In the 1930’s, retired Marine General Smedley Butler wrote an essay that has become infamous. Though it is over seventy years past, Butler’s assessments still ring true.

WAR is a racket. It always has been. It is possibly the oldest, easily the most profitable, surely the most vicious. It is the only one international in scope. It is the only one in which the profits are reckoned in dollars and the losses in lives.

Who Makes The Profits? Well, the average earnings of the DuPont’s for the period 1910 to 1914 were $6,000,000 a year. It wasn't much, but the DuPont’s managed to get along on it. Now let's look at their average yearly profit during the war years, 1914 to 1918. Fifty-eight million dollars a year profit we find! Nearly ten times that of normal and the profits of normal times were pretty good. An increase in profits of more than 950 per cent.

Bethlehem Steel’s 1910-1914 yearly earnings averaged $6,000,000. Then came the war. And, like loyal citizens, Bethlehem Steel promptly turned to munitions making. Did their profits jump -- or did they let Uncle Sam in for a bargain? Well, their 1914-1918 average was $49,000,000 a year! Or, let's take United States Steel. The normal earnings during the five-year period prior to the war were $105,000,000 a year. Then along came the war and up went the profits. The average yearly profit for the period 1914-1918 was $240,000,000. Not bad.

I don’t consider myself anti-war by the accepted definition of the phrase, but General Butler brings up numerous examples of war profiteering that hold true today under the most minimal scrutiny. If you haven’t read his essay in its entirety, I highly recommend spending some time on it, and see how well you can link the examples of World War I with today.

Now fast forward to the current Iraq war. The following are excerpts from The Center for Public Integrity and SourceWatch:

Halliburton announced on Friday that its KBR division, responsible for carrying out Pentagon contracts, experienced a 284 percent increase in operating profits during the second quarter of this year. [2005]
The increase in profits was primarily due to the Pentagon's payment of "award fees" for what military officials call "good" or "very good" work done by KBR in the Middle East for America's taxpayers and the troops.
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General Electric's reconstruction activities in Iraq were not disclosed in documents the Defense Department provided to the Center for Public Integrity in response to a Freedom of Information Act request. Media sources, however, indicate that GE has or had post-war business dealings in Iraq.
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As the auditors plan to expand their investigations to all of Bechtel's $2.85 billion in Iraq contracts, they are sure to discover a pattern of failure. Not only should Bechtel be dropped from all of its failing contracts, but the company should be required to refund all misspent U.S. taxpayer and Iraqi funds so that Iraqi contractors can get to work and real reconstruction can finally begin.

On Sept. 30, 2006, all unobligated money for reconstruction in Iraq reverts back to the U.S. Treasury. This means that unless action is taken now to ensure that this money goes to Iraqis, U.S. corporations will keep their billions, while Iraqis are left with failed projects and little money to recover.

In the modern age, multi-divisional conglomerates own defense firms, media outlets, technology concerns and have vast lobbying power in Washington. As General Butler observes, in war the only costs are paid in human lives…….newly marked white crosses….and economic deprivations upon the middle and lower classes.

Do defense/media corporations beat the drums of war in the pursuit of profit? Some posters will answer with an obvious ‘duh’. George Schultz was President and Director of the Bechtel Group for eight years prior to joining the Reagan Administration as Secretary of State. After his term in Cabinet, Schultz returned to Bechtel. There’s no need to revisit Cheney’s connection with Halliburton, or the routine ‘reassignment’ of retiring Flag Officers to the boards of these same multi-divisional conglomerates.

Some points to ponder………Is there a way to end this? Is there a need to end this? Is this just an anti-war conspiracy theory? I’m especially interested in the opinions of supporters of the war in Iraq, as the reasons for invading and the reasons for staying are controversial.

Questions for debate:

Would you support some form of legislation that limits corporate profits that can be made during a time of war, when dealing with government contracts?

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?

Is there any way possible to end the cycle that seems to link the media-with-war-with profits?

Lots of food for thought here, but I do want to address one specific question for now. I'll get to some of the others when I have more time to think about it.

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?

I have almost as much experience at working on the "other end" (ie. for a defense contractor) as most of the military people here do. My experience runs the gamut from active duty and retired four stars down to enlisteds working on the flight line. Nearly every test pilot I worked with was a combat veteran, mostly Wild Weasel pilots in Vietnam and I can tell you they were all, without exception one tough group to satisfy. Part of it was that they were putting their behinds on the line when they strapped on an airplane for testing, but mostly it was because they knew someday one of their friends was going to strap on that airplane and go to war in it - and they knew what that entailed. Their advice, their criticism and their swearing outs (frequent at times) were invaluable to those of us working to develop the best weapons system possible. To prevent them from bringing their experience into the area of weapons system development would be completely insane.


Edited to add......

So, my answer is no. And, I have no doubt that should such legislation be passed in the future, President McCain would veto it in a heartbeat.

Aquilla

There is a truckload of validity to your statement. This issue effects me as well, except I'm not a senior officer. Except for one instance, every one of my post-retirement job leads are with companies that have contracts with the Department of Defense. Because of my schooling, skills and experience it's a natural fit, rather than trying to start something completely new and on the ground floor.

But........it is ethical for senior officers to gain employment wit a firm that bids for defense contracts? Is there probably not quite a bit of quid pro quo going on, where a contract is awarded and coincidently, an award-connected, newly retiring officer finds he has a job with that same firm?

I don't have the answers, and military experience is value added immeasurably to a defense firm, but clearly a problem lies within this arrangement.

I have the same thoughts on this as I do other potentially abused but otherwise legitimate deals that frequently get arranged in the business world. As Aquilla points out, there are plenty of valid reasons to bring senior military people on to defense contractor businesses...their direct knowledge helps build better projects, which then benefit both the contractor and the military. Are these deals sometimes abused to give some officers jobs as part of some inside deal? I'm sure it happens, but probably not as frequently as in many other industries because of the validity of their knowledge and experience. In those times when it does happen...is their really a major harm done? If General Joe Whatisname gets a cushy job out of a $60 billion weapon program, so what? That falls somewhere into the 7th or 8th digit, which is sevarl digits short of being consequential in the slightest. Particularly when the harm done in trying to prevent such a deal which would then also eliminate the valid input so many others would have provided, but now couldn't. In this instances where such a deal were arranged, it should be possible to ferret it out and prosecute it currently. The 'cure' causes more harm than the disease--in these cases prevention is sometimes the worst remedy of all.

It sounds a lot like the lobbyist problem to me. Experience is great for a bunch of reasons, but the actual dealmaking machinery sounds like it is flawed. If the decision to buy is affected because the ex-General-turned-company-president regularly golfs with the some of the guys who make the decision to buy, that stinks, especially if it's the main reason the company hired him. I firmly believe that lots of rules and harsh penalties are necessary to put some distance between the sellers and the buyers, especially when the buyers are in the government. When your company can spend a few million on a Duke Cunningham type and get those back a hundred-fold or a thousand-fold, the temptation will always be great on both sides.

I don't know enough about the contracting process on the military side to know how much influence a senior officer, even a four star has in the final contractor selection. If there was indeed ever an kind of quid pro quo going on with any program I was working on, it was way above my pay grade. What I do know was that the experience and expertise former military people brought to our programs was invaluable and that went clear up to the former head of the Tactical Air Command, General Alton Slay, who worked closely with us at Lockheed on our proposal for the ATF program (now the F-22). I don't know how much Lockheed was paying him as a consultant (more than they were me I'm sure), but I do know what a tremendous help he was to me in the development process. The airplane that Lockheed ended up proposing to the Air Force (which ended up being selected) was a much better airplane because of Gen Slay's input.

Now, did Lockheed win that contract because they hired General Slay? Probably, but not for the reasons some may infer. Lockheed won that contract because the airplane they proposed was superior to Northrup's version and that was due in part to General Slay's advice on the design effort. His advice wasn't along the lines of "this is the guy you take to dinner and provide a hooker", rather it was "This flight performance requirement is really, REALLY important for this airplane. If you have to compromise something else in order to meet this requirement, do it, but this one is absolutely crucial". I didn't at the time and don't now see anything whatsoever unethical about that. We ended up with a better airplane for our pilots.

Aquilla

I disagree with you here - of course there is harm done. Company A sells an assault rifle that works perfectly, Company B sells one that tends to jam in certain circumstances. Company B buys Duke Cunningham a yacht, so now thousands of our soldiers have to deal with jamming guns - even years later, when Duke is in jail. How do you get more harmful than that? Maybe in another situation it's not an outright bribe - maybe it's just an old connection, but it might be enough to sway a decision the wrong way. Same lousy outcome for the guys on the ground.

Like Aquilla, all of this really occurs well above my pay grade, but JohnfrmCleveland brings up a good example. I can't testify to the bidding process that occurred [I wasn't there] but we are currently saddled with the M4 Assault Rifle, which has been in the news lately due to poor performance when tested against other comparable rifles. The M4 is based on the same general design we have been using since Vietnam, with the M16. Was the M16 the best rifle at the time of adoption? Most soldiers who have light weapons experience would say no. So why are we still using the same platform?

But this all is a part of the larger problem that is too obvious to ignore. Wars are great business for defense firms. Defense firms that have a large number of influential former military officials have distinct lobbying power with the Department of Defense due to the incestual relationship, just as those same companies have distinct lobbying power with elected officials due to campaign donations. Further, many of these defense firms are partnered with or subsidiaries of conglomerates that also own media outlets. The drums for war in many cases are being beaten by not a single drummer, but a band. This perpetuates a cycle going back at least since WWI in this nation. For the good of America's sons and daughters, present and future.....shouldn't it stop?

Butler’s assessments don't only ring true, they are true. Were it not for the prospect of war profiteering, the United States would not currently be occupying Iraq - or Afghanistan. It's as simple as that.

Would you support some form of legislation that limits corporate profits that can be made during a time of war, when dealing with government contracts?

In general, I'd favor legislation that limits corporate profits, period. But it would really depend on the details of the legislation. I don't think a cap on profits would work, though I might favor a hefty "war tax" on windfall profits related to military action.

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?

No - so long as said senior military officers have retired form the armed forces.

Is there any way possible to end the cycle that seems to link the media-with-war-with profits?

Possibly. Start with these:

Make sure that there are never - ever - no-bid contracts awarded to anyone in relation to government spending, whether it's defense spending or anything else. Establish a bipartisan panel of industry experts to review all bids on defense contracts, assess the quality of the work, and award the contract to the lowest bidder that meets minimum standards - with no exceptions ever.

No more blind trusts for elected officials. If you own shares in a defense contract industry, you must divest yourself of them entirely before taking the oath of office. You are welcome to reinvest once you leave office - and only once you leave office.

Punish conflict-of-interest dealings in relation to defense spending with severe and mandatory prison sentences and crippling fines. No exceptions.

Vacate all contracts with any company that fails to deliver or otherwise breaches any contract and prohibit them from tendering any further bids with any government body for a period of not less than ten years. No excuses, no second chances.

Import a Congress and a Justice Department from a parallel universe that will actually enforce the laws that are already on the books.

I agree, but unfortunately the problem is much more pernicious than that. The 'payoff' for funding defense contracts often doesn't come in the form of direct monetary benefit to the elected official. The benefits are largely indirect. Smart defense contractors ensure that nearly every state has a vested interest in the manufacturing of (whatever it is), particularly the most politically influential states. Congressmen then support the defense contractors because it offers money/jobs to the people within their states. This is particularly true of the more powerful Congressmen who have been around the longest and get their way the most. Look at the states that have (or will soon have) the operational F22 bases, for rough instance. They are all home states to highly influential Congressmen (Virginia, Alaska, New Mexico, Hawaii). This is no accident. It isn't because those locations have much to do with mission-readiness.

Mr P just got home from a deployment. I'll try to drag information out of him later if he's willing to share. He could add a lot to this topic, since he's worked on both ends with contractors and the government/military side of things. A lot of the problems also stem from inter-service budget battles (the service...Army, Navy, AF, which gets the most funding "wins" so Generals often push to fund certain programs..Perfectly illustrated case here).

****************

I think, regarding General Butler, we should put some context into the timeframe he made that speech. It wasn't very relevant eight years later, when it was necessary to go to war and our army was 16th in the world, behind Yugoslavia. Armament spending was next to nothing during the time he made that speech. When we entered WWII the military was in such a dilapidated state it was said that creating a war-ready fighting force out of it was like trying to fashion a dinosaur from a collarbone and an ulna. Less than 100 airplanes, and most of those open-cockpit, while the Luftwaffe had been opening new bases and pumping out new Ju 87 dive-bombers for years previous along with Mark III tanks, and litters of U-boats. Japan had just invaded Manchuria, and would later nearly take over the Pacific.

We were able to start churning out equipment fast by converting sewing machine factories into weapons factories overnight. That wouldn't be possible with the type of high-tech equipment we use today. I'm for keeping a sharp sword and NOT having to use it, rather than dulling the sword and trying to rub the rust off when we need it.**

The year Butler gave that speech, the US was not only in the midst of a Great Depression, but had reached the very nadir. The CCC didn’t exist, and FDR hadn’t served a month in office. The US government had just sent in its own army to crush protests by World War I veterans in Washington DC with brutality, the sight of their blazing shacks enraged the nation. It was a very bad time to be a veteran or a soldier. I do think that, had Butler survived about five years longer than he did, to see Pearl Harbor and what happened to the world very soon after this speech, he would have worded it a bit differently and perhaps changed his mind about some things.

**On that point, I'd like to see us have a much smaller fingerprint in the rest of the world. I'm for closing most bases overseas. But that too is a problem. For instance, we've been trying to hand over operational control to the ROK for years, and they won't take it. It has been delayed time and again, not from our end but theirs (because it would require them to invest more money into their military rather than relying on ours).

I get a much diiferent observation of Butler's essay, along the lines of 'the more things change, the more they stay the same'. The middle and lower classes [by and large] are still the payers of any war debt, whether economically or through lives. The defense firms that supply the military continue to reap astronomical profits. These same firms also wield immense lobbying power or direct media control, sometimes both. It isn't a stretch to state that war is in their best interest, there's not much of a downside for them.

I don't think it's impossible to connect the dots today anymore than it was for Butler.

1.) A theme relevant to Brecht's Mother Courage and Her Children is that war is an enterprise. Well isn't it? Corporations do harm every day in a society free from the hassle of war anyway. Just because people are dying to turn a profit during war, people are getting hurt every day at the expense of corporations.

I know that's a very cynical thing to think, but hey.

So no. There are also practical reasons for not establishing a price ceiling on the limit corporations can earn during a conflict. Once they maximize their profits from a legislative standpoint, what is to stop them from pulling out. Sure a contract may help, but we witness double-dealing and horse-trading all the time in this world. I have very little faith in corporations as a whole and their ability to honor agreements with individuals, house-holds, other corporations, nations, and the planet.

It's in the best interest of all parties involved to let corporations run amok, as it were, to ensure their the quality [ideally] of the goods or services remains high and that competition can move in [if an exclusive contract [which those seem to work just fine] has not been granted].

2.) No. I would actually encourage it. Experience is an important thing to government, military, and industry. Horse-trading of people at that level doesn't bother me. I am greatly encouraged that Bush Senior can work for The Carlye Group after having been President of the United States. It shows activity in his old age.

3.) Nationalization of the news outlets. Although I doubt there'd be much support for that.

Would you support some form of legislation that limits corporate profits that can be made during a time of war, when dealing with government contracts?

Not necessarily but I think we need to take a much stronger auditing role in our miulitary contract system and employ significant penalties for breaches of the public trust. Also economics is an extension of war to a degree. We should not use the spoils system of rewarding our companies for vitory overseas. Iraq needed an intensive effort to promote new industries and even the appearance that AMerican companies profit from the invasion of Iraq hurts our image in Iraq and abroad. When American companies profit in Iraq it should be because of Iraqi nationals' choices.

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?

Absolutely. I think not only have present political and military leaders not developed a strong sense of ethics in this area, they have in fact developed a sense of entitlement to lucrative private sector jobs as a part of their public service. This creates less of a free market business relationship and more of a quid pro quo system, which is in a word, corruption.

Is there any way possible to end the cycle that seems to link the media-with-war-with profits?

IK don't think I understand the question, but I'll take a swing at it. War and profits are connected as war is good business. So there is not a media perception of this. It is war profiteering (and peace profiteering) that needs to be watched closely. Companies should feel like they must honor their agreements with the government and crossing the line should be met with clearly stated and enfroced penalties and habitual violators should be given the federal contract death penalty.

The system of awarding contracts should be watched over carefully too and made more transparent. Public officials should be rated and awarded or penalitzed on how effectively they use public funds and follow the intent of the system for awarding contracts.

Profits are limited on all government contracts and have been for decades (at about 13-15%). And the government audits their books to verify they did not make too much. The "award fees" Is a new one on me and I have seen lots of military contracts.

Only if the firm is one they dealt with in the military and then only for a set period of time.
What is far worse is the Congress forcing spending or projects that the Pentagon does not want but that happens to be in the district of a powerful Congressman – the Osprey for example.

I don’t buy the idea that companies or media “make war”.

I guess I don't see a conflict of interest when senior military officers retire and take jobs that deal with the military. I know that many people get out of the Army and then get civilian jobs on post. I also know that in order to get jobs with many private security firms that are contracted by the government require a certain level of military experience. It only makes sense to me if I were to be hiring people to do work with the military, and the job was specific, that I would hire someone with extensive experience. It may just be that former military personnel are the most qualified. Maybe I misunderstand something here.

Which is why I worded the question 'Senior military Officers' I'm referring to flag rank officers who retire and take positions on the board or as CEO of a defense firm. A position that could be used as leverage while said flag officer is still on active duty. I'm not speaking of pilots, SpecOps or technical guys, who's experience and training is quite valuable on in the job market. For full disclosure I mentioned that I too am likely to take a position with a dfense firm when I retire this fall. But I'm not in any position to steer lucrative contract bidding, thus there is literally no conflict of interest.



I didn't say 'make war'. But if you're unaware, look into the number of companies that provide intelligence to the government, outsourced if you will. The corporations that are defense oriented and own media interests and have lobbying power, are in the position to sway public opinion, congressional opinion and defense/intelligence opinion towards military adventurism that will increase their profits, by in some cases 250% for a single quarter. All they have to do is attach terrorism to it and there are lapdogs in waiting who will think nothing about sending young Americans to their deaths. That kind of power doesn't frighten you?

Now I understand. I am surprised that there aren't any rules in the UCMJ restricting senior officers from taking on such civilian roles. I was not aware that military personnel could, while still on active duty, serve as CEO or on a board of a defense contracted firm.

They cannot simultaneously serve on active duty and be a member of the board at a firm that has contracts with the government. My point was that a senior officer, especially in Acquisition or Program Management, who works closely with firms bidding for contracts, can easily be wooed by said company. In return for preferential steering to gain a lucrative contract, said officer can find himself very marketable to said company upon retirement. Quid pro quo. Now there isn't any hard statistics of this arrangment occurring, the sheer number of flag officers who go immediately to the boards of these firms upon retirement has to at least make one wonder. It's too coincidental for it to never happen.

Many have debated over the issue of congress people working immediately for lobbying firms upon leaving the hill, it's essentially the same issue.

I guess there is always a sour apple in the bunch, and I don't doubt that it could or does happen. With that said, I don't think it constitutes legislative action. Making law because there is a possibility that a problem could arise does not justify making more laws if you ask me.

Certainly “defense” companies push for defense spending but I see no connection to war making. If you think the votes for the war in Iraq were “made” by companies I disagree. Show me who voted for the war and the companies that pushed them please.

And “media” is uniformly liberal biased and certainly did nothing to “push war”.

The intel that lead to the war was not primarily “outsourced” but rather internal – CIA, or UN etc. What companies are you referring to?

So you see no connection between defense firms [who war is extremely profitable for], the lobbying power they hold with the DoD and Congress, and that fact that many of these umbrella corporations own defense and media interests? My you are a trusting soul.



You're opinion is duly noted.



I'll give you one for starters:

A Pentagon office that claims to monitor terrorist threats to U.S. military bases in North America -- and was once reprimanded by the U.S. Congress for spying on antiwar activists -- has just awarded a multi-million dollar contract to a company that employs one of Donald Rumsfeld’s former aides. That aide, Stephen Cambone, helped create the very office that issued the contract.
The new CIFA contract with QinetiQ expands work that Analex has provided CIFA and its various directorates since 2003. Under its first contract, according to the QinetiQ website, Analex staffers were sifting through information “from traditional to non-traditional providers, ranging from unclassified through top secret classification using sophisticated information technologies and systems specifically designed by CIFA analysts.”

The CIFA contract was awarded just two months after QinetiQ hired Stephen Cambone, the former undersecretary of defense for intelligence and a longtime Rumsfeld aide, as its vice president for strategy. Cambone is the most senior of a savvy group of former high-ranking Pentagon and intelligence officials hired by QinetiQ to manage its expansion in the U.S. market.
Link

Another interesting note concerning QinetiQ:

For its first 18 months, QinetiQ was run by the MoD. But in February 2003, control slipped decisively out of government hands when 33 percent of its shares were acquired by the Carlyle Group, the powerful Washington-based private equity fund with close ties to the Bush administration. Carlyle invested $73 million in the company, and the MoD retained the other 66 percent. In an unusual arrangement, however, Carlyle was granted 51 percent of the voting shares, which meant that the investment fund and its appointed executives had effective control over the company.
Link

Many, many other companies provide intelligence sources and services to the US Government, aside from IT/Network jobs, it's the fastest growing security clearance job market these days.

There is little doubt that contractors – all of them – use connected people to help win business. This is a problem in DC where ALL lobbies including farmers, unions, chemical companies and thousands of others lobby for their piece of the pie. The recent 11,000 “earmarks” came fro this activity.

To say companies forced “war” on the government is the stretch I disagree with and you have not made a case for imo.

Minor detail here, but DTOM, your questions concerned retired Military officers, not civilian political appointees. Cambone falls into the later category and that expands this debate considerably. Not sure if we really want to do that in this thread.....


Aquilla

True, my debate questions asked about senior military officers. I was more referring to when Ted asked for an example of where the US Government has, in essence, outsourced intelligence collection and analysis. The same example also illustrated how a senior Defense Department official effectively created his own post-retirement career, while serving in the Pentagon.



That's not what I said. I said that defense firms are in the position to steer intelligence and lobbying and media power towards what will expand their profits......war. The debt for which is paid for in blood and money from people like you and I. That concerns me. Apparently it doesn't concern you.

I don't know, I still am of the thinking that someone that worked their way up the military ladder and became a senior officer going to work for a firm that receives defense projects is only taking advantage of their resume after retiring from the military. If I had the credentials to go to work for a company and make millions of dollars after retirement as a civilian utilizing all the training and education I received in the military, I think I would jump all over the chance. Right now, there are only a finite number of firms that can accomplish what the defense contracts ask for even during peace time. If a bunch of retired generals organize their own firm to get into the competition, and they get contracts from former colleagues, I can't say that I would be surprised. It happens in all facets of governmental contracts, not just the military.

Would you support some form of legislation that limits corporate profits that can be made during a time of war, when dealing with government contracts?

No. If the government is going to use the resources and technologies developed by private companies, then they should be compensated justly. You want to end war profits? Stop going to war...its that simple.

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?

No I would not. If the officers are retired from their military posts and are hence in civilian life, they should be free to pursue whatever interests they so choose.


Is there any way possible to end the cycle that seems to link the media-with-war-with profits?


See above. Stop going to war and this would not be a problem. But as long as the government wants to pursue idealistic adventures in the third world, then those who contribute vital resources should be justly compensated.

I agree, but who is behind the scenes lobbying, persuading and steering various administrations to go to war? The evidence is circumstantial. but the dots can easily be connected. Military adventurism has always has an economic component. And in the end result, some few reap the rewards and some many pay dearly.

Let me explain to you how it works.

The military develops its future requirements in the Quadrennial Defense Review. This is a high level review generates program requirements down to the Pentagon where the money ultimately comes from. In that building the services fight for their particular requirements and then they kick off development programs for the hardware/software etc. This money and the requirements then flows to the program management groups used by the services like SPAWAR, MITRE, etc. And then to the defense contractors.

What the ex colonels in the employ of big and small defense contractors do is introduce their employers to the program people and offer their solutions. They don’t “create” the requirements they don’t “make” wars or anything like that.

Politicians, make wars not corporations.

http://www.globalsecurity.org/military/lib...2006-report.htm

http://enterprise.spawar.navy.mil/

I'm well aware of the QDR, and the framework you described is exactly what is supposed to happen. It's a nice vetted, PowerPoint sort of explanation. But what is it that makes you disagree with the very real defense-profit-war connection that Butler wrote about? You obviously disagree that his observations are continuing to this day, do you disagree that he was correct for his era?



I hate getting in the way of your rhetoric, but this will be the second time that I've told you, that this is not what I'm saying.

His statements do seem to fit the situation today. On the other hand, eight short years after he wrote that piece, the situation didn’t fit at all. In fact, had he made the suggestion that our forces were combating the Germans in North Africa so that the companies could do swift business making mosquito and fly nets, people would probably have said (correctly I think) that it was past time for him to stop drinking his own bath water.

I asked Mr P and he contributed some thoughts on this (not as much as I'd hoped though...He isn't very supportive of my internet habit. ):
Would you support some form of legislation that limits corporate profits that can be made during a time of war, when dealing with government contracts?

I do not think regulating corporate profits is the correct approach. If a corporation undertakes higher risk, it should be entitled to higher reward. The issue for government contracts is not necessarily the strike price, but the limited accountability for failure to produce as agreed. This is the same problem that permeates many defense contracts, and I suspect a large number of other types of government contracts as well.

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?

I believe that senior military officers should be allowed to work for defense contractors, but they should not interact with the active military. For example, a retired officer could consult a contractor concerning a product he thinks would be useful, but he should not be allowed to attempt to sell the product to the services. In this way, everyone could benefit from the officer’s experience without the downside influence of “networking”.

My thoughts again: There's a lot to this topic. At present, we are completely dependent on the private contractors. The DOD couldn't fight a war without them, and they have no control over them. It's scary (IMO) how privatized war has become. We're moving more towards Butler's statements today than before.

One way to eliminate the war profit business would be to nationalize all war industry (if I remember correctly, this was Butler's suggestion). But then, countries that have done so in the past were hardly pacifist (Soviets, Fascist Italy, Imperial Japan, Nazi Germany). And even today in the Congo, for rough instance, four million people have died in the last six years of war, a situation that makes Iraq look like the second act of the Nutcracker. No corporate greed there to speak of. Nor are we intervening, though the defense companies could have the excuse to use up ever more toys. US interests are often tied to big business interests because wars are often fought for underlying economic reasons, so it's hard to say where one stops and the other begins. Corporate "oil greed", no matter how corrupt or persuasive, wouldn’t be able to keep our forces in the Middle East if we didn’t depend on oil.

Edited to add: Actually, conscription would probably stop war endeavors more than curtailing industry profits would. Another of Butler's suggestions was to only permit those who fight to vote for war. There are of course some practical problems with either conscription or Butler's idea, though.

There is little doubt that there are more conservatives in corporate America (leadership), many that support the war perhaps more than the general public. Certainly none of the defense contractors are going to shrink from war or the need to have the tools of war – but you have not come close to proving they “made” this war or any other.

And the “media” is overwhelmingly liberal even when GE owns it.

As fro beating the war drum check out the statements about the danger of Iraq from Dems as well as Reps in 1998.

This is an idea that I can get behind. I’m not in favor of more legislation either, but the size and scope of influence that defense corporations have on D.C., not to mention their ownership of media outlets, is worrying to me since it keeps growing year after year.

Regarding private contractors……it’s more than most people realize. L3 Communications subsidiary Titan provides the vast majority of field interpreters and quite a few intelligence analysts. General Dynamics Information Technologies, Invertix, CACI, SAIC, Harding Security Associates, Battelle, Camber, Optimetrics, and LMI are only some of the companies that provide intelligence related services to the Department of Defense. There is absolutely no way our military could function as we presently do, without private entity support. They literally outnumber us.



Sigh……I’ve even re-read my posts, and found nowhere that I said that corporations ‘made’ war. But answer me this: given the rampant infiltration of private entities, via government contract, into the world of military and national intelligence, are you not at all worried that they are in a position to influence or steer analysis? Analysis that can be sold to an administration and the media, that could lead to war……..that would lead to greater profits?

I would bet they would like to but I believe that we spend billions/year on Intel groups like the CIA for a reason and that their assessment would far, far outweigh anything else.

Questions for debate:

Would you support some form of legislation that limits corporate profits that can be made during a time of war, when dealing with government contracts?
No, especially given the slanted nature of the Butler's inflammatory presentation. A weak argument could concievably be made about "war profiteering" if the profit percentage went up, yet Butler gives us no indication that's the case. How much did Bethlehem Steel's production go up?

One of the challenges of modern warfare as it relates to economics is the complex relationship between specialization and risk. The more you specialize, the greater your efficiency. The more you specialize, the greater your risk. Defense firms are highly specialized in order to achieve the efficiencies we like when it comes time to go out and kill our enemies. Unfortunately, that specialization places them in a very small market with few customers, i.e., at great economic risk. So, higher profit rates or extinction. How many companies were primary manufacturers of our warplanes during WW2? How many today?

The haranguing of "war profiteers" is a time-honored American tradition, with complex roots. Suffice it to say that in the centuries of such harangues, along with numerous rigourous (as opposed to muckraking) investigations, actual instances of war profiteering have been few and far between, especially when compared to instances of demogoguery on the subject.

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?
Sure, as soon as we put into place legislatioin that prohibits new professors from taking jobs with firms that do business with colleges, doctors from taking jobs with firms that do business with hospitals, and lawyers from taking jobs with, well, anybody....

Is there any way possible to end the cycle that seems to link the media-with-war-with profits?
Sure. End war and find some way of motivating people to do anything beyond what's necessary for immediate survival yet doesn't involve profits. Good luck with both of those. The specialization analysis above does point to one thing that can help though, and its exactly what you are decyring. Diversification. An economic entity focused entirely on warcraft is far more likely to look at war to boost profits than one that has diversified.

DTOM, I don't think you've made the case that companies have successfully lobbied us into war. Despite your protests to the contrary, that is exactly what you've implied in your first response to Ted in this quoted post.

Certainly, if the government goes to war, lobbyists will try to persuade the government to use its equipment. Even in peacetime, these companies lobby that the government needs this new rifle or that new jet fighter.

Which media outlet pushed for war? Which one(s) are still in support of it? Then tie those answers to the parent companies who own both defense companies and these new outlets. I think your insinuation falls apart.

Would you support some form of legislation that limits corporate profits that can be made during a time of war, when dealing with government contracts?

It's a contract. The government agrees to pay for a good or service for a certain price and at a certain delivery schedule. If the company provides the goods for less money, why should the government get to renegotiate the deal? If the government doesn't like the price, it is free to shop elsewhere.

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?

This would be a serious waste of the knowledge the military has invested in these men. Just because senior officers know of a demand within the military and they then work for a company to provide for that want does not mean they are motivated badly. The military gets what it wants (let's say a new tank design) and the company is providing the service. The two parties agree on a price and the deal is finalized. This is how business is run every day.

I know an engineer who worked for years at a nuclear power plant. One day, he had an idea to improve how things were run and he started his own company to provide consulting services. Should his profit be limited? Should the nuclear power industry ignore his ideas because he was once an "insider"?

Is there any way possible to end the cycle that seems to link the media-with-war-with profits?

I don't think the case has been made, so my answer is no.

I understand that I haven’t ‘made the case’, that’s why I posed the questions for debate. I’m not wedded to the idea of a conspiracy theory, I simply find it extremely troubling that defense firms make such a profit during war, have their hands in so many more pockets than they used to, and that the parent companies in many cases also run major media outlets. If the implied level of lobbying is not occurring now, I think most people would at least admit that the potential for abuse, abuse that get’s Americans killed, exists.



I agree so far, but what about the proliferation of intelligence analysis and exploitation that has been contracted out from corporations to the Department of Defense? I haven’t even touched on the extent that contracted civilians have been embedded at both the tactical and the strategic level of the military. It simply seems a bit problematic if you combine a corporate friendly administration, with interventionist foreign policy aims and the level of saturation that could be used to sway congress; and then with the media, the public into a war.

Maybe somebody replaced my Kevlar with tinfoil when I wasn’t looking.

On a side note, somebody earlier had mentioned that corporate profits were Ok because those companies take a risk during war. Why don’t we decrease some of the taxpayer dollars that go to defense firms and bump up the pay of the people who are taking the real risks, the servicemembers?
Back in the 70’s and 80’s, the public was correctly complaining about the $600 hammer and the $1000 toilet seat. I don’t really think we’ve really fixed the system since then. War is still good for business, bad for the people.

The question though, is whether this was due to some quid pro quo like we have been discussing. I would claim it wasn't...it was due to some other factor, not the least of which would be kickbacks. I am FAR more concerned about kickbacks (uh, bribes) than I am whether or not these defense firms hire previous military personnel. One has lots of potential very valid and very valuable input, the other is an illegitimate means of gaining a contract, one which clearly then wasn't made on the merits of the weapon itself. Those I am adamantly against--most particularly in our defense industry. In fact, I would think the M16 itself represents a sound and just form of punishment for those found engaging in such activities, as they directly harm our national security.

Is there any way possible to end the cycle that seems to link the media-with-war-with profits?

I really wish there was. However, this goes back, just in the U.S., to at least the Spanish-American war, which was largely started due to drummed up emotions over the Maine incident. What would be the primary motivation over drumming up such emotion? To sell newspapers, of course. So, we don't even need the defense industry involved at all to have potential conflicts here, with consequences of the highest order.

It seems to me that you are indeed wedded to this conspiracy theory. You use the words "my you are a trusting soul" implying that the unholy marriage you describe is not only real but the fact that another doesn't recognize it makes them naive.

You've implied that the media had a hand in persuading the public to support (if not outright demand) the war in Iraq. Of course, I could simply point to the media coverage over the past four years to prove otherwise. If the defense companies who are owned by the same people who own the media would benefit from the war beginning, my guess is that they'd also benefit from the war continuing and favorable stories about the weapons of war and how we are using them to kick terrorist butt would abound. Maybe I missed these stories, but somehow I doubt it.

The intelligence angle is a relatively new development. After the peace dividend and downsizing during the 1990s, a lot of our capabilities were hampered. These people are providing a service, but they are not making the decisions. I would forward the notion that these companies might make more money during peacetime since the military is likely to take over intelligence operations during an actual shooting war. Either way, all you've offered is the suggestion that something inappropriate is going on and no actual proof.

I don’t know where you get the idea that the “defense contractors” are making big profits. As I mentioned earlier the government caps profit margin now at about 17% MAX.

Here is a list of the top 100 most profitable companies. The first contractor I see is LM at 52 them Raytheon at 97. The top companies are energy, banks, cars, retail, insurance and computers (Dell). So what are you getting at?

http://money.cnn.com/magazines/fortune/fortune500/full_list/

I can only smile at this comment.

Hey, be careful... your about to step over that liberal line... you better start closing those eyes... I know... unlikely, right??



And such a case can not be made. It is the infuriating part of the questions of debate. You take the nature of our nation now, our positions on secrecy within our democracy, the power of these lobbyists, the corporate control of the media, and what else are you left with DTOM, but implications and insinuation. You think you are going to find some smoking gun from one of the debaters on this board?? How??

You understand that eve on a debate board we are bound to our secrets, not to mention, if one were to say "I have secret info", who here would believe it?

but at the same time, you know what you see. Why are there such connections? Because there absolutely is a marriage and an unholy one at that. Did the media and the lobbyist sell us on the war? The media did it's part, it told one side of the story. It showed videos of dead Iraqis with no context. It aired the words of the administration, often with little objection. It made the enmy villian, it made our alliance heroes.

Lobbyist were not necessary in my opinion. LOOK AT THE VICE PRESIDENT. LOOK AT THE FATHER OF THE PRESIDENT, WHAT WAS HIS JOB?

Even today we are focused still on WMD! It was the wrong question then it is the wrong question today.

Would you support some form of legislation that limits corporate profits that can be made during a time of war, when dealing with government contracts?

Yes, I would support legislation that limits profit... PERIOD. Come on, ask "Big Business" to sacrifice too. They ask us the military(though i am not in anymore) to do it all the time. They are Americans, too. Yet, they have no patriotic duty or responsibility other than fattening their profits.

The funny thing about it, is the false pretense of neccessity of these corporate entities. There is not a job that the civilian population can not do that could not be done by the military if manned and trained. Which brings up the effeciency factor of corporate entities. Which is often talked about, but never proven as being better for the American taxpayer.

Would you support legislation that prohibits senior military officers from taking jobs with firms that do business with the military?

No. This is neither a solution or even a band-aid to the problem. A job for a senior military official does have to potential to invite a semblance of quid pro quo relationships. But take away the job, the connections that wealth brings, would still greatly influence senior officials to help wealthy "freinds"

Is there any way possible to end the cycle that seems to link the media-with-war-with profits?

Call me cynical... my answer is "no"

No smoking gun, but there are some relevant observations. Last year, the defense budget was approximately 448,000 million, and the number of active duty military personnel 882,000. Back in 1999, the defense budget was approximately 275,000 million (350,000m adjusted for inflation today), the number of active duty military personnel was 920,000. The budget has gone up 100,000,000,000 real inflation adjusted dollars, as might be expected while we are engaged in a two-front war in Afghanistan and Iraq, but the number of personnel has decreased by 40,000 during that same timeframe. Now, 1999 was after a major drawdown in forces and cutting of expenses due to the end of the cold war. In 1986 there were 1,334,000 active duty military (virtually none engaged in combat). I'm not sure how we can justify having less active duty today (and the Airforce is still kicking people out) while troops are working 7 days per week in 15 months tours of duty, while the budget has increased 100,000,000,000 dollars. We didn't expect our troops to pull more than one year-long tour at a time even during Vietnam.

The proposed budget for this year is over 600,000,000,000. Some of the services, like the airforce, are actually still downsizing but the servicemembers can go blue-to-green (transfer to the army) to keep their jobs. This money obviously isn't going towards personnel, it is going towards stuff. Lots and lots of stuff.

Correct and this is because the “stuff” is needed and we are wearing it out quicker than we can fix or replace it – and the “new” stuff we need to win future wars is delayed ot on hold which is just not good:

http://www.orlandosentinel.com/news/local/...0,3877177.story

We could be left with an exausted military and too few men and equipment for a real high intensity war.

The reason for this as some have noted is that we never “mobilized” for this “war” as we did for past “real” wars like WWII. If you “mobilize” the budget goes to say 800 billion/year and you rapidly expand both equipment, R&D and men. This is a war “on the cheap” and it is hurting our military now and into the future.

You link to an article about cuts in F22 production, and then speak about having too few men and an exhausted military? Perhaps the money should be going towards those people rather than cutting forces further to fund new planes? More F22s would be very nice, a new destroyer for the navy might be nice, but when our troops are often using captured and/or found weapons and ammunition in Afghanistan because they don't have the equipment, we are obviously not being smart about the way we divvy up and distribute what we’re purchasing with all that money.

It isn't about national security, it's largely pushed by the Congressmen and defense industries (via jobs in Congressional districts) and generals in large offices, rather than compelling defense needs. Even the placement of F22 bases is driven by prestige (the most powerful Congressmen get them) rather than security and training concerns. Looking forward is nice, but it's cost to gains. Right now, looking forward and buying into the future instead of investing in the forces we are have (that are overtaxed as it is), is like training for racing in the Olympics while you're treading water in the middle of the Pacific ocean with no land in sight.



Do you also advocate the rationing system? That went on during WWII too.

Billions are being poured into the IED resistant vehicles. There is no shortage of guns and ammo but I agree we need to ramp up the size of the Army and Marines faster.


Some things never change



Why would we need that? We could spend 4 X and still be cheaper than Vietnam (as a % of GDP) and we didn’t “mobilize” for that either.

Apparently, the Airforce just made a contract with European Airbus over Boeing for refueling tankers.

I concede that shoots some of my conspiracy thoughts out of the water. I would have lost this bet. Never in a million years would I have seen this coming. I agree with the decision, I might add. The KC-30 is the better plane.

Edited to add: More from the article.

Sometimes checks and balances do work.

The F-22. Perfect example of war waste.

From Matt Taibbi:



And here's the great thing about the American political system: Democratic senators Joe Lieberman and Chris Dodd voted for a successful amendment to bind the government into a three year contract... votes that were obviously, unaffected by the fact that Connecticut-based contractors Pratt and Whitney make parts for the aircraft.

So I'm not taking an axe to the republican party. Democrats fall for this stuff too, even Chris Dodd, a so-called net-roots hero. And I am under no illusions that not even 1,000 barack obamas could put a stop to this system. It's madness and it's been going on for decades.

But to defend it? Why? This is waste. $361 million per plane can put a whole lot of GI's through college, and in doing so, bring more opportunity-seeking Americans into the armed forces. Bigger military? More opportunity and education for working Americans? That's a win-win for every cat and dog in Washington.

And from a tactical standpoint, $361 dollars spent towards boosting troop numbers goes a lot farther than a single plane. (not to mention the operating costs of the plane, which must be staggering). I don't think America has ever been in such a ground war since the invention of the airplane.

I do agree with your overall analysis of the waste. We paid through the nose for the thing, and then some. But there are some erroneous statements in the article above, that I feel the need to correct. First, the testing cliches are hardly extraordinary when compared to other fighter planes. When the F16, the fighter of choice in the article above, was first produced, they used to say "one a day in Tampa bay" there were so many crashes. It's part of the development process.

Second, I'm not sure how anyone can say the F22 has a horrible record for "seeing the enemy first, outnumbering the enemy, outmaneuvering the enemy and killing the enemy quickly" considering the performance of this aircraft. Perhaps Sprey wrote a piece for The Onion? After hundreds of simulated combat situations this plane was never shot down by other aircraft once. Now that the testing process is over, the perfect record might have changed a bit but not by much. In the recent Alaskan air exercise, 12 F-22's downed 108 adversaries with no losses. In a nutshell, it absolutely dominates in most or all of those criteria. My husband once went up alone against eight F15s and shot them all down within minutes. The F15s don't even want to fly against them anymore because they are shot down too quickly to train. The performance of this plane really can't be realistically criticized. There is absolutely nothing like it. And the stealth capability is certainly not "a mirage"...we have to worry about more than other enemy aircraft, SAMs (surface to air missiles) are the greater concern, and even Bosnia had technology that could reach out and touch us ten years ago.

That said, did we need it now? Is it worth the tremendous expense? Couldn't the money have been better spent elsewhere? Those are harder questions and I do share your view. Congressmen of all stipes defend/support it (in part) because nearly every state has a hand in the manufacturing of that plane. I also agree absolutely with the last paragraph in the quoted text of your article above. The push to buy this plane came because we have sold fighter aircraft with better and better capabilities overseas. Capabilities that, in some cases, outmatch ours. I see no end in sight to the vicious cycle, I would bet we'll sell the F22 as well soon enough.

Nonsense. It’s a wonderful plane and we will be needing it soon as the Russians return to rapid military build up – AND sell their air defense systems to anyone with the money.

In tests a pair of F-22 easily took out 9 F-15s – who never saw them unless they flew over them.

“Russia is hoping to make a giant come-back in civil and military aviation.
It has pledged to spend billions of dollars on boosting its defence industry, especially the air force.
The goal is to build nearly 6,000 new military and civilian aircraft, and to win 15% of the global aviation market.
Russia has set up a new government-controlled company to oversee the process, the United Aircraft Corporation.”
http://news.bbc.co.uk/1/hi/business/7266853.stm

An update on my post above regarding the Airbus contract. Now Boeing is targeting McCain