Liberty Forged

the State has no money of its own, so it has no power of its own. ` Nock

Guns and Butter

Posted by Jesse on February 9, 2008

An excerpt from:

America – A Bankrupt Empire
Financial instability rooted in economic ‘blowback’ from our disastrous foreign policy

by Justin Raimondo

(be sure to see the original version, Justin has tons of links throughout the article)

“……How many Americans realize the US military budget is greater than that of the rest of the world combined? This doesn’t include our “off-budget” expenditures in the Iraqi and Afghan theaters, which surpass the combined military budgets of Russia and China. For the first time, the bill for the “defense” of the United States – a task left to the Department of Homeland Security [.pdf], not the Defense Department – exceeds $1 trillion. And that’s just what’s public: the secret “black budget” costs are unknown, and on this score Johnson advises us to heed economist Robert Higgs, who advises us to take any official Pentagon figures and simply double them.

Empires are expensive, and the American version has a peculiarly altruistic twist to it, in that, as Garet Garrett remarked, “everything goes out, and nothing comes in.” We’ve financed it all with deficit spending, and rather than impose direct taxation – always a risky proposition – the powers that be have simply set the printing presses of the Federal Reserve on overdrive, creating a huge bubble that’s about to pop.

…..Public works, in the form of ever-higher military spending, created an ever-expanding war-industry that sucked vital resources into avenues that led to a cul de sac, i.e. that had no productive use, such as nuclear bombs. Our mighty nuclear arsenal, which continues to expand even after the Soviet meltdown, represents trillions of dollars in frozen resources which go nowhere – that is, which produce no goods, and yield no continuing economic benefits. This has led to the fatal distortion of the American economy, and the massive misallocation of scarce resources: it is the root cause of the collapse of the US manufacturing sector. As Johnson puts it:

“Over time, a commitment to both guns and butter has proven an unstable configuration. Military industries crowd out the civilian economy and lead to severe economic weaknesses. Devotion to military Keynesianism is, in fact, a form of slow economic suicide.”

Read the rest here….

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2 Responses to “Guns and Butter”

  1. […] Political Kudzu wrote an interesting post today onHere’s a quick excerpt An excerpt from: America – A Bankrupt Empire Financial instability rooted in economic ‘blowback’ from our disastrous foreign policy by Justin Raimondo (be sure to see the original version, Justin has tons of links throughout the article) “……How many Americans realize the US military budget is greater than that of the rest of the world combined? This doesn’t include our “off-budget” expenditures in the Iraqi and Afghan theaters, which surpass the combined military budgets of Russia and Chi […]

  2. […] ugpress wrote an interesting post today onHere’s a quick excerptAn excerpt from: America – A Bankrupt Empire Financial instability rooted in economic ‘blowback’ from our disastrous foreign policy by Justin Raimondo (be sure to see the original version, Justin has tons of links throughout the article) “……How many Americans realize the US military budget is greater than that of the rest of the world combined? This doesn’t include our “off-budget” expenditures in the Iraqi and Afghan theaters, which surpass the combined military budgets of Russia and China. For the first time, the bill for the “defense” of the United States – a task left to the Department of Homeland Security [.pdf], not the Defense Department – exceeds $1 trillion. And that’s just what’s public: the secret “black budget” costs are unknown, and on this score Johnson advises us to heed economist Robert Higgs, who advises us to take any official Pentagon figures and simply double them. Empires are expensive, and the American version has a […] […]

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