The War at Home

The Domestic Costs of Bush's Militarism

by Frances Fox Piven

The New Press, 2004, hardcover


Historically, governments waging war sooner or later tried to compensate their people for the blood and wealth they sacrificed. As war continued and the rush of patriotic fervor faded, governments tried to shore up support by expanding democratic rights, making the rich share some of the costs through increased taxation, and initiating or expanding social welfare programs.

This period is markedly different. During World War II, tax rates on the rich rose to 90 percent; during our current wars, taxes on the rich have been slashed. Toward the end of World War I the franchise was expanded in war-weary Britain, Woodrow Wilson announced his support for collective bargaining, and toward the end of the Vietnam War, eighteen-year-olds were given the right to vote in the United States; our current wars have so far seen the stripping away of civil liberties and a sustained assault on unions. And at the end of World War II, European nations vastly expanded their health, housing, and income security programs, and the United States initiated a remarkably generous veterans' benefit program. During the current period, social welfare programs are being cut, both at the federal and the state level, and even some veterans' benefits have been reduced.

Explanations focusing on imperialism assume the main reason for war in Iraq was to shore up American domination abroad. I argue that another reason for war was to shore up America's rulers at home. War-making satisfied powerful domestic interest groups who were pushing for a military buildup. The fear and excitement generated by war helped paper over fissures in the Republican base. And the war figured importantly in the electoral strategy of the president and his party. (As I will show in the next chapter,) with the political lift gained by war-making, the Bush regime was also able to push rapidly ahead with its right wing domestic policy agenda. The agenda was predatory, not in the imperial sense of extracting wealth from foreign peoples, but in the more pedestrian sense of extracting wealth from the American people.

For much of American history, this seems to have been more or less true. Even the enormous military expansion of World War II was followed by demobilization, both of troops and defense factories. But the Cold War that rapidly ensued spurred a new buildup of the military that was never reversed. The armed forces and the intelligence agencies grew, as did the industries that supplied them, and their far-flung allies multiplied in research institutions and universities, in think tanks, and in government. Whatever the initiating motives or the raison d'etre of this establishment, it has now become a major force in its own right, ready and able to generate the ideas and even the events that justify its stability and growth.

... some 1.4 million men and women remain under arms, with a payroll of roughly $80 billion. And the armed forces ought reasonably to include the people who work for private security companies. These are effectively mercenaries operating under the radar screen of official public policy, but they are paid with government funds, and they are replacing government troops in conflicts around the world. In Colombia, for example, they conduct secret search and surveillance operations. And they are increasingly important in Iraq, where the occupation has led to an explosive growth in the industry with some two dozen private military companies employing as many as 20,000 people in the field.

... the roughly 1,000 or so bases that the United States owns or rents overseas, often giant establishments with quite lavish facilities. But the overwhelming majority, some 6,000 military bases, are not overseas but in the United States and its territories where the bases have become integral to local economic life and a major source of profit to private companies like Halliburton, DynCorp, and the Vinnell Corporation who contract to provide base services.

Then there are the sprawling intelligence agencies, with a $30 billion a year bottom line divided among fifteen agencies with a crazy-quilt division of responsibilities, most under the control of the Department of Defense, the remainder under the control of the CIA. The military establishment also includes the nuclear weapons programs run by the Energy Department. The U.S. nuclear arsenal includes 5,400 multiple megaton warheads, 1,750 nuclear bombs and cruise missiles, and 1,670 tactical nuclear weapons, with an additional 10,000 nuclear weapons stored in bunkers. The Star Wars lobby embraces not only the Pentagon, Lockheed Martin, and Boeing, but right-wing think tanks like the Heritage Foundation, the Center for Security Policy, and Empower America. Looming in the future with the increasing use of satellite-directed missiles is the expansion of the space program recently promised by President Bush.'° On the agenda, in other words, is the militarization of space.

The military is intimately tied to the industries that supply it, and both are closely connected to politics, especially but not solely to Republican politics.

Naomi Klein
"Some argue that it's too simplistic to say this war (Iraq) is about oil. They're right. It's about oil, water, roads, trains, phones, ports, and drugs." In the short run, at least, these contracts are being paid for not by the imperial extraction of the resources of other peoples, but by extraction from American taxpayers. The big winner in the competition to rebuild Iraq is Dick Cheney's old firm, the giant Texas oil services business Halliburton, and its subsidiary, Kellogg, Brown & Root. Halliburton received its first contract for logistical services for American troops in Iraq in 2001.11 In September 2002, a secret task force, formed to plan for Iraq's oil industry in the event of war, granted Kellogg, Brown & Root the noncompetitive contract for up to $7 billion to rebuild Iraq's oil operations. All told, Halliburton has so far received some $11 billion for its work in Iraq. 18 (Halliburton subsidiaries, incidentally, are incorporated in a variety of exotic places to avoid federal taxes.

A subsidiary of Bechtel, Bechtel National, is slated to do the work of rebuilding Iraq's roads, power plants, water systems, seaports, and airports. Bechtel's ties to the military establishment are longstanding. One of its board members, and a former president of the firm, is George Shultz, the secretary of state under Ronald Reagan, and chairman of the Committee for the Liberation of Iraq. Caspar Weinberger, defense secretary under Ronald Reagan, was also associated with the firm.

The Bush family itself is tied to the military industrial complex. Kevin Phillips has recently had much to say about the family and its connections: "If there are other families who have more fully epitomized and risen alongside the hundred-year emergence of the U.S. military-industrial complex, the post-1945 national security state, and the twenty-first century imperium, no one has identified them. Certainly no other established a presidential dynasty." The dynasty's power begins with the great-grandfathers of President Bush-George Herbert Walker and Samuel Prescott Bush-and continues with grandfather Prescott Bush who maintained ties with Nazi Germany until Pearl Harbor. Elsewhere, Phillips says that "when you get the Bushes, you get really what amounts to a four-generation history of involvement with finance and the oil industry... [and] very close ties to the intelligence agencies of the military-industrial complex, of which the oil industry has become a major part. And obviously there are the ties to the oil industry and the preoccupation with the Middle East and Texas, and the price of oil.

... the long-term influence of a closely knit group of neo-cons with long associations with both the Pentagon and right-wing think tanks, a group that Pat Buchanan not unreasonably calls the "War Party." The think tank network is extensive, including the well-known American Enterprise Institute (which serves as a kind of recruitment office for the neocons), the Hudson Institute, the Heritage Foundation, the Free Congress Foundation, Georgetown University's Ethics and Public Policy Center, the Committee for the Free World, the Center for Security Policy, the National Institute for Public Policy, the Project for a New American Century, and the Jewish Institute for National Security. These interconnected organizations, and the journals in which the neo-cons publish, are supported by a number of conservative foundations such as Olin, the Adolph Coors Foundation, the Smith-Richardson Foundation, and Scaife Family Trusts, as well as by midsize industrial firms, the oil industry, and the largesse of Bechtel, Lockheed Martin, the Carlyle Group, Martin Marietta, and Boeing Northrop Grumman.

With the ascendance of the Bush administration, key figures from this group came to occupy important posts in the administration, particularly in the Pentagon. The network reached to Vice President Dick Cheney and the new Secretary of Defense Donald Rumsfeld. It included Cheney's chief of staff, Lewis "Scooter" Libby, and Rumsfeld's deputy secretary, Paul Wolfowitz, as well as Douglas Feith, undersecretary of defense for policy. The network also included players in other Pentagon-related agencies such as the Defense Policy Board, which Richard Perle chaired until March 2003.

As early as 1981, Midge Decter, a first generation neo-con, wrote: "Except in certain enclaves of absurdity and irrelevance, such as the universities and the Public Broadcasting System, virtually no one in the world believes anymore that there is a system preferable to ours: more benign, more equitable, more productive .... [We are] waging a 'battle of ideas.' That battle, at least among serious people is now over. We have won it."'

In 1992 a document leaked from the Pentagon office of Paul Wolfowitz called for a permanent American military presence on six continents capable of establishing and protecting a new world order. Dismissed when it was leaked to the Washington Post in 1992, the Wolfowitz proposal became American policy in the form of a thirty-three-page National Security Strategy memo issued by President Bush on September 21, 2002 .Dolores Janiewski cites a 1996 Foreign Affairs article by Robert Kagan and Irving Kristol that argued for a foreign policy that would assert "America's role as a global hegemon" through increased military spending and the mobilization of public opinion in support of "America's global mission" to promote democracy, free

markets, and regime change. On January 26, 1998, Elliott Abrams, Bill Bennett, Robert Kagan, William Kristol, Richard Perle, and Paul Wolfowitz wrote to then-President Clinton begging him to use his State of the Union message to make removing Saddam Hussein through military action the aim of American foreign policy. And only nine days after 9/11 a longer list of neocons wrote to President Bush saying that the newly declared "war on terror" must target Hezbollah, Syria, and Iran, and overthrow Saddam.

In 2003, [William] Kristol explained the relationship between his patriotism and unilateral war: "[F]or a great power, the 'national interest' is not a geographical term, except for fairly prosaic matters like trade and environmental regulation .... And large nations, whose identity is ideological, like the Soviet Union of yesteryear and the United States of today, inevitably have ideological interests in addition to more material concerns. Barring extraordinary events, the United States will always feel obliged to defend, if possible, a democratic nation under attack from nondemocratic forces, external or internal .... No complicated geopolitical calculations of national interest are necessary."

On the day after the invasion of Iraq was launched, Richard Perle gloated in the Guardian: "What will die is the fantasy of the UN as the foundation of a new world order. As we sift the debris, it will be important to preserve, the better to understand, the intellectual wreckage of the liberal conceit of safety through international law administered by international institutions." Subsequently, in a book revealingly entitled An End to Evil, Perle together with neo-con David Frum proposed attacking North Korea, Iran, Syria, Libya, and Saudi Arabia.


Implementing the Business Agenda

The political power of the Republican right has been delivered to the big business interests that backed the administration and its party. The fog of war also helps in this process, for national security rationales have been used to divert public attention from the huge strides that are being made in implementing the big business agenda. We usually regard imperial war as a strategy that makes possible the predation of foreign lands and peoples, or "accumulation by dispossession" in David Harvey's phrase. But in this instance war is also a strategy for domestic predation, a strategy for 1 enacting the policies that dispossess resources and rights from ordinary Americans on an unprecedented scale. Nobel laureate in economics George Akerlof calls this "a form of looting."

These developments notwithstanding! the main targets of business looting are not in Iraq. They are within the borders of the United States. If we step back in time, it is clear that the business political agenda now being enacted under the cloud of war is a continuation of a campaign that began three decades ago when American business became intensely politicized. To be sure, big business has always attended to politics, but rarely with the zeal and determination of the past three decades. The origins of this campaign are in the economic troubles of the early 1970s when American business was simultaneously struggling with oil price shocks, rising competition from West Germany and Japan, and the narrowing profit margins resulting from the array of labor, social welfare, and regulatory gains won by the social movements of the 1960s and early 1970s. Big business responded by mobilizing an army of lobbyists and think tanks to promote a political agenda that would shore up profits by rolling back the public policies of the New Deal and Great Society.

The main planks of that agenda were cutting taxes on business and the affluent, reducing government regulation of business, weakening unions, and slashing the public programs that shored up the power of workers, largely by reducing the pain of unemployment. The agenda gained considerable traction under Ronald Reagan, another president who enjoyed the overwhelming support of big corporations, as well as the support of a right-wing populist base of Christian fundamentalists, gun advocates, tax cutters, and libertarians first activated in reaction to the civil rights and women's movements of the 1960s and 1970s.

... effective government depends on revenues, and the Bush administration has moved rapidly to deplete public revenues. In 2001, the president pushed tax cuts through Congress amounting to $1 trillion over ten years. Then in 2003, with the war in Iraq under way, another huge tax cut was enacted, amounting to $800 billion over ten years. Income taxes were reduced by an estimated average of $90,000 per millionaire, the federal estate tax on large inheritances was phased out, the rate on capital gains was cut from 20 percent to 15, and the top rate on dividends was slashed from 39.6 percent to 15 percent. Corporate taxes were allowed to wither as a source of federal revenue through new generous write-offs for investments in plants and purchases of equipment that will total more than $175 billion through 2004, and much more if they are not allowed to expire in a few years as is now expected.

Paul Krugman
"If you take the administration's tax proposals as a group, they effectively achieve a longstanding goal of the radical right: an end to all taxes on income from capital, moving us to a system in which only wages are taxed- a system, if you like, in which earned income is taxed but unearned income is not."

An obvious consequence of the new tax laws is that the tax burden is shifted from the rich to everyone else. Corporate income tax revenues fell to $132 billion in 2003, down 36 percent from $207 billion in 2000, representing only 1.2 percent of the Gross Domestic Product and the lowest level since 1983, a year in which corporate tax receipts fell to levels last seen in the 1930s. Meanwhile, the share of federal revenues consisting of payroll taxes rose to the highest level in the nation's history. But the consequences go beyond the redistribution of the tax burden.

Falling revenues and rising deficits are significant for another reason important to the right-wing agenda: they generate enormous pressure for cuts in spending, especially cuts in spending on social programs. Overall federal revenues as a share of the economy are falling sharply to their lowest level since 1959, while federal deficits are ballooning. "Except during the two world wars, the fiscal reversal amounts to the largest four-year deterioration in the federal budget in American history .... Since the present administration took office, the foreign indebtedness of the United States has increased by $1.4 trillion. And fully half of that deficit was the result of the Bush tax cuts.

Dick Cheney is reported to have said that Reagan proved deficits don't matter, meaning they don't matter to the voters. Reagan in fact proved that deficits do matter to Congress, if only because they can be used as a club to press for cuts in social programs. The tax cuts have already reduced revenues by $270 billion in 2004. This is barely a beginning, since most of the cuts have not yet taken effect. Indeed, only 11 percent of the cuts will take effect before 2008, and revenues will fall far more as the full impact of the administration's tax cuts unfolds. Over ten years, an estimated $12 to $14 trillion will be lost, more than enough to pay for the Social Security and Medicare shortfalls combined. "It will be a perfect fiscal storm" said Leslie B. Samuels, a partner at Cleary Gottlieb Steen & Hamilton, who served as assistant secretary for tax policy under President Clinton. The anticipated fiscal storm has led even the International Monetary Fund to worry about the long-run fiscal stability of the United States. The storm could well suck up the money that might otherwise be spent on our major social programs. Paul Krugman calls this "the bait-and-switch strategy known on the right as 'starve the beast.' The ultimate goal is to slash government programs that help the poor and the middle class, and use the savings to cut taxes for the rich."


Rolling Back Social Spending

The Bush regime has taken up the long-term business campaign against American social programs. These are the programs improve the well-being of people who earn little or nothing that provide services such as education or health care that not be left to the market.

Bush himself has echoed this view. "The new culture," he wrote, referring presumably to the liberalization of the 1960s, "said if people were poor, the government should feed them. If criminals are not responsible for their acts, then the answers are not in prisons, but in social programs. People became less interested in pulling themselves up by their bootstraps and more interested in pulling down a monthly government check. A culture of dependency was born. Programs that began as a temporary hand up became a permanent handout, regarded by many as a right."

The popularity of these attitudes acknowledged, employers have been the most consistent opponents of the social programs. Redistribution through government taxation and spending is an issue for them, but it is not nearly as important as the impact of the social programs on labor markets. The underlying problem is longstanding. To the extent that the social programs reduce economic insecurity among workers or potential workers, workers acquire a measure of independence and therefore of power in their relations with employers.

The campaign to privatize social programs is unfolding in education, welfare, job training, and most importantly because so much money is involved, in Social Security and Medicare. The Bush administration is working to push this campaign forward.

Employer opposition to social spending is longstanding. It was overcome in the United States only during periods when popular economic discontent reached levels that threatened both civil order and the stability of reigning political regimes. During the Great Depression of the 1930s, joblessness and hardship led to demonstrations and riots across the country and also led to the defeat of the then-dominant Republican Party. Programs like emergency relief, and later Social Security and unemployment insurance, were initiated quickly by Franklin Delano Roosevelt to deal with the immediate threat of popular unrest, and to build long-term support for his New Deal Democratic coalition. Once trouble subsided, however, most of the social programs atrophied, until a new surge of popular protest erupted in the 1960s, this time spearheaded by the civil rights and urban poverty movements. The New Deal programs were revived and expanded, and new programs were added, most importantly Medicaid and Medicare. It is worth noting that at these peak moments of crisis in the 1930s and 1960s, even leaders of big business supported new social spending.

The business political mobilization that began in the 1970s, however, targeted the New Deal and Great Society programs for rollbacks, partly to justify the tax cuts business was demanding, but more importantly as a component of the effort to roll back labor costs.

The logic that threads through these [Bush's cuts in social programs] social program initiatives is the logic of the labor market. Programs are being refashioned to make long hours of low-wage work the only option available to many. Even the vein of meanness contributes to this logic, for it heaps insult on those who turn to government support. The Bush administration immigration initiatives should also be understood in this way. Most immigrants, including legal immigrants, were already denied eligibility for the main means-tested programs under the 1996 welfare law. Although these measures might have gained some political traction among anti-immigrant groups from the belief that such restrictions would keep immigrants out, they did not, and neither did Congress show much appetite for the strong border controls that might keep immigrants out. To the contrary, our de facto policy seems to be to allow immigrants in albeit not easily-and to deny them the protections that might allow them to defend themselves from low-wage employers.

The president's new immigration proposal is consistent with that policy. To be sure, it would give temporary legal status to undocumented workers for three years, with the possibility of an extension. This tenuous legalization will be promoted by the administration in its appeal to Hispanic voters. But under the plan, prospective immigrants would have to have a job waiting, and they would have to keep it once they were here. It is only employers who can obtain permits for legal guest workers, and the permit belongs to the employer. Undocumented workers already here could be admitted to the program, but only if their employer sponsors them. Workers will be bound to their employers by the threat of losing their temporary legal status and deportation. As Mike Davis says, the "Bush proposal, which resembles the infamous Bracero program of the early 1950s, would legalize a subcaste of low-wage labor without providing a mechanism for the estimated 5 to 7 million undocumented workers already in the United States to achieve permanent residence or citizenship. Toilers without votes or permanent domicile, of course, represent a Republican utopia .... a stable, almost infinite supply of indentured labor."

There are ample precedents for this sort of policy, extending back to the nineteenth century when immigrants from Europe and Asia were often brought here by labor contractors. But the more recent precedents are in guest-worker programs for Mexican workers . The most notorious was the Bracero program initiated during World War II to bring in Mexican workers to help harvest the fields. To make sure they would not stay, a part of their salary was deducted, presumably to be given back when they returned home. It rarely was, and that along with the harsh treatment of the migrant workers, earned the program a reputation as a form of peonage. The Bush proposals, which tie workers to particular employers, could also create a form of peonage. No wonder that business executives in the low-wage hotel, restaurant, hospital, construction, and agriculture industries are cheering. "Americans just don't want to take a lower-paying, entry-level job," said Frank Romano, founder and owner of the Essex Group, a chain of fifteen nursing homes and assisted-living facilities. They will not apply for it. Last year I had to spend close to $300,000 on help-wanted ads because it was such a struggle to find people to do the jobs we need done."

John Sweeney, president of the AFL-CIO, talked about the same reality but put it in a different light. The president's proposal, he said, would create "a permanent underclass of workers .... The plan deepens the potential for abuse and exploitation of these workers while undermining wages and labor protections for all workers." Representative Bob Menendez, Democrat from New Jersey, had even stronger words. He called the plan "a glorified guest-worker program with no new path to legalization." While Bush, he said, "wants their sweat and labor, he ultimately doesn't want them. The proposal will be a rotation of human capital, to be used and discarded, with no hope of permanently legalizing one's status."

... the impact on the states of the tax- and social-spending cuts should be examined. The federal tax cuts reduced state revenues because state tax formulas were hitched to federal tax formulas. At the same time, flagging employment and a weak stock market caused further revenue losses, combining with tax cuts during the 1990s to produce huge state deficits that totaled about $190 billion from 2001 through 2003, and are estimated at an additional $40 to $50 billion in 2004.29 In the past, budget crises on the state level have usually been moderated by increases in federal grants. This time they were aggravated by cuts in federal grants, and by the imposition of new unfunded mandates on state governments by the federal government, including the requirements of homeland security, of the Help America Vote Act, and the No Child Left Behind law.

Meanwhile, the practice of short hospital stays is shifting the prescription drug costs of the elderly and the disabled from Medicare, a federally funded program, to Medicaid, to the time of an estimated $28 billion during the course of the state fiscal crisis. The Center on Budget and Policy Priorities estimates that from state fiscal year 2002 through fiscal year 2005 federal policies will cost states and localities a total of about $185 billion.

Inevitably, states are coping with their fiscal shortfalls by cutting social spending.

... the Medicare program is affected by the crisis in health care costs that affects all Americans. The Bush tax cuts, by depleting future revenues, of course make this problem much more serious. The recently passed Medicare Prescription Drug Act takes steps toward a market solution to this at least partially manufactured crisis. Well, not really a market solution. Rather, the legislation moves us further toward the creation of an unregulated market in health care, but a market saturated with public funds. The legislation contains subsidies for just about everyone in the health care business, including doctors, hospitals, insurance companies, and for-profit health plans. Moreover,(as noted earlier) the legislation forbids Medicare from bargaining with the pharmaceutical companies to bring down the cost of prescription medicines.

More than that, the legislation contains what may be important pilot programs toward the privatization solution. Private health plans are offered $12 billion in subsidies to compete with traditional Medicare, and also guaranteed that no HMO will be paid less for a patient than the traditional fee-for-service in what is called an experiment that will be launched in six major cities in 2010.43 Tax-Free Health Savings Accounts are introduced, which are really another tax cut for the better off. And a provision in the legislation requires that a crisis be declared if more than 45 percent of Medicare funding is expected to be drawn from general revenues in a seven-year budget projection. 41 As for prescription drugs for seniors, the bill provides an oddly patchy and limited solution. A senior will have to pay $3,600 out of the first $5,100 in annual costs of drugs before the government starts reimbursing costs.

Social Security was originally a pay-as-you-go system, where payroll taxes collected each year funded the pension benefits that were paid each year. That changed in 1983 when the large deficits created by the Reagan tax cuts and defense increases were eased by a big increase in payroll taxes for Social Security. The result is that at least on paper, Social Security reserves have become enormous, although in actuality, those reserves exist only as treasury notes, debts of the federal government to the fund. Nevertheless, the existence even in principle of huge public pension funds is ideologically offensive to the right. More than that, were the funds converted to private pensions, a new frontier of millions of individual stock accounts and broker fees would open for Wall Street investment firms, an arrangement naturally favored by the financial firms that backed Bush, including Merrill Lynch & Co., Credit Suisse First Boston, UBS Paine Webber, and the Goldman Sachs Group, who together with others formed a lobbying group called the Coalition for American Financial Security. The strident and insistent talk of a long-term crisis in Social Security financing is the overture to proposals for privatizing the system.

What does social spending generally, or tax cuts, or deregulation, or corporate giveaways, have to do with war? Well, virtually nothing, and that is just the point. "The American public, transfixed by the unfolding invasion of Iraq, may someday look up and discover too late what the Republican Congress did while the world's attention was elsewhere. Led by the Bush administration, the House and Senate are about to march under the public's radar screen and lead the country into a decade of budgetary disaster," the New York Times editorialized as the invasion of Iraq began." The Times was right. War was and is a power strategy, and for awhile at least, it smoothed the way for the implementation of right-wing domestic agenda.


The Leaking Bush Balloon

Hermann Goring, Luftwaffe commander, speaking at the Nuremberg Trials in 1946, wondered "Why should some poor slob on a farm want to risk his life in a war when the best he can get out of it is to come back to his farm in one piece? Naturally, the common people don't want war." Goring knew the answer to the question. "But after all it is the leaders of the country who determine the policy, and it is always a simple matter to drag the people along, whether it is a democracy, or a fascist dictatorship, or a parliament, or a communist dictatorship .... Voice or no voice, the people can always be brought to the bidding of leaders. That is easy. All you have to do is tell them they are being attacked [and] denounce the pacifists for lack of patriotism and exposing the country to danger."

The president followed Goring's age-old formula for leading a people into war. He told Americans they were in danger, that we "must not ignore the threat gathering against us. Facing clear evidence of peril, we cannot wait for the final proof-the smoking gun-that would come in the form of a mushroom cloud." And on the eve of the deployment of American troops in Iraq, the president asserted that "intelligence gathered by this and other governments leaves no doubt that the Iraq regime continues to possess and conceal some of the most lethal weapons ever devised."

Former Secretary of the Navy James Webb made one of the stronger statements:

"Bush arguably is committed the greatest strategic blunder in modem memory. To put it bluntly, he attacked the wrong target. . . There is no historical precedent for taking such action when our country was not being directly threatened. The reckless course that Bush and his advisors have set will affect the economic and military energy of our nation for decades."

American history reveals a familiar )pattern of tacit bargaining with a population forced to bear the costs of war. To be sure, wars or the threat of wars have also spurred repressive measures, justified by the war emergency. The Alien and Sedition Acts were passed when war with France threatened. When the United States entered World War I, the Espionage Act of 1917 and the Sedition Act of 1918 led to the jailing of leaders of the International Workers of the World. Japanese Americans were rounded up and placed in internment camps in World War II.

But the repression of particular groups was typically accompanied or followed by major concessions to the larger population in the form of expanded democratic rights and social welfare measures. Laura Jensen reports on the commitments of the Continental Congress to provide for men injured in the Revolutionary War, and to give land to certain classes of veterans both of the Revolutionary War and the War of 1812.68 After the Civil War, pensions were granted to war veterans and their families, and the Thirteenth, Fourteenth, and Fifteenth amendments extended citizenship and voting rights to the freed slaves, many of whom had fought with the Union Army and had helped reverse the tide of battle. World War I saw the repression of some of the most radical labor leaders, but it also led President Woodrow Wilson to announce support for collective bargaining rights for labor unions.

Similarly, during World War II, the federal government incarcerated Japanese Americans and extracted no-strike pledges from most unions, but it also conciliated the unions with the War Labor Board's maintenance of membership policies that enlarged union membership and treasuries. And after the war, a system of exceedingly generous veterans' benefits was introduced.


During the Vietnam War the federal government finally moved to enforce the rights first granted the freed slaves after the Civil War, social welfare programs were expanded, new national health programs were introduced in the form of Medicaid and Medicare, and the right to vote was extended to the eighteen-year-olds who were fighting in southeast Asia.

True, not all of these concessions endured. Civil War pensions atrophied as the veterans died off, southern states successfully countermanded the rights granted the freed slaves under the federal constitution, Woodrow Wilson's support of collective bargaining rights did not have much practical consequence. Nevertheless, the regularity of the pattern suggests a powerful underlying dynamic of reciprocal bargaining in the relation of governments at war to their populations.

What about now? "There are internal reasons" writes Eric Hobsbawn "why the American empire may not last, the most immediate being that most Americans are not interested in imperialism or world domination in the sense of running the world. What they are interested in is what happens to them in the U.S."

Soaring profits and stagnant wages mean, of course, that inequality, already at peak levels when the Bush administration took office, is growing. "What is happening," says Bob Herbert, is nothing short of historic. The American workers' share of the increase in national income since November 2001, the end of the last recession, is the lowest on record. Employers took the money and ran." Profits never stopped rising as a share of national income during the recent recession, and the median pay of chief executives also continued to rise, albeit at a much slower rate than during the boom years of the 1990s.37 Now during the economic recovery, profits are soaring, but wages are stagnating, consumer debt is skyrocketing at an annual rate of 11.5 percent as the costs of such basics as housing, health insurance, and transportation increase but wages do not. Consistent with these trends, poverty is increasing; last year another 1.7 million Americans slipped below the poverty line. The U.S. Conference of Mayors reports growing homelessness and hunger, with most of (the cities surveyed reporting they had been forced to turn away people requesting help.

The Bush economic stimulus plan consists of sharply increase military spending and big tax cuts for business and the affluent. This sort of deficit spending is a variant of Keynesianism that "has particular appeal for Republicans. Instead of growing the government in general-pumping resources into public works, health care and education, say, which would have an immediate knock-on effect on sorely needed job creation-the policy focuses on those areas that represent obvious conservative and business-friendly constituencies .... that tend to be big contributors to Republican Party funds." James K. Gaibraith thinks that "economic stagnation is to their taste. They don't want a new recession, obviously, and they look set to avoid that. But do they really want full employment and strong labor unions and rising wages? Probably not. The oil, mining, defense, media, and pharmaceutical firms who form the core of their [Bush] constituency rely on monopoly power, patents, and the control of public resources for their profits. They do not depend, very much, on strong consumer demand."

The United States is in the grip of a ruling group that is brash, shortsighted, and greedy. There are no promises for our political future. But of course, there are never any promises, yet predatory rulers are sometimes curbed, and even defeated.

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