May 6, 2002
"The Sixteen-Trillion-Dollar Mistake, How the U. S. Bungled its National Priorities from the New Deal to the Present," Bruce S. Jansson, Columbia University Press, New York, 2001. ISBN 0-231-11423-X
Rarely is Federal budgeting and spending looked at as a whole rather than parts. To do so endangers credulity if not inducing retching.
Presidents propose budgets. Congress prepares budgets and enabling legislation. Basic checks and balances -- too bad it works so poorly. Count our blessings that it works at all. Few realize, know or much care that Federal accounting is quite dissimilar to whatever people may think accounting represents and how it is done. Federal accounting has only a remote relationship to generally accepted rules which apply to business and other non-governmental entities. And then there are Enron and Andersen to demonstrate the weaknesses of those systems. Their antics are, in actuality, tame compared to Federal practices. Words like differences between cash and accrual bookkeeping go over the heads of most folks. Fewer still know essential differences between bookkeeping and accounting. We won't mess over heads by going farther into such arcana.
Every once in a while, a report will be issued noting that billions of unaccountable dollars disappeared -- most often in Pentagon procurement. Generals, Admirals and politicians know unerringly that public attention to such matters is ephemeral, blows over easily and fast.
Presidents of more recent times have been supported by the Office of Management and Budget (OMB). Congress is supported by the Congressional Budget Office (CBO). OMB is purely political and serves at the pleasure of the incumbent President. The idea is to keep the President looking good or at least bulletproof. CBO, at times, functions more like a bird dog or watch dog. At its core is a professional civil service staff. CBO's degree of integrity is, however, a function of which party controls Congress. It works better when the houses and Presidency are not controlled by the same political party.
Jansson, a social scientist and professor at the University of Southern California in Los Angeles, was first intrigued by the illusive "Peace Dividend" which was thought available by ending the Cold War (1989+). With the broad hints delivered by U.S. Ambassador to Iraq, April Glaspie, to Saddam Hussein in 1989 (coincidence?) that there would be little objection to Iraq reclaiming its former province of Kuwait, Bush I buried the Peace Dividend along with untold thousands of Iraqis then and subsequently.
Saddam Hussein may not be a nice guy by whatever standards may be applied but he once was "our not very nice guy." He had been very helpful in chewing up literally millions of Iranians with very overt and covert aid of the United States of America. The U. S. was then and still is very angry at the Ayatollahs for deposing the U. S. puppet Shah in 1979. Officially, America remains very angry at Iran, now part of Bush II's "Axis of Evil" along with its archenemy Iraq. By now Saddam Hussein has learned part of the lesson which Bush II is hankering to finish. He has joined other former "our guys" such as Noriega and, yes!, bin Laden.
President Clinton, for all his faults, presided over eight years during which the Federal government reversed, finally, the vast debt accumulations of his predecessors since Nixon prolonged the Vietnam war at such great, such largely hidden costs. After Clinton, the U. S. was briefly in surplus until Bush II was anointed.
In 1971-72, the fact of technical bankruptcy forced draconian measures on Nixon. The once sacred Gold Standard was abandoned. Essential aspects of the Bretton Woods agreements which had served to stabilize international financial matters since the ending of WW II were repudiated. The dollar was covertly devaluated which brought on signal inflationary pressures. Lord Keynes smiled grimly from his grave. All of which fiscally buried the Carter administration and strongly contributed to that one term presidency. Don't, however, overlook the Reagan campaign's dirty tricks with the Iranians, though.
Reagan initiated the basic strategy now being followed religiously by Bush II. Under the Reagan administration, fiscal policies quickly converted the world's prime creditor nation into the world's prime debtor nation. Buried along with burgeoning debt were nearly all social and infrastructure initiatives, what Jansson calls "National Priorities" -- all except, of course, Pentagon excesses and Corporate Welfare. The question, "Who benefits?" is obvious. Those who profit from debt collect their interest and dividends and get their stars. As "Deep Throat" of the Watergate era advised, "Follow the money!"
Jansson follows the money from Franklin Delano Roosevelt to now and a little. Ten years of dogged research results in a monumental study. Awareness of the contents might, if known, unleash citizen outrage and make differences.
Nearly one third of 492 pages are consumed with detailed notes, references, bibliography and index. In other words, Jansson produced a work meeting rigorous academic standards.
Jansson raises the issue of National Priorities. National Priorities involve more than funding military fantasies, lavishing welfare on corporations and feathering the accounts of oligarchs.
He conservatively shows that at least Sixteen Trillion Dollars have been squandered from 1931 to date. He uses OMB figures based on constant 1992 dollars. Adjusted to 2001 constant dollars, the number soars to $18.46 trillion! Succeeding administrations of both parties without political constraint -- until Clinton -- did it to us. Monica did it with Clinton. Short changed are ". . . such constructive purposes as social and educational programs, improving public transportation, cleaning up the environment and lowering taxes for taxpayers in the lowest two economic quintiles [folks on the bottom two fifths of taxpayers]."
When added to the creative accounting regularly and routinely favored by politicians and those who buy them, while Jansson doesn't come right out to say so, the U.S.A. would easily qualify as the most corrupt, corruptible and corrupted government (and society) in the history of humankind. Another illusion tread upon?
Total Federal expenditures 1931-2004 in constant 1992 dollars equal $56 trillion dollars, including WW I, WW II, Korea, Vietnam and all the various incursions and invasions broadly ranging the earth plus Desert Storm. That suggests that 28.5% of those trillions of dollars were squandered. Since 1968, the total of Federal expenditures is $12.8 trillion dollars.
From 1965-2004, Medicare and Medicaid took $5.8 trillion dollars. Yet current estimates of people without even basic health care protections range from 30 to 40 million people, with a high percentage being children -- that is roughly ten percent plus of the U. S. population. Jansson's research estimates that an additional $548 billion dollars would have provided coverage for the majority of those uncovered. Ironically, about one year of Pentagon spending.
Yet "Conservatives" of both parties persist in a very Big Lie about a Welfare State run rampant. Non-medical entitlements such as food stamps, SSI (disability aspects of Social Security), EITC (Earned Income Tax Credits); social investments such as education, training, employment and social services have stagnated or declined since the late 1970s. Infrastructure budgets have plummeted, public transportation is a disaster, roads and bridges barely maintained, environment crashing, energy alternatives a joke, etc.
Jansson's key list (p. 355):
Does such research matter? Make a difference?
Is there coincidence in another Bush War? Coup d'état in process? Republican (bipartisan?) looting of Treasury? Blighted National Priorities?
· · · · · ·
Milo Clark, a founding member of Swans, had it all: Harvard MBA, big house, three-car garage, top management... Yet, once he had seemingly achieved the famed American dream he felt something was missing somewhere. As any good executive he decided to investigate. Since then, he has become a curmudgeon and, after living in Berkeley, California, where he was growing bamboos, making water gardens, listening to muses, writing, cogitating and pondering, he has moved on to the Big Island in Hawaii where he creates thought forms about sunshine.
Do you wish to share your opinion? We invite your comments. E-mail the Editor. Please include your full name, address and phone number. If we publish your opinion we will only include your name, city, state, and country.
Please, feel free to insert a link to this article on your Web site or to disseminate its URL on your favorite lists, quoting the first paragraph or providing a summary. However, please DO NOT steal, scavenge or repost this work without the expressed written authorization of Swans, which will seek permission from the author. This material is copyrighted, © Milo G. Clark 2002. All rights reserved.
This Week's Internal Links
The United States v. Democracy - by Stephen Gowans
The Wrong Stuff - by Deck Deckert
The Hand Of God - by Alma Hromic
Of Rice And Men: The Mistaken Promise Of Genomics - by Jan Baughman
Self Interest - by Milo Clark
Israel - by Milo Clark
Massacre Or Not? It Depends On Which Side Of Washington's Ledger You're On - by Stephen Gowans
Blackmailing Palestinians: Plucked, Cooked, Baked And Packaged - by Gilles d'Aymery
Going Home: i - Looking Back - Poem by Alma Hromic
Going Home: ii - Taking Flight - Poem by Alma Hromic
Dollars for Terror - Book Review by Milo Clark
Milo Clark on Swans
Essays published in 2002 | 2001 | 2000 | 1999 | 1997 | 1996