The incidental costs of a costly defense

RALEIGH -- The greatest threat to the United States is not terrorism but the debt crisis due to military spending, budget deficits and trade deficits. The president's fiscal year 2009 budget proposes an additional $70 billion in war-related spending, on top of $102.4 billion the administration continues to pursue for Fiscal Year 2008.

The amount requested for FY 2009 is merely a placeholder for the first few months of the next fiscal year, vastly underestimating what would be required to continue the war in Iraq at the current level of involvement. The administration plans to seek additional funding for the war in Iraq and Afghanistan, according to the Congressional Data Service. From FY 2001 to FY 2008, the war in Iraq has cost $514 billion and in Afghanistan $149 billion, for a total of $663 billion.

In addition to proposed war funding, the non-war military budget will increase by nearly 5 percent over that of FY 2008 under the proposed budget, reaching $541 billion in FY 2009. This includes funding for nuclear weapons under the Department of Energy budget. The U.S. military budget is the world's largest, and it continues to grow.

The Congressional Budget Office has estimated that the deficit for FY 2009 will be $198 billion. This estimate assumes that only $70 billion will be appropriated for military operations in Iraq and Afghanistan, and does not include the additional supplemental funding that will be requested later in the year by the president.

The Center for Economic and Policy Research reported last May on the long-term economic impact of increased military spending. The research showed that, after an initial demand stimulus, by about the sixth year the effect of increased military spending turns negative.

Dean Baker, an economist who worked on the research project, stated, "It is often believed that wars and military spending increases are good for the economy. In fact, most economic models show that military spending diverts resources from productive uses, such as consumption and investment, and ultimately slows economic growth and reduces employment."

Military Keynesianism does not work -- it's a form of economic suicide. Due to excessive military spending, the United States did not modernize or replace our capital assets, resulting in our becoming less competitive in the global market.

In 2007, our trade deficit was $711 billion, a slight decline after setting records in five consecutive years. A telling comparison that reveals just how much worse the United States is doing can be found in the "current accounts" of nations. This measures the net trade surplus or deficit of a country, plus cross-border payments of interest, dividends, capital gains and other income. The United States. is dead last on the list. In 2006 our current account deficit was $811 billion.

To finance the growing military spending, budget deficit and trade deficit the government is borrowing funds from foreign countries, particularly China and Japan. As the dollar weakens, foreign countries are becoming reluctant to finance U.S. wars.

Just on economic grounds, the wars in Iraq and Afghanistan cannot be justified. Peace Action urges Congress to end the Iraq war and work to reduce military spending in order to fund human and community needs: health-care, housing, environmental protection and public transportation.

(Bill Towe is coordinator of N.C. Peace Action.)