(1) Car imports down from 700 to 40 vehicles a month
in Daytona Beach
(2) World leaders will meet in April to put in place a New World
Financial System (NWFS)
(3) Outsourcing?
(4) Tinkering with Inflation measurements may have led to
Financial Crisis - Rodrigue Tremblay
(5) Currency Battle Between UK And Europe
(6) Russian-Jewish oligarch 'had RBS loan of £2.5bn written
off' - Telegraph
(7) In Detroit, houses are cheaper than cars: just $7,500 (Not
$75,000)
(8) US can no longer afford its 1,000 overseas military bases
(1) Car imports down from 700 to 40 vehicles a month in Daytona
Beach
From: Stephanie Relfe <srelfe@earthlink.net> Date:
06.03.2009 06:41 PM
Car sales down to 6% of previous in Daytona Beach
Here is a report from Daytona Beach, Florida.
My husband, Michael, went to get the windshield on our car
repaired. The man who worked on it said that another job he has
is to check new cars that arrive by ship. Apparently there is
often a lot of things wrong with new cars that arrive, before
customers see them, like no transmission fluid, wrong mirrors
etc., and this mam fixes them. He said that normally 700 vehicles
a month come in. Now it's down to 40 a month!!!
(2) World leaders will meet in April to put in place a New World
Financial System (NWFS)
From: Joe Bryant <succeed@tsn.cc> Date: 05.03.2009 12:11 AM
To date, on economic/financial matters, it has only been possible
for agreement to be reached when it is in line with what suits
the banking cartel, otherwise known as the 'Money Power'.
It has been the way since 1694 and the Charter that established
the Bank of England. BUT that does not mean it must stay that
way.
We need to recognise that if the system is to be changed to best
ensure the welfare and prosperity of the people then the people
will need to exert more pressure on governments than the Money
Power does. This is possible because the Money Power only
controls about 2% of the votes at election time. The remaining
98% are controlled through the lack factual of information,
propaganda and a compliant media.
There is a big job ahead. As with all jobs one needs to make a
start or nothing gets done.
The issue of credit, banking and economy has the potential to
galvanise populations around the need for a better economic
system, one insulated from boom bust situations and recessions.
Australia tested such a system between 1913 and 1923. The rest
proved to be an outstanding success. The problem today is few
people know about this success. Build on the few, make it the
majority and the solution will materialise. By far the best time
to start this knowledge flow process this is now while the
present system cannibalises itself.
We have people Australia-wide ready willing and able to push
ahead with the first stages of implementing the solution, but
before we do we need a much larger involvement by people of like
mind on this particular issue. We also need to as best possible
identify the enemy within the patriotic movements.
I visited both sites suggested By John Craig, well written stuff,
bur at a glance I could see what was developing was a rehash of
theory mistakes made, and as a result I put these aside for,
possible, later reading. I am not a lot interested in the
failures of the past, but rather, the one outstanding success of
the past, that nobody wants to talk about, having had their
thinking capacity consumed by what can only be described as a
system of economic insanity. Insanity if for no other reason that
we keep repeating the same avoidable economic mistakes, which is
basically sticking with a system that goes from one private
banker-made recession to the next, as regular as clockwork.
Joe Bryant United People Power Australia.
(3) Outsourcing?
From: Howard & Rosemary <mymms@ceinternet.com.au> Date:
06.03.2009 06:31 PM
I think it is time that the subject of outsourcing in Australian
industry considered the cost savings of outsourcing financial and
managerial skills from China. I am certain there are Chinese
professionals who would work more efficiently for considerably
less remuneration than most Australian corporate executives and
especially less than the American executives such as companies
like Telstra seem to favor.
Having worked for many years on the factory floor in Australian
Industry, it is common knowledge at that level, that the cost of
manufacturing in Australia is not dramatically higher than any
other country, yet the costs of administration and salaries to
senior executives is so outrageously high it has a paralyzing
effect on company competitiveness in the World Market. By
outsourcing manufacture, the small savings made allow these
overpaid executives to continue unchallenged until their salaries
finally threaten to bankrupt the company, by which time they have
opted for the golden parachute and "for family
reasons?" have negotiated a way out of the impending
financial disaster, leaving the corporation in "need of
financial reform?" another term for financially broke. Of
course at that time there is a closing of ranks amongst the
"overpaid executives" and some scheme is devised to
"save" the company, covering up the real cause of the
demise.
Let's wave this in front of "The Masters of the Australian
Corporate Sector" and mention "Boys, the game is up,
put your marbles back in the bag, you are required in the
classroom for lessons", and have these individuals start to
behave in an ADULT manner towards your fellow Australians who
have the misfortune to TRUST YOU to manage the business they find
employment in.
You see it is a simple failure of TRUST, we the workers cannot
TRUST you, the GREEDY any longer, to run the companies we depend
on to raise our families.
My next effort will expose the "Welfare Sector" and the
liars, cheats and thieves who run some of these services.???
(4) Tinkering with Inflation measurements may have led to
Financial Crisis - Rodrigue Tremblay
From: John Cameron <blackheathbooks@internode.on.net> Date:
06.03.2009 04:54 PM
http://www.thenewamericanempire.com/tremblay=1108
How Tinkering with Inflation Measurements May Have Led to the
Current Financial Crisis
by Rodrigue Tremblay
Friday, March 6, 2009
How Tinkering with Inflation Measurements May Have Led to the
Current Financial Crisis
by Rodrigue Tremblay
"There are three kinds of lies: lies, damned lies, and
statistics." Mark Twain, (1835 - 1910)
"The Cost of Living [has been] replaced by the Cost of
Survival. The old system told you how much you had to increase
your income in order to keep buying steak. The new system
promised you hamburger, and then dog food, perhaps, after
that."
John Williams, private economist
"The consumer price index is being understated by at least 1
percent per year."
Bill Gross, professional investor
"... The development of credit derivatives has contributed
to the stability of the banking system by allowing banks,
especially the largest, systemically important banks, to measure
and manage their credit risks more effectively. In particular,
the largest banks have found single-name credit default swaps a
highly attractive mechanism for reducing exposure concentrations
in their loan books...."
Alan Greenspan, Fed Chairman, May 5, 2005
Last February 20th, the U.S. Department Of Labor Bureau of Labor
Statistics announced that, on a seasonally adjusted basis, the U.
S. Consumer Price Index (CPI) increased by 0.3 percent during the
month of January (on a yearly basis). Some independent
economists, however, think that the real inflation rate is much
higher, possibly as high as 7.52 percent (on a yearly basis). Why
is that so?
The CPI is a measure of how much the price level of a basket of
representative consumer goods and services, adjusted for
predictable seasonal shifts, is supposed to have varied during a
month or a year. Such a measure has been provided by the Bureau
of Labor Statistics since 1919, covering the period between 1913
and today.
For many people, the CPI is less a measure of inflation than an
imperfect measure for adjusting cost of living allowances. It is
a technique that plays a central role in computing increases in
the Cost Of Living Allowances (COLAs) of various money
disbursements, incomes and wages. Some incomes, for example, such
as Social Security payments and other entitlements, are
statutarily adjusted upwards when the CPI goes up, and such
adjustments have a direct influence on one's standard of living.
Economists have long debated the best methods of measuring
inflation, especially as it affects the cost of living of various
categories of consumers. This is a complex issue that involves
statistical methods in calculating price indices, economic
principles and notions of social justice. Moreover, not everyone
is impacted equally by a rise in the overall level of consumer
prices, depending on one's economic and financial situation. For
example, for people living in a city and who are renters, a rise
in the price of cars or of houses would not have the same
predictable effect on them as it would on folks living in a rural
area and who own their own homes. And it is not everyone who can
deflect the negative impact of a rise in the price of consumer
goods on their standard of living by substituting less costly
items.
For the period between 1913 and 1982, the formula for measuring
consumer inflation in the U. S. was pretty much straightforward.
Government statisticians would periodically collect prices in
certain identified areas with which the Bureau of Labor
Statistics would then construct price indexes. Over time, surveys
of consumer expenditures were conducted and the weight of
different goods in the index would be adjusted accordingly to
reflect people's new buying habits.
In the early 1980s, the Reagan administration feared that the
standard CPI index overstated the impact of overall inflation on
the cost of living of many recipients of government payments, the
most important ones being Social Security outlays. The decision
was then made to move away from the objective of having a general
consumer price index measuring overall consumer inflation and
adopt instead the policy of constructing a cost-of-living index
that more closely reflected the true impact of inflation on
different categories of consumers. That is why, since 1982, the
CPI measurements that the Bureau of Labor Statistics publishes
relates more to the cost of living, as defined and periodically
revised, than to providing accurate information about the level
of general inflation. [As a matter of fact, another government
agency, the Bureau of Economic Analysis (BEA), has the
responsibility to calculate a price deflator for consumption
expenditures and other expenditures as part of the National
Income and Product Accounts (NIPA).]
Indeed, in the mid-1990s, substantial changes were made to the
CPI index which had the net result of lowering the official
measure of consumer inflation. First, increases in asset prices,
such as in housing, were only indirectly taken into account. For
example, the 2002-2006 real estate bubble hardly registered at
all in the CPI because only 'imputed' home rents for home owners
were used in the index. At that time, rents were virtually
stagnant in many cities due to overbuilding. Secondly, arbitrary
downward adjustments were made in the prices of certain goods to
reflect their enhanced quality. It is true that cars, TV sets or
cellular phones are more performing today than their alternatives
in the past, and this raises people's standard of living.
However, such goods cost more, and the higher prices are not
fully recorded in the CPI. Thirdly, and maybe more debatably, in
order to concentrate on the impact of price increases on the true
cost of living, it was assumed that consumers adjust to higher
prices of certain items by substituting relatively less costly
goods when relative prices change. For instance, buyers would be
assumed to switch from steaks to hamburgers or from beef to
chicken when the price of steaks or beef increases. Similarly,
people would tend to switch from high-priced stores to discount
stores when their incomes do not follow inflation. It can also be
assumed that such forced substitutions are not without
inconveniences or hardships for the consumers, and thus could
indicate a lowering in their standard of living. Nevertheless,
these modifications that lowered the official measure of the CPI
were incorporated into new statistics from 1982 on.
Consequently, it has become somewhat risky to rely on official
CPI figures to obtain a true assessment of inflation. Because of
all the changes made in the CPI index since 1982, the CPI has
become less and less a true measure of consumer inflation, even
though it may or may not more closely reflect the true impact of
inflation on people's cost of living. For the overall economy, it
is fair to assume that the true inflation rate is substantially
higher than what is reflected in official CPI announcements, and
this has a compounding effect overtime.
For its part, since February 17, 2000, the Fed uses a
"core" chain-type price index for personal consumption
expenditures (CTPIPCE), i.e. a price measure for all items less
price increases in food and energy. What is at stake here is the
danger that government officials may begin to believe their own
official inflation figures which are understated, maybe for good
reasons as far as cost of living issues are concerned, but
nevertheless severely understated as far as the true inflation
rate is concerned. This has the potential for disastrous
consequences, not only for the public in correctly judging
inflation pressures for investment purposes, but also for public
officials in framing policy, especially monetary policy.
The most recent example is provided by the pronouncements that
Fed officials made during the crucial 2003-2005 period, when a
dangerous housing bubble was building up speed and when financial
firms were embarking upon riskier and riskier financial schemes.
To a man, Fed officials denied there was any risk of inflation
and, contrary to what everybody could see, declared that there
was no housing bubble going on.
For instance, on March 1, 2003, the No. 2 man at the Federal
Reserve, Fed Gov. Donald Kohn insisted that the extremely low
short-term interest rates that the Fed was keeping down had not
created a speculative bubble in real estate.
In 2004 and in 2005, Fed Chairman Alan Greenspan himself echoed
Mr. Kohn and repeated many times that there was no inflation and
that he was in no hurry to raise short-term interest rates from
their 46-year low level of 1 percent. In April 2004, for example,
in remarks on the economic outlook to the Joint Economic
Committee, Greenspan remained unconcerned about inflation,
declaring that "as yet, the protracted period of monetary
accommodation has not fostered an environment in which
broad-based inflation pressures appear to be building", just
at a time when the housing bubble was but one year from its final
top.
At that time, the old pre-1982 CPI formula, as calculated by
private economists, indicated that U.S. consumer inflation was
above 8 percent and that a housing bubble and a concomitant stock
market bubble were in full swing. Future Fed Chairman Ben
Bernanke, then a Fed Board member, echoed his mentor in late 2005
by saying that there was no housing bubble to go bust and that
the fact that U.S. house prices were rising four times faster
than the economy was "largely [a reflection of] strong
economic fundamentals."
But, it is now generally agreed that from 2002 to 2004, the
American central bank pursued a monetary policy that was too
expansionary and that—plus the lack of government
regulation of the credit derivative
market—contributed greatly to create the conditions
for a major financial crisis. Let us keep in mind that in 2004,
the Fed Chairman was publicly recommending that people buy
adjustable rate mortgages (ARMs), especially interest-only
adjustable-rate mortgages, and other subprime loans instead of
safer fixed rate loans.
As a matter of fact, most economists agree that interest rates
should have been raised as early as 2002. But Mr. Greenspan
implied later that he was forced to play politics with his
monetary policy, when he declared on September 17, 2007, in an
interview with the Financial Times, that "raising interest
rates sooner and faster would not have been acceptable to the
political establishment given the very low [official] rate of
inflation".
There you have it. What is suggested here is that the push to
reelect President George W. Bush, in the fall of 2004, may have
played an important role in letting the housing bubble become
bigger, thus paving the way for a housing bubble burst in
2005-2006. This is, by the way, on top of the confession that Mr.
Greenspan made in interviews promoting his Memoirs (The Age of
Turbulence) that he had personally lobbied the Bush-Cheney
administration in favor of the unprovoked 2003 U.S. war against
Iraq, and that consequently, he was personally tied to the
overall political agenda of the Bush-Cheney administration.
When the history of this financial and economic crisis is
written, it shall be recorded that the Fed and other government
agencies, such as the Securities and Exchange Commission (SEC),
did little or nothing to prevent the debt pyramid from reaching
the dangerous levels it attained and which is now crashing down,
dragging down with it the entire U.S economy and most of the
world economies. __
Rodrigue Tremblay is professor emeritus of economics at the
University of Montreal and can be reached at rodrigue.tremblay@
yahoo.com.
He is the author of the book The New American Empire. Author's
Website: www.thenewamericanempire.com/
Check out Dr. Tremblay's coming book The Code for Global Ethics
at: www.TheCodeForGlobalEthics.com/ *****The French version of
the book is now available. See:
www.LeCodePourUneEthiqueGlobale.com/ or: Le code pour une
éthique globale
Posted, Friday, March 6, 2009, at 5:30 am
(5) Currency Battle Between UK And Europe
From: lenczner <atoyuma@yahoo.com> Date: 22.02.2009 03:24
PM
<Note: this comes from the same telegraph.co.uk where
Evans-Pritchard writes his blog> "The prospect of a
currency battle between Britain and Europe loomed larger last
night after the man considered to be the international ambassador
for the European Central Bank delivered a thinly-veiled swipe at
the level of sterling.
ECB's Lorenzo Bini-Smaghi hits out at sterling /By Edmund Conway,
Economics Editor
http://www.telegraph.co.uk/finance/economics/4691561/ECBs-Lorenzo-Bini-Smaghi-hits-out-at-sterling.html
In comments which underline the scale of concern throughout
Europe about the sharp decline in the UK currency in recent
months, ECB Executive Board member Lorenzo Bini-Smaghi said that
EU countries should not allow their currencies to slide in order
to gain an economic advantage. The pound has slid by the biggest
amount since the demise of the Bretton Woods system in the 1970s
- something economists regard as a significant boost for UK
exports.
However, Mr Bini-Smaghi said in a speech in Berlin: "The
current crisis is bound to raise again the issue of whether a
single market like the one we have among 27 countries in the EU
can function smoothly when the exchange rate of some of the
members is allowed - or even encouraged - to depreciate sharply,
possibly distorting competition. "The integrity of the
single market itself can be put at risk if the exchange rate is
used - and seen to be used - as an instrument to gain
competitiveness at the detriment of the others."
Mr Bini-Smaghi also indicated that he was pushing the UK to allow
the ECB to become a pan-European financial regulator in the
future. He said he expected the UK to agree to proposals which
would grant the ECB supervision over banking throughout the
continent.
<related links by sender> UK "could experience a crash
similar to Iceland"
http://www.hedgeweek.com/articles/detail.jsp?content_id=294300
Bailed Out Bank To Add $3 Trilion To UK Debt
http://business.timesonline.co.uk/tol/business/economics/article5764793\
<two following links from the telegraph.co.uk by Ambrose E.P
and Bruno Waterfield : > European banks' toxic debts risk
overwhelming EU governments
http://www.globalresearch.ca/index.php?context=va&aid=12357
Secret EU Document: European bank bail-out could push EU into
crisis
http://www.globalresearch.ca/index.php?context=va&aid=12358
* see for example, the 2008 "Declaration: Standards and
Strategies for 9/11 Truth" which equates
"anti-environmentalism" with "Holocaust
Denial" and "Moon Landing Hoax":
http://www.truthmove.org/content/2008-declaration/
On that point, by the way, I appreciate your recent efforts to
bring a spirit of real debate and precaution to the Holocaust
controversy, especially seeing how "Holocaust Denial"
is being used as a symbolic propganda weapon by some green
extremists.
(6) Russian-Jewish oligarch 'had RBS loan of £2.5bn written
off' - Telegraph
From: Josef Schwanzer <donauschwob@optusnet.com.au> Date:
20.01.2009 05:15 PM
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/4286459/Russian-tycoon-had-RBS-loan-of-2.5bn-written-off.html
Russian tycoon 'had RBS loan of £2.5bn written off'
A £2.5 billion loan said to have been given to a Russian
oligarch by a British bank and then written off is an example of
the alleged practices perpetrated by this country's major lenders
which have prompted a surge of political anger.
By James Kirkup and Caroline Gammell
Last Updated: 7:01AM GMT 19 Jan 2009
ABN Amro, a Dutch bank owned by the Royal Bank of Scotland (RBS),
apparently lent Leonid Blavatnik the money to help shore up the
finances of his troubled chemicals company LyondellBasell.
RBS is just one of the British banks being scrutinised by
Government officials, alongside Lloyds Banking Group and
Barclays, after lending to foreign nationals left them facing
multi-billion pound losses which require another taxpayer funded
bail-out.
Officials have discovered that the banks made the majority of
their loans overseas, sometimes to companies and individuals
whose ability to repay their debts was highly questionable.
In some cases, only 20 per cent of bank lending was
British-based, with the rest going abroad.
The past lending practices of RBS – of which the
taxpayer now holds a majority share – have emerged
as a particular concern.
Senior Government figures are said to have been infuriated to
learn that RBS was part of a group of banks that offered a
£2.8billion loan to a firm owned by Oleg Deripaska, a Russian
billionaire who last year hosted both Peter Mandelson and George
Osborne on holiday in Corfu.
The apparent loan to Mr Blavatnik has now brought the
51-year-old, who divides his time between America, Russia and
Britain – where he resides in a £41million home
in Kensington Palace Gardens –into the spotlight.
Raised in a Jewish household, he moved from Russia to America at
the age of 21 to find a new life, earning an MBA from Harvard. He
regularly returned to Russia for business and founded Access
Industries in 1986, making his fortune in chemicals and natural
resources, including oil, aluminium and coal.
Mr Blavatnik is a director of several companies within the Access
Industries portfolio, including LyondellBasell and TNK-BP, a
joint oil venture with the British energy group.
Last year, the oligarch – referred to as Len
Blavatnik in the West – was ranked as the 11th
richest man in Britain, with an estimated fortune of £3.9
billion.
Another deal that saw RBS buy ABN Amro for nearly £50billion
in 2007 has been held up as an example of bankers' recklessness.
Officials familiar with RBS's accounts say the sale saddled the
bank with huge debts.
The departure from "old fashioned banking"
– where banks raised money from British savers and
then lent it to British firms and homebuyers – is
being blamed for the current plight of the country's biggest
financial institutions.
The Prime Minister, Gordon Brown, at the weekend spoke of his
"anger" at the banks' behaviour. Backbench Labour MPs
have been even more critical. Tom Harris, a former minister,
described British banks as "a national embarrassment".
He said: "We should be pointing our fingers more in the
direction of the incompetent leeches who have conspired to
bankrupt our banking system."
And the anger is not restricted to the political Left. David
Cameron, the Conservative leader, has spoken of the need for
"day of reckoning" when bankers should face "the
rightful consequences of irresponsible behaviour".
How politicians will act on their growing anger is unclear, but
those directors of banks who have not yet been removed may find
themselves in the spotlight.
Privately, senior Government sources believe that once the new
bail-out package is settled, some of those directors must be held
accountable for the banks' troubles.
(7) In Detroit, houses are cheaper than cars: just $7,500 (Not
$75,000)
From: IHR News <news@ihr.org> Date: 06.03.2009 05:25 PM
Detroit's Outlook Falls Along With Home Prices
Chicago Tribune
http://www.chicagotribune.com/news/nationworld/chi-detroit-housingjan29,0,5435392.story
Detroit's outlook falls along with home prices
Motor City on the brink of bankruptcy, but still 15 people want
to be mayor
By Tim Jones |Tribune correspondent
January 29, 2009
DETROIT — It may be tough to get financing for a new
car these days, but in Detroit you can buy a house with a credit
card.
The median price of a home sold in Detroit in December was
$7,500, according to Realcomp, a listing service.
Not $75,000. Remove a zero—it's seven thousand five
hundred dollars, substantially less than the lowest-price car on
the new-car market. ...
If the Obama administration is looking for a city to test new
ideas for chronic urban problems, it can look to Detroit, a
northern New Orleans without the French Quarter. While bedrock
poverty in the Crescent City was violently laid bare by Hurricane
Katrina in 2005, Detroit has been quietly slipping into social
and economic crisis for 40 years. One-third of the population
lives in poverty, and almost 50 percent of children are in
poverty, according to data from the Detroit-Area Community
Indicators System. Median household income has dropped 24 percent
since 2000, according to the Census Bureau.
New York bond-rating houses this month lowered the city's bond
rating to junk status, a lowly assessment shared by New Orleans
and few others.
On a positive note, Detroit's homicide rate dropped 14 percent
last year. ...
Detroit, which has lost half its population in the past 50 years,
is deceptively large, covering 139 square miles. Manhattan, San
Francisco and Boston could, as a group, fit inside the city's
boundaries. There is no major grocery chain in the city, and only
two movie theaters. Much of the neighborhood economy revolves
around rib joints, hot dog stands and liquor stores. The
candidates travel around this sprawling city, some invoking the
nostalgic era of Big Three dominance and vowing that Detroit can
be great again. ...
"Detroit will never be the great industrial center
again," said Kevin Boyle, a Detroit native and author of
"Arc of Justice: A Saga of Race, Civil Rights and Murder in
the Jazz Age."
"What will it look like?" Boyle said. "I don't
know."
tmjones@tribune.com ==
http://www.telegraph.co.uk/news/worldnews/1547829/A-house-costs-less-than-a-car-in-Detroit.html
A house costs less than a car in Detroit
By Alex Spillius in Washington
Last Updated: 1:12AM BST 06 Apr 2007
The mortgage crisis in America has deepened so much that family
homes can now be bought for less than £15,200 - the price of a
new car.
A four-bedroom home near the original Motown recording studio in
Detroit recently sold for £3,700 ($7,000), less than most used
cars. A boarded-up bungalow fetched £685, and a three-bedroom
house listed for £276,000 attracted just £69,000.
Detroit, which made its fortune on the back of the car industry,
now holds a more dubious distinction: the capital of home
repossessions.
The decline of its main industry has seen Detroit suffer more
than other areas from a crisis that is sweeping the United States
and has sent a big chill through the whole economy and global
stock markets.
(8) US can no longer afford its 1,000 overseas military bases
From: IHR News <news@ihr.org> Date: 06.03.2009 05:25 PM
Too Many Overseas Bases
David Vine | February 25, 2009
Foreign Policy In Focus
http://www.fpif.org/fpiftxt/5903
In the midst of an economic crisis that’s getting
scarier by the day, it’s time to ask whether the
nation can really afford some 1,000 military bases overseas. For
those unfamiliar with the issue, you read that number correctly.
One thousand. One thousand U.S. military bases outside the 50
states and Washington, DC, representing the largest collection of
bases in world history.
Officially the Pentagon counts 865 base sites, but this
notoriously unreliable number omits all our bases in Iraq (likely
over 100) and Afghanistan (80 and counting), among many other
well-known and secretive bases. More than half a century after
World War II and the Korean War, we still have 268 bases in
Germany, 124 in Japan, and 87 in South Korea. Others are
scattered around the globe in places like Aruba and Australia,
Bulgaria and Bahrain, Colombia and Greece, Djibouti, Egypt,
Kuwait, Qatar, Romania, Singapore, and of course, Guantánamo
Bay, Cuba — just to name a few. Among the
installations considered critical to our national security are a
ski center in the Bavarian Alps, resorts in Seoul and Tokyo, and
234 golf courses the Pentagon runs worldwide.
Unlike domestic bases, which set off local alarms when threatened
by closure, our collection of overseas bases is particularly
galling because almost all our taxpayer money leaves the United
States (much goes to enriching private base contractors like
corruption-plagued former Halliburton subsidiary KBR). One part
of the massive Ramstein airbase near Landstuhl, Germany, has an
estimated value of $3.3 billion. Just think how local communities
could use that kind of money to make investments in schools,
hospitals, jobs, and infrastructure.
Even the Bush administration saw the wastefulness of our overseas
basing network. In 2004, then-Secretary of Defense Donald
Rumsfeld announced plans to close more than one-third of the
nation’s overseas installations, moving 70,000
troops and 100,000 family members and civilians back to the
United States. National Security Adviser Jim Jones, then
commander of U.S. forces in Europe, called for closing 20% of our
bases in Europe. According to Rumsfeld’s estimates,
we could save at least $12 billion by closing 200 to 300 bases
alone. While the closures were derailed by claims that closing
bases could cost us in the short term, even if this is true,
it’s no reason to continue our profligate ways in
the longer term.
Costs Far Exceeding Dollars and Cents
Unfortunately, the financial costs of our overseas bases are only
part of the problem. Other costs to people at home and abroad are
just as devastating. Military families suffer painful
dislocations as troops stationed overseas separate from loved
ones or uproot their families through frequent moves around the
world. While some foreign governments like U.S. bases for their
perceived economic benefits, many locals living near the bases
suffer environmental and health damage from military toxins and
pollution, disrupted economic, social, and cultural systems,
military accidents, and increased prostitution and crime.
In undemocratic nations like Uzbekistan, Kyrgyzstan, and Saudi
Arabia, our bases support governments responsible for repression
and human rights abuses. In too many recurring cases, soldiers
have raped, assaulted, or killed locals, most prominently of late
in South Korea, Okinawa, and Italy. The forced expulsion of the
entire Chagossian people to create our secretive base on British
Diego Garcia in the Indian Ocean is another extreme but not so
aberrant example.
Bases abroad have become a major and unacknowledged
“face†of the United States, frequently
damaging the nation’s reputation, engendering
grievances and anger, and generally creating antagonistic rather
than cooperative relationships between the United States and
others. Most dangerously, as we have seen in Saudi Arabia and
Yemen, and as we are seeing in Iraq and Afghanistan, foreign
bases create breeding grounds for radicalism, anti-Americanism,
and attacks on the United States, reducing, rather than
improving, our national security.
Proponents of maintaining the overseas base status quo will
argue, however, that our foreign bases are critical to national
and global security. A closer examination shows that overseas
bases have often heightened military tensions and discouraged
diplomatic solutions to international conflicts. Rather than
stabilizing dangerous regions, our overseas bases have often
increased global militarization, enlarging security threats faced
by other nations who respond by boosting military spending (and
in cases like China and Russia, foreign base acquisition) in an
escalating spiral. Overseas bases actually make war more likely,
not less.
The Benefits of Fewer Bases
This isn’t a call for isolationism or a
protectionism that would prevent us from spending money overseas.
As the Obama administration and others have recognized, we must
recommit to cooperative forms of engagement with the rest of the
world that rely on diplomatic, economic, and cultural ties rather
than military means. In addition to freeing money to meet
critical human needs at home and abroad, fewer overseas bases
would help rebuild our military into a less overstretched,
defensive force committed to defending the nation’s
territory from attack.
In these difficult economic times, the Obama administration and
Congress should initiate a major reassessment of our 1,000
overseas bases. Now is the time to ask if, as a nation and a
world, we can really afford the 1,000 bases that are pushing the
nation deeper into debt and making the United States and the
planet less secure? With so many needs facing our nation,
it’s unconscionable to have 1,000 overseas bases.
It’s time to begin closing them.
David Vine, Assistant Professor of Anthropology at American
University in Washington, DC and a contributor to Foreign Policy
In Focus, is organizing the Security Without Empire conference
that will bring together leading U.S. peace activists and
scholars, as well as base opponents from 11 nations from February
27-March 2. He is the author of Island of Shame: The Secret
History of the U.S. Military Base on Diego Garcia (Princeton
University Press), to be released in April.
Peter Myers, 381 Goodwood Rd, Childers 4660, Australia ph +61 7
41262296
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