UK in Recession Thanks to Cameron’s Stupid Austerity Policy: Lesson for the U.S.

Wednesday the UK statistical office announced that Britain was in recession. Wednesday’s economic data established that Britain’s gross domestic product fell 0.2 percent in the first quarter of 2012 on top of a 0.3 percent decline at the end of 2011. While the data can be revised and some conservative voices are questioning it, it still is not good to likely have a double dip in the face of promises of a quick recovery by the Tory-Libs government. This is official recognition of what the average citizen of Britain already knew. Sadly, it only reaffirms that the conservative ideology of starving the real economy and raining buckets of benefits on the rich is again not working! 

It has hardly worked before and where tried, especially during the great depression, it has been a total disaster. It can’t really work now and has shown its perverse impact on the lives of people in Europe, given the region a sense of decline, and created a corrosive political environment (including the rise of extreme xenophobic parties).

The troubled nations of Europe are feeling its cold wind and it has caused a political upheaval recently in France and the Netherlands. Already resentment of forced and mindless austerity policies has created anger and despair for many EU countries. It has great relevance for America’s own economy and global leadership capabilities. The Republicans seem hell-bent along the same lines with the same approach that Cameron’s Tory Party has already shown to be unsuccessful with the same rate of unemployment as in America despite a still better social safety net thanks to the programs initiated by the Labour Party after WWII.

President Obama tried a larger stimulus package earlier and at least achieved some gains – America made very modest but real growth and employment gains generally greater than Britain and many countries in the EU. Frankly, we need another full stimulus to get us back into the steady 3-4%+ growth rate which would both lessen our debt levels as a percent of GDP and lower the unemployment levels.

Prime Minister Gordon Brown and President Obama had worked earlier at getting a global consensus towards not austerity but a trajectory of growth. This was stalled by Brown’s UK election defeat, opposition of Germany and other conservative governments, and not least by the Republicans’ effort to defeat Obama in a second term even at the cost of the well being of the US economy.

The question today is whether the British and American publics and perhaps finally the key EU countries, after trying the worst possible policies, will finally choose the right one. To paraphrase Winston Churchill, much of the capacity for good globally depends on the resurgence and reinvigoration of the Western economies – much of the rest of the world depends not only on their trade and aid but also on their leadership to deal with our critical global challenges and to assure global security and peace.

By Harry C. Blaney III.

The Self-Inflicted Wounds of 9/11

This article was originally posted on t r u t h o u t on September 11, 2010

The attacks on Washington and New York City nine years ago extracted a terrible price in terms of blood and treasure. Unfortunately, the adverse US reaction to 9/11 has also extracted a terrible price with no end in sight. Although al-Qaeda is no longer a sophisticated terrorist organization capable of launching large-scale operations and is merely one of many jihadist groups based in Pakistan, the United States has thrown itself into the briar patch called Afghanistan.

Nearly twice as many Americans have died fighting wars in Iraq and Afghanistan than were lost in the 9/11 attacks. The total cost of these long wars will be in the trillions of dollars. When the United States invaded Iraq in 2003, the cost of oil was less than $25 a barrel; the price reached $140 a barrel in 2008 and, currently, the price is still three times the 2001 levels. The entire national security system has suffered as a result of the wrong-headed actions of the Bush administration in Iraq and the Obama administration in Afghanistan. The Iraq war marked the greatest travesty of all, based on a series of official lies that linked Saddam Hussein to Osama bin Laden and Iraq to weapons of mass destruction. As we knew seven years ago, there were no such links and no such weapons.

President Barack Obama declared last week that the US combat role in Iraq was over, but Americans continue to die in military action there, and 50,000 American servicemen and women will remain at least until the end of next year. President Obama inherited the war in Afghanistan, but last year he unwisely redefined and expanded it when he bowed to the demands of Secretary of Defense Robert Gates and the Pentagon to send more than 30,000 additional soldiers and Marines to Afghanistan. The president has defended this action as being part of the struggle against bin Laden and al-Qaeda, but we have been told authoritatively that there are only 50-100 al-Qaeda members in Afghanistan. In both wars, we have aligned ourselves with corrupt governments that are dysfunctional.

These wars have been used to dramatically increase the size of the defense and intelligence budgets, which find the United States now spending more than the rest of the world in both categories. The $708 billion defense budget for FY 2011 is higher than at any point in our post-World War II history. In constant dollars it is 16 percent higher than the 1952 Korean War budget peak and 36 percent higher than the 1968 Vietnam War budget peak. Secretary of Defense Gates argues that the budget plan “rebalances” spending by putting an emphasis on the near-term challenges of counterinsurgency, counterterrorism and stabilization operations, but the plan makes no effort to prioritize these near-term commitments against funding for long-term commitments. The Pentagon’s role in so-called nation building assures continued high defense budgets, and already we hear demands for an increased military role in Yemen and Somalia.

The defense budget is, in fact, out of control, increasing funding for both near-term and long-term programs and activities. Overall procurement spending would rise by nearly eight percent in the 2011 budget, buying virtually all of the equipment the services want. Historically, the costs to operate and maintain the US military tend to grow at about 2.5 percent a year. Not this year! The defense budget request for Operations and Maintenance is more than $200 billion, which represents an 8.5 percent increase. President Dwight David Eisenhower’s warnings about the military-industrial complex and the need for commanders in chief who actually understand the Pentagon’s clarion calls have never been more germane. Continue reading