A QUICK NOTE ON SPECTRUM-PITTSFIELD DEAL GETS US GOING, then … SOME ‘BUDGET HAWK’: PAUL RYAN LEAVES DEFENSE SPENDING UNCUT … RYAN ISN’T A ‘BUDGET HAWK;’ HE’S JUST ANOTHER PLAIN, OLD HAWK WHO WILL PROTECT THE FAT & SACRED COW … plus … A CLOSE LOOK AT THE UNITED STATES of AMNESIA’s OBSCENE PENTAGON BUDGET
By DAN VALENTI
PLANET VALENTI News and Commentary
(FORTRESS OF SOLITUDE, WEDNESDAY, AUG. 15, 2012) — THE PLANET begins with this note on today’s post: Yes, we shall be exploring the various facets of the Spectrum-Pittsfield agreement in detail. We shall ask questions that, we alone (most likely) will dare to ask. Meanwhile, if you missed it, we shared this hasty remark yesterday on the basis of incomplete news and with the ink still wet:
This development raises more questions than it solves, so many it is difficult to figure out where to begin. The confidentiality agreement, with respect to the role played by BHS, is one of the most pressing queries. Eddie raises the fair point of BHS’s domination in the county, and a reasonable person can only conclude that this has been in the mix for a while. How long? Now that is a key concern. Another question is the $100,000. What kind of piss-poor negotiation position and job during the arguments did the city have and do? It must have been off the charts, on the low side. As DTR mentions above, most of this is on Ruberto, but Bianchi comes off looking bad, too. His quote about never again agreeing to confidentiality is another big question. You mean, he agreed? He didn’t inherit legal duct tape over the mouth? There is so much about this resolution that, on the surface, appears dishonorable and unscrupulous. We have only begun to dig. There are people involved with this deal who aren’t happy. THE PLANET will be interested in any factual information anyone might have. For the sake of the good people of Pittsfield, this cannot be allowed to stand.
Also, please allow one quick personal note: R.I.P. Johnny Pesky. THE PLANET shall have our tribute upcoming on a later day.
Now, to our regularly planned coverage.
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WHY PAUL RYAN IS NOT A BUDGET HAWK
Mitt Romney’s choice for vice president, Paul Ryan, is most frequently described as a ”budget hawk.” Seriously? Can you take the word of any candidate for office on either of the major tickets? Budget hawk? How about just plain, ordinary hawk, a term used to describe pols and military people with itchy trigger fingers.
THE PLANET points out that Ryan supported the Bush and Obama “too big to fail” bailouts, the TARP fiasco and voted to raise the debt ceiling. That responsible conservatism? That’s a …
… budget hawk? Oh, that it were true, because if Ryan truly wanted to made a dent into criminal amount of debt rung up by this country, he would start with the defense department. When we look into his so-called “government-slashing” budget proposal, however, we see that he keeps his hands off of the sacred-cow Pentagon. The outrageously sinful amounts of money eaten up each day by the U.S. National Security States of America (also known, in Gore Vidal’s great term, as “the United States of Amnesia) bear another look. A strong national defense is one thing. Pure pork barrel spending on weapons that we don’t need and often don’t work as advertised is another.
Bipartisan at Last: Both Dems and Repubs are Afraid of Taking on the Pentagon
In the end, Ryan, of course, is just another well-scrubbed street punk with a $200 haircut in an expensive suit who doesn’t dare shake up the MIC — the military-industrial complex. That, by the way, is one of the few truly bipartisan actions that Dems and Repubs undertake each year.
That’s a deal buster as far as THE PLANET is concerned, since the $.7 trillion spending — all taxpayer money — to fuel the endless war machine has to be the first on the chopping block for any serious budget reduction proposal. As you will see in the article below, if you count total spending, the military gets $1 trillion a year. The U.S. is the world’s greatest war maker.
A study by the International Institute for Strategic Studies shows how disproportionate U.S. military spending is as a percentage of the nation’s GDP. Please educate yourself on this. To that end, THE PLANET presents this work by Winslow Wheeler writing on defenseaol.com. We include the hot links:
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$1 TRILLION A YEAR FOR THE WORLD’S GREATEST WAR MAKER
A telling graphic from the International Institute for Strategic Studies’s newly released report on global military spending(click here for the original).
The International Institute for Strategic Studies (IISS) has released its annual series of reports on international defense spending, The Military Balance 2012. The full text is subscriber-only, but a summary press release, detailed table of contents, and a very useful overview of one of the more interesting volumes, “Comparative Defence Statistics,” are free online. The content of the comparative volume is important; it gives a view of the gigantic girth of the American defense budget.
First, however, to better appreciate what these figures reveal about the huge size of the US defense budget, a short discussion is needed about the caveats that some articulate to adjust the optics of the spending comparisons.
Some point out that the IISS numbers for the Chinese and Russian defense budgets do not include all their defense related spending. That is correct. For example, for 2010 the official Chinese defense budget is shown as the equivalent of $78.7 billion in US dollars, but if foreign arms purchases, R&D and other defense related spending is included, the amount is re-estimated at $111.1 billion. IISS also introduces a concept called “purchasing power parity” (PPP) to attempt to equalize the value of a dollar of spending in each country; the PPP version of the 2010 Chinese defense budget is $178.0 billion.
But there are some very important caveats to these caveats.
Just as the official Chinese and Russian defense budgets are incomplete, so is the US defense budget. The IISS does count the US spending outside the Pentagon’s nominal budget, such as for nuclear weapons, the Selective Service, and other defense related spending in what the Office of Management and Budget calls the “National Defense” budget function. However, the IISS does not count other US defense related spending. For 2011, this includes roughly $20 billion in military retirement spending outlayed by the Treasury Department (the DOD budget pays for less than half of annual military retirement costs). IISS does not count military aid to countries like Israel and Pakistan (in the International Affairs budget). It also does not count various homeland defense costs in the Department of Homeland Security (such as Customs and Border Patrol and the Coast Guard). It does not count the costs of caring for veterans of past and current wars in the Department of Veterans Affairs. Adding in all of these non-DOD agencies’ costs, plus a share of the annual interest on the national debt, can get total US defense-related spending up to about $1 trillion, rather than the $739.3 billion the IISS counts for the US for 2011. (The IISS version of the US defense budget for 2011 is further complicated by the fact that IISS counts the original Obama request for 2011, $739.3 billion, not the $717.4 billion that has actually been appropriated, but $20 billion is a minor error in such gigantic calculations).
In short, the IISS does not count all Chinese, Russian, or American defense spending. To achieve a complete and accurate apples to apples count would require more analysis than IISS has performed. To count all such spending for all such countries may, or may not, mean counting all of the items that total the US national security budget to about $1 trillion; it would depend on the methodology. The use of only each government’s officially counted defense budget undercounts the numbers, but it does so for each. How the relationships might change, especially the ratio by which the US budget exceeds the others, is unknown pending a better apples to apples comparison by IISS or others, but at first glance it does not appear that the ratio of US spending levels would be significantly disadvantaged.
The IISS estimate for the Chinese and Russian defense budgets is also affected by the “PPP” (Purchasing Power Parity) analysis, an effort to equalize various economic and other analytical factors. The effect of the PPP is large, larger than the effect of attempting to count all defense-related spending. For example, the official Chinese defense budget for 2010 grows from $78.7 billion to $111.0 billion when one includes all known defense spending, but that number grows much more, to $178.0 billion, in the PPP analysis. (I find no PPP analysis for China’s 2011 numbers.)
The PPP analysis, however, should be treated with care. Part of that caution is expressed by IISS itself. In its printed volumes, IISS states: “The use of PPP rates is a valid tool when comparing macroeconomic data, such as GDP, between countries at different stages of development. However, no specific PPP rate exists for the military sector, and its use for this purpose should be treated with caution. Furthermore, there is no definitive guide as to which elements of military spending should be calculated using the limited PPP rates available.” It is presumably for this reason that in its “Comparative Defence Statistics” analysis, IISS does not employ the PPP factor for comparing defense budgets across countries.
The PPP comparison also reminds one of a bizarre analytical technique the Cold War era intelligence community used when comparing US defense spending to that of the Soviet Union. To size the overall Soviet defense budget, an assumption was made, for example, to cost Soviet tanks, such as the T-72, as the cost equivalent of American tanks, such as the M-1, notwithstanding the fact that the American tank was far more complex and therefore much more expensive than the T-72. Thus, with the Soviets producing tanks in greater numbers than the US, the Soviet defense budget was counted as far larger than it actually was. It was threat inflation masked behind contrived budget analysis, and it was quite notorious to all, except those who welcomed the budget/threat inflation for bureaucratic or political reasons. The IISS description of its PPP analysis talks about adjusting for the cost of labor and materials in different countries and hints of an analytical technique vaguely like this discredited Cold War method; so the IISS admonition that its own PPP analysis “should be treated with caution” for the purpose of comparing military spending is an admonition that should be respected. If IISS did not use it for its comparative analysis, it seems reasonable for others to avoid it as well.
All that said, what do the IISS numbers show?
The first figure compares officially reported (and incomplete) US defense spending for 2011 ($739.3 billion) to the rest of the top ten defense spenders (also as officially reported): They are China, the UK, France, Japan, Russia, Saudi Arabia, Germany, India and Brazil–in that order. See the budget numbers at the link: note that not one breaks the $100 billion threshold, let alone coming anywhere close to the US. Added all together, the nine come to roughly two-thirds of the US amount, showing not balance but imbalance.
However, the contraposition of US spending to these nine is a bit odd; it suggests there is some sort of analytical comparison to be made between the US and these nine countries, other than that they are the next nine in spending levels. It would make more sense to compare US spending to that of opponents, or at least potential opponents. Assuming for the moment that China and Russia are “potential opponents” (an assumption often made by Cold Warriors with a hangover or others with no great respect for the ability of US policy makers to learn to live with regional powers or even a future superpower), the combined total for China ($89.8 billion) and Russia ($52.7 billion) comes to $142.5 billion.
Consider how puny that $142.5 billion is compared to the US’s $739.3 billion. Showing that relationship in a bar graph would almost seem to be a conscious act in diminishing China and Russia or bloating US spending. That, nonetheless, is the appropriate comparison. Moreover, adjusting it for the defense budgets of Syria, Iran, North Korea, Somalia or anyone else won’t change a thing. Not one of the latter breaks the $10 billion barrier, and if you add the defense related spending not officially reported (including for the US), the basic relationship in these spending totals will not likely change: The US spends roughly five times what these other countries spend.
In other words, the US defense budget is not just dominant; it is operating at a level completely independent of the perceived threat. In the nineteenth century, the Royal Navy sized itself to the fleets of Britain’s two most powerful potential enemies; America’s defense budget strategists declare it will be “doomsday” if we size to anything less than five times China and Russia combined.
The last figure, “Planned Defence Expenditure by Country 2011,” shows the proportion of US spending to all other regions and countries. The US accounts for 45.7 percent of total spending by the world’s 171 governments and territories. While, again, there is no comparison of the US and our allies vis-à-vis all of our “potential opponents,” the comparison becomes so unbalanced as to be odious. With most of the top ten on “our” side, the ratio of “us” to “them” is far more than five to one and more like ten, or more, to one – even assuming many governments are neutral.
As the Republicans argue in the coming (election) year that Obama is “cutting” defense to “dangerous” levels, and as Obama’s Secretary of Defense moans about “doomsday” to occur if existing spending is reduced below current plans, consider the numbers above. Do these people know what they are talking about? Do they want you to know?
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RYAN COMES UP SHORT
We’ve read an awful lot of coverage on Ryan’s proposals, and the best we’ve seen in terms of digesting the essentials without presenting an unfair, eviscerated version, is the one written by Liz Goodwin or Yahoo! News. THE PLANET presents her piece here:
Mitt Romney’s budget hawk running mate Paul Ryan made his name in Congress by releasing a bold, government-slashing budget proposal that he calls ‘The Path to Prosperity.” It was first proposed for fiscal year 2012. Democrats have criticized Ryan’s budget as a “Darwinian” re-making of the federal government, which would reward the rich and corporations with lower tax rates while cutting safety-net programs like Medicaid by hundreds of billions of dollars. But Ryan and his many supporters say he is one of the few people in Washington willing to state the obvious, yet politically risky fact that the nation’s entitlement programs aren’t sustainable and need to be saved.
President Barack Obama’s campaign released a statement Saturday saying Ryan’s plan “would end Medicare as we know it by turning it into a voucher system, shifting thousands of dollars in health-care costs to seniors.” The attack shows Democrats will use Ryan’s budget proposals as a weapon against Romney. But will it work on voters?
Below, we’ve laid out the five key points from Ryan’s “Pathway to Prosperity” budget so that you can judge for yourself.
1. Ryan’s budget plan cuts $5.8 trillion over 10 years from projected federal spending and reduces the deficit by $4.4 trillion over the same period. Discretionary spending, which includes programs like food stamps, would see more than $900 billion in reductions. The budget also calls for the repeal of President Obama’s health care reform law, which supporters say would save billions in federal subsidies that will be given to lower-income people to buy insurance.
2. The most contentious part of Ryan’s proposed budget are the changes to Medicare, the nation’s insurance plan for retirees and a political third rail. Ryan’s plan would eventually transform Medicare into defined payments that seniors can use to buy private insurance or a government plan on an insurance exchange. There would be no limits to the out-of-pocket costs seniors could pay in this program, but Ryan assumes that the increased competition between Medicare and private plans would bring down overall costs. The amount of money seniors get to buy insurance would grow at a slightly higher rate than GDP each year. (The Congressional Budget Office says this would save the government money, but also significantly increase the amount seniors will eventually have to pay for their own insurance.) The eligibility age would gradually rise to 67, from 65. Democrats say this transforms Medicare into a “voucher program” that may leave seniors with big prescription bills and other medical costs, and the Obama campaign is already using this against Romney and Ryan. If Obama can convince seniors–a powerful voting bloc that turns out at the polls–that Ryan would worsen or weaken Medicare, it could mean bad news for their campaign. But it’s important to note that Ryan’s proposed changes would go into effect for the next generation of seniors, not this one.
3. Ryan would cut the top federal income tax rate for individuals and corporations to 25 percent from 35 percent. The budget says some tax breaks and loopholes would be eliminated to help offset the revenue loss.
4. Ryan would cut Medicaid, the insurance program for some low-income people, by $735 billion over ten years, and hand the program back to the states to administer with more freedom. The CBO writes that states would most likely have to “reduce payments to providers, curtail eligibility for Medicaid, provide less extensive coverage to beneficiaries, or pay more themselves than would be the case under current law.”
5. The budget spares Social Security and defense spending, which are left at current levels. Ryan’s decision to back off Social Security is interesting, since he put forward proposals to privatize the program around the same time that President George W. Bush tried to sell the nation on a similar proposal. (Social Security does not face the same solvency challenges as Medicare and Medicaid, and is not projected to grow much as a percentage of GDP over the next 20 years).
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There is no such thing as the perfect vice presidential choice. Any one and all of them come with strengths and weaknesses, advantages and tradeoffs. Net-net, Ryan, in forcing Romney more to the hard right, will be a net loss for the ticket. Romney’s best chance of winning is strongly conservative but not rabid right.
“OPEN THE WINDOW, AUNT MILLIE.”
LOVE TO ALL.