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Friday, January 18, 2019

The Military Can Handle The Sequester Cuts — Even If The Economy Can’t

Speaker John Boehner said of the sequester, “A federal policy is set to go into effect that threatens U.S. national security.” But if that were really true, would he be so eager let it happen?

The truth is that the sequester cuts would shrink Pentagon spending to about the same amount we spent in 2006. This is still above that spent during the Cold War, according to a new report, ” Sequestration, the Pentagon and the State” (PDF) from the National Priorities Project, when the nation actually faced an existential threat from a military enemy.

Between 9/11 and 2011, U.S. defense spending grew 48 percent and is now greater than the total spending of the 16 next largest countries.

“For the $647.4 billion that the Pentagon is projected to spend in FY2013, we could provide the maximum $5,500 annual Pell Grant award to each of the nation’s 21.6 million college and university students for the next 5.4 years,” according to the NPP report.

Currently, defense makes up 57 percent of the nation’s discretionary spending.

The planned cuts to defense were put into the sequester in order to raise the chances that Republicans would choose to avert it. That prediction appears to have been faulty, as the House GOP is refusing to consider any alternative to the cuts that includes any deficit reduction from revenue.

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3 responses to “The Military Can Handle The Sequester Cuts — Even If The Economy Can’t”

  1. charleo1 says:

    The facts remain that it is very unfortunate the Republicans have opted, as a political strategy,
    to characterize the Nation’s debt as an immediate, and imminent threat, in order to energize their
    base. Because now, they, their base, see the reduction of that debt is necessary above all other concerns, for the
    survival of the Country. And believe just as strongly, that any, any, raising of revenue through the tax code, will prevent all the job creation, and economic growth, because it would take away the
    money businesses will need to expand, and create more jobs. Now, Republicans may have calculated that selling their base these two erroneous contentions, solved their political problems.
    One, they explain to the majority of their base, who are not wealthy, the reason for their first goal, of not allowing tax increases on the wealthy people, and corporations, that fund their campaigns.
    And, by convincing their supporters the debt, and not jobs, or expanding the economy, or health
    care, or infrastructure, or anything else, is as important as reducing spending, they hamstring
    the President, and slow economic recovery, and by a political reckoning, increase their election
    chances. But, now having ultimately lost the election, they find themselves unable to back away,
    or explain, any necessary compromises they now must make, to achieve any of their stated goals.
    In fact, they have sold to a very successful extent, the policies of the most extreme elements of
    their Party to the most faithful of their supporters. So, it is unfortunate. For the GOP, which is
    at odds, and beyond consensus with itself. And, outside the mainstream of public opinion.

  2. The irony is that the sudden focus on fiscal integrity came when the economy is recovering, jobs are being created, our financial institutions are once again on solid footing, and the Dow doubled its value the last four years. Where were these neo-conservatives in 2007, when the economy collapsed, when we were losing 800,000 jobs a month, and when the TARP was proposed and signed to prevent the collapse of our financial institutions?
    We need both, revenue increases and spending reductions to put an end to deficit spending, borrowing, and accumulating debt, but an austerity program is not the answer to achieve that worthy goal. The key to sustainable economic growth and job creation is investment, preferably by the private sector, but since the latter is more interested in investing their large portfolios overseas rather than in the USA, the only option to further stimulate the economy and encourage private sector investment, is investment by the public sector. It is also worth remembering that in addition to stimulating the economy, creating jobs and reducing the deficit, we are in desperate need of upgrading or at least repairing our infrastructure, we need to invest in R&D, new technologies and concepts, modernization and education. We simply cannot afford to continue to neglect improvements critical to our future the way we have been doing during the past several decades, to achieve short term political goals.

  3. rothgar says:

    If the GOP really beleives their own economic ideology they’d be cheering the SEQUESTER. By their theory it should lead to a GOLDEN Era for America. That they are trying to blame the President shows they don’t beleive it themselves.

    If these cuts do have the projected results there is NO REASON to ever consider the CONSERVATIVE opinion concerning economics EVER AGAIN. These cuts will have validated EVERYTHING that John Maynard Keynes said about the economy and employment. His entire theory was that employment moved as a function of demand and investment (such as infrastructure or in our case DOD spending). In his treatsis on employment, he complained how attempts at fiscal prudence among Government and Private entities exacerbated the economic problems during the Great Depression. By 1932 to maintain reserves to be fiscally… prudent economic investment had dropped to 2% (or so) of levels maintained during the roaring 20’s. The CONSERVATIVE theory on employment was invalidated by the Great Depression when people would have accepted any rate of pay to work but there were NO JOBS!

    The only Conservative idea to have worked recently is TARP, but modern (tea-party) conservatives don’t like it at all. Oddly enough it is proof that Milton Friedmann was right about something. In “A Monetary History of the USA 1876-1960” Dr.Friedmann complained that the FED let the Banking Sector down (which lead to distortive regulations) by not bolstering the banks with guaranteed money (ala FDIC Insurance) in the period from 1929 to the Bank Holiday in 1933. By acting like the laissez-faire GOP bankers they were they let the banking commmunity end up being subjected to regulations like Glass-Steagall.

    Defense spending is the ONLY ideologically allowable form of Federal Spending for our “friends” on the right so it has grown as the GOP desparately tried to stimulate the economy to cover the abject failure of their kleptocratic tax policies. We’ve ended up with a huge MIC. Now, a disorganized approach to cutting the DOD budget as currently enacted to satisfy the Tea Party will hurt upper middle class working people just as badly as a failed (nonexistent) industrial/manufacturing policy hammered the blue segment of the middle class.

    To properly cut the DOD budgets requires going through the QDR process (which takes a 4 year view) is the way to execute the needed DOD cuts without completely dessimating our economy. The QDR process gives companies and people a little time to adjust (even if that means retiring).

    There are good and solid reasons for the failure but it is enough to say that tax policies that encourage the raping of US Businesses by their owners and executive are not conducsive to economic growth. Is this why the median with outliers excluded growth rate has dropped about a percent since Ronald Reagan was elected. I think so. Instead of leaving funds in their companies to support their future (pension) earnings executives have worked to increase their wages to astronomical levels.

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