Military Lunacy: How About a Bit of Common Sense?


By Russell Mokhiber and Robert Weissman

[original post on corp-focus, 3/9/06]

In a crazy place, even the most modest steps toward sanity can seem radical.

Thus, in Washington, the Common Sense Budget Act, introduced this week by Representative Lynn Woolsey of California, seems like a far-reaching move.
In fact, it might be better titled the “How About Just a Bit of Common Sense Act.”

The legislation would divert $60 billion from the Pentagon budget, and allocate it to social investment, renewable energy and humanitarian aid. Fifteen other members of the Progressive Caucus, of which Woolsey is co-chair, are co-sponsoring the bill.

Sixty billion dollars obviously goes a long way when it comes to people’s needs, and the legislation promises to do a lot. Among the programs that would benefit:

* $10 billion annually would go to provide health care coverage for millions of uninsured children.

* $10 billion a year would be spent on modernizing schools.

* $10 billion would be invested annually in renewable energy.

* $13 billion would be spent every year on humanitarian foreign aid.

Yes, $60 billion is a tremendous amount of money.

But not for the Department of Defense. The Pentagon is seeking $463 billion for the next fiscal year. That figure excludes the amount Rumsfeld and friends will request to fight the wars in Iraq and Afghanistan (and anywhere else they might start fights). For war-fighting, the administration is expected to seek an additional $115 billion in 2006. So we’re approaching $600 billion a year in defense/war spending.

The proposed cuts for the Pentagon follows recommendations from Reagan Assistant Defense Secretary Lawrence J. Korb. In a report issued in conjunction with the introduction of the Common Sense Budget Act, Korb writes that, “without diminishing America’s ability to fight extremists, America can save $60 billion mostly by eliminating Cold War-era weapons systems designed to thwart the former Soviet Union — weapons and programs that are not useful in defending our country from extremists or the other threats we now face.” Most of the proposed savings come from reducing the size of the U.S. nuclear arsenal, cutting most spending for the missile defense program, and scaling back or eliminating support for weapons designed to fight perceived threats from the Soviet Union.

In other words, these are no-brainer cost savings. They aim to stop spending on Cold War weaponry, but don’t threaten the prevailing war-fighting ideology at the Pentagon. The proposed cuts would upset particular defense contractors and agencies, to be sure, but they don’t pose a fundamental challenge to the Pentagon’s vice grip over the federal budget and inside-the-beltway politics and culture.

By way of perspective, consider this: global military expenditures soared past the $1 trillion mark in 2004, according to data compiled by the Stockholm International Peace Research Institute (SIPRI) and published in the Institute’s 2005 Yearbook. In inflation-adjusted terms, military spending is now rivaling the record total achieved during the peak of Cold War expenditures in 1988-1989, according to SIPRI.

Since 1998, government military spending has jumped almost 6 percent annually in real terms. “The major determinant of the world trend in military expenditure is the change in the USA, which makes up 47 percent of the world total,” according to SIPRI’s 2005 Yearbook.

By 2007, U.S. spending is expected to constitute more than half the total global military expenditure.

There are roughly 300 million people living in the United States. There are about 6.5 billion people on the planet, meaning the U.S. population is about 4.6 percent of the global total.

One half the world’s military spending. Under 5 percent of the world’s population.


Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter, . Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor, . Mokhiber and Weissman are co-authors of On the Rampage: Corporate Predators and the Destruction of Democracy (Monroe, Maine: Common Courage Press).

(c) Russell Mokhiber and Robert Weissman

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Rising Foreign Investment in the United States

The Washington Post reports today on the rise in Middle Eastern investment in the United States.

The Dubai-ports controversy is the obvious news hook for the story, but the real story is buried deep into the report from Paul Blustein.

That story is that foreign investment in the United States — both in financial paper and direct investment — is at an extraordinarily high level.

Blustein reports,

Whatever Arab investors abroad finally do, their clout is relatively small — at least for now. At the end of 2004, investors from Arab countries held just $4 billion in direct investment in the United States, according to Commerce Department data.

British investors, by contrast, held $252 billion, Japanese investors held $177 billion, Dutch investors held $167 billion and German investors held $163 billion. Their holdings span industries often deemed “critical,” such as telecommunications (Finland’s Nokia Corp. and Sweden’s Ericsson Inc.), energy (British Petroleum PLC and Royal Dutch Shell PLC) and utilities (E.On AG of Germany, which controls much of the gas and electricity distribution in Kentucky).

The aggregate foreign control of the U.S. economy is quite amazing. One view is: Who cares? These companies and investors are seeking a profit and are no different than U.S. companies and investors. But another take is: This foreign control leaves the U.S. very vulnerable. If the value of the dollar declines, as surely it will thanks to the massive trade deficit, then investors are going to pull out of the United States, or demand much higher returns on investment — meaning interest rates will have to rise.

The considerable foreign control of the U.S. economy is an outgrowth of the trade deficit, and until that problem is addressed, foreign ownership stake will continue to rise.

Here are some more numbers from the U.S. Treasury Department: Foreign companies operating in the US account for 5.8 percent of U.S. GDP from private industry, and 4.7 percent of employment in the U.S. private sector.

And, as of June 2004, the Treasury Department reports, foreign investors held $6 trillion in securities in the United States, up sharply from $5 trillion the year before. New data when it becomes available will surely show the number continuing to skyrocket.

Have You Ever Been Convicted of a Felony?

Have You Ever Been Convicted of a Felony?

By Russell Mokhiber and Robert Weissman

Have you ever been convicted of a felony?

That question is asked throughout our lives.
By people who are interviewing us for a job.

By courts seeking jurors.

By Little League officials screening coaches.

For background checks of all kinds.

People want to know.

If you have been convicted of a felony, then it says something bad about you.

And if you have been convicted of a felony, then people generally don’t want anything to do with you.

So, our advice — don’t get convicted of a felony.

But let’s say we had a system where you could commit a felony, and not be convicted of a felony.

Let’s say you rob a bank, and get caught robbing the bank.

And the prosecutor says to you — okay, we can do this two ways.

You can plead guilty to the crime. And be sentenced to prison. And you would have been convicted of a felony.

And that felony will follow you the rest of your life.

Or you can just agree to go to prison, and agree to pay a fine — and we won’t convict you of the felony.

So, when you get out of prison, there won’t be that black mark on your record.

And when you are asked throughout your life — have you ever been convicted of a felony? — you can tell the truth and say — no.

The prosecutor gets everything the prosecutor could get with a conviction — restitution, prison, a fine.

Except for the conviction.

Prosecutors would never accept such a system for human being criminals.

Because prosecutors believe they represent the public.

And in cases of serious crimes, they must defend the public’s right to get justice.

And justice demands not only punishment but deterrence.

And deterrence demands of us that we remember for our entire lives that rules exist for a reason.

Society says, if you commit a serious crime, the conviction will follow you your whole life.

Those are the rules for human beings who commit serious crimes.

For corporate criminals, the rules have changed, in just the past couple of years.

The change is this — a major U.S. corporation that commits a felony no longer has to plead guilty to a felony.

Instead, federal prosecutors will offer — and the corporation will accept — a deferred prosecution or non prosecution agreement.

And it is difficult to find a prosecutor, defense attorney, academic or politician who is not supportive of this trend.

They argue this — a prosecutor gets everything they could get from a criminal prosecution — fines, restitution, changing in corporate structure, cooperation against the guilty individuals — except for the conviction.

And a conviction would threaten innocent third parties — workers and investors. See Arthur Andersen.

So, with deferred and non prosecution agreements, you get the best of both worlds — change within the corporation, fines paid to the government, restitution to the victim — and few if any collateral consequences against innocent third parties.

This sea change has largely gone unnoticed in the mainstream media.

It used to be that a corporation caught committing a serious crime would be convicted of committing a serious crime.

No longer.

Under the new system, outside of a few antitrust and environmental crimes, it is highly unlikely that a major corporate criminal will be convicted of a crime in the United States.

Corporations too do not like to answer “yes” to the question — have you ever been convicted of a felony?

They could be barred from government contracts, from the various markets. Consumers, investors and workers may shun them.

Had corporations introduced legislation in Congress to repeal corporate criminal liability, there would have been an uproar in the press.

But they have effectively repealed corporate criminal liability for big business — through prosecutorial discretion. It is unclear what the effects of this effective repeal will be.

But to those who defend the trend, they must answer this question — why the double standard?

Why not offer deferred prosecution and non prosecution deals to all major individual felons — drug pushers, money launderers and muggers alike?

After all, you get all of the benefits of a criminal prosecution, without the collateral consequences.

Prison, fines, restitution.

It’s just that, when you go to answer — have you ever been convicted of a felony? — then all of us — individuals and corporations alike — will be able to answer “no” with a clear conscience.