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Volume 6, Issue 3: January 19, 2004

  1. Total U.S. Defense Spending Dwarfs Official Defense Budget
  2. Iraq War Decision Predated 9/11, Former White House Official Says
  3. The Voluntary City: Restoring Urban Life in Crisis Times -- Independent Policy Forum (2/4/04)
  4. Remembering Martin Luther King, Jr.

1) Total U.S. Defense Spending Dwarfs Official Defense Budget
The $401.3 billion defense budget for 2004, signed by President Bush in November of last year, is huge indeed, as many commentators have noted. The "official" sum, however, greatly underestimates total U.S. defense spending. Add together all defense-related spending by federal agencies and the tab amounts to about $754 billion -- 88 percent more than $401.3 billion -- according to Robert Higgs, senior fellow in political economy at the Independent Institute, editor of THE INDEPENDENT REVIEW, and editor of the noted book, ARMS, POLITICS, AND THE ECONOMY.

"Lodged elsewhere in the budget, other lines identify funding that serves defense purposes as surely as -- sometimes even more surely than -- the money allocated to the Department of Defense," writes Higgs in an op-ed published in the SAN FRANICISCO CHRONICLE. "On occasion, commentators take note of some of these additional defense-related budget items, such as the nuclear-weapons activities of the Department of Energy, but many such items, including some extremely large ones, remain generally unrecognized."

In arriving at his $754 billion calculation for total defense spending for 2004, Higgs added to the $401.3 the amount of spending on homeland defense by agencies other than the Department of Homeland Defense, estimates of foreign military financing (including development funds that free up the defense budgets of recipient countries), spending by the Department of Veterans Affairs, and the interest costs of past years' defense spending, as well as the supplemental spending bills to fund the occupation and reconstruction of Afghanistan and Iraq.

"Although I have arrived at my conclusions honestly and carefully," Higgs writes, "I may have left out items that should have been included -- the federal budget is a gargantuan, complex, and confusing document. If I have done so, however, the left-out items are not likely to be relatively large ones. Therefore, I propose that in considering future defense budgetary costs, a well-founded rule of thumb is to take the Pentagon's (always well publicized) basic budget total and double it. You may overstate the truth, but if so, you'll not do so by much."

See "The Defense Budget Is Bigger Than You Think," by Robert Higgs (SAN FRANCISCO CHRONICLE, 1/18/04) -- Defense

ARMS, POLITICS, AND THE ECONOMY: Historical and Contemporary Perspectives, edited by Robert Higgs

CRISIS AND LEVIATHAN: Critical Espisodes in the Growth of American Government, by Robert Higgs


2) Iraq War Decision Predated 9/11, Former White House Official Says
The National Security Council (NSC) began to discuss how and when to attack Iraq a mere 10 days after President Bush's inauguration, according to former NSC member and Treasury Secretary Paul O'Neill, speaking on CBS's "60 Minutes" last week.

O'Neill's recollection doesn't jibe well with the president's assertion that the terrorist attacks of 9/11 were a key motive to go to war -- but then many of the pillars on which the public case for war rested have fallen lately, argues Ivan Eland, director of the Center on Peace & Liberty at the Independent Institute, in his latest op-ed.

Was force-feeding democracy to the Middle East a key motive? You wouldn't have known that by attending the NSC's closed-door meetings. "Rather than talking about democratizing Iraq and then the Middle East by invading and occupying Iraq -- the public face of the intervention -- the council meetings focused more on divvying up Iraq's oil booty," writes Eland.

What about Iraq's purported weapons of mass destruction? WASHINGTON POST reporter Barton Gelman, writes Eland, "uncovered a letter from Iraq's chief of unconventional weapons programs reporting the destruction of all Iraqi biological weapons in 1991 -- contradicting U.S. intelligence estimates prediciting that Iraq had retained large stockpiles of such weapons. Most important, Iraq's nuclear weapons program was largely terminated after the Gulf War and never restrarted -- contrary to the administration's pre-invasion claims that the Iraqis could have a nuclear weapon within a year. It would have probably taken the better part of a decade before the nuclear program would have produced a weapon."

And as for supposed links between Iraq and the 9/11 terrorists, "both the president and Secretary of State Colin Powell have admitted that the implied link by administration officials between Saddam and al Qaeda or the September 11 attacks has no concrete evidence to support it."

Concludes Eland: "In the wake of September 11, public opinion was willing to give the president the benefit of the doubt on an invasion of Iraq. That tolerance may evaporate now that the pillars justifying the invasion and occupation have been weakened one-by-one. The guerrillas can figure out that much. Paul O’Neill’s revelations about a war in search of a reason may have sawed through the last timber."

See "A War in Search of a Reason," by Ivan Eland (1/14/04)

Center on Peace & Liberty

War on Terrorism

PUTTING "DEFENSE" BACK INTO U.S. DEFENSE POLICY: Rethinking U.S. Security in the Post-Cold War World, by Ivan Eland


3) The Voluntary City: Restoring Urban Life in Crisis Times -- Independent Policy Forum (2/4/04)

With the repeal of the state car-tax increase, California Governor Arnold Schwarzenegger has declared a “public safety emergency” to address the fiscal crises facing cities. But, what is the optimal mode for providing city services? Must cities be centers for crime, homelessness, poverty, failing schools, unemployment, traffic gridlock, pollution, and other social ills? Should urban reformers rely on a political process that puts special interests above community needs? Today, governments too often dominate city life, with decision-making highly politicized, expensive, bureaucratic and largely unaccountable to the citizenry.

Drawing on the pioneering new book, THE VOLUNTARY CITY, urban experts Peter Gordon, Fred Foldvary, and Daniel Klein will discuss the rich history and dynamism of how private, market and community-based entrepreneurship can provide superior social services, urban infrastructure, and community governance.


Peter Gordon is Professor of Policy, Planning, and Development, University of Southern California. An authority on urban planning, urban transportation and urban economics, Prof. Gordon is co-editor of the on-line journal PLANNING AND MARKETS and co-editor of the Independent Institute book, THE VOLUNTARY CITY: Choice, Community and Civil Society.

Fred Foldvary is Professor of Economics, Santa Clara University; contributing author, THE VOLUNTARY CITY: Choice, Community and Civil Society.

Daniel Klein is Professor of Economics, Santa Clara University; contributing author,THE VOLUNTARY CITY: Choice, Community and Civil Society

Wednesday, February 4, 2004
Reception and book signing: 7:00 p.m.
Program: 7:30 - 9:00 p.m.

The Independent Institute Conference Center
100 Swan Way
Oakland, CA 94621-1428
Map and directions

TICKETS: $32 Special Admission: Includes copy of THE VOLUNTARY CITY. (25% off cover price!) Admission without a book is $15 per person (or $10 for Independent Institute Members). Reserve tickets by calling (510) 632-1366.

Praise for the featured book, THE VOLUNTARY CITY: Choice, Community, and Civil Socitey, edited by David T. Beito, Peter Gordon and Alexander Tabarrok (co-published by University of Michigan Press and The Independent Institute):

“The exciting and pioneering book, THE VOLUNTARY CITY, sketches out a provocative vision for communities based on civil cooperation and entrepreneurship. Drawing upon a fascinating history of city innovations, the book shows why the de-bureaucratization of urban life is crucial to fostering thriving markets, vibrant neighbors and educational excellence.”
-- Jerry Brown, Mayor, City of Oakland; former Governor, State of California

“THE VOLUNTARY CITY explores the fascinating history of bottom-up approaches to the challenges of urban living. It provides refreshing counterpoint to the dominant urbanologist tradition, which stresses the indispensability of government engineering of basic city institutions.”
-- Robert Ellickson, Walter E. Meyer Professor of Property and Urban Law, Yale University

“Those of us concerned with the role of government, particularly on the local level, have a great deal to learn from THE VOLUNTARY CITY. The central questions about how we can best build community and provide for a better quality of life -- and whether these objectives are best accomplished inside or outside of government -- are addressed here in a way that will stimulate a crucial dialogue.”
-- Ross C. Anderson, Mayor, City of Salt Lake City, Utah

More information about this event.


4) Remembering Martin Luther King, Jr.

If you've watched TV or listened to the radio today, you've probably heard a snippet or two of Dr. Martin Luther King's "I have a dream" speech -- and with good reason. King's speech, delivered on August 28, 1963, is not only one of the landmarks of 20th century American public oratory, THE LIGHTHOUSE is willing to wager that two centuries from now historians will still consider it a landmark event and the public will still draw inspiration from it. The eloquence of Dr. King's words, the conviction of his passionate delivery, the power of his vivid imagery -- all come together to form a powerful moral stance that commands assent.

Without further fanfare, we invite you to read or, better yet, listen to King's speech in its entirety.

Audio: (RealPlayer required.)

Also see the following items, which discuss King's legacy in the context of current issues:

Transcript of "The New Betrayal of Black Freedom in America," Shelby Steele's presentation to the Independent Policy Forum (2/24/99). Listen to it it in RealAudio.

A transcript of "Losing the Race? Black Progress, Freedom and Independence," John McWhorter's presentation to the Independent Policy Forum (3/20/01). Hear it in RealAudio.

A transcript of "Truth and Propaganda in Politically Correct America," Larry Elder's presentation to the Independent Policy Forum (8/14/01). Hear it in RealAudio.

A transcript of "Race Preferences: Pro and Con," a debate between William Bagley and Ward Connerly, Independent Policy Forum (4/25/00). Hear it in RealAudio.

More on race issues.


  • Catalyst
  • Beyond Homeless