A Peace Economy Starts with How We Make Our Money
“How you make your money is way more important than how much money you make.” – Gary Vaynerchuk(more…)
Bigger and Bigger Military Appetites
A Brief Overview of Weapons AcquisitionBy Charles Kindleberger You have probably heard of the Doomsday Clock that measures “minutes to midnight” based on an assessment of world dangers by the Bulletin of Atomic Scientists. Over the years the minutes to midnight have ranged from 17 minutes (1991) on the high side, to three minutes (1883) on the scary side. Earlier this year, the clocked was changed in the wrong direction – from five minutes in 2012 to three minutes now. In the mind of those at the Bulletin of Atomic Scientists, the existential danger to the planet is caused by two realities – the warming globe and the advancements in nuclear weapons. Most members of PEP are concerned by both trends. PEP as an organization focuses primarily on the latter subject - the growth of nuclear weapons and their delivery mechanisms, and the role of the Military-Industrial–Congressional complex that promotes these and related weapons of war. We also worry about the huge costs associated with the US military, costs that we do not believe the country can or should afford. It is obvious that the Armed Services and their friends in industry and Congress are very hungry. Consider the wish list associated with each major branch:
NAVYThe Navy has expensive tastes. In recent years it has had a $15.7 billion dollar shipbuilding budget. But look at what it has on its plate. Eleven aircraft carriers are operated out of Newport News, Va. and Bremerton, Wash. The Gerald Ford is the newest carrier having cost $12.9 billion to date, but which is, according to the General Accounting Office (GAO) still only 80 percent complete and requiring almost another billion. The Navy has ordered two more Ford class ships, so that the estimated total cost will be $43 billion for three new carriers, but, of course they want to replace all 11 of them. Three Zumwalt-class destroyers have been ordered (seen as replacements for the Iowa class battleships). The largest and fanciest destroyer ever built, the Zumwalt can do a lot of things with a crew of only 142 sailors. But the GAO estimates that one ship will cost $7.3 billion, or three at about $22 billion. Less expensive is the LHA 6 America class Amphibious Assault ship which is also a “floating fortress” complete with all kinds of weapons, the ability to carry aircraft and helicopters and 1,871 troops over and above its 1200 person crew. The current estimated cost is only $3.4 billion per ship or a little more than $10 billion for the three that have been ordered. What did Senator Everett Dirksen say? “A billion here and billion there and pretty soon you are talking about real money.” The Navy wants plenty of other ships of course, some of which are quite controversial. Once celebrated as “ships of the future,” Littoral Combat Ships (LCS) have been built in two versions, Freedom class and Independence class, for operations close to land. Unfortunately, there have been extensive complaints about the price ($670 million each), the lack of firepower and vulnerability. Four are scheduled to be in Singapore by 2018, presumably to make a presence in the South China Sea. The overall order has supposedly been cut from 52 to 32. But wait there is more. The Navy is currently building two Virginia class attack submarines a year, at about $2 billion each. Eighteen built, another 10 ordered and a total of 49 desired. However, it also wants to replace its 14 Ohio class submarines with 12 new SSBN-X subs. Eighteen were built in the 1980s and 1990s, designed for 30 year service, later certified for 42 years. Four of the 18 were converted to cruise missile submarines without nuclear weapons. The Navy wants to replace them with 12 new Ohio class subs. Unhappily, the first will cost an estimated $14 billion. Over time the twelve would average $7 billion. Finally the Navy wants more and fancier weapons on its ships. In January, Vice Admiral Thomas Rowden was quoted in military speak – “We’re going to up-gun as many existing platforms as we can to achieve more total lethality.”
AIR FORCEEverybody loves to beat up on the F-35, and with reason. Of course, it is not just the Air Force’s problem; the Navy and Marines have, with their own versions, skin in the game. There are currently so many complaints – a nose cannon that some say won’t be ready until late 2018 because of delays in required software; limited ability to drop bombs, deal with hostile incoming missiles or identify enemy radar; engine design issues and more. In April the GAO expressed concern, and the Pentagon’s Inspector General identified 61 “nonconformities” with DOD requirements and policies. The Pentagon says it won’t begin full rate production for another four years (April 2019), though it has already purchased more than 100 that will all need retrofitting. DOD and Congress still want to purchase 2400 of these planes at a total of about $400 billion. A more depressing number is the estimated $850 billion required for production, maintenance and operations over the plane’s 55 to 60 year lifetime. The Air Force wants new bombers – at an estimated $550 million per system. They currently argue for 100 which would cost $55 billion (some say $80 billion) and be available in the mid-2020s. These would augment or replace 20 B2s and B52s Stratofortresses. To the chagrin of many, the Defense Department wants to get rid of the A-10 Wart Hog fleet, saving $4.7 billion, and slash the EC10 fleet, saving $470 million. They also speak of possibly purchasing Textron Scorpions which sounds a lot like replacing the A-10 plane. If the Ohio Class Submarine and new or current bombers are two elements of US nuclear deterrence, recall that the triad has a third piece– the 450 Minuteman III Intercontinental Ballistic Missiles (ICBM) that reside in the North Dakota, Montana and Wyoming. There has been a lot of controversy about the morale of the men and women who work on this force. There is general consensus that the Air Force is not able to respond quickly to a terrorist or some other emergency at one of its sites. The Missiles are said to need upgrading and “demerving” so that there will only one warhead on each missile. Modernization and spare parts have cost around $350 million in recent years. The expectation is that they will then remain in good shape until around 2030, but already design work on the replacement system has been reported.
ARMYThe Army has largely personnel challenges, the result of substantial pay increases and health care costs in recent years. It costs only an estimated $17,000 to equip a soldier. Fortunately, the Defense Department (if not Congress, especially those from Ohio and Pennsylvania) believes that the Army has enough tanks which can cost around $6 million each. To upgrade an older Abrams tank costs about $7.5 million. Then there are the Bradley fighting vehicles which come in several flavors – the M2 Infantry Fighting Vehicle and the M3 Cavalry Fighting Vehicle, both of which have been modified over time. Almost 7,000 have been manufactured, at an average cost of a little over $3 million. In 2009 Defense Secretary Robert Gates canceled the replacement system (Future Combat Systems Manned Ground Vehicles); then in 2010 the Army started a Ground Combat Vehicle program which was cancelled in 2014. Now there is talk of a Future Fighting Vehicle program that could start as soon as 2019. What ground war are these guys planning for? This snapshot does not include extensive costs associated with upgrading nuclear weapons and trying to build anti-ballistic missile systems – both ICBM and local systems like the one proposed to protect Gulf states from a country like Iran. The reality is that we cannot do it all, not without bankrupting the country. The nation needs education, infrastructure, healthcare, employment and a working safety net. China does not want to attack us – we owe them too much money, and they want to invest here. Russia with its tottering economy can’t realistically take on NATO. They know that it either struck first with a large sale attack we would retaliate with overwhelming power. Our challenge is to show potential adversaries that we will not unilaterally disarm, but that we favor international cooperation and that we are capable of a strong defense that costs far less. We are convinced that there are many options that should be explored. For example: Even if the F-35 works out its problems, consider building 300 or 400 of them rather than 2400. Planes like the F-15, F-16 and F-18 are perfectly adequate in most of the world. Don’t let the Air Force spend $50 to $80 billion dollars building a new bomber force. Our submarines and our ICBM missiles are enough of a deterrent. If necessary equip our current bombers with standoff weapons systems, and/or convert some F-22s or F-35s into UAVs able to deliver bombs without pilots on board. Stretch out acquisitions. Why do we need to lead a world-wide arms race? Reexamine the wisdom of $14 billion aircraft carriers. No other country has more than one or two, but we have 11. Our carriers have very sophisticated layers of defense, but China is reported to be building very sophisticated anti-ship missiles. What if an incident resulted in two or three percent of the hostile missiles getting through and sinking a carrier with 5000 people and 90 planes on board? What would a proportional response be that didn’t result in nuclear winter on the planet. This article was originally published in our 2015 annual newsletter.
The Struggle in Honduras and ImmigrationBy Abbe Sudvarg This summer I will return to Guanacaste, Honduras for my fifth annual medical mission trip. Guanacaste is a profoundly poor, mountain community of approximately 400 people. They have lived for generations without clean water, electricity or health care. Under the auspices of the small non-governmental organization (NGO), Washington Overseas Mission, our group of 10 U.S. citizens has seen the health of Guanacaste’s citizens improve significantly. We have provided materials and hens for the building of a community chicken coop. The children are better nourished. Clean water now flows to Guanacaste and the children have fewer parasites. Contraception has allowed more time between pregnancies. Vitamins have improved the quality of the pregnancies and early childhood health. Chronic illnesses are being managed. Because of the location of Guanacaste, in the southwest near the El Salvadorean border, the one health danger that the people of this community do not fear is the terrible violence that is rampant in other parts of the country. San Pedro Sula, in northwest Honduras, is the most dangerous city in the world outside of the Middle East. Murder, including drug trafficking related homicides, is a daily part of the lives and communities of the people living in much of Honduras. A sad consequence of the violence is the separation of children from their parents. Last summer, the influx of unaccompanied minors from Mexico and Central America into the United States was front page news. The children were sent north by parents who were trying to protect them. And what has the U.S. response been? Some children are living with family members who were already residing legally in the U.S. Some are still being held in detention centers. And in 2014, according to the Transactional Records Access Clearinghouse of Syracuse University, 4,000 of these Honduran juveniles were deported. According to the Department of State website, the U.S. priorities in Honduras are listed as “being aimed at promoting a healthy and more open economy capable of sustainable growth, improving the climate for business and investment, protecting U.S. citizen and corporate rights, and promoting the well-being and security of the Honduran people”. Deporting minors back to the country from which they have fled certainly does not promote the well-being or security of children who come to our country for safety. Drug trafficking in Central America, including Honduras, is a colossal threat to the safety and security of its citizens. But solutions advanced by the U.S. are abysmal failures. We have spent more than $20 billion dollars in the last decade to thwart the drug traffic from Central America. But, according to Congressman Eliot Engel, the Ranking Member on the House Foreign Affairs Committee, "Billions upon billions of U.S. taxpayer dollars have been spent over the years to combat the drug trade in Latin America and the Caribbean. In spite of our efforts, the positive results are few and far between." Our priorities in Honduras, and in all of Central America, should involve health and education—yet U.S. corporate rights receive higher billing on the State Department list. Dollars spent on the War on Drugs could bring true development to impoverished communities in the Americas. Surely, in the interest of a more sane and humane policy toward refugees who come from countries close to our border, a fraction of these dollars could be spent integrating these children into the safe haven our nation can provide. This article was originally published in our 2015 annual newsletter.
Science Fiction is Very Much Alive in the Military
Scarier and ScarierBy Charles Kindleberger Pity the poor souls in charge of naming projects and acronyms in the Defense Advanced Research Projects Agency (DARPA), the Navy Research Lab and about 75 other groups in the Department of Defense, not to mention contracted universities and other consultants. Most of the work is fascinating. Some is promising in that it would allow more to be accomplished with less. A good part is frightening. Why frightening? Because much of the research accelerates the arms race around the world, and advanced weapons inevitably run the risk of convincing policy leaders that the US can be more assertive, and less humble, in dealing with its allies and adversaries. Here is a look at some of the latest stuff in the works:
ROBOTICSLow-Cost UAV Swarming Technology (LOCUST). Remember Michael Creighton and his 2002 book about nanobots called “Prey.” The Navy is on the verge of demonstrating how 20 or 30 synchronized “birds” (drones) can be launched from a “canon.” The goal is to have a swarm that can join together, break apart and conduct missions individually, collaboratively and spontaneously. Recall that in Creighton’s book the Swarm turned on its creators. Anti-submarine Warfare Continuous Trail Unmanned Vehicle (ACTUV). A robotic ship, “the Sea Hunter,” is supposed to launch this year able to track very quiet diesel-electric submarines. In addition to following submarines, it can avoid vessels, rocks and other problems on the surface. How will we respond if someone sinks it? Robotic War Balls. A company called GuardBot has developed an amphibious drone that swims over water at about four miles per hour and then can roll up and along a beach with a 30 degree incline at 20 miles per hour. Designed for use by Marines, these devices can carry detection or camera equipment or explosives.
LASERSThe Navy has a prototype 30-kilowatt-class Laser on the USS Ponce, a transport ship in the Persian Gulf. Using light focused from six solid state commercial welding lasers, it can be used on small boats and UAVs. In the next few years more are expected with a range of around a mile. Then in the next decade projections are that laser systems will increase in range (10 miles?) and in the ability to intercept a variety of incoming missiles. Advanced Test High Energy Asset (ATHENA). Lockheed is actively developing laser weapons. It recently field tested a “multi-fiber laser” destroying a small truck a mile away. Last year it demonstrated the ability to hit and stop small rubber boats about a mile apart. High Energy Liquid Laser Area Defense System (HELLADS). This ambitious system is designed to protect aircraft from surface to air missiles. DARPA is reporting to be working on a variation that would be an offensive weapon able to destroy ground targets.
RAILGUNSAn alternative to laser technology, the railgun uses electromagnetic technology to fire rapidly (around 10 rounds a minute) at muzzle velocities twice those of conventional guns. With no propellants or explosives on board, the projectiles are easier to store. There is also a far lower cost in comparison with comparable missiles. Lots of companies have gotten involved: K2 Energy Solutions has received $81 million from the Navy in order to create a battery system able to power rail guns. General Atomics has received funding from the Office of Naval Research for the 32 MJ launcher. It also has developed the Blitzer MJ System on its own. BAE makes a hypervelocity projectile that can be fired from a railgun. They have proposed a “tank killing” railgun for the next version of the Bradley fighting vehicle. The Navy anticipates deploying railguns in sea trials next year.
PLANESWe have read for a long time that the 2500 F-35s would be the fighter for the next 55 or 60 years. Now comes news of work on its successor – the x plane. Pentagon Acquisition Chief has announced the Aerospace Innovation Initiative, an effort to expand the building of prototype airframes and engines. Many of us have wondered about the problems of the 5th generation F-35; is it really time to get serious about a 6th generation plane. There is much more: Vulture II program works on the Solar Eagle that would stay in the air for at least five years solar energy. The Integrated Sensor IS Structure (ISIS) is an effort to create an unmanned high-altitude, solar powered airship that would collect information for a 10 year period. The VTOL X-Plane. Remember all the problems associated with the V-22 Osprey. Here comes its replacement- faster, capable of very efficient hovering and able to carry 4800 lbs of cargo. Aiming for 2018. The Aerial Reconfigurable Embedded System (ARES) is a follow on project to DARPA’s Transformer project that would create a flying Humvee. Field tests by Lockheed have been scheduled for 2015. The SR- 72 is a hypersonic plane being developed by Lockheed Martin and Aerojet Rocketdyne. Designed to accelerate quickly and cruise at Mach 6, this surveillance and reconnaissance plane would replace the SR-71. The plane builds on DARPA’s work. In 2012, it announced that a plane flying at 20 times the speed of sound would occur in 2016. The military is involved in so much more: Extreme Accuracy Tasked Ordinance (EXACTO) which looks to build smart, self-guided bullets. Legged Squad Support System (LS3) in development by Boston Dynamics, a four legged robot that can carry hundreds of pounds of military equipment. One Shot XG is a DARPA program to improve the accuracy of snipers with a computer driven device that calculates the best aim given wind conditions, weapons alignment, etc. Z-Man helps soldiers engage in high risk climbing with a synthetic material that replicates the capabilities of geckos and spiders. Broad Operational Language Translation (BOLT) is a tool that would allow soldiers to communicate with, and understand, citizens speaking in different languages. What do we make of all this? Can this huge assembly of brilliant innovation make the world safer? We have our doubts. First, we don’t like the idea of making it easier to kill people. Second, controlling all this accelerating technology is going to be difficult. But beyond that, all this Research and Development seems likely to induce China, and to a lesser extent Russia, to strive to build bigger weapons themselves. If any of the major powers achieve a major military advantage, that country may feel they can take more risks, and their counterparts may in turn determine that they have to strike first to protect themselves. This article originally appeared in our 2015 annual newsletter.
Can the U.S. Strengthen the Safety Net?By Charles Kindleberger This article was originally published in our the 2014 edition of the Peace Economy News. Please sign up below to receive our 2016 newsletter when it comes out later on this summer. Earlier this year there seemed to be evidence of new concern for the nation’s poor. Fifty years after the beginning of President Johnson’s “War on Poverty,” politicians on both sides of the aisle proclaimed that ending poverty was still an important national goal. Sen. Mark Rubio gave a long speech in January expressing concern, if few specifics, other than transferring federal safety net programs to the 50 states. House Ways and Means Committee Chair Congressman Paul Ryan released a 200 page report put together by his committee staff that, as one might expect, claimed that federal poverty programs often don’t work, even as a close look at the report highlighted many examples deemed to be “effective.” Senator Ran Paul expressed interest in creating “economic freedom zones” in depressed areas where flat individual and company 5 percent tax rates would encourage investment. Then in early March, President Obama submitted his annual budget. Its proposed expenditures stayed within the overall compromise limits reached by Congressman Ryan and Senator Murray last year. His budget contained poverty reduction and economic growth measures, while continuing a reduction of the federal debt as a percent of the gross domestic product. Immediately, the Republican leadership in the Congress declared that it was not a serious document. They deemed it “Dead on Arrival (DOA).” On April 1st, Congressman Ryan unveiled a new 10 year budget aimed at eliminating the federal debt. His “Path to Progress” appeared to be a repeat of previous budgets in which two thirds of the proposed cuts would come from programs designed to assist low and moderate income individuals. Over 10 years his budget would cut Pell Grants for low and moderate income college students by $125 billion, and SNAP (food stamps) by another $125 billion. An additional $500 billion would be cut from unspecified mandatory programs (things like Medicare and Medicaid) as well as $791 billion in non-defense discretionary programs (things like education, research, law-enforcement, early child care and low income housing assistance). Defense would be increased by $483 billion over 10 years. The Affordable Care Act would, of course, be repealed; Medicaid would be cut by 25 percent and conveyed as a “block grant” to the states. Individual and corporate tax rates would top out at 25 percent, causing an estimated revenue short fall of $5 trillion (Urban Institute and Brookings Tax Policy Center). This is a budget that may find use during the election season, but with a Democratic Senate and President, in terms of actual enactment it too is DOA. Is any progress on safety net programs possible this year? Wouldn’t it be great if the House and Senate could focus on smaller specific steps? Here are some for consideration.
Earned Income Tax CreditThe EITC was put in place by President Gerald Ford in 1975 and has long had bi-partisan support. Even Congressman Ryan’s report indicates that it is an “effective tool for encouraging and rewarding work among lower-income individuals.” The EITC could be made more effective in several ways including allowing single men and women to participate.
Job TrainingWho can deny that finding work is central to the fight against poverty, and that many of the unemployed (especially the 2 million long term unemployed) need new or upgraded skills? At minimum, Congress should reauthorize the Work Force Investment Act that expired in 2003.
Child Care and Development Block GrantThe Senate voted to reauthorize this program with a vote of 97 to 1. It would encourage health and safety standards for child care centers and allow more day care assistance, thereby providing more opportunity for poor people with kids to work.
Emergency Unemployment CompensationHouse Speaker Boehner said he would not consider an extension for the 2 million who continue to search for work after their initial 26 weeks have run out unless the extension was paid for. Several months ago it was reported that the Senate had reached a bi-partisan agreement allowing a five month, retroactive EUC measure that would be financed.
Financial Security CreditThis innovation would allow low income families to place all or part of their tax return into a savings account. Those who maintained the deposit in the account for at least 8 months would receive a matching amount up to $500. The government provides middle and upper income households with programs (IRAs, 701k, etc.) that encourage savings. Why not the poor? Is it naive to think that any of these programs could be implemented in an election year? Maybe, but the polls tell us that the American people are upset. A recent Pew Research Center/USA Today survey revealed that almost 70 percent think that the government should do either “a lot or some” more to fix the gap between the rich and the poor. About two thirds recognize that over the last 10 years and longer the gap between the very rich and everyone else has increased dramatically. Major legislative accomplishments are not likely this year. But programs that provide incentives for low and moderate income people to work and save, and that don’t cost too much should appeal to a cross sections of republicans and democrats. Let’s keep pushing.
Review: The New Confessions of an Economic Hit Man"The New Confessions of an Economic Hit Man" is the updated and expanded version of the New York Times bestseller, "Confessions of an Economic Hit Man," which was originally released in 2004. The 2016 edition of the book features several new chapters highlighting the work of EHMs, or Economic Hit Man, in the 12 years since the book was first published. The new chapters cover topics such as the 2009 financial crisis, Honduras, and China's burgeoning use of the EHM system. Whether or not you've read the 2006 book, I highly recommend the 2016 edition. (more…)
World Trouble Spots: The Middle EastBy Charles Kindleberger, Board Member This article was originally published in the 2013 edition of the Peace Economy News. Our 2016 edition will be released later this summer. To receive a free copy in the mail, please sign up through this form. There is some good news around the world. The global poverty rate has been cut in half during the past 20 years. The World Bank reports that 20 “fragile and conflict affected states” have met one or more targets under the millennium development goals (MDGs) with another six countries expected to meet targets by 2015. The World Bank measures progress towards reduction of extreme poverty, access to water, gender parity in education, maternal mortality, and finds some reason for hope. (more…)
Save the Date: Kim Klein Fundraiser Workshop
Raising the Money You Need from the People You Know A Workshop Presented by Kim Klein
Friday, Nov. 18 9:30 a.m. - 3:30 p.m. 590 E. Lockwood Ave., 63119
Hosted by the Peace Economy Project(more…)
No More NukesBy Rachel Kent Former PEP Executive Director Growing up, I gave no thought to nuclear weapons. In history class, we were told that the use of atomic bombs in Hiroshima and Nagasaki ended World War II, saving thousands--if not millions--of lives. We were shown videos of Cold War era schoolchildren practicing what they should do in the event of a nuclear attack, but were assured that the danger of nuclear weapons being used again was well past us, and that we need not worry. So I didn’t worry or think about nuclear weapons or ever imagine that I would end up working to eliminate nuclear weapons. (more…)
The Defense Budget ProcessBy Charles Kindleberger PEP Board Member This article was originally published in our 2016 edition of the Peace Economy News. It is the summer of 2016, and once again the nation is engaged in resolving how much should be spent on the military, and for what. The process involves passage of a National Defense Authorization Act (H.R. 4904 and S. 2943), passage of a Defense Appropriations Act, and then approval by the President. Differences between a bill passed by the House of Representatives and a bill passed by the Senate get resolved in a conference committee. This year 19 national non-profits have come together in order to recommend desirable modifications to the authorization bill for 2017. What was impressive is the fact that some of these groups are primarily conservative in nature, worried about the size of the Federal Budget; others are primarily concerned about the danger, as well as waste, of excessive weapons and an overly aggressive American foreign policy. (more…)
Save the Date: Kim Klein Fundraiser Workshop
September 13, 2016
Local Groups Respond to Police Killings
July 8, 2016
We Need to Change the Army’s Mission
June 8, 2016
Can the U.S. Strengthen the Safety Net?
June 1, 2016
Bigger and Bigger Military Appetites
May 16, 2016