For nearly all of us, U.S. national security involves policies and practices remote from our personal experience. What we know about this subject comes for the most part from what we see on television or read about in the newspapers. As a result, we tend to fall prey to disinformation broadcast by parties with an axe to grind. The U.S. administration is always the most important such interested party. Now more than ever, as the government prosecutes a so-called war on terrorism without a visible enemy or a definable resolution, it behooves us to separate illusions from realities.
Illusion #1: The U.S. Defense Department protects the American people in America.
Reality #1: The Defense Department occupies itself overwhelmingly in preparing for, or engaging in, foreign wars against persons who do not pose serious threats to the American people in America. The proposals now being considered for the creation of a Department of Homeland Security highlight the fact that heretofore the defense and intelligence establishments have given little thought and directed few of their actions toward defending U.S. citizens on their own soil.
During the Cold War, the Defense Department prepared for wars in Europe, Asia, the Middle East, and elsewhere, against the Soviet Union and its surrogates. In doing so, the U.S. military establishment routinely protected regimes that at least pretended to oppose communismno matter how tyrannical or murderous those regimes were.
Since the end of the Cold War, the Defense Department has undertaken to defend certain personsmany of them none too savoryin Kuwait, Saudi Arabia, Kurdistan, and southern Iraq; in Somalia, Haiti, Bosnia, and Kosovo; as well as the usual suspectsWestern Europe, Japan, South Korea, and Taiwan. Very little of this activity has had a direct connection with actually protecting the American people in America, and much of it has had no genuine connection whatsoever.
Illusion #2: The Defense Department has the motivation and the capacity to manage effectively the vast resources placed at its disposal, in a way that enhances the security of the American people in America.
Reality #2: The Defense Department is either unable or unwilling to deal seriously with its decades-long engagement in massive waste, fraud, and mismanagement, especially (but not exclusively) in its relations with the big defense contracting companies.
The Defense Department will not even obey the laws with regard to its own accounting practices. According to a report by the departments own inspector general, dated Feb. 15, 2001:
We identified $1.1 trillion in department-level accounting entries to financial data used to prepare DoD component financial statements that were not supported by adequate audit trails or by sufficient evidence to determine their validity. In addition, we also identified $107 billion in department-level accounting entries to financial data used to prepare DoD component financial statements that were improper because the entries were illogical or did not follow accounting principles. . . . [Further] DoD did not fully comply with the laws and regulations that had a direct and material effect on its ability to determine financial statement amounts.
The governments audit agencies also found the accounts of the individual armed services in a mess, so that those records could not be audited. According to the memorandum previously cited, The Military Department audit agencies attempted to audit those financial statements and issued disclaimers of opinion. However, the DoD inspector general did report, The financial data reported on the FY 2000 financial statements for Army, Navy, and Air Force General Funds; the Army, Navy, and Air Force Working Capital Funds; and the U.S. Army Corps of Engineers, Civil Works Program, were unauditable and comprise a significant portion of the financial data reported on the DoD Agency-wide Financial Statements for FY 2000.
And to think: Congress is wasting time holding hearings on the accounting shortcomings of Arthur Andersen and Enron, and the President is threatening to sic the Department of Justice on accounting malefactors such as WorldCom and Xeroxall of which are veritable paragons of accounting probity by comparison with the Pentagon. (Of course, various parties benefit from this blatant lawlessness and public irresponsibility. In this brief article, I cannot take up the important question of cui bono, but some of the beneficiaries are no doubt sufficiently obvious.)
Illusion #3: Since September 11, everything is different.
Reality #3: Very little of any significance has changed in the allocation of funds and the managerial conduct of the U.S. military-and-intelligence apparatus since September 11. The most notable change is that the Bush administration and Congress have seen fit to give vast additional amounts of taxpayer moneyamounts projected to increase annual military spending by some $120 billion in the next five yearsamounts that, in large part, are certain to be wasted in the usual fashion.
Defense secretary Donald Rumsfeld himself testified to Congress last year: We have an obligation to taxpayers to spend their money wisely. Today, were not doing that. Rumsfelds statement merits an award for understatement, because anyone who has spent even a little time looking into the matter knows that the Defense Department has been wasting the taxpayers money by the shipload, year in and year out, for decades. Nor is any improvement in sight. On the contrary, the new infusions of funds will only encourage greater waste and abuse.
The destruction of the World Trade Centernot to speak of the damage to the Pentagon itselfwill remain forever an indictment of the failure of U.S. defense-and-intelligence policy and practice. The most curious upshot of this terrible failure is that the President and Congress have not seen fit to punish those responsible for the failureno heads have rolled; hell, nobody has even had his wrists slapped. Instead, the failed defense-and-intelligence establishment is now being rewarded with the greatest infusion of new taxpayer money it has absorbed in a generation.
Robert Higgs is Senior Fellow in Political Economy at The Independent Institute and Editor at Large of the Institutes quarterly journal The Independent Review. He received his Ph.D. in economics from Johns Hopkins University, and he has taught at the University of Washington, Lafayette College, Seattle University, and the University of Economics, Prague. He has been a visiting scholar at Oxford University and Stanford University, and a fellow for the Hoover Institution and the National Science Foundation. He is the author of many books, including Depression, War, and Cold War.
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