who, no doubt will eventually apologize to his progressive supporters).

Cutting The Pentagon Budget-- By 10%

I caught those above two minutes Wednesday night on MSNBC of Ali Velshi interviewing Bernie about his amendment to cut the Pentagon budget by 10% and repurpose the funds for America's most economically hard-pressed communities. What's a mere 10% you might ask and how can that help anyone? How about $74 billion with a "b?" The proposed Pentagon Budget is $740.5 billion and Bernie and his allies in this battle-- Elizabeth Warren (D-MA), Ed Markey (D-MA), Jeff Merkley (R-OR), Ron Wyden (R-OR) and, believe it or not, normally reflexive war-monger Chuck Schumer who may be nervous about a prospective upcoming primary challenge from AOC, in the Senate and Barbara Lee (D-CA), Pramila Jayapal (D-WA) and Mark Pocan (D-WI) in the House-- would like to see that money go towards healthcare, housing and childcare in communities with a poverty rate of over 25%.

The amendment is to the National Defense Authorization Act for 2021 by far right Oklahoma Republican Jim Inhofe-- and it's one of over 700 amendments offered in the Senate alone! That includes another one by Bernie-- along with Chuck Grassley (R-IA), Ron Wyden (D-OR) and Mike Lee (R-UT)-- to force a Pentagon audit and one by Bernie, "Reduction in Amount Authorized to be Appropriated for Fiscal Year 2021 by this Act" that would amount to a 14% spending cut across all DoD agencies (excluding personnel, research and healthcare).

Most of the 700+ amendments will never be voted on. This one will. In a letter of support from dozens of organizations across the country other members were urged to sign on as cosponsors. "We urge you to co-sponsor Amendment 1788 introduced by Senators Sanders and Markey, and vote in support should it reach the Senate floor."

Our militarism budget is out of control. In 2019, the United States spent more money on our military than the next nine countries combined. The Department of Defense's budget eclipses that of federal courts, education, the State Department, local economic development, public health, and environmental protection combined, yet the Pentagon is incapable of passing a basic audit.

Multiple analyses have determined that U.S. and collective security would not suffer, and in fact would improve by, cutting hundreds of billions of dollars from the runaway Pentagon budget through common-sense steps, like eliminating redundant and unusable weapons systems, ending wars, ceasing reliance on expensive contractors, and rejecting new nuclear weapons development. These overdue steps would instead allow us to properly focus our investments on our most urgent and pressing human needs. Polling demonstrates that this is a popular idea, and most American voters want to see money redirected from the Pentagon to invest in human security.

The jarring recent images of police with weapons of war in our streets is a stark reminder of how militarism and white supremacy drive misplaced spending priorities both at home and abroad. Meanwhile, all over the country, millions have lost their jobs and access to healthcare as the novel coronavirus pandemic rages on. The current moment should force us to confront the reality that, for too long, we have invested in the wrong priorities, the wrong tools, and the wrong solutions.

As a point of comparison: last year, the Centers for Disease Control budget was $7 billion, just 7 percent of the national policing budget, and less than 1 percent of the Pentagon budget. Those three figures alone tell a tragic story about what and who this country prioritizes and values.

We should no longer tolerate unchecked spending on systems that fuel violence and corporate greed at the expense of the basic needs of our people. This amendment is a crucial step toward a federal budget that actually aligns with our values. We strongly urge you to support it.

This amendment is going to be voted on in both houses of Congress by the end of the month. I'll remember to tell you who votes for it and who votes against it. Will you remember to not support Democrats who oppose it? I know Eva Putzova, Cathy Kunkel and Liam O'Mara are, in great part, motivated to run for Congress because of a genuine yearning for peace on earth. I asked each how they feel about the amendment. Eva told me that "It always comes down to the institutionalized, legalized corruption. Those who take money from corporate interests benefiting from the military-industrial complex like my opponent vote for expansion of the DoD budget every single time. Finally, we have a bill that can divert resources from wasteful and inhumane war economy to programs and services we desperately need. I doubt Congressman O'Halleran will have the political courage to do what's right but hope these will be among the last bills he would cast his votes for."

"My opponent, Congressman Mooney, recently cosponsored a bill to claw money back from the CARES Act-- money for low-income legal aid, public transit and the Peace Corps, among others," said West Virginia progressive Cathy Kunkel. "Rather than cutting programs with direct benefit to West Virginians (and millions of other Americans), the real question is what benefit are Americans really deriving from our oversized military budget, especially when the Department of Defense is incapable of passing an audit to even account for these expenditures? If I were in Congress today, I would be supporting efforts to redirect military spending towards basic economic needs, like healthcare and education."

Liam O'Mara, the progressive Democrat running for the last GOP hold in Riverside County, reminded me that "We were warned, repeatedly, and most famously in 1961 by Eisenhower, that the defence establishment gaining influence over Congress would be disastrous for our way of life and system of government. We ignored those warnings, and have sent people back to Congress again and again who are fully bought and paid for by the military-industrial complex. Ken Calvert is one such swamp-creature-- a so-called Representative who refuses to meet his constituents and is 98% funded by corporate interests, the largest share of which are defence contractors. Maybe if we stopped electing people who are there just to serve the stock price of big corporations, and whose loyalty is only to the almighty dollar, we wouldn't be spending such an obscene amount of money on tools of destruction, or using them to bomb eight countries. It's time to wake up, stop shovelling blood and treasure into that yawning void that is the stock market, and get this country working for ordinary people again. And the way to do that is to fire spineless lackeys like Calvert who'll spend any amount of our money to make his owners richer."

New must-watch video from Brave New Films:

Did You Know That In The U.S. There Is No Party That Favors Peace

War-mongers Jason Crow (D-CO) and Liz Cheney (R-WY)

Last week, the House Armed Services Committee-- an aggressively devoted tool of the Military Industrial Complex regardless of which party controls Congress-- voted on an amendment by Jason Crow (New Dem-CO) and Liz Cheney (R-WY) to prevent Trump from withdrawing troops from Afghanistan. As expected, it passed, 45-11. Think about that: a committee controlled by Democrats voted to prevent Trump from getting U.S. troops-- who, remember, are being assassinated by criminal elements to earn Russian bounties-- out of the 100% pointless and unwinable war in Afghanistan. How the hell did that happen? Maybe you think the Democratic Party is something different than is? Possible? Our troops have been fighting and dying there for 2 decades and we've wasted over a trillion dollars--much, if not most, of it finding its way into the hands of corrupt Americans and corrupt Afs-- and 2,300 American lives and God knows how many Afghan lives.

Do you recall how last cycle one of the DCCC gimmicks was to run military vets and call them heroes? A lot of them got elected and, guess what-- they all suck-- every single one of them; no exceptions. SUCK! Of the candidates who ran by flaunting their credentials as military heroes, each of them has earned a ProgressivePunch "F" score, even the one who pretended to run as a progressive, Maine reactionary Jared Golden (who Blue America was tricked into endorsing and supporting and even persuading Nancy Ohanian into doing a piece of art for!).

BIG Mistake!

There are 31 Democrats and 26 Republicans on the overstuffed committee, where it is extraordinarily easy to earn bribes from the Military Industrial Complex. Here's how the Democrats voted:

• Adam Smith, chairman (New Dem-WA)- stay in Afghanistan
• Susan Davis (New Dem-CA)- stay in Afghanistan
• James Langevin (RI)- stay in Afghanistan
• Rick Larsen (New Dem-WA)- stay in Afghanistan
• Jim Cooper (Blue Dog-TN)- stay in Afghanistan
• Joe Courtney (CT)- stay in Afghanistan
• John Garamendi (CA)- stay in Afghanistan
• Jackie Speier (CA)- stay in Afghanistan
• Tulsi Gabbard (HI)- withdraw troops
• Donald Norcross (New Dem-NJ)- stay in Afghanistan
• Ruben Gallego (AZ)- stay in Afghanistan
• Seth Moulton (New Dem-MA)- stay in Afghanistan
• Salud Carbajal (New Dem-CA)- stay in Afghanistan
• Anthony Brown (New Dem-MD)- withdraw troops
• Ro Khanna (CA)- withdraw troops
• William Keating (New Dem-MA)- stay in Afghanistan
• Filemon Vela (Blue Dog-TX)- stay in Afghanistan
• Andy Kim (NJ)- stay in Afghanistan
• Kendra Horn (Blue Dog-OK)- didn't vote
• Gil Cisneros (New Dem-CA)- didn't vote
• Crissy Houlahan (New Dem-PA)- didn't vote
• Jason Crow (New Dem-CO)- stay in Afghanistan
• Xochitl Torres Small (BlueDog-NM)- stay in Afghanistan
• Elissa Slotkin (New Dem-MI)- stay in Afghanistan
• Mikie Sherrill (Blue Dog-NJ)- stay in Afghanistan
• Veronica Escobar (New Dem-TX)- stay in Afghanistan
• Deb Haaland (NM)- stay in Afghanistan
• Jared Golden (ME)- stay in Afghanistan
• Lori Trahan (New Dem-MA)- stay in Afghanistan
• Elaine Luria (New Dem-VA)- stay in Afghanistan
• Anthony Brindisi (Blue Dog-NY)- stay in Afghanistan

I spoke with Ro Khanna after the vote and he told me that "It is appalling that the time Congress would choose to wake up from its slumber on matters of war and peace is to mandate perpetual war and restrict bringing our troops home. Let's be very clear what just happened. The Cheney Crow Amendment is to the right of Trump’s foreign policy and it’s scary how many people voted for it."

Republicans who voted against the bill: Mo Brooks (AL), Bradley Byrne (AL), Scott DesJarlais (TN), Jim Banks (IN) and Austin Scott (GA), although I think one or two others who missed the vote added their names in opposition to the Crow/Cheney amendment.

It confuses some progressives when Trump actually wants to do the right thing-- even if it isn't for "pure" reasons. But in this case, Democrats on the committee should have voted against Crow (one of those DCCC military heroes who was elected in 2018 and has done nothing but suck shit since) and Cheney. I mean anyone can get their head around the idea than a Cheney can bewares then even Trump, right? Anyway, New York Magazine's Eric Levitz set out to help Democrats bridge the gap between righteous Trump hatred and getting out of the fuckingwar already: Please Don’t Prolong a Pointless War Just to Show Russia Who’s Boss. He reminded his readers that "Throughout America’s longest war, top Pentagon and civilian officials deliberately misled the public about the endeavor’s likelihood of success in a bid to insulate their adventure from the threat of democratic rebuke. As the Washington Post reported last fall, summarizing the upshot of various confidential government documents it had obtained, 'it was common at military headquarters in Kabul-- and at the White House-- to distort statistics to make it appear the United States was winning the war when that was not the case.' John Sopko, the head of the Office of the Special Inspector General for Afghanistan Reconstruction, put the point more plainly: 'The American people have constantly been lied to.' Amid the lies, war crimes, tens of thousands of civilian deaths, egregious corruption, and revival of the Afghan opium trade, some positive developments have accompanied the U.S. invasion. Afghan women have made some real gains in their personal liberty, however limited and fragile. But the U.S. has neither the will nor the capacity to deny the Taliban a role in governing the country. The peace deal that the Trump administration struck with that group in February was an acknowledgment of the inevitable; as such, it was a productive step forward. Under the agreement’s terms, the U.S. will fully withdraw its troops in 14 months, so long as the Taliban upholds its commitments to, among other things, bar Al Qaeda from operating in areas under its control, and participate in 'Intra-Afghan talks' with the government in Kabul, opposition politicians, and various representatives of civil society about the future governance of the country."

To uphold its end of the bargain, the Trump administration plans to reduce America’s troop presence from its current level of 8,600 to 4,500 by this autumn.

But this week, a bipartisan group of House lawmakers erected new barriers to that withdrawal... [T]he House’s conditions are senselessly prohibitive. It’s difficult to see how one could ever withdraw military forces tasked with preventing the formation of terrorist safe havens without increasing the risk of “the expansion of existing or formation of new terrorist safe havens.” But that is not a rational basis for prolonging a 19-year war. The U.S. cannot maintain military occupations in every country where Islamist militants could conceivably gather and plot violence. Nor should it. As COVID-19 and climate change are making clear (or should be), terrorism is a relatively trivial threat, one that has diverted precious resources from pandemic prevention, green-energy transition, and other efforts necessary for mitigating the genuinely catastrophic challenges to Americans’ safety and security.

Congress’s (uncharacteristic) decision to interfere with the executive branch’s conduct in a foreign war was not explicitly tied to recent revelations concerning Russia’s apparent efforts to place bounties on U.S. troops in Afghanistan. But given the prominence of that story, it seems reasonable to worry that the issue influenced the House’s action. Especially since one of the amendment’s sponsors suggested that the U.S. must respond to Russia’s treachery by dispelling any question of America’s “will” to defend its interests.

Congress is right to investigate allegations of Russian targeting of U.S. troops and the Trump administration’s handling of relevant intelligence. But Russia’s actions have no bearing on the wisdom of prolonging an unwinnable war. If anything, the vulnerability of U.S. troops to such attacks constitutes an argument for quicker withdrawal. Extending military quagmires to demonstrate our resolve to Moscow was crazy when it was still the world’s second greatest power; doing so now that Russia is a declining petrostate with modest regional influence would be utter madness.

I'm not so sure about this report by Saagar Enjeti, but it's not out-of-hand dismissible and it's definitely worth carefully considering. Listen with an open mind:

Jesse Ventura Could Pose a Greater Threat Than Biden or the Democrats Believe

What the 2016 electoral vote would have looked if the “FU / None of the Above” electorate had turned out (source)

by Thomas Neuburger

“If I were to become President, these wars in the Middle East would end. War is a money-making scheme done by the military industrial complex. I would start a war on the climate, a war on pollution. If the oceans die, we die.”
—Jesse Ventura (September, 2019)

On April 27, Jesse Ventura announced he's testing the Green Party waters:

OK, I've decided I'm going to test the waters. IF I were going to run for president, the GREEN party would be my first choice. I've endorsed the party and I'm testing the waters. #mondaythoughts #MondayMorning #MondayMotivaton #MondayMood

— Jesse Ventura (@GovJVentura) April 27, 2020

If indeed he runs, and he keeps talking like this (9:48 in the clip below)...

If I were to become the president, let's say it that way, these wars in the Middle East would end. I take my foreign policy from Major General Smedley Butler, who wrote the book War Is a Racket, because war is that, it is a racket. It's a money-making scheme done by the military-industrial complex. Our soldiers don't fight for the United States; they fight for the corporations.

So to me, I would start a war on the climate, on pollution. I live in Mexico. I'm watching the oceans die before my very eyes. I've got news for you, ladies and gentlemen. If the oceans die, we die.

...he's going to win a lot of votes from the #NeverBiden crowd on the left.

Or if he keeps talking like this: “Wealth distribution is completely out of line today. In fact, people have talked to me about the minimum wage. What about a maximum wage?”

Sounds a lot like Sanders, doesn't he? He even has Sanders' mark of authenticity — whatever he looks and sounds like, that's who he is. Ventura's also strongly pro-marijuana; listen to the clip starting at 7:22 for the striking reason why.

The whole interview from which this quote came is interesting, by the way, and it's not terribly long. Aside from his marijuana story and the climate change quote, he discusses President Trump , the current state of the WWE, living without a cell phone, and how and when he will make up his mind about running for office again.

(His comment about Trump: "The first night of boot camp, there's one person who will break down, wet their pants, cry for their mom. That's Donald Trump.")

Ventura, a former Navy SEAL, comes from a strongly libertarian point of view, but if one looks at this compiled list of his issues I don't see much there besides his quotes on gun control to alienate many pro-Sanders but #NeverBiden voters. He'd have to update (or clean up) his past contrarian positions, but he won't be the first (for example, Joe Biden) to have to do that ahead of a presidential run.

Tarred with an Alex Jones Brush

Ventura will have problems, of course. In the past he's been on the record as a 9/11 skeptic and climate change denier, as this 2009 Guardian article shows — note the reference to his since-deleted TruTV show, “Conspiracy Theory with Jesse Ventura” — and there's his occasional association with Alex Jones. He'll also get no press, or "what a clown" press only, so he'll get no good coverage at all that he doesn't create himself.

On the other hand, he's rather good at creating coverage for himself. Should he enter the race, Ventura would make an interesting 2020 wildcard — or a dangerous one, depending on your point of view.

Ventura Would Run Seriously

I do think if he chose to run, he'd run seriously and to win. As one Minnesota commenter put it in a thread discussing his potential 2020 candidacy (emphasis added):

I voted for Jesse [for governor of Minnesota].

In the days immediately before the election Jesse was polling at 10%. And then he won.

This is because 1) polling models only look at “likely voters,” 2) 50% of the public doesn't vote, 3) the Dem and GOP candidates were doctrinaire party stalwarts that no one really liked, and 4) the chance for a Fuck You/None of The Above from that 50% was overwhelming as the under 40 vote came out in huge numbers.

I know you said “he won't win,” but he has and he could again. Trump and Biden are that bad and the Fuck You/None Of The Above vote could be at an all time high this fall.

Now, how was Jesse as governor? I liked him. He was no-bullshit candidate and speaker. He got us light rail and treated the job seriously. Somewhere I have an article that detailed his effectiveness, where someone mentioned that it took the Dems and GOP three years to learn how to team up against him so he wouldn't be effective and they could prevent the ascendancy of the Reform Party he won on, but now that he's in the news there's so many new articles in my search that I can't find it.

But on bottom line, he did well, and was well liked, and might have won again. He just grew sick of the bullshit politics and decided four years was enough and went on with his life. And I can respect that.

I'm not calling for a vote for Jesse Ventura, just noting that in this train wreck season, another locomotive may soon be added to the track, and not a small one.
  

File Under: Another Major Campaign Promise Broken

If the Trump Regime were running up mega-deficits by improving the country's healthcare system or educational system or by improving the infrastructure-- all promises he made during his campaign and then tossed away as soon as he got into the White House in favor of massive tax cuts for the wealthy (another campaign promise broken)-- I wouldn't mind the nearly trillion dollar deficit this year. But that's not how he ran up the gargantuan deficit. He ran it up by slashing revenues with a tax cut for the super-wealthy and by wasting money on personal projects that enriched himself and his cronies. The Associated Press reported that "The $984 billion deficit tally for 2019 came in more than $200 billion more than last year's, despite very low unemployment and continuing economic growth." Conservative economists "have long taken the position that deficits and the nation's $22 trillion national debt are unsustainable. CBO noted that deficits have been growing faster than the size of the economy for four years in a row, ending 2019 at 4.7 percent of gross domestic product."

There's no appetite in Washington to try politically painful medicine to deal with the deficit. Democrats have noted the spike in deficits since President Donald Trump's tax cut plan was passed in 2017, while Trump has promised not to touch popular retirement benefits like Social Security and Medicare.

Trump has already proposed a budget that violently slashes Social Security, Medicare and other parts of the tattered social safety net. So that was stupid reporting from AP. They should have shown examples of how Trump is misappropriating funds. Major Danny Sjursen did at Truthdig this week. He's a retired U.S. Army officer and former history instructor at West Point. He served tours with reconnaissance units in Iraq and Afghanistan and his piece for Truthdig, Secretary of Defense, Incorporated, is completely typical of how the entire Trumpist Regime functions. "Trump," Sjursen points out, "has installed faceless bureaucrats to run the most powerful national security state in human history. And the rest of us hardly notice. Trump’s appointment of Mark Esper as head of the largest and most active Cabinet department, and the new Defense Secretary’s near unanimous approval by the U.S. Senate, is no less of a scandal than Trump’s apparent efforts to seek foreign interference in the 2020 elections. Only it isn’t. Still, the nomination of Esper, a recent lobbyist for the defense contracting corporation Raytheon, ranks as one of the most egregious illustrations of the 'revolving door' between lobbyists and the Defense Department. It’s crony capitalism in fatigues, and while nothing new, a clear indication that things have only worsened under our reality-show-mogul-president." Bernie was out of town that day but he opposed Esper's confirmation, as did the other senators running for president, other than the Republican pretending to be a Democrat, Michael Bennet (CO).

Of course, seen through the rose-colored glasses of American empire, Esper is highly qualified to head the Defense Department. He’s a West Point graduate, former Army infantry officer, recipient of a master’s degree in public administration from Harvard and a doctorate in public policy from George Washington University, and has past experience working in the Pentagon.

If one digs further, however, Esper is wildly problematic-- loaded with conflicts of interest, a veteran of the (should be) discredited neoconservative Bush-era DOD, and little more than a corporate “company man.” He didn’t just work for Raytheon, he lobbied on the defense contractor’s behalf only recently. Under rather sharp questioning by Sen. Elizabeth Warren during his confirmation hearings, Esper refused to recuse himself from participating in government business involving Raytheon. In typically lifeless language, Esper replied that “On the advice of my ethics folks at the Pentagon, the career professionals: No, their recommendation is not to.” How’s that for accepting responsibility? No matter, he was swiftly and quietly confirmed by a vote of 90-8 in the Senate.

Expect another banner year for Raytheon. It’s already the third-largest U.S. defense contractor, and produces, among other tools of destruction, Paveway precision-guided missiles-- the very weapons that Congress recently sought to stop shipping to Saudi Arabia due to (rather tardy) concerns about the heads of Yemeni civilians upon which they’re dropped.

I predict more deals and more taxpayer billions for Raytheon with Esper at the Defense helm. Not that the company has done poorly during the Trump years. In 2018, Raytheon CEO Thomas Kennedy candidly quipped that “It’s the best time that we’ve ever seen for the defense industry.” Not for indebted taxpayers, bombed-out Middle Easterners or U.S. soldiers still dying in endless wars, it’s not. But sure, it truly is the best of times for what prominent American leaders-- once upon a time-- labeled the “merchants of death.”





Conflicts of interest, sliding seamlessly between defense contracting boards and the Pentagon, and securing post-government largesse on corporate boards, that’s an old story indeed. Looking back to 2001, most Defense Secretaries have troublesome private sector connections. Donald Rumsfeld entered the Pentagon after a 24-year business career; Robert Gates was on the board of directors of Fidelity Investments and the Parker Drilling Company; Chuck Hagel served on the boards of Chevron and Deutsche Bank; Ash Carter-- an exception-- was mostly an academic and a bureaucratic wonk, but still consulted for Goldman Sachs. All made millions.

That covers the Bush and Obama years. What we’ve seen in the Trump administration, is, however, something far more brazen. His three Secretaries of Defense (one of whom, Patrick Shanahan, was only acting head) have been unapologetically ensconced in the world of defense contracting and corporate lobbying.

“Saint” Jim Mattis had, while still a general, encouraged the military to buy the blood test products of Theranos, then dropped the service and joined its corporate board. But Theranos’ products did not work, the deal described by the Securities and Exchange Commission as an “elaborate, years-long fraud.” Mattis also served, both before and after his Pentagon stint, on the board of General Dynamics, the nation’s fifth largest defense contractor. Nonetheless, Mattis easily slid through his confirmation and was praised by all types of mainstream media as the administration’s “adult in the room.”

After Mattis resigned, he being unable to countenance even Trump’s hints at modest withdrawal from the wars in Syria and Afghanistan, Patrick Shanahan stepped in as interim defense chief. Unlike his predecessor, Shanahan didn’t emerge from the military, but rather from yet another defense contractor, Boeing, for which he’s worked some 30 years. Trump thought that was dandy and nominated him to officially replace Mattis, but Shanahan decided to withdraw due to alleged personal scandals. Enter Mark Esper, Raytheon lobbyist extraordinaire.

Esper’s in good company in Washington’s military-industrial swamp. Recent reports by the Project on Government Oversight (POGO)-- a vital organization that hardly any American has heard of-- identified “645 instances in the past 10 years in which a retired senior official, member of Congress or senior legislative staff member became employed as a registered lobbyist, board member or business executive at a major government contractor.” POGO also noted that “those walking through the revolving door included 25 generals, nine admirals, 43 lieutenant generals and 23 vice admirals.”

All of which begs some questions and provides some disturbing answers. Perhaps we ought to ditch the myth that the Defense Secretary simply heads the Pentagon, and admit that Esper is really the emperor of a far grander military-industrial complex that includes a veritable army of K-Street lobbyists and venal arms dealers. Maybe it’s time to concede that unelected national security czars, and not a stalemated bought-and-sold Congress, run national defense and set the gigantic Pentagon budget. Perhaps we should confess to ourselves that the nation’s vaunted soldiers are little more than political pawns in a game that’s far bigger, far more Kafkaesque, than those troopers could begin to fathom. And, finally, let’s admit one last thing: Few of us care.

At Blue America we care very much and we look for candidates who we feel will never sell out to the military industrial complex and who will, in fact, push back against it in the strongest possible ways. Progressive Nebraska congressional candidate Kara Eastman told us today that "You'd expect that Rep. Don Bacon would apply his military background to maintain a patina of oversight over this brazen wholesaling of the defense budget. However, and despite his tenure on the House Armed Services Committee, Bacon has traded oversight and review for campaign cash and ignorance. Case in point are the cost overruns at Offut Airforce Base, which used to be under his purview. Costs for repairing the base from climate change-induced flooding has gone through the roof and Bacon has signed off on diverting key funds supporting the 55th Wing to the Southern Border Wall."

Eva Putzova, a progressive Democrat from Flagstaff running for an Arizona congressional seat held by Republican-turned-Blue Dog Tom O'Halleran, one of the most right-wing Democrats in Congress, told us that " The appointment of Mark Esper, the former lobbyist for Raytheon, as Secretary of Defense, demonstrates the total corruption of our military-industrial complex. Raytheon receives billions of dollars from the Pentagon and nations like Saudi Arabia to manufacture weapons used to kill civilians in Yemen and elsewhere. My opponent, the incumbent blue dog "Democrat," takes campaign contributions from Raytheon and is silent on the influence of arms dealers in the Pentagon budgeting process.  Besides the enormous waste of taxpayers money which adds to our deficit in an unproductive manner the waste in human lives is even greater. When I am in Congress I will endorse legislation to outlaw the revolving door between private contractors and government service. I will also oppose all wars of choice and our role in the arms trade that fuels wars in which we are not directly involved."

Why We Will Never Leave Afghanistan

Bagram Air Base in north-central Afghanistan. Note Kandahar, home of Kandahar Air Field, much further south.

by Thomas Neuburger

The U.S. will never leave Afghanistan. Our military is too strong to be driven out by the Taliban, just as U.S. military control is too weak to "pacify" (fully conquer) the country.

Fortunately for the U.S., its goal is not to pacify the nation. The U.S. goal is much more narrow, and in geostrategic terms much more significant. It's to keep control of Bagram Air Base. So long as the U.S. controls Bagram and has a semi-successful client state installed in Kabul as a way of keeping the insurgency at arm's length, it has everything it needs to accomplish what it wants to accomplish in the region.

Holding Bagram Air Base does two things for U.S. military planners:

• The Bagram base in particular and the U.S. occupation in general put a U.S. military presence on the borders of five important Central Asian nations — Iran, Turkmenistan, Uzbekistan, Tajikistan and Pakistan. From there the U.S. can project power in every direction that matters, east, north and west.
   
• The base at Bagram represents a permanent and constant threat specifically to Iran, our designated primary enemy in the region. We are sitting on their border in the same way a Russian air base in Cuba would be sitting on ours — constantly a threat, constantly a reminder of the presence of a hostile foreign power.

The Bagram base has one added feature: Until 2014 it was home to one of the CIA's primary black torture sites, and perhaps it still is, unless you trust the CIA not to lie.

Until the U.S. makes peace with Iran — something I don't see happening under any presidency but Bernie Sanders', if at all — we will maintain our military presence there until we are forced by force to abandon it. Given the current state of our war against the Taliban and theirs against us — a kind of rolling, shooting stalemate — that base and that presence is as permanent as we want it to be.

For more, I refer you to this excellent short article by Ronald Enzweiler, a man who has lived and worked in the Middle East since the 1970s, including for seven years as a civilian adviser during the Iraq and Afghanistan wars.

After a discussion of who the Taliban are and why they will neither stop fighting nor ever lose popular support, Enzweiler writes this about why the U.S. will also never stop fighting (emphasis added):

The real reason for the pushback by the Washington national security establishment against getting all U.S. troops out of Afghanistan is the guiding maxim of our post-World War II “War State” (the military-industrial complex President Eisenhower warned about) that has grown into a $1-trillion/year enterprise with a worldwide empire of over 800 foreign military installations: never give up a military base in a strategic location. The U.S. military eventually will be pushed out of Kandahar Airfield in southern Afghanistan (it’s also a civilian airport near a large restive city in Taliban territory). But Bagram Airfield (a prior Soviet base north of Kabul) is a military-only installation in an easily defended remote area. Bagram is the missing piece in our War State’s chessboard of worldwide bases. Retaining it will enable our military to “project power” throughout Central Asia. It’s a steal at $30 to $40 billion/year (assuming troops levels and graft payments are drawn down at some point) for our overfunded War State. Representative Max Thornberry, then chairman and now ranking member of the House Armed Services Committee, visited Bagram in October 2018. He publicly acknowledged afterwards that the U.S. seeks “a sustainable presence” in Afghanistan. (The U.S. military’s new high-tech F-35 fighters — a $1.5 trillion program — are manufactured at a Lockheed plant near Rep. Thornberry’s district in north Texas.)

To repeat — The guiding maxim of our post-World War II state is, never give up a military base in a strategic location. Look again at the map at the top. When will the Pentagon agree to surrender that base? Answer: Never.

Enzweiler is more certain that the U.S will eventually be pushed out of Afghanistan than I am, perhaps with good reason. He thinks, for example, that the U.S. will eventually lose Kandahar in the south, and of that I'm sure he's right. It's true that the Taliban will never stop fighting us, just as the Vietnamese never stopped.

But the U.S. doesn't need to hold Kandahar to hold Kabul. Note the location of Bagram on the map. So long as the U.S. holds that region and can maintains a compliant puppet "government" there with a reasonably sized "pacified" (or bribed) quiet zone around it — and so long as the current geopolitical forces of the world are not radically restructured by the coming and massive scramble that climate chaos will bring — our military will flex every muscle to maintain its position there. It doesn't have to control the country to control that region.

Will the U.S. military flex every muscle to keep the base at Bagram even if an elected president decides on a full withdrawal? I guess we'll have to wait and see on that one. To start, we'd need to elect a president who wants what voters want, an end to the war in Afghanistan.
 

If There Are No Consequences Commensurate With The Crime Of Treason, Wall Street Executives Will Keep Selling Us Out

Russia may have paid to get them in office, but China seems to be getting the most out of it

During Wednesday’s debate, the candidates were all asked to name the biggest single national security threat to the country. Few of them had the self-discipline to name just one, but almost all of then named China. Tim Ryan caught himself about to say China is “whipping” us everywhere, realized that might sound defeatist and changed it in mid-sentence into something that didn’t make any sense— “wiping us everywhere.” Last night, one of the moderators just phrased it as a what-to-do-about-China question.

This week Matt Stoller co-authored a piece for the American Conservative, America’s Monopoly Crisis Hits the Military, about how Wall Street greed has “decimated our defense industrial base and undermined our national security… [T]he destruction of America’s once vibrant military and commercial industrial capacity in many sectors has become the single biggest unacknowledged threat to our national security. Because of public policies focused on finance instead of production, the United States increasingly cannot produce or maintain vital systems upon which our economy, our military, and our allies rely.”

When national security specialists consider preparedness, they usually think in terms of the amount of money spent on the Pentagon. One of President Donald Trump’s key campaign promises was to aggressively raise the military budget, which he, along with Congress, started doing in 2017. The reaction was instant. “I’m heartened that Congress recognizes the sobering effect of budgetary uncertainty on America’s military and on the men and women who provide for our nation’s defense,” then-defense secretary Jim Mattis said. Budgets have gone up every year since.

Higher budgets would seem to make sense. According to the 2018 National Defense Strategy, the United States is shifting away from armed conflicts in the Middle East to “great power” competition with China and Russia, which have technological parity in many areas with the United States. As part of his case for higher budgets, Mattis told Congress that “our military remains capable, but our competitive edge has eroded in every domain of warfare— air, land, sea, space, and cyber.”

In some cases, our competitive edge has not just been eroded, but is at risk of being— or already is— surpassed. The Chinese surge in 5G telecom equipment, which has dual civilian and military uses, is one example. China is making key investments in artificial intelligence, another area of competition. They even seem to be able to mount a rail gun on a naval ship, an important next generation weapons technology that the U.S. Navy has yet to incorporate.

And yet, the U.S. military budget, even at stalled levels, is still larger than the next nine countries’ budgets combined. So there’s a second natural follow-up question: is the defense budget the primary reason our military advantage is slipping away, or is it something deeper?

…[I]t wasn’t one of [our] adversaries that killed our telecommunications capacity, but one of our own institutions, Wall Street, and its pressure on executives to make decisions designed to impress financial markets, rather than for the long-term health of their companies. In 1996, AT&T spun off Bell Labs into a telecom equipment company, Lucent Technologies, to take advantage of investors’ appetite for an independent player selling high-tech telecom gear after Congress deregulated the telecommuncations space. At the time, it was the biggest initial public offering in history, and became the foundation of a relationship with financial markets that led to its eventual collapse.

The focus on stock price at Lucent was systematic. The stock price was posted daily to encourage everyone to focus on the company’s relationship with short-term oriented financial markets. All employees got a small number of “Founder’s Grant Share Options,” with executives offered much larger slugs of stock to solidify the connection. When Richard McGinn became CEO in 1997, he focused on financial markets.

Lucent began to buy up companies. According to two scholars, “The perceived need to compete for acquisitions became a ‘strategic’ justification for keeping stock prices high. This in turn demanded meeting or exceeding quarterly revenue and earnings targets, objectives with which Lucent top executives, led by the hard-driving McGinn, became obsessed.”

Lucent got even more aggressive. McGinn’s subordinate, an executive named Carly Fiorina, juiced returns with a strategy based on lending money to risky startups who would then turn around and buy Lucent equipment. Fiorina collected $65 million in compensation as the stock soared. And then, when the dot-com boom turned to bust, the company, beset by accounting scandals designed to impress shareholders and the financial markets, embarked on massive layoffs. CEO McGinn was among those laid off, but with a $12.5 million severance package—royal compensation for taking one of America’s strategic industrial assets down the road toward total destruction.

In the early 2000s, the telecom equipment market began to recover from the recession. Lucent’s new strategy, as Mottl put it, was to seek “margin” by offshoring production to China, continuing layoffs of American workers and hiring abroad. At first, it was the simpler parts of the telecom equipment, the boxes and assembly, but soon contract manufacturers in China were making virtually all of it. American telecom capacity would never return.

Lucent didn’t recover its former position. Chinese entrants, subsidized heavily by the Chinese state and using Western technology, underpriced Western companies. American policymakers, unconcerned with industrial capacity, allowed Chinese companies to capture market share despite the predatory subsidies and stolen technology. In 2006, French telecom equipment maker Alcatel bought Lucent, signifying the end of American control of Bell Labs. Today, Huawei, with state backing, dominates the market.

The erosion of much of the American industrial and defense industrial base proceeded like Lucent. First, in the 1980s and 1990s, Wall Street financiers focused on short-term profits, market power, and executive pay-outs over core competencies like research and production, often rolling an industry up into a monopoly producer. Then, in the 2000s, they offshored production to the lowest cost producer. This finance-centric approach opened the door to the Chinese government’s ability to strategically pick off industrial capacity by subsidizing its producers. Hand over cash to Wall Street, and China could get the American crown jewels.

The loss of manufacturing capacity has been devastating for American research capacity. “Innovation doesn’t just hover above the Great Plains,” Mottl said. “It is built on steady incremental changes and knowledge learned out of basic manufacturing.” Telecommunications equipment is dual use, meaning it can be used for both commercial and military purposes. The loss of an industrial base in telecom equipment meant that the American national security apparatus lost military capacity.

This loss goes well beyond telecom equipment. Talking to small manufacturers and distributors who operate in the guts of our industrial systems offers a perspective on the danger of this process of financial predation and offshoring. Bill Hickey, who headed his family’s metal distributor, processor, and fabricator, has been watching the collapse for decades. Hickey sells to “everyone who uses steel,” from truck, car, and agricultural equipment manufacturers to stadiums and the military.

Hickey, like many manufacturers, has watched the rise of China with alarm for decades. “Everyone’s upset about the China 2025 plan,” he told the American Conservative, referencing the current Chinese plan causing alarm among national security thinkers in Washington. “Well there was a China 2020 plan, 2016 plan, 2012 plan.” The United States has, for instance, lost much of its fasteners and casting industries, which are key inputs to virtually every industrial product. It has lost much of its capacity in grain oriented flat-rolled electrical steel, a specialized metal required for highly efficient electrical motors. Aluminum that goes into American aircraft carriers now often comes from China.

Hickey told a story of how the United States is even losing its submarine fleet. He had a conversation with an admiral in charge of the U.S. sub fleet at the commissioning of the USS Illinois, a Virginia-class attack submarine, who complained that the United States was retiring three worn-out boats a year, but could only build one and a half in that time. The Trump military budget has boosted funding to build two a year, but the United States no longer has the capacity to do high quality castings to build any more than that. The supply chain that could support such surge production should be in the commercial world, but it has been offshored to China. “You can’t run a really high-end casting business on making three submarines a year,” Hickey said. “You just can’t do it.” This shift happened because Wall Street, or “the LBO (leveraged buy-out) guys” as Hickey put it, bought up manufacturing facilities in the 1990s and moved them to China.

“The middle-class Americans who did the manufacturing work, all that capability, machine tools, knowledge, it just became worthless, driven by the stock price,” he said. “The national ability to produce is a national treasure. If you can’t produce you won’t consume, and you can’t defend yourself.”

The Loss of the Defense Industrial Base

But it’s not just the dual-use commercial manufacturing base that is collapsing. Our policy empowering Wall Street and offshoring has also damaged the more specialized defense base, which directly produces weaponry and equipment for the military.

How pervasive is the loss of such capacity? In September 2018, the Department of Defense released findings of its analysis into its supply chain. The results highlighted how fragile our ability to supply our own military has become.

The report listed dozens of militarily significant items and inputs with only one or two domestic producers, or even none at all. Many production facilities are owned by companies that are financially vulnerable and at high risk of being shut down. Some of the risk comes from limited production capability. Mortar tubes, for example, are made on just one production line, and some Marine aircraft parts are made by just one company— one which recently filed for bankruptcy.

At risk is everything from chaff to flares to high voltage cable, fittings for ships, valves, key inputs for satellites and missiles, and even material for tents. As Americans no longer work in key industrial fields, the engineering and production skills evaporate as the legacy workforce retires.

Even more unsettling is the reliance on foreign, and often adversarial, manufacturing and supplies. The report found that “China is the single or sole supplier for a number of specialty chemicals used in munitions and missiles…. A sudden and catastrophic loss of supply would disrupt DoD missile, satellite, space launch, and other defense manufacturing programs. In many cases, there are no substitutes readily available.” Other examples of foreign reliance included circuit boards, night vision systems, batteries, and space sensors.

The story here is similar. When Wall Street targeted the commercial industrial base in the 1990s, the same financial trends shifted the defense industry. Well before any of the more recent conflicts, financial pressure led to a change in focus for many in the defense industry— from technological engineering to balance sheet engineering. The result is that some of the biggest names in the industry have never created any defense product. Instead of innovating new technology to support our national security, they innovate new ways of creating monopolies to take advantage of it.

…Fleecing the Defense Department is big business. [TransDigm’s] executive chairman W. Nicholas Howley, skewered by Democrats and Republicans alike in a May 2019 House Oversight hearing for making up to 4,000 percent excess profit on some parts and stealing from the American taxpayer, received total compensation of over $64 million in 2013, the fifth most among all CEOs, and over $13 million in 2018, making him one of the most highly compensated CEOs no one has ever heard of. Shortly after May’s hearing, the company agreed to voluntarily return $16 million in overcharges to the Pentagon, but the share price is at near record highs.

L3 Technologies, created in 1997, has taken a different, but also damaging, approach to monopolizing Defense Department contracts. Originally, it sought to become “the Home Depot of the defense industry” by going on an acquisition binge, according to its former CEO Frank Lanza. Today, L3 uses its size, its connections within the government, and its willingness to offer federal employees good-paying jobs at L3, to muscle out competitors and win contracts, even if the competitor has more innovative and better priced products. This practice attracted the ire of two Republican congressmen from North Carolina, Ted Budd and the late Walter Jones, who found in 2017 that L3 succeeds, in part, due to “blatant corruption and obvious disregard of American foreign interest in the name of personal economic profit.”

Like TransDigm, this isn’t L3’s first brush with trouble. It was temporarily suspended from U.S. government contracting for using “extremely sensitive and classified information” from a government system to help its international business interests. It was the subject of a scathing Senate Armed Services Committee investigation for failing to notify the Defense Department that it supplied faulty Chinese counterfeit parts for some of its aircraft displays. And it agreed to pay a $25.6 million settlement to the U.S. government for knowingly providing defective weapon sights for years to soldiers serving in Iraq and Afghanistan.

Yet, also like TransDigm, L3 has thrived despite its troubles. When the company was granted an open-ended contract to update the Air Force’s electronics jamming airplane in 2017, Lieutenant General Arnold Bunch outlined the Air Force’s logic at a House Armed Services Subcommittee meeting. L3, he said, is the only company that can do the job. “They have all the tooling, they have all the existing knowledge, and they have the modeling and all the information to do that work,” he said.

In other words, because L3 has a monopoly, there was no one else to pick. The system— a system designed by the financial industry that rewards monopoly and consolidation at the expense of innovation and national security— essentially made the pick for him. It is no wonder our military capacities are ebbing, despite the large budget outlays— the money isn’t going to defense.

In fact, in some ways, our own defense budgets are being used against us when potential adversaries use Wall Street to take control of our own Pentagon-developed technologies.

There’s no better example than China’s takeover of the rare earth metal industry, which is key to both defense and electronics. The issue has frequently made the front page during the recent trade war, but the seldom-discussed background to our dependence on China for rare earths is that, just like with telecom equipment, the United States used to be the world leader in the industry until the financial sector shipped the whole thing to China.

In the 1970s and 1980s, the Defense Department invested in the development of a technology to use what are known as rare-earth magnets. The investment was so successful that General Motors engineers, using Pentagon grants, succeeded in creating a rare earth magnet that is now essential for nearly every high-tech piece of military equipment in the U.S. inventory, from smart bombs and fighter jets to lasers and communications devices. The benefit of DARPA’s investment wasn’t restricted to the military. The magnets make cell phones and modern commercial electronics possible.

China recognized the value of these magnets early on. Chinese Premier Deng Xiaoping famously said in 1992 that “The Middle East has oil, China has rare earth,” to underscore the importance of a rare earth strategy he adopted for China. Part of that strategy was to take control of the industry by manipulating the motivations of Wall Street.

Two of Xiaoping’s sons-in-law approached investment banker Archibald Cox, Jr. in the mid-1990s to use his hedge fund as a front for their companies to buy the U.S. rare-earth magnet enterprise. They were successful, purchasing and then moving the factory, the Indiana jobs, the patents, and the expertise to China. This was not the only big move, as Cox later moved into a $12 million luxury New York residence. The result is remarkably similar to Huawei: the United States has entirely divested of a technology and market it created and dominated just 30 years ago. China has a near-complete monopoly on rare earth elements, and the U.S. military, according to U.S. government studies, is now 100 percent reliant upon China for the resources to produce its advanced weapon systems.

Wall Street’s outsized control over defense contracting and industry means that every place a foreign adversary can insert itself into American financial institutions, it can insert itself into our defense industry.

At an Armed Services Committee hearing in 2018, Representative Carol Shea-Porter talked about how constant the conflict between financial concentration and patriotism had been in her six years on the committee. She recounted a CEO once telling her, in response to her concern about the outsourcing of defense industry parts, that he “[has] to answer to stockholders.”

Who are these stockholders that CEOs are so compelled to answer to? Oftentimes, China. Jennifer M. Harris, an expert in global markets with experience at the U.S. State Department and the U.S. National Intelligence Council, researched a recent explosion of Chinese strategic investment in American technology companies. She found that China has systematically targeted U.S. greenfield investments, “technology goods (especially semiconductors), R&D networks, and advanced manufacturing.”

The trend accelerated, until the recent flare-up of tensions between the United States and China. “China’s foreign direct investment (FDI) stock in the U.S. increased some 800% between 2009 and 2015,” she wrote. Then, from 2015 to 2017, “Chinese FDI in the U.S. …climbed nearly four-fold, reaching roughly $45.6 billion in 2016, up from just $12.8 billion in 2014.”

This investment runs right through Wall Street, the key lobbying group trying to ratchet down Trump’s tough negotiating posture with the Chinese. Rather than showing concern about the increasing influence of a foreign power in our commerce and industry, Wall Street banks have repeatedly followed Archie Cox down the path of easy returns.

In 2016, J.P. Morgan Chase agreed to pay a $264 million bribery settlement to the U.S. government for creating a program, called “Sons and Daughters,” to gain access to Chinese money by selectively hiring the unqualified offspring of high-ranking Communist Party officials and other Chinese elites. Several other banks are under investigation for similar practices, including Citigroup and Goldman Sachs, who, not coincidentally, hired the son of China’s commerce minister. It appears to have worked out for them. In 2017, Goldman Sachs partnered with the Chinese government’s sovereign wealth fund to invest $5 billion Chinese government dollars in American industry.

In short, China is becoming a significant shareholder in U.S. industries, and is selectively targeting those with strategic implications. Congresswoman Shea-Porter’s discovery that defense industry CEOs aren’t able to worry about national security because they “[have] to answer to shareholders” was disturbing enough. But the fact that it potentially translates as CEOs not being able to worry about national security because they have to answer to the Chinese should elevate the issue to the top of our national security discussion. This nexus of China, Wall Street, and our defense industrial base may be the answer to why our military advantage is ebbing. Even when American ingenuity can thrive, too often the fruits go to the Chinese.

In short, the financial industry, with its emphasis on short-term profit and monopoly, and its willingness to ignore national security for profit, has warped our very ability to defend ourselves.

How Did We Get Here?

Believe it or not, America has been here before. In the 1920s and 1930s, the American defense industrial base was being similarly manipulated by domestic financiers for their own purposes, retarding innovation and damaging the nation’s ability to defend itself. And American military readiness was ebbing in the midst of an increasingly dangerous world full of rising autocracies.

Today it might be artificial intelligence or drones, but in the 1930s the key military technology was the airplane. And as with much digital technology today, while Americans invented the airplane, many of the fruits went elsewhere. The reason was similar to the problem of Wall Street today. The American aerospace industry in the 1930s was undermined by fights among bankers over who got to profit from associated patent rights.

In 1935, Brigadier General William Mitchell told Congress that the United States didn’t have a single plane that could go against a “first-class power.” “It is a disgraceful situation and is due,” he said, “for one thing, to this pool of patents.” The lack of aerospace capacity reflected a broader industrial problem. Monopolists refused to invest in factories to produce enough steel, aluminum, and magnesium for adequate military readiness, for fear of losing control over prices.

New Dealers investigated, and by the time war broke out, the Roosevelt administration was in the midst of a sustained anti-monopoly campaign. The Nazi war machine, like China today, gave added impetus to the problem of monopoly in key technology-heavy industries. In 1941, an assistant attorney general for the antitrust division, Norman Littell, gave a speech to the Indiana State Bar Association about what he called “The German Invasion of American Business.”

The Nazis, he argued, used legal techniques, like patent laws, stock ownership, dummy corporations, and cartel arrangements, to extend their power into the United States. “The distinction between bombing a vital plant out of existence from an airplane and preventing that plant from coming into existence in the first place [through cartel arrangements],” he said, “is largely a difference in the amount of noise involved.”

Nazis used their American subsidiary corporations to spy on U.S. industrial capacity and steal technology, such as walkie-talkies, intertank and ground-air radio communication systems, and shortwave sets developed by the U.S. Army and Navy. They used patents or cartel arrangements to restrict the production of stainless steel, tungsten-carbide, and fuel injection equipment. According to the U.S. military after the war, I.G. Farben, the Nazi chemical monopoly, had influence over American production of “synthetic gas and oils, dyestuffs, explosives, synthetic rubber (‘Buna’), menthol, cellophane, and other products,” and sought to keep the United States “entirely dependent” on Germany for certain types of electrical equipment.

The Nazis took advantage of an industrial system that was, like the current one, organized along short-term objectives. But seeing the danger, New Dealers attacked the power of financiers through direct financing of factories, excess profits taxes, and the breaking of the power of the Rockefeller, Dupont, and Mellon empires through bank regulation and antitrust suits. They separated the makers of airplanes from airlines, a sort of Glass Steagall for aerospace. During the war itself, antitrust chief Thurman Arnold, and those he influenced, sought to end international cartels and loosen patent rules in part because they allowed control over American industry by the Nazis.

After the war, the link between global cartels and national security vulnerabilities was a key driver of American trade and military strategy. America pursued globalization, but with two differences from the form we have today. First, strategists sought to prevent the recurrence of global cartels and monopolies. Second, they sought to become industrially intertwined with allies, not rivals. While multinational corporations stretched across the West, they did not locate production or technology development in Moscow or among strategic rivals, as we do today in China.

Domestically, anti-profiteering institutions and rules protected against corruption, especially important when the defense budget comprised a large chunk of overall American research and development. The Defense Department’s procurement agency— the Defense Logistics Agency— was enormously powerful and oversaw procurement and supply challenges. The Pentagon had the power to force suppliers of sole source products— contractors that had monopolies— to reveal cost information to the government. The financial health of defense contractors mattered, but so did value to the taxpayer, a skilled defense industrial workforce, and the ability to deliver quality products to aid in national defense.

A fragmented base of contractors and subcontractors ensured redundancy and competition, and a powerful federal apparatus with thousands of employees with expertise in pricing and negotiation kept prices reasonable. The Defense Department could even take ownership of specialized tooling rights to create competition in monopolistic markets with specialized spare part needs— which is precisely where TransDigm specializes. This authority and expertise had been carefully cultivated over decades to provide the material necessary to equip American soldiers for World War II, the Korean and Vietnam wars, and the first Gulf war.

In the 1980s, while Ronald Reagan allowed Wall Street free rein elsewhere in the economy, he mostly kept Wall Street from going after the defense base. But scholars began debating whether it made sense to have such a large and expensive negotiating apparatus to deal with contractors, or if a more “cooperative” approach should be taken. Business consultants argued that the Pentagon could save money if it would simply be “a better customer, by being less adversarial and more trusting” of defense contractors.

With the end of the Cold War, these arguments found new resonance. Bill Clinton took the philosophical change that Reagan had pushed on the civilian economy, and moved it into the defense base. In 1993, Defense Department official William Perry gathered CEOs of top defense contractors and told them that they would have to merge into larger entities because of reduced Cold War spending. “Consolidate or evaporate,” he said at what became known as “The Last Supper” in military lore. Former secretary of the Navy John Lehman noted, “industry leaders took the warning to heart.” They reduced the number of prime contractors from 16 to six; subcontractor mergers quadrupled from 1990 to 1998. They also loosened rules on sole source— i.e. monopoly— contracts, and slashed the Defense Logistics Agency, resulting in thousands of employees with deep knowledge of defense contracting leaving the public sector.

Contractors increasingly dictated procurement rules. The Clinton administration approved laws changing procurement, which, as the Los Angeles Times put it, got rid of the government’s traditional goals of ensuring “fair competition and low prices.” They reversed what the New Dealers had done to insulate American military power from financiers.

The administration also pushed Congress to allow foreign imports into American weapons through waivers of the Buy America Act, and demanded procurement officers stop asking for cost data. Mass offshoring took place, and businesses could increase prices radically.

This environment attracted private-equity shops, and swaths of the defense industry shifted their focus from aerospace engineering to balance sheet engineering. From 1993 to 2000, despite dramatic declines in Cold War military spending and declines in the number of workers in the defense industrial base and within the military, defense stocks outperformed the S&P.

Today, the American defense establishment quietly finds itself in the same predicament it did in the 1930s. Despite spending large amounts of money on weapons systems, it often gets substandard equipment. It is dependent for key sources of supply on business arrangements with potentially hostile powers. The problem is so big, so toxic, and so difficult that few lawmakers even want to take it on. But the increasingly obvious danger of Chinese power means we can no longer ignore it.

The Fix

Fortunately, this is fixable. Huawei’s predatory pricing success has shown policymakers all over the world what happens when we don’t protect our vital industrial capacity. Last year, Congress strengthened the Committee on Foreign Investment in the United States, the committee that reviews foreign investment and mergers. The Trump tariffs have begun forcing a long-overdue conversation across the globe about Chinese steel and aluminum overcapacity, and Democrats like Representative Dan Lipinski are focused on reconstituting domestic manufacturing ability.

Within the defense base itself, every example— from TransDigm to L3 to Chinese infiltration of American business— has drawn the attention of members of Congress. Representatives Ted Budd and Paul Cook are Republicans and Representatives Jackie Speier and Ro Khanna are Democrats. They are not alone. Democratic Senator Elizabeth Warren and Representative Tim Ryan have joined Khanna’s demand for a TransDigm investigation.

Moreover, focus on production is bipartisan. One of the most ardent opponents of consolidation in the 1990s is current presidential candidate Bernie Sanders, who in 1996 passed an amendment to block Pentagon subsidies for defense mergers, or what he called “Payoffs for Layoffs.” On the other end of the spectrum, Trump has refocused national security and trade officials on the importance of domestic manufacturing.

Defense officials have also become acutely aware of the problem. In a 2015 briefing at the Pentagon, in response to questions about Lockheed’s acquisition of Sikorsky, then secretary of defense Ash Carter emphasized the importance of not having “excessive consolidation,” including so-called vertical integration, in the defense industry because it is “[not] good for the defense marketplace, and therefore, for the taxpayer and warfighter in the long run.” Carter’s acquisition chief, Frank Kendall, also noted the “significant policy concerns” posed by the “continuing march toward greater consolidation in the defense industry at the prime contractor level” and the effect it has on innovation.

American policymakers in the 1990s lost the ability to recognize the value of production capacity. Today, many of the problems highlighted here are still seen in isolation, perhaps as instances of corruption or reduced capacity. But the problems— diminished innovation, marginal quality, higher prices, less redundancy, dependence on overseas supply chains, a lack of defense industry competition, and reduced investment in research and development— are not independent. They are the result of the financialization of industry and of monopoly. It’s time for a new strategic posture, one that puts a premium not just on spending the right amount on military budgets, but also on ensuring that financial actors don’t capture what we do spend. We must begin once again to recognize that private industrial capacity is a vital national security asset that we can no longer allow Wall Street to pillage. By seeing the problem in its totality, we can attack the power of finance within the commercial and defense base and restore our national security capacity once again.

There are many levers we can use to reorder our national priorities. The Defense Department, along with its new higher budgets, should have more authority to promote competition, break up defense conglomerates, restrict excess defense contractor profits, empower contracting officers to get cost information, and block private equity takeovers of suppliers. Congress could reinstate the authority of the Defense Department to simply take ownership of specialized tooling rights to create competition in monopolistic markets with specialized spare part needs, a power it once had.

In the commercial sector, rebuilding the industrial base will require an aggressive national mobilization strategy. This means aggressive investment by government to rebuild manufacturing capacity, selective tariffs to protect against Chinese or foreign predation, regulation to stop financial predation by Wall Street, and anti-monopoly enforcement to block the exploitation of market power.

Policymakers must recognize that industrial capacity is a public good and short-term actors on Wall Street have become a serious national security vulnerability. While private businesses are essential to our common defense, the public sector must once again structure how we organize our national defense and protect our defense industrial base from predatory finance. For several decades, Wall Street has been organizing not just the financing of defense contractors, but the capabilities of our very defense posture. That experiment has been a failure. It is time to wake up, before it’s too late. 

Pig on the Wing