Like the case of Rome before it, Empire is bankrupting America. The true fiscal cost of the national security budget is now upwards of $1.3 trillion per year (counting veterans expense and international operations and aid), but there is no way to pay for it.
That’s because the 78-million strong Baby Boomers are in the driver’s seat of American politics. They plainly will not permit the $3.5 trillion per year retirement and health care entitlements-driven Welfare State to be curtailed. At the same time, Washington has become the War Capital of the World where the ruling UniParty insists that the massive fiscal claims of the Warfare State are non-negotiable.
Indeed, during 2017-2020 the Trumpite/GOP already sealed the deal. Trump massively increased the Warfare State budget, even as the Congressional GOP refused to reform Social Security and Medicare and proved to be utterly incapable of even laying a glove politically on Obamacare/Medicaid, Food Stamps or any of the other Welfare State entitlements. Meanwhile, the GOP remained all-in for its anti-tax allergy, thereby refusing to tax the American public to close Washington’s yawning deficits.
Accordingly, the Federal budget is now simply on a doomsday track. With interest rates finally normalizing and the debt compounding at rates far higher than the growth of nominal GDP, interest costs on the public debt is headed into the fiscal stratosphere.
Indeed, the outlook is now so dire that the CBO doesn’t even dare print the long-term debt numbers. Instead, it attempts to camouflage the catastrophe ahead by expressing the data in more cosmetic “% of GDP” terms without actually printing the underlying GDP figures.
Yet the data to derive those figures are all there in the fine print. It turns out that in its latest long-term outlook CBO projected that nominal GDP would grow by the modest figure of 3.8% per annum for the next 30 years. In whole numbers that puts the nominal GDP at $85 trillion by 2054; and applying the 172% of GDP figure for the public debt results in a sum of $146 trillion!
That’s not a typo. Under the CBO’s Rosy Scenario for the next three decades the embedded fiscal policy will result in a debt so gargantuan that the figure cannot even be printed in official government documents. That is to say, America is racing toward a debt Armageddon at $146 trillion—implying interest expense of $7.5 trillion per year even at the current weighted average yield on the US Treasury debt curve.
CBO Projects The Public Debt Will Reach $146 Trillion By Mid-Century
Unfortunately, the generation which marched on the Pentagon in 1968 against the insanity and barbarism of LBJ’s Vietnam War has long since abandoned the cause of peace. So doing, boomers have acquiesced in the final ascendancy of the Warfare State, which grew like Topsy once the US became the world’s sole superpower after the Soviet Union disappeared into the dustbin of history in 1991.
Yet there is a reason why the end of the 77-year world war which incepted with the “guns of August” did not enable the world to resume the pre-1914 status quo ante of relative peace and capitalism-fueled global prosperity.
To wit, the hoary ideology of American exceptionalism and the Indispensable Nation was also, ironically, liberated from the shackles of cold war realism when the iron curtain came tumbling down.
Consequently, it burst into a Washington-based quest for unadulterated global hegemony. In short order (under Bush the Elder and the Clintons) Washington morphed into the War Capital of the World, and became an imperial beehive not only of militarism, but of an endless complex of think-tanks, NGOs, advisories and consultancies, “law firms”, lobbies and racketeers.
The unspeakable prosperity of Washington flows from that Imperial beehive. And it is the Indispensable Nation meme that provides the political adhesive that binds the Washington political class to the work of Empire and to provisioning the massive fiscal appetites of the Warfare State.
Needless to say, Empire is a terrible thing because it is the health of the state and the profound enemy of capitalist prosperity and constitutional liberty.
It thrives and metastasizes by abandoning the republican verities of non-intervention abroad and peaceful commerce with all the nations of the world in favor of the self-appointed role of Global Hegemon. Rather than homeland defense, the policy of Empire is that of international busybody, military hegemon and brutal enforcer of Washington’s writs, sanctions, red lines and outlawed regimes.
There is nothing more emblematic of that betrayal of republican non-interventionism than the sundry hot spots which dog the Empire today. These include the Ukrainian proxy war with Russia, various regime change fiascos in the middle east, the failed, bloody 20-year occupation of Afghanistan, the meddling of the US Seventh Fleet in the South China Sea, and, most especially, Washington’s endless contretemps in Iran.
As to the latter, there is absolutely no reason for the Empire’s attack on Iran. The proverbial Martian, in fact, would be sorely perplexed about why Washington is always marching toward the brink of war with Iran’s puritanical and authoritarian but relatively powerless religious rulers.
After all, Iran didn’t violate the 2014 nuke deal (JPAOC) by the lights of any credible authority – or by even less than credible ones like the CIA. Nor by the same consensus of authorities has it even had a research program for nuclear weaponization since 2003.
Likewise, its modest GDP of $41o billion is equal to just five days of US output, thereby hardly constituting an industrial platform from which its theocratic rulers could plausibly menace America’s homeland.
Nor could its tiny $10 billion defense budget – which amounts to just four days worth of DOD outlays – inflict any military harm on American citizens.
In fact, Iran has no blue water navy that could effectively operate outside of the Persian Gulf; its longest range warplanes can barely get to Rome without refueling; and its array of mainly defensive medium and intermediate range missiles cannot strike most of NATO, to say nothing of the North American continent.
The answer to the Martian’s question, of course, is that Iran is no military threat whatsoever to the safety and security of the US homeland. It’s demonization, therefore, stems from the fact that it has run badly afoul of the dictates of the Washington Hegemon.
That is to say, it has presumed to have an independent foreign policy involving Washington proscribed alliances with the sovereign state of Syria, the leading political party of Lebanon (Hezbollah), the ruling authorities in Baghdad and the reining power in the Yemen capital of Sana’a (the Houthis).
All these regimes except the puppet state of Iraq are deemed by Washington to be sources of unsanctioned “regional instability” and Iran’s alliances with them have been capriciously labeled as acts of state-sponsored terrorism.
The same goes for Washington’s demarche against Iran’s modest array of short, medium and intermediate range ballistic missiles. These weapons are palpably instruments of self-defense, but Imperial Washington insists their purpose is aggression – unlike the case of practically every other nation which offers its custom to American arms merchants for like and similar weapons.
For example, Iran’s arch-rival across the Persian Gulf, Saudi Arabia, has more advanced NATO supplied ballistic missiles with even greater range (2,600 km range). So does Israel, Pakistan, India and a half-dozen other nations, which are either Washington allies or have been given a hall-pass in order to bolster US arms exports.
In short, Washington’s relentless economic war and political, diplomatic and military pressure on Iran is an exercise in global hegemony, not territorial self-defense of the American homeland. It is a testament to the manner in which the historic notion of national defense has morphed into Washington’s arrogant claim that it constitutes the “Indispensable Nation” which purportedly stands as mankind’s bulwark against global disorder among nations.
Needless to say, Iran is just one typical case in point of the Indispensable Nation in action. Yet the other hot spots of the moment are no less exercises in the hegemonic aggression which inexorably flows from it.
Thus, Washington triggered the Ukrainian carnage by sponsoring, funding and instantly recognizing the February 2014 coup that overthrew a Russia-friendly government, replacing it with one that is militantly nationalistic and bitterly antagonistic to Russia. And it did so for the most superficial and historically ignorant reason imaginable.
Namely, it objected to the decision of Ukraine’s prior government in late 2013 to align itself economically and politically with its historic hegemon in Moscow rather than the EU and NATO. Yet the fairly elected and constitutionally legitimate government of Ukraine then led by Viktor Yanukovych had gone that route mainly because it got a better deal from Moscow than was being demanded by the fiscal torture artists of the IMF.
Needless to say, the ensuing US sponsored putsch arising from the mobs on the street of Kiev in February 2014 re-opened deep national wounds. Ukraine’s bitter divide between Russian-speakers in the east and on the Black Sea rim and Ukrainian nationalists in the center and west dates back to Stalin’s brutal rein in Ukraine during the 1930s and Ukrainian collusion with Hitler’s Wehrmacht on its way to Stalingrad and back during the 1940s.
It was the memory of the latter nightmare, in fact, which triggered in March 2014 the fear-driven outbreak of Russian separatism in the Donbas and the 96% referendum vote in Crimea to formally re-affiliate with mother Russia.
In this context, even a passing familiarity with Russian history and geography would remind that Ukraine and Crimea are Moscow’s business, not Washington’s.
In the first place, there is nothing at stake in the Ukraine that matters. During the last 700 years it has been a meandering set of borders in search of a country.
In fact, the intervals in which the Ukraine existed as an independent nation have been few and far between. Invariably, its rulers, petty potentates and corrupt politicians made deals with or surrendered to every outside power that came along.
These included the Lithuanians, Turks, Poles, Austrians, Muscovites and Czars, among others. Indeed, in modern times Ukraine largely functioned as an integral part of Mother Russia, serving as its breadbasket and iron and steel crucible under czars and commissars alike. Given this history, the idea that Ukraine should be actively and aggressively induced to join NATO was just plain nuts.
The allegedly “occupied” territory of Crimea, in fact, was actually purchased from the Ottomans by Catherine the Great in 1783, thereby satisfying the longstanding quest of the Russian Czars for a warm-water port. Over the ages Sevastopol then emerged as a great naval base at the strategic tip of the Crimean peninsula, where it became home to the mighty Black Sea Fleet of the Czars and then the Soviet Union, too.
For the next 171 years Crimea was an integral part of Russia. That span stretching to 1954 exceeded by far the 106 years that had elapsed since California was annexed by a similar thrust of “Manifest Destiny” on this continent, thereby providing, incidentally, the United States Navy with its own warm-water port in San Diego.
While no foreign forces subsequently invaded the California coasts, it was most definitely not Ukrainian and Polish rifles, artillery and blood which famously annihilated The Charge Of The Light Brigade at the Crimean city of Balaclava in 1854; the stout defenders were Russians protecting their homeland from the invading Turks, French and Brits.
And the portrait of the Russian “hero” hanging in Putin’s office is that of Czar Nicholas I – whose brutal 30-year reign brought the Russian Empire to its historical zenith. Yet despite his cruelty, Nicholas I is revered in Russian hagiography as the defender of Crimea, even as he lost the 1850s war to the Ottomans and Europeans.
At the end of the day, security of its historic port in Crimea is Russia’s Red Line, not Washington’s. Unlike today’s historically-ignorant Washington pols, even the enfeebled Franklin Roosevelt at least knew that he was in Soviet Russia when he made port in the Crimean city of Yalta in February 1945.
Maneuvering to cement his control of the Kremlin in the intrigue-ridden struggle for succession after Stalin’s death a few years later, Nikita Khrushchev allegedly spent 15 minutes reviewing his “gift” of Crimea to his subalterns in Kiev.
As it happened, therefore, Crimea became part of the Ukraine only by writ of one of the most vicious and reprehensible states in human history – the former Soviet Union:
On April 26, 1954: The decree of the Presidium of the USSR Supreme Soviet transferring the Crimea Oblast from the Russian SFSR to the Ukrainian SSR… Taking into account the integral character of the economy, the territorial proximity and the close economic and cultural ties between the Crimea Province and the Ukrainian SSR…
That’s right. Washington’s hypocritical and tendentious accusations against Russia’s re-absorption of Crimea imply that the dead-hand of the Soviet presidium must be defended at all costs – as if the security of North Dakota depended upon it!
In fact, the brouhaha about “returning” Crimea is a naked case of the hegemonic arrogance that has overtaken Imperial Washington since the 1991 Soviet demise.
After all, during the long decades of the Cold War, the West did nothing to liberate the “captive nation” of Ukraine – with or without the Crimean appendage bestowed upon it in 1954. Nor did it draw any red lines in the mid-1990’s when a financially desperate Ukraine rented back Sevastopol and the strategic redoubts of the Crimea to an equally pauperized Russia.
In short, in the era before we got our Pacific port in 1848, and even during the 176-year interval since then, America’s national security has depended not one whit on the status of Russian-speaking Crimea, nor the rest of Ukraine for that matter. That the Russian-speaking populations of Crimea, the Donbas and the Black Sea rim have now chosen fealty to the Grand Thief in Moscow over the ruffians and rabble who have seized Kiev in the 2014 coup amounts to a giant: So what!
The truth is, when it comes to Ukraine there really isn’t that much there, there. As we indicated, its boundaries have been morphing for centuries among the quarreling tribes, peoples, potentates, Patriarchs and pretenders of a small region that is none of Washington’s damn business..
Still, it was this final aggressive drive of Washington and NATO into the internal affairs of Russia’s historic neighbor and vassal, Ukraine, that largely accounts for the demonization of Putin. Likewise, it is virtually the entire source of the false claim that Russia has aggressive, expansionist designs on the former Warsaw Pact states in the Baltics, Poland and beyond.
The latter is a nonsensical fabrication. In fact, it was the neocon meddlers from Washington who crushed Ukraine’s last semblance of civil governance when they enabled ultra-nationalists and crypto-Nazis to gain government positions after the February 2014 putsch.
As we indicated above, in one fell swoop that inexcusable stupidity reopened Ukraine’s blood-soaked modern history. That intercepted with Stalin’s re-population of the eastern Donbas region with “reliable” Russian workers after his genocidal liquidation of the kulaks in the early 1930s.
It was subsequently exacerbated by the large-scale collaboration by Ukrainian nationalists from Galicia and elsewhere in its western territories with the Nazi Wehrmacht. Together they laid waste to Poles, Jews, gypsies and other “undesirables” on their way to Stalingrad in 1943. Thereafter followed an equal and opposite spree of barbaric revenge as the victorious Red Army marched back through Ukraine on its way to Berlin.
So it may be fairly asked. What beltway lame brains did not chance to understand that Washington’s triggering of “regime change” in Kiev would reopen this entire bloody history of sectarian and political strife?
Moreover, once they had opened Pandora’s box, why was it so hard to see that an outright partition of Ukraine with autonomy for the Donbas and Crimea, or even accession to the Russian state from which these communities had originated, would have been a perfectly reasonable resolution? After all, that’s exactly what the Minsk II accord provided, and what Putin had agreed to during the March 2022 negotiations in Istanbul – an arrangement that could have avoided the subsequent carnage, but which was sabotaged by Boris Johnson on the command of Washington.
Certainly that would have been far preferable to dragging all of Europe into the lunacy of the current anti-Putin sanctions and embroiling the Ukrainian factions in a suicidal civil war. The alleged Russian threat to Europe, therefore, was manufactured in Imperial Washington, not the Kremlin.
Even more hideous is the rhetorical provocations and Seventh Fleet maneuvers ordered by Washington with respect to China’s comical sand castle building exercises in the South China Sea. Whatever they are doing on these man-made islets, it is not threatening to the security of America – nor is there any plausible reason to believe that it is a threat to global commerce, either.
After all, it is the mercantilist economies of China and East Asian that would collapse almost instantly if Beijing attempted to interrupt world trade. That is, any theoretical red military shoe would first fall on the Red Suzerains of Beijing themselves because it is the $3.5 trillion of hard currency earnings from its export machine that keeps the Red Ponzi from collapsing and the Chinese people enthrall to their communist overlords.
Needless to say, none of these kinds of interventions were even imaginable in the sleepy town of Washington DC just 110-years ago. But it’s baleful evolution from the capital of an economically focused Republic to seat of power in a globally mobilized Empire ultimately sprung from the Indispensable Nation heresy.
Indeed, so long as Imperial Washington is stretched about the planet in its sundry self-appointed missions of stabilization, peacekeeping, punishment, attack, occupation, sanctions and other hegemonic maneuvers – there is zero chance that America’s collapsing fiscal accounts can be salvaged.
The Indispensable Nation folly thus hangs over the rotten edifice of America’s $98 trillion of public and private debt like a modern day Sword of Damocles.
But Empire is a corrosive disease upon democratic governance. It eventually metastasizes into imperial arrogance, over-reach and high-handedness. Ultimately, like at present, it falls prey to the rule of bellicose war-mongers and thugs like John Bolton and Mike Pompeo on the GOP side and Antony Blinkin and Jake Sullivan on the Dem side.
In the present instance, it is the former pair who exploited Trump’s abysmal ignorance on the Iranian nuke deal; it was their specious imperial beef with Iran’s legitimate right as a sovereign nation to its own foreign policy which gave him cover to withdraw and to re-impose of maximum sanctions, thereby effectively bracing Tehran with an act of war by any other name. And it is the latter pair who lack the gumption to reverse the drastic policy errors made by the Trumpite warmongers.
Yes, the feinschmeckers of the foreign policy establishment consider economic sanctions to be some kind of benign instrument of enlightened diplomacy – the carrot that preempts resort to the stick. But that is just sanctimonious prattle.
When you hound the deep water ports of the planet attempting to block Iran’s oil sales, which are its principal and vital source of foreign exchange, or cut-off access by its central bank to the global money clearance system known as SWIFT or pressure friend and foe alike to stop all investment and trade – that’s an act of aggression every bit as menacing and damaging as a cruise missile attack.
Or at least it was once understood that way. Even as recently as 1960 the great Dwight Eisenhower (very) reluctantly agreed to lie about Gary Power’s U-2 plane when the Soviets shot it down and captured its CIA pilot alive.
But Ike did so because he was old-fashioned enough to believe that even penetrating the air space of a foe without permission was an act of war. And that he did not intend – the CIA’s surveillance program notwithstanding.
Today, by contrast, Washington invades the economic space of dozens of foreign nations with alacrity. In fact, the US Treasury Department’s Office of Foreign Asset Control (OFAC) proudly lists 30 different sanctions programs including ones on Belarus, Burundi, Cuba, Congo, Libya, Somalia, Sudan, Venezuela, Yemen and Zimbabwe – along with the more visible programs against the alleged malefactors of Iran, Russia and North Korea.
These, too, are the footprints of Empire, not measures of a homeland defense befitting a peace-seeking Republic. As we have demonstrated elsewhere, the latter would cost around $400 billion per year, and would rely on an already built and paid for triad nuclear capacity for deterrence, and a modest Navy and Air Force for protection of the nation’s shorelines and air space.
The $500 billion excess in today’s bloated defense budget of $900 billion is the cost of Empire; it’s the crushing fiscal burden that flows from the Indispensable Nation folly and its calamitously wrong assumption that the planet would descend into chaos without the good offices of the American Empire.
Needless to say, we do not believe that the planet is chaos-prone absent Washington’s ministrations. After all, the historic record from Vietnam through Afghanistan, Iraq, Libya, Syria and Iran suggests exactly the opposite, as we will amplify in part 2.
David Stockman was a two-term Congressman from Michigan. He was also the Director of the Office of Management and Budget under President Ronald Reagan. After leaving the White House, Stockman had a 20-year career on Wall Street. He’s the author of three books, The Triumph of Politics: Why the Reagan Revolution Failed, The Great Deformation: The Corruption of Capitalism in America, TRUMPED! A Nation on the Brink of Ruin… And How to Bring It Back, and the recently released Great Money Bubble: Protect Yourself From The Coming Inflation Storm. He also is founder of David Stockman’s Contra Corner and David Stockman’s Bubble Finance Trader.
