Friday, November 4, 2011

Bill Sponsors Get Big Campaign Donations from Corporations that Want Tax Holiday

Bill Sponsors Get Big Campaign Donations from Corporations that Want Tax Holiday

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Almost 70 members of Congress co-sponsoring legislation for a massive tax holiday have received almost a million dollars in campaign contributions from the corporations that would benefit most.

Among the leading advocates for a bill that would allow the firms to pay cut-rate taxes on a trillion dollars these firms have stashed offshore is the WIN America campaign, a coalition of trade groups and companies like Apple, Pfizer and Google. An iWatch News analysis of campaign finance data has found that 68 of the 80 sponsors of the legislation in the House and Senate have received donations from WIN-affiliated companies since the start of 2009, taking in more than $940,000.

In addition to contributions to lawmakers, the WIN affiliates gave huge amounts to the two national political parties. The national committees for the Republicans got at least $576,000 while their Democratic counterparts collected at least $408,000 during this period.

For a select group of companies that would benefit most from the tax holiday, the stakes are high. When the holiday was granted once before, in 2004, some of the wealthiest corporations had their taxes cut by billions of dollars. Pfizer profited to the tune of $37 billion; Merck by $15.9 billion, Hewlett-Packard by $14.5 billion and IBM and Johnson & Johnson by some $10 billion each.

Given the number of tech firms that stand to benefit from the tax holiday, it is no surprise California Democrats with Silicon Valley connections are among the top recipients. Reps. Anna Eshoo and Zoe Lofgren, who both claim part of Silicon Valley in their districts, are among the 11 Democrats to co-sponsor the House bill. They ranked first and second in funds received from WIN affiliates among co-sponsors of the bill, with Eshoo receiving more than $64,000 and Lofgren bringing in at least $53,000. California Sen. Barbara Boxer ranks fourth on the list with more than $51,000 in donations.

The primary sponsors of the Senate bill have gotten generous contributions: Sens. Kay Hagan (D-N.C., at least $43,000) and John McCain (R-Ariz., at least $32,000). In fact, every one of the 11 co-sponsors of the Senate bill received funding from WIN affiliated groups, bringing in a total of more than $347,000 during this period.

In the House, primary sponsors have been similarly rewarded: Reps. Kevin Brady (R-Texas, at least $28,000) and Jim Matheson (D-Utah, at least $32,000).

The corporations that have been most generous to co-sponsors are Microsoft (at least $206,000), Pfizer (at least $168,000), Duke Energy (at least $121,000), Devon Energy (at least $76,000) and Cisco (at least $76,000).

The WIN America campaign is aimed at passage of “repatriation,” a tax holiday on profits that are kept offshore by American companies. Given the stunted economy, bringing those funds home is an attractive proposition to many, but critics warn the policy would simply be a giveaway to wealthy corporations .

Among the WIN coalition members are major corporations such as Apple, Oracle, Pfizer and Microsoft, along with powerful trade groups like the U.S. Chamber of Commerce.

The backers of the two repatriation bills – “ The Freedom to invest Act of 2011 ” in the House and the “ Foreign Earnings Reinvestment Act ” in the Senate—are primarily Republicans, but there are some notable Democrats who have signed on to champion the cause.

One group of lawmakers that has particularly benefitted from the WIN affiliates is the Blue Dog Democrats in the House. A group of pro-business, primarily Southern Dems, the Blue Dogs were poised to wield massive power in Congress before being decimated in the 2010 elections, dropping from 54 members to just 25.

Every single remaining member of the Blue Dog coalition has received some money from WIN affiliated companies during this time period, to the tune of at least $260,000. Additionally, the Blue Dog PAC , which funnels cash towards the coalition members, received another $50,000 from these companies.

The potential payoff? Five of the 11 House Democrats co-sponsoring the bill are Blue Dogs, including coalition leaders Reps. John Barrow of Georgia, Mike Ross of Arkansas, Dan Boren of Oklahoma and Jim Matheson of Utah, a primary sponsor on the bill. On Oct. 12, WIN America put out a press release trumpeting the support of the Blue Dogs for a repatriation holiday, which included a letter from the coalition leadership to the chairs of the Super Congress charged with finding ways to cut costs. The letter called for the passage of a “bipartisan, common-sense policy that would bring up to $1.4 trillion in private money back to the United States.”

In an opinion piece for USA Today , Blue Dogs Ross and Jim Matheson wrote, “Opponents of repatriation argue that it would be counterproductive to job growth and deficit reduction. Nothing could be further from the truth.” The two cite studies from the American Enterprise Institute and former Bush-era Congressional Budget Office head Douglas Holtz-Eakin, the latter of whom is featured prominently on WIN’s website.

Blue Dog spokeswoman Kristen Hawn issued a statement to iWatch News that the coalition is “a policy-oriented organization” with “a long history of working with members of Congress on both sides of the aisle to promote fiscally responsible policies that may not always be good politics but are always in the best interest of the country.” Repatriation “will bring back money that would otherwise be spent overseas bolstering foreign economies rather than our own.”

Creating Jobs?

In a statement, Lofgren of California said “I support the Freedom to Invest Act because it would incentivize companies to bring a trillion dollars in capital into the United States, capital that our economy desperately needs to grow. I do, however, support making repatriation conditional on job creation, and am hopeful that the bill can be amended to include such a provision. My job is to represent the interests of my constituents, and a majority of those I have heard from support this measure.”

Boxer’s staff pointed to previous statement by the Senator saying, “By bringing back the more than $1 trillion that’s sitting overseas, we will create jobs, strengthen the economy and reduce the deficit.” Boxer was also a main sponsor of the 2004 repatriation bill. McCain Spokesman Brian Rogers said, “Economists on both sides of the aisle agree that temporary tax relief on foreign earning can help bring some $1.4 trillion back to our economy, creating some 1-2 million new jobs and increasing GDP by hundreds of millions of dollars.”

WIN America and their allies want a repeat performance of a 2004 bill that offered a one-year tax reduction on foreign profits, bringing the tax rate from 35 percent down to just 5.25 percent. The bill was aimed at creating jobs in America, but critics charge the money benefitted just a few elite companies that used the money for self-enrichment, rather than investing in new workers.

“The WIN America campaign is very pleased that so many, across the political and ideological spectrum, support repatriation” says WIN spokesperson Abigail Gardner. “Frankly, there are very few ideas in Washington, D.C., that have garnered so much bipartisan support, and we think the reason repatriation is gaining so much momentum is because it is a great idea for strengthening our economy.” Gardner told iWatch News that WIN has not coordinated with its affiliates on political donations.

Overall, the 19 WIN affiliates donated at least $9.3 million to all congressional candidates during this time period. Co-sponsors of the bill received around 11 percent of that total.

As iWatch News reported in October, numerous studies done since 2004 agree that the bill failed to create jobs, and warn that allowing another holiday could end up costing taxpayers to the tune of $40 billion to $80 billion . Among the risks are concerns that companies will keep future funds overseas in expectation of another holiday, something that was seen after 2004.

“I want them to pay their taxes like the rest of us,” said Sen. Carl Levin, the Democrat from Michigan whose committee recently compiled a report opposed to the idea of a new repatriation period. “The rest of us don’t get a tax holiday.”

Levin received just $1,000 from WIN affiliated corporations during this period.

Supporters of the tax holiday concede that there wasn’t a noticeable increase in job growth after the 2004 bill, but argue that bringing the money back will benefit the economy in other ways. The Holtz-Eakin study quoted by the Blue Dogs, written in a Chamber of Commerce report widely circulated by WIN, says that payouts to shareholders in 2004 “put resources in the hands of other economic actors — firms, households, pension plans, investors, etc. — who continue the chain of real purchases and financial transfers.” (The Chamber is a WIN affiliated group.) And a paper by the New America Foundation, while noting that only 26 percent of repatriated money would likely be spent on jobs, believes that 25 to 40 cents of every dollar returned to stockholders would be used for shopping.

Proponents of the tax holiday have spent significant chunks of money lobbying the Hill on these issues. WIN alone has spent $380,000 this year to hire eight lobbyists, including a former congressman and several former high-level staffers. All told, 58 organizations and companies listed “repatriation” on their disclosure forms as an issue they were lobbying on through the first nine months of 2011.

The lobbyists on retainer for the WIN Campaign, Cauthen Forbes & Williams and Capitol Counsel LLC, have managed day to day efforts on repatriation and coordinated with affiliates on federal lobbying, according to Gardner.

Among the lobbyists working for WIN is Drew Goesl, a former chief of staff for Rep. Ross, Co-Chair of Communications for the Blue Dogs and a sponsor of the bill. On Goesl’s bio , he notes his role for Rep. Ross also included “helping elevate the profile of the Blue Dogs on Capitol Hill and nationally.” Goesl did not return requests to comment on the story.

The offices of Reps. Eshoo, Matheson, Ross and Brady did not respond to requests for comment.

Numbers in this story were compiled using data from the subscription-only CQMoneyLine. The totals include donations made to the politician’s campaigns and leadership PACs from Jan. 1, 2009, to Sept. 30, 2011.

Call of Duty: Veterans Join the 99 Percent

Call of Duty: Veterans Join the 99 Percent

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11-11-11 is not a variant of Herman Cain’s much-touted 9-9-9 tax plan, but rather the date of this year’s Veterans Day. This is especially relevant, as the U.S. has now entered its second decade of war in Afghanistan, the longest war in the nation’s history. U.S. veterans of the Iraq and Afghanistan wars are appearing more and more on the front lines—the front lines of the Occupy Wall Street protests, that is.

Video from the Occupy Oakland march on Tuesday, Oct. 25, looks and sounds like a war zone. The sound of gunfire is nearly constant in the video. Tear-gas projectiles were being fired into the crowd when the cry of “Medic!” rang out. Civilians raced toward a fallen protester lying on his back on the pavement, mere steps from a throng of black-clad police in full riot gear, pointing guns as the civilians attempted to administer first aid.

The fallen protester was Scott Olsen, a 24-year-old former U.S. Marine who had served two tours of duty in Iraq. The publicly available video shows Olsen standing calmly alongside a Navy veteran holding an upraised Veterans for Peace flag. Olsen was wearing a desert camouflage jacket and sun hat, and his Iraq Veterans Against the War (IVAW) T-shirt. He was hit in the head by a police projectile, most likely a tear-gas canister, suffering a fractured skull. As the small group of people gathered around him to help, a police officer lobbed a flashbang grenade directly into the huddle, and it exploded.

Four or five people lifted Olsen and raced with him away from the police line. At the hospital, he was put into an induced coma to relieve brain swelling. He is now conscious but unable to speak. He communicates using a notepad.

I interviewed one of Olsen’s friends, Aaron Hinde, also an Iraq War veteran. He was at Occupy San Francisco when he started getting a series of frenzied tweets about a vet down in Oakland. Hinde raced to the hospital to see his friend. He later told me a little about him: “Scott came to San Francisco about three months ago from Wisconsin, where he actually participated in the holding of the State Capitol over there. Scott’s probably one of the warmest, kindest guys I know. He’s just one of those people who always has a smile on his face and never has anything negative to say. ... And he believed in the Occupy movement, because it’s very obvious what’s happening in this country, especially to us veterans. We’ve had our eyes opened by serving and going to war overseas. So, there’s a small contingency of us out here, and we’re all very motivated and dedicated.”

As I was covering one of the Occupy Wall Street rallies in Times Square on Oct. 15, I saw Sgt. Shamar Thomas become deeply upset. Police on horseback had moved in on protesters, only to be stopped by a horse that went down on its knees. Other officers had picked up metal barricades, squeezing the frightened crowd against steam pipes. Sgt. Thomas was wearing his desert camouflage, his chest covered with medals from his combat tour in Iraq. He shouted at the police, denouncing their violent treatment of the protesters. Thomas later wrote of the incident: “There is an obvious problem in the country and PEACEFUL PEOPLE should be allowed to PROTEST without Brutality. I was involved in a RIOT in Rutbah, Iraq 2004 and we did NOT treat the Iraqi citizens like they are treating the unarmed civilians in our OWN Country.”

A group calling itself Veterans of the 99 Percent has formed and, with the New York City Chapter of IVAW, set Wednesday as the day to march to Liberty Plaza to formally join and support the movement. Their announcement read: “ ‘Veterans of the 99 Percent’ hope to draw attention to the ways veterans have been impacted by the economic and social issues raised by Occupy Wall Street. They hope to help make veterans’ and service members’ participation in this movement more visible and deliberate.”

When I stopped by Occupy Louisville in Kentucky last weekend, the first two people I met there were veterans. One of them, Gary James Johnson, told me: “I served in Iraq for about a year and a half. I joined the military because I thought it was my obligation to help protect this country. ... And right here, right now, this is another way I can help.”

Pundits predict the cold weather will crush the Occupy movement. Ask any veteran of Afghanistan and Iraq about surviving outdoors in extreme weather. And consider the sign at Liberty Plaza, held by yet another veteran: “2nd time I’ve fought for my country. 1st time I’ve known my enemy.”

Unemployment and the global financial aristocracy

Unemployment and the global financial aristocracy

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The International Labour Organization’s report on global unemployment, released Monday, paints a stark picture of world capitalism.

Three years after the onset of the economic crisis in 2008, the global jobs situation is disastrous. According to the ILO, 80 million jobs would have to be added in the next two years just to reach pre-crisis employment levels. Basing itself on extraordinarily optimistic assumptions, the ILO anticipates that only half that number will be created.

In the advanced industrial countries, including the United States and Europe, there are 13 million fewer jobs now then four years ago. Employment in these countries is not expected to recover until well past 2016. Youth unemployment is above 20 percent, and long-term unemployment has soared to record heights. (See, “ILO report warns of sharp employment downturn, social unrest“)

Beyond the immediate indicators of social distress—to which many more could be added—the ILO report points to an unprecedented state of global class relations. Conditions are building up for a social explosion on a world scale.

One of the ILO’s comments is especially revealing. Its report refers to the “paradox” of the past three years; that “the impact of the global economic crisis of 2007-08 on the financial sector was short-lived initially—despite it being at the very origin of the downturn.”

There is, however, nothing paradoxical about this. The crash of 2008 was set off by the collapse of an enormous speculative bubble. Since that time, world governments, led by Washington, have scrambled to ensure the wealth of the very financial aristocracy that created the crisis, at the direct expense of the vast majority of the population.

Unlimited funds have been turned over to the banks, with no strings attached, in the form of direct bailouts and cheap cash. In the United States alone, some $14 trillion has been made available. The argument advanced to justify this transfer of wealth—that it was necessary to revive economic growth and “create jobs”—has proven a fraud. The funds have simply been funneled back into the financial system and the pocket books of the ruling elite.

The ILO complains that even non-financial institutions—which, in the US in particular, have record cash hoards—have shunned productive investment in favor of stock buybacks and other financial transactions. Actual production is not considered sufficiently profitable.

The response of the ruling class to the financial crisis has led not only to an unprecedented decline or even collapse in the living standards of workers all over the world; it has also failed to resolve any of the contradictions that led to the crisis in the first place. Bad assets have been transferred to governments, which now face bankruptcy, most immediately in Europe. The financial system itself, heavily invested in government debt, stands on the brink of another collapse.

Every dollar handed to the financial aristocracy must in turn be extracted from the flesh of the working class. Austerity measures have only undermined growth, depleting government treasuries, and thus requiring new doses of austerity. “In short,” the ILO writes, “there is a vicious cycle of a weaker economy affecting jobs and society, in turn depressing real investment and consumption, thus the economy and so on.”

Events Tuesday brought out sharply the relationship of the financial aristocracy to the overwhelming majority of the population. For his own purposes, Greek Prime Minister George Papandreou proposed to put the most recent bailout/austerity scheme to a referendum. Financial markets reacted with horror at the prospect of the Greek or any other population having some democratic say on the course of events. The major powers and their propaganda machines mobilized themselves, insisting that the package had to be pushed through at any cost, and by the end of the day the future of the Greek government was in question.

At the same time, the divisions among these powers—over who will be forced to foot the bill and who will get the biggest share of the spoils—has precluded any coordinated international response. The crisis of the eurozone points to the reemergence of national conflicts, which in the 20th century sparked two catastrophic world wars.

The ILO’s prediction that the global conditions are producing conditions for increased “social unrest” now has the character of a truism. Indeed, 2011 has already witnessed a significant upturn in the global class struggle, beginning in Tunisia and Egypt in January and February, and extending to Europe, the United States and Latin America. The Occupy Wall Street movement is itself an initial expression of the reemergence of explosive class struggles at the center of world capitalism, unlike anything that has been seen in generations.

The financial aristocracy stands as an absolute barrier to even the most trifling reforms. “Everything for the rich!” is the watchword of each ruling elite. In the face of these class realities, the ILO’s counsel—that governments institute significant jobs programs and reverse the staggering growth of social inequality—is hopelessly utopian. In the United States, experience with the Obama administration, the government of “change,” has assuredly demonstrated the absolute stranglehold of the financial elite over the entire political system.

A crisis has a way of clarifying class relations. For three years, the ruling class and its political representatives have been free to advance their solution, a solution that has only paved the way for an even greater disaster. The response of the international working class now emerges as a new and decisive factor in the global situation.

There is no way out of the crisis in the interests of the working class that does not target the power of the corporate and financial elite and the social system that it defends. In fighting for their basic rights—including, above all, the right to a job—workers everywhere are driven into struggle against capitalism.

The success of that struggle requires above all the building of a new leadership in the international working class.

We May Be Witnessing the First Large Global Conflict Where People Are Aligned by Consciousness and Not Nation State or Religion

We May Be Witnessing the First Large Global Conflict Where People Are Aligned by Consciousness and Not Nation State or Religion

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America's politicians, it seems, have had their fill of democracy. Across the country, police, acting under orders from local officials, are breaking up protest encampments set up by supporters of the Occupy Wall Street (OWS) movement - sometimes with shocking and utterly gratuitous violence.

In the worst incident so far, hundreds of police, dressed in riot gear, surrounded Occupy Oakland's encampment and fired rubber bullets (which can be fatal), flash grenades and tear-gas canisters - with some officers taking aim directly at demonstrators. The Occupy Oakland Twitter feed read like a report from Cairo's Tahrir Square: "they are surrounding us"; "hundreds and hundreds of police"; "there are armoured vehicles and Hummers". There were 170 arrests.

My own recent arrest, while obeying the terms of a permit and standing peacefully on a street in lower Manhattan, brought the reality of this crackdown close to home. America is waking up to what was built while it slept: Private companies have hired away its police (JPMorgan Chase gave $4.6m to the New York City Police Foundation); the federal Department of Homeland Security has given small municipal police forces military-grade weapons systems; citizens' rights to freedom of speech and assembly have been stealthily undermined by opaque permit requirements.

Suddenly, the United States looks like the rest of the furious, protesting, not-completely-free world. Indeed, most commentators have not fully grasped that a world war is occurring. But it is unlike any previous war in human history: for the first time, people around the world are not identifying and organising themselves along national or religious lines, but rather in terms of a global consciousness and demands for a peaceful life, a sustainable future, economic justice and basic democracy. Their enemy is a global "corporatocracy" that has purchased governments and legislatures, created its own armed enforcers, engaged in systemic economic fraud, and plundered treasuries and ecosystems.

Around the world, peaceful protesters are being demonised for being disruptive. But democracy is disruptive. Martin Luther King, Jr argued that peaceful disruption of "business as usual" is healthy, because it exposes buried injustice, which can then be addressed. Protesters ideally should dedicate themselves to disciplined, nonviolent disruption in this spirit - especially disruption of traffic. This serves to keep provocateurs at bay, while highlighting the unjust militarisation of the police response.

Moreover, protest movements do not succeed in hours or days; they typically involve sitting down or "occupying" areas for the long hauls. That is one reason why protesters should raise their own money and hire their own lawyers. The corporatocracy is terrified that citizens will reclaim the rule of law. In every country, protesters should field an army of attorneys.

Protesters should also make their own media, rather than relying on mainstream outlets to cover them. They should blog, tweet, write editorials and press releases, as well as log and document cases of police abuse (and the abusers).

There are, unfortunately, many documented cases of violent provocateurs infiltrating demonstrations in places like Toronto, Pittsburgh, London and Athens - people whom one Greek described to me as "known unknowns". Provocateurs, too, need to be photographed and logged, which is why it is important not to cover one's face while protesting.

Protesters in democracies should create email lists locally, combine the lists nationally and start registering voters. They should tell their representatives how many voters they have registered in each district - and they should organise to oust politicians who are brutal or repressive. And they should support those - as in Albany, New York, for instance, where police and the local prosecutor refused to crack down on protesters - who respect the rights to free speech and assembly.

Many protesters insist in remaining leaderless, which is a mistake. A leader does not have to sit atop a hierarchy: A leader can be a simple representative. Protesters should elect representatives for a finite "term", just like in any democracy, and train them to talk to the press and to negotiate with politicians.

Protests should model the kind of civil society that their participants want to create. In lower Manhattan's Zuccotti Park, for example, there is a library and a kitchen; food is donated; kids are invited to sleep over; and teach-ins are organised. Musicians should bring instruments, and the atmosphere should be joyful and positive. Protesters should clean up after themselves. The idea is to build a new city within the corrupt city, and to show that it reflects the majority of society, not a marginal, destructive fringe.

After all, what is most profound about these protest movements is not their demands, but rather the nascent infrastructure of a common humanity. For decades, citizens have been told to keep their heads down - whether in a consumerist fantasy world or in poverty and drudgery - and leave leadership to the elites. Protest is transformative precisely because people emerge, encounter one another face-to-face, and, in re-learning the habits of freedom, build new institutions, relationships and organisations.

None of that cannot happen in an atmosphere of political and police violence against peaceful democratic protesters. As Bertolt Brecht famously asked, following the East German Communists' brutal crackdown on protesting workers in June 1953, "Would it not be easier ... for the government to dissolve the people and elect another?" Across the United States, and in too many other countries, supposedly democratic leaders seem to be taking Brecht's ironic question all too seriously.

Americans: Awash In Spin

Americans: Awash In Spin

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I have come to the conclusion that Big Brother’s subjects in George Orwell’s 1984 are better informed than Americans.

Americans have no idea why they have been at war in the Middle East, Asia and Africa for a decade. They don’t realize that their liberties have been supplanted by a Gestapo Police State. Few understand that hard economic times are here to stay.

On October 27, 2011, the US government announced some routine economic statistics, and the president of the European Council announced a new approach to the Greek sovereign debt crisis. The result of these funny numbers and mere words sent the Standard & Poor’s 500 Index to its largest monthly rally since 1974, erasing its 2011 yearly loss. The euro rose, putting the European currency again 40% above its initial parity with the US dollar when the euro was introduced.

On National Public Radio a half-wit analyst declared, emphatically, that the latest US government statistics proved that the recovery was in place and that there was no danger whatsoever of a double-dip recession. And half-brain economists predicted a better tomorrow.

Europe is happy because the European private banks, the creditors of the European governments, have agreed to eat 50% of Greece’s sovereign debt and to be recapitalized by public money handed to them by the European Financial Stability Facility rescue fund. The President of the European Council, Herman Van Rompuy, thinks that Greece’s debt is the only sovereign debt to be written down and that the debt of Italy, Spain, and Portugal will somehow be bailed out through other means, including a Chinese contribution to the EFSF rescue fund. Obviously, if all EU sovereign debt has to be cut by 50% as well, the rescue fund would not be up to the job.

For our corrupt financial markets, any news that can be spun as good news can send stocks up. But what are the facts?

For facts one has to turn to serious people, not to the presstitute media. Among those who give us real facts is John Williams of shadowstats.com. In his October 27 report, Williams exposes the happy second quarter 2011 economic growth figure of 2.5% as nonsense. Every other economic indicator contradicts the spin.

For example, personal consumption is reported to have increased 1.7%, but this surge in consumption took place despite a 1.7% collapse in consumer disposable income! In other words, if there was an increase in personal consumption, it come from drawing down savings or from incurring higher consumer debt.

A country’s consumers cannot forever draw down savings or go deeper into debt. For an economy to recover, there must be growth in consumer income. That growth is nowhere to be seen in the US. A large percentage of the goods and services sold to Americans by American corporations are now produced abroad by foreign labor. Thus, Americans no longer received incomes from the production of the goods and services that they consume. The American consumer market is on its way out.

The Dow Jones rose 339.51 points on the phony good news, but consumer sentiment is in the basement. John Williams reports that “consumer confidence hit the lowest levels ever recorded in 2008 and 2009” and that consumer confidence has now “fallen back to that 2008 level.” But the stock market boomed. Somehow a population 23% unemployed with debt up to its eyeballs is going to spark an economic recovery.

Recovery can only happen in the delusional world created for us by the concentrated media. No longer permitted to utter one world of truth, the presstitutes proclaim non-existent recoveries and weapons of mass destruction and demonize Washington’s chosen opponents.

The sovereign debt crisis in Europe has distracted Americans from the much worst crisis in their country. After two decades of exporting US manufacturing and middle class jobs, and after a decade of consumer debt growth that has resulted in millions of foreclosed homeowners and massive credit card and student loan debt that cannot be paid, consumers have no income growth or borrowing capacity with which to fuel an economy based on consumer demand.

European banks, already ruined by purchases of Standard & Poor’s and Moody’s AAA ratings of junk derivatives, now find themselves threatened by sovereign debt. Greece’s debt crisis, caused with Goldman Sachs’ help in hiding the true debt of the country as was done for Enron, has brought to light that Portugal, Ireland, Italy, and Spain, in addition to Greece, have more debt than the governments can service.

In the EU, unlike the US and UK which have their own central banks that can create new money to bail out the over-indebted governments, the EU central bank is prohibited by treaty from printing money in order to purchase bonds from member states that cannot be redeemed.

Regardless of the treaty prohibition, the EU central bank has been lending Greece the money to pay its bond holders. The imposed austerity that is part of the deal created political instability in Greece.

Now that European Council President Herman Van Rompuy has announced a 50% write-off by private banks of Greek sovereign debt, can the same treatment be denied Portugal, Italy, and Spain?

The European Central Bank is following the lead of the Federal Reserve and creating new money to bail out debt. The cost will be paid in inflation and flight from the euro and the dollar. As an indication of the future, despite the positive spin on the news and the rise in US stocks, on October 27 the Japanese yen rose to a new high against the US dollar.

The Air Has Been Let Out Of The Balloon

The Air Has Been Let Out Of The Balloon

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Do you hear that sound? It is the sound of Europe being hit with a cold dose of financial reality. The air has been let out of the balloon, and investors all over the world are realizing that absolutely nothing has been solved in Europe. The solutions being proposed by the politicians in Europe are just going to make things worse. You don't solve a sovereign debt crisis by shredding confidence in sovereign debt. But that is exactly what the "voluntary 50% haircut" has done. You don't solve a sovereign debt crisis by pumping up your "bailout fund" with borrowed money from China, Russia and Brazil. More debt is just going to make things even worse down the road. You don't solve a sovereign debt crisis by causing a massive credit crunch. By giving European banks only until June 2012 to dramatically improve their credit ratios, it is going to force many of them to seriously cut back on lending. A massive credit crunch would significantly slow down economic activity in Europe and that is about the last thing that the Europeans need right now. If the deal that was reached last week was the "best shot" that Europe has got, then we are all in for a world of hurt.

On Monday, investors all over the globe began to understand the situation that we are now facing. The Dow was down 276 points, and the euphoria of late last week had almost entirely dissipated.

But much more important is what is happening to European bonds.

Investors are reacting very negatively to the European debt deal by demanding higher returns on bonds.

Perhaps the most important financial number in the world right now is the yield on 10 year Italian bonds.

The yield on 10 year Italian bonds is up over 6 percent, and the 6 percent mark is a key psychological barrier. If it stays above this mark or goes even higher, that is going to mean big trouble for Italy.

The Italian government just can't afford for debt to be this expensive. The higher the yield on 10 year bonds goes, the worse things are going to be for Italy financially.

Of course it was completely and totally predictable that this would happen as a result of the "voluntary 50% haircut" that is being forced on private Greek bondholders, but the politicians over in Europe decided to go this route anyway.

Major Italian banks also got hammered on Monday. The following is how a CNN article described the carnage....

Shares of UniCredit, the largest bank in Italy, sunk more than 4% on Friday in Milan and were down nearly another 6% Monday. Intesa, the second-largest Italian bank, slipped 7% Monday, while Mediobanca, Italy's third-largest financial institution, fell about 4%.

The financial world can handle a financial collapse in Greece. But a financial collapse in Italy would essentially be the equivalent of financial armageddon for Europe.

That is why Italy is so vitally important.

Another EU nation to watch closely is Portugal.

The yield on 2 year Portuguese bonds is now over 18 percent. A year ago, the yield on those bonds was about 4 percent.

In many ways, Portugal is in even worse shape than Greece.

A recent article by Ambrose Evans-Pritchard discussed the debt problems that Portugal is faced with. The following statistic was quite eye-opening for me....

Portugal’s public and private debt will reach 360pc of GDP by next year, far higher than in Greece.

Like Greece, Portugal is essentially insolvent at this point. Their current financial situation is unsustainable and politicians in Portugal are already suggesting that they should be able to get a "sweet deal" similar to what Greece just got.

You see, the truth is that what this Greek debt deal has done is that it has opened up Pandora's Box. Most of the financially troubled nations in Europe are eventually going to want a "deal", and this uncertainty is going to drive investors crazy.

There is very little positive that can be said about this debt deal. It has bought Europe a few months perhaps, but that is about it.

As the new week dawned, financial professionals all over the globe were harshly criticizing this deal....

*The CEO of TrimTabs Investment Research, Charles Biderman, says that the big problem with this deal is that the fundamental issues have not been addressed....

"The euphoria about the latest euro zone bailout will fade quickly, as investors realize that the underlying solvency issues have not been addressed"

*Bob Janjuah of Nomura Securities International in London was even harsher....

"This latest round of euro zone shock and awe is, in my view, nothing more than a confidence trick and has possibly even set up an even worse financial outcome."

In fact, Janjuah says that the debt deal is essentially a "Ponzi scheme"....

This latest bailout relies on the market not calling what I see is a huge "bluff", because if the market does call it, the bailout simply won't be credible or even deliverable. It is instead akin to a self-referencing ponzi scheme, and I can't believe eurozone policymakers have even considered going down this route. After all, we all have recent experience of how such ponzi schemes end, and we all remember how eurozone officials often belittled and berated US policymakers for their role in the US housing/CDO/SIV financial bubble.

*The chief economist at High Frequency Economics, Carl Weinberg, is calling the European debt deal a scheme "of Madoffian proportions"....

"Now they (EU Leaders) are keen to tap into resources that are not their own to fund this crazy scheme of guarantees, leveraged off guarantees to sell bonds and bank shares that no one may want to buy, (in order) to restore value in the banking system destroyed by other bonds that no one wants to own right now. This is a construct of Madoffian proportions"

Even George Soros is criticizing the deal. George Soros is saying that this European debt deal will help stabilize things for a maximum of three months.

Of course with Soros there is always an agenda and you never know what his motives are. Perhaps he is honestly concerned about the financial health of Europe, or perhaps he is trying to feed the panic to get Europe to crash even faster. With Soros you never really know what he is up to.

In any event, the crisis in Europe is already claiming financial casualties in the United States.

MF Global, a securities firm headed up by former New Jersey governor Jon Corzine, has filed for bankruptcy protection.

As a recent CNBC article noted, the firm failed because of bad debts on European sovereign debt....

The bankruptcy protection filing from MF Global — a mid-sized trading firm run by former New Jersey Gov. and Goldman Sachs CEO Jon Corzine — only helped amplify the realization that more difficulties remain. MF Global got into trouble mainly because Corzine made tragically wrong bets on European sovereigns that unraveled when it became clear that bondholders of Greek debt will not be made whole as the nation tries to make its way out of its fiscal morass.

As time goes on, there will be more financial casualties. The truth is that someone is going to pay the price for the financial foolishness of these countries in Europe.

Politicians in Europe did not want to increase the "bailout fund" with any of their own money, so they are going to go crawling to China, Russia and Brazil and beg those countries to lend them huge amounts of money.

This is incredibly foolish, and it is already fairly clear that China is going to play hardball with Europe. China has Europe exactly where China wants them, and China will likely demand all sorts of crazy things before they will lend Europe any cash for this bailout fund.

As a recent CNN article noted, Europe is going to be in a lot of trouble if they can't get money out of China, Russia and Brazil....

The hope is that China and other sovereign wealth fund will invest in new special vehicles that will allow the EFSF to add leverage to increase the amount of funding available.

Without the help of China, Brazil, Russia and others, Europe is back where it started. And it still seems clear that the stronger northern European nations aren't keen on the idea of a full bailout of their southern siblings.

What a mess.

It is a comedy of errors for the politicians over in Europe. They can't seem to get anything right. In fact, everything that they do seems to make a financial collapse in Europe even more likely.

Keep a close eye on the bond yields over in Europe. Especially keep a close eye on the yield on 10 year Italian bonds.

A massive financial storm is coming to Europe.

It is going to rock the entire globe.

Now is the time to make certain that your financial house is not built on a foundation of sand. Get your assets into safe places and keep them safe because the road ahead is going to be quite rocky.

Occupy Wall Street is Transforming its Participants, Our Country, and Democracy

Occupy Wall Street is Transforming its Participants, Our Country, and Democracy

Go To Original

Monday night at a bar in Brooklyn my friend Alex and I looked through pictures on his phone of the “early days” of Occupy Wall Street. He had pictures of the General Assembly from Day 5 and we laughed together about how empty it looked, how ramshackle and tenuous almost, how we could still see the pavement and there was still space between the people. We had just biked back from Occupy Wall Street and we were commenting, again, on how different the space seems every time we are down there. This time I had been surprised to see tents everywhere, something I hadn't seen before and honestly between the tents, the problems with the drumming in the past week and the debate about moving to a spokes-council structure it felt like the movement was in a moment in which it was trying to deal with its own internal dynamics. Growing pains almost.

It makes sense for a movement like Occupy Wall Street to be having growing pains right now. It is still a surprise to most people, those inside the movement and those observing, whether in solidarity or not, that it is still there and that it is growing. It is still a surprise that in places like Occupy Oakland, where their tents were torn down in the middle of the night and they were tear gassed the next evening, they came back the next day in even stronger numbers and called for a general strike. It has become clear in the past month that the political discourse has shifted and it has become clear in the past month that this thing isn't going away. But some mornings I still wake up surprised about it all.

It actually hadn't become clear to me how much the discourse had shifted until I taught urban poverty and inequality this past week to my Anthropology 101 students at Baruch College. I have taught urban poverty and inequality every year for the past 3 years and every year have similar debates in my class: when I start the section off by asking them why people are poor the first response I usually get from students is that, simply put, people are lazy and they don't want to work. I see my job then to be to explain the structural causes of poverty and that simply saying, “People are lazy and don't want to work” is actually a really problematic way of thinking. Explaining all of this has been so much work in my classes that usually I dread the week on poverty and inequality because it is a week where I am tired.

But last week when I asked my students this question the first response I got in my classes was that “People can't find jobs” and the next one was, “There is a huge wealth gap” and the the third was that, “We have an economic system that needs poor people”. I was shocked. I have never gotten responses like this before. And then I found myself explaining to my students that it was because of all these reasons that I am anti-capitalist. I felt like I was coming out to them, exposing myself in a way that I haven't before. And they listened, they were interested, they thought I was being crazy and idealistic but they cared and it felt really good to have these debates with them. I left teaching that evening feeling energized by our discussions.

This made me realize that since getting involved in Occupy Wall Street I have felt myself change. Speaking up to block the Declaration of Occupy Wall Street so that its language was inclusive and didn’t erase historical and current oppressions and inequalities (which you can read about here) was a moment in which I realized, in a way that I haven't before, that I can do this. That feeling was about that particular moment but also something larger, something that has grown to encompass thinking about ways in which to create a world outside of capitalism. I keep thinking: we can do this. And I'm not scared to say this stuff anymore, I'm not scared to articulate my hopes and dreams and wishes for the world. I'm not scared to sit down with Eliot Spitzer and debate capitalism, as did I last week for a New York Magazine piece a friend was putting together. Even if he is defensive and won't let me finish my sentences and tries to tell me that my thinking isn't “rigorous,” even then I'm still not scared of him.

In some ways this fearlessness has surprised me and in other ways it makes perfect sense. The entire time I was having coffee with Spitzer and he was cutting me off and acting more powerful and knowledgeable then me, I just wanted to make him use consensus process. I wanted to tell him not to jump stack. I wanted him to have to take into account historic inequalities and voices that are not traditionally heard. I wanted to tell him to check his privilege. To step back. To listen to me, not in spite of the fact that I am a young woman of color, but because these sorts of voices are not usually heard and should be.

I did try to tell him some of this. I invited him to come down to Zucotti Park and and try making a decision with us. I said, “Mr. Spitzer, why don't you come down to Zuccotti Park and stand in the crowd and just be another citizen, not someone born with a lot of privilege, not someone who has held a lot of power in his life but just someone whose voice is equal to mine. Come down to the park and try this.” He didn't actually have much to say to this. In fact he mostly just looked annoyed at me. I mean when I asked him how he imagined getting more people involved in the political process he suggested “technology”.

I guess I would be annoyed at me too if I were him. If you are a older white man who has traditionally been part of the 1% and who is perhaps hoping to make a comeback in politics, you would feel threatened and challenged by seeing a lot of people start using a process that checks your power, that takes into account your privilege, that makes it so that you can't shout anyone down or cut them off. I'm not saying that the structure alone does this but consensus decision making, combined with the work of making this process go smoothly, has the potential to.

These are our, Occupy Wall Street's, experiments in democracy. They are our experiments in a new form of power. Last Sunday I facilitated the largest meeting I have ever facilitated, a 100 person meeting of the Person of Color working group and it was really tough work to make sure that the process of this meeting went smoothly. I know I alienated someone when I told them not to speak out of turn. I know I was personally frustrated that the meeting ran an hour over. I found out how really really hard it is to say to people: “You've spoken a lot, let’s hear a voice we haven't heard yet this meeting” but while I was saying these things I was also imagining how my classes in graduate school would look if I could say these sorts of things to the many men who monopolize them, how different my work meetings would feel if there was this sort of awareness.

And so Occupy Wall Street has been having growing pains in the past week. There were fears that not being able to work with the community board about the drumming would shut down the whole thing. There was a divisive and hard spokes-council decision that we made on Friday night. A decision in which we could not reach consensus and instead had to vote on using a modified 9/10 consensus model.

The creation of a spokes-council is a move away from making all of our decisions at the nightly General Assemblies. Instead there will also be a spokes-council where “clusters” of people from the various working groups (of which there are now upwards of 50, encompassing everything from “sustainability” to “media” to “education and empowerment”) will meet together every day and connect with each other and make day to day decisions.

Here any large decisions, financial or about the movement, would still go to the open and large General Assembly meetings and the spokes-council would take on the more day to day aspects of governing, running and decision making. This was a hard decision because many many people were worried about a spokes-council creating a de-facto power structure, creating a hierarchy of decision making or creating more bureaucracy. I understood these concerns-- a spokes-council can look a lot like the sort of representative governing that we are trying to move away from, but also from working in the movement I think we need a better way to communicate across working groups and a better way to make day-to-day decisions. To put it simply: 300 people at the General Assembly do not need to make a decision about whether or not the comfort working group should buy recycled plastic trash bags or not.

I also think that a spokes-council structure, in which working groups meet together every day and discuss issues, is also a great way to communicate across working groups that issues of racism, patriarchy, oppression and inclusivity are not just something for the people of color working group (and women and people of color themselves) to take on but for all working groups to be thinking about. So I was in support of the spokes-council.

And so I spent my Friday night standing outside for hours listening to the discussion about it and finally at around 10pm voting in favor of it. The vote was needed because, like I said, we couldn't reach consensus. There were two “blocks”, both for ideological reasons: that in this movement we should not have any sort of body that acts as if it is representing others one that could be mistaken for a power structure or that could be mistaken for a “leader”. I think these concerns and these blocks are completely valid and necessary critiques. Standing outside in the cold on Friday night, listening to people passionately express these views, I was so so glad that the process forced everyone to hear, and attempt to deal with, dissent before we made our decision.

I was glad to be reminded that we should proceed with how we structure ourselves with care. With immense care. And I was glad that when we couldn't consensus fully on this decision that we voted knowing that we needed a 9/10th majority for this to go through. In the end there was a 95% majority who voted for the spokes-council. Not full consensus but close enough. As we carefully counted the votes (17 no’s and 300-something yes’s) I thought about voting and consensus and democracy. It felt good to know that this structure allowed for people to block things, but it also felt good to think that a 95% consensus was still a victory for the process and for everyone who took part in it.

There are other growing pains too: there is the work of making the space of Liberty Plaza safe and non-oppressive for everyone there. There is the constant work of making sure that questions of economic justice are connected to racial justice, that conversations about oppression are tied to conversations about privilege. There is winter and cold and snow looming in the distance, something that we had to deal with last night. But there is still a tremendous amount of hope and possibility.

On Thursday I went to a Community Watch meeting at 60 Wall Street, or “The Atrium” as it has been called. The Atrium is another one of these “density bonuses” like Zuccotti Square is: a privately owned but publicly accessible space. This one seems like a cross between a corporate lobby (it is indoor) and a bizarre sandy park. There are fake palm trees. There are white plastic chairs and marble benches. The ceiling and walls are weirdly textured and mirrored. To get from Zuccotti Park to The Atrium you have to walk south on Broadway for two blocks. You can either enter The Atrium from Wall Street or one block closer on Pine Street. Even though Pine Street is closer I like to enter from the Wall Street side because there is something about running past the Stock Exchange, around the barricades they have put up, through the crowds of tourists and business people, past the Tiffany's and past the Trump building to finally duck into the Atrium for a working group meeting that makes me feel really powerful and excited about the world.

And in the past two weeks there have been multiple working group meetings meeting here at all times. Last night the Community Watch meeting met next to a Media Training, which was next to the Demands Working Group, which was next to the Security Meeting, across from the Sustainability Meeting which was next to the Anti-Racism Group. On a Thursday night there were over a hundred people in that strange corporate lobby public space meeting and working together on various different aspects of the movement.

As I looked around all on Thursday I realized that we are also occupying this space now, that by being bodies assembled together in this space we are occupying it and by learning how to work together in doing this we are making this Occupation, this political shift, this chance at a new ways of being in the world, possible. Of course this process has growing pains, it wouldn't be what be revolutionary if it didn't. It wouldn't be revolutionary if it wasn't complicated, and messy but also inspirational. The facilitator at the Community Watch training I attended last night said something that struck me as she was outlining the steps of response for how to deal with unsafe situations at Zucotti Park. She said: “this process isn't perfect yet and we know that, but this is what setting up a town, a movement in four weeks, using direct democracy looks like”.

Blueprint of the PNAC Plan for U.S. Global Hegemony

Blueprint of the PNAC Plan for U.S. Global Hegemony

Some people have compared it to Hitler's publication of Mein Kampf, which was ignored until after the war was over.

Full text of Rebuilding America's Defenses here

Go To Original

When the Bush administration started lobbying for war with Iraq, they used as rationale a definition of preemption (generally meaning anticipatory use of force in the face of an imminent attack) that was broadened to allow for the waging of a preventive war in which force may be used even without evidence of an imminent attack. They also were able to convince much of the American public that Saddam Hussein had something to do with the attacks of 9/11, despite the fact that no evidence of a link has been uncovered. Consequently, many people supported the war on the basis of 1) a policy that has no legal basis in international law and 2) a totally unfounded claim of Iraqi guilt.

What most people do not know, however, is that certain high ranking officials in the Bush administration have been working for regime change in Iraq for the past decade, long before terrorism became an important issue for our country. In 1997 they formed an organization called the Project for the New American Century (PNAC). They have sought the establishment of a much stronger U.S. presence throughout the Mideast and Iraq's Saddam Hussein has been their number one target for regime change. Members of this group drafted and successfully passed through Congress the Iraqi Liberation Act, giving legal sanctions for an invasion of the country, and funneled millions of taxpayer dollars to Hussein opposition groups called the Iraqi National Congress and The Committee for the Liberation of Iraq.

The PNAC philosophy was formed in response to the ending of Cold War hostilities with Russia and the emergence of America as the world's only preeminent superpower. Claiming that this is a "strategic moment" that should not be squandered, members of PNAC say that America should use its position to advance its power and interests into all areas of the globe. They believe the time is ripe for establishing democracies in regimes considered hostile to U.S. interests and are not hesitant to advise the use of military means to achieve those ends.

PNAC members on the Bush team include Vice-President Dick Cheney and his top national security assistant, I. Lewis Libby; Secretary of Defense Donald Rumsfeld; Deputy Secretary of Defense Paul Wolfowitz; National Security Council member Eliot Abrams; Undersecretary for Arms Control and International Security John Bolton; and former Chairman of the Defense Policy Board, Richard Perle. Other PNAC members exerting influence on U.S. policy are the President of the Committee for the Liberation of Iraq Randy Scheunemann, Republican Party leader Bruce Jackson and current PNAC chairman William Kristol, conservative writer for the Weekly Standard. Jeb Bush, the president's brother and governor of Florida, is also a member.

Their campaign to overthrow Hussein was unsuccessful during the Clinton presidency and early days of Bush's term, but on 9/11 they found the event they needed to push for the overthrow of Hussein. Within 24 hours both Wolfowitz and Cheney were calling for an invasion of Iraq, even before anyone knew who had been responsible for the attacks.

Individuals who now belong to PNAC have been influencing White House policy since the Reagan era, calling for coups in Central America and claiming that a nuclear war with Russia could be "winnable." Richard Perle is one of their most prominent spokesmen. He and Michael Ledeen (of the American Enterprise Institute), who is currently lobbying for war with Syria and Iran, have adopted a stance that they call "total war" — the ability to wage multiple simultaneous wars around the globe to achieve American ends. Recently Perle commented on America's war on terrorism: "No stages," he said, "This is total war. We are fighting a variety of enemies. There are lots of them out there. All this talk about first we are going to do Afghanistan, then we will do Iraq . . . this is entirely the wrong way to go about it. If we just let our vision of the world go forth, and we embrace it entirely and we don't try to piece together clever diplomacy, but just wage a total war . . . our children will sing great songs about us years from now."

Members of PNAC are so self-assured they are advancing America's best interests that they publish policy papers specifically outlining their plans, plans that many fear may be laying the groundwork for a third world war. Their ideas are peculiarly atavistic, considering the friendly ties that have been forged between most of the major nations during the past ten years.

Their central policy document is entitled "Rebuilding America's Defenses (RAD)," published on their website at http://newamericancentury.org/RebuildingAmericasDefenses.pdf. It outlines a plan for American hegemony in the coming years, pinpointing "problem areas" of the world and suggesting regime change of unfavorable governments so that eventually the whole world will be unified under the banner of American democracy.

Already we are seeing evidence of PNAC influence on U.S. policy. For instance, the concept of "Homeland Defense" comes straight from "RAD." Iran, Iraq and North Korea, nations that George Bush calls the "Axis of Evil", are listed together in "RAD" several times as possible military threats to the U.S. There is a suggestion that military spending be increased to 3.8 percent of the GDP, exactly the amount (over and above present expenses for the Iraqi campaign) Bush has proposed for next year's budget. Its basic statement of policy bespeaks and advocates the very essence of the idea of preemptive engagement.

Bush's National Security Strategy of September 20, 2002, adopted PNAC ideas and emphasized a broadened definition of preemption. Since we are already hearing accusations against regimes in Iran and Syria, will they be slated next for invasion?

The document is written with all of the single-mindedness, unilateralism and inattention to international ramifications (with either friend or foe) that the Bush administration displayed in its current build-up for war with Iraq. There is even assertion of the necessity of American political leadership overriding that of the U.N. (p. 11), a policy that was sadly played out when the U.S. invaded Iraq without the approval of either the U.N. or the international community.

Rebuilding America's Defenses

I believe that "Rebuilding America's Defenses" is a must-read for anyone concerned about the future of our planet. Since the document is over 80 pages long I have created a summary of its major ideas in order to make it more accessible.

Subject areas are arranged under 4 categories: A. Pax Americana — outlining the rationale for global empire, B. Securing Global Hegemony — pinpointing regions that are considered trouble spots for U.S. policy, C. Rebuilding the Military — plans for expansion of U.S. military might, and D. Future Wars of Pax Americana — the "RAD" vision of complete control of land, sea, air, space and cyberspace.

As much as possible I have used direct quotations followed by page numbers so that the reader can consult the original. My personal comments are in italics.

For further reading about the PNAC, see the following articles:

http://www.informationclearinghouse.info/article1665.htm (Information Clearing House has many excellent articles about the PNAC.)
http://www.informationclearinghouse.info/article2326.htm (this article is followed by a long list of links to published articles about the plans of the Bush Administration influenced by the PNAC.)
http://www.mail-archive.com/brin-l@mccmedia.com/msg12730.html
http://pilger.carlton.com/print/124759

A. Pax Americana

"It is not a choice between preeminence today and preeminence tomorrow. Global leadership is not something exercised at our leisure, when the mood strikes us or when our core national security interests are directly threatened; then it is already too late. Rather, it is a choice whether or not to maintain American military preeminence, to secure American geopolitical leadership, and to preserve the American peace" (p. 76).

The building of Pax Americana has become possible, claims "RAD," because the fall of the Soviet Union has given the U.S. status as the world's singular superpower. It must now work hard not only to maintain that position, but to spread its influence into geographic areas that are ideologically opposed to our influence. Decrying reductions in defense spending during the Clinton years "RAD" propounds the theory that the only way to preserve peace in the coming era will be to increase military forces for the purpose of waging multiple wars to subdue countries which may stand in the way of U.S. global preeminence.

Their flaws in logic are obvious to people of conscience, namely, 1) a combative posture on our part will not secure peace, but will rather engender fear throughout the world and begin anew the arms race, only this time with far more contenders, and 2) democracy, by its very definition, cannot be imposed by force.

Following is the preamble to the document:

"As the 20th century draws to a close, the United States stands as the world’s most preeminent power. Having led the West to victory in the Cold War, America faces an opportunity and a challenge: Does the United States have the vision to build upon the achievement of past decades? Does the United States have the resolve to shape a new century favorable to American principles and interests?

"[What we require is] a military that is strong and ready to meet both present and future challenges; a foreign policy that boldly and purposefully promotes American principles abroad; and national leadership that accepts the United States’ global responsibilities.

"Of course, the United States must be prudent in how it exercises its power. But we cannot safely avoid the responsibilities of global leadership or the costs that are associated with its exercise. America has a vital role in maintaining peace and security in Europe, Asia, and the Middle East. If we shirk our responsibilities, we invite challenges to our fundamental interests. The history of the 20th century should have taught us that it is important to shape circumstances before crises emerge, and to meet threats before they become dire. The history of the past century should have taught us to embrace the cause of American leadership" (from the Project’s Statement of Principles).

Four Vital Missions

PNAC members believe that there are four vital missions "demanded by U. S. global leadership," but claim that "current American armed forces are ill-prepared to execute" these missions.

"Homeland Defense. America must defend its homeland. During the Cold War, nuclear deterrence was the key element in homeland defense; it remains essential. But the new century has brought with it new challenges. While reconfiguring its nuclear force, the United States also must counteract the effects of the proliferation of ballistic missiles and weapons of mass destruction that may soon allow lesser states to deter U.S. military action by threatening U.S. allies and the American homeland itself. Of all the new and current missions for U.S. armed forces, this must have priority.

"Large Wars. Second, the United States must retain sufficient forces able to rapidly deploy and win multiple simultaneous large-scale wars and also to be able to respond to unanticipated contingencies in regions where it does not maintain forward-based forces. This resembles the 'two-war' standard that has been the basis of U.S. force planning over the past decade. Yet this standard needs to be updated to account for new realities and potential new conflicts.

"Constabulary Duties. Third, the Pentagon must retain forces to preserve the current peace in ways that fall short of conduction major theater campaigns. A decade’s experience and the policies of two administrations have shown that such forces must be expanded to meet the needs of the new, long-term NATO mission in the Balkans, the continuing no-fly-zone and other missions in Southwest Asia, and other presence missions in vital regions of East Asia. These duties are today’s most frequent missions, requiring forces configured for combat but capable of long-term, independent constabulary operations.

"Transform U.S. Armed Forces. Finally, the Pentagon must begin now to exploit the so-called 'revolution in military affairs,' sparked by the introduction of advanced technologies into military systems; this must be regarded as a separate and critical mission worthy of a share of force structure and defense budgets" (p. 6).

"In conclusion, it should be clear that these four essential missions for maintaining American military preeminence are quite separate and distinct from one another – none should be considered a 'lesser included case' of another, even though they are closely related and may, in some cases, require similar sorts of forces. Conversely, the failure to provide sufficient forces to execute these four missions must result in problems for American strategy. The failure to build missile defenses will put America and her allies at grave risk and compromise the exercise of American power abroad. Conventional forces that are insufficient to fight multiple theater wars simultaneously cannot protect American global interests and allies. Neglect or withdrawal from constabulary missions will increase the likelihood of larger wars breaking out and encourage petty tyrants to defy American interests and ideals. And the failure to prepare for tomorrow’s challenges will ensure that the current Pax Americana comes to an early end" (p. 13).

On Usurping the Power of the UN

"Further, these constabulary missions are far more complex and likely to generate violence than traditional 'peacekeeping' missions. For one, they demand American political leadership rather than that of the United Nations, as the failure of the UN mission in the Balkans and the relative success of NATO operations there attests.

"Nor can the United States assume a UN-like stance of neutrality; the preponderance of American power is so great and its global interests so wide that it cannot pretend to be indifferent to the political outcome in the Balkans, the Persian Gulf or even when it deploys forces in Africa. Finally, these missions demand forces basically configured for combat. While they also demand personnel with special language, logistics and other support skills, the first order of business in missions such as in the Balkans is to establish security, stability and order. American troops, in particular, must be regarded as part of an overwhelmingly powerful force" (p. 11).

On Preserving American Preeminence

"Since today’s peace is the unique product of American preeminence, a failure to preserve that preeminence allows others an opportunity to shape the world in ways antithetical to American interests and principles. The price of American preeminence is that, just as it was actively obtained, it must be actively maintained" (p. 73).

"The fourth element in American force posture – and certainly the one which holds the key to any longer-term hopes to extend the current Pax Americana – is the mission to transform U.S. military forces to meet new geopolitical and technological challenges" (p. 11).

"America’s armed forces, it seemed, could either prepare for the future by retreating from its role as the essential defender of today’s global security order, or it could take care of current business but be unprepared for tomorrow’s threats and tomorrow’s battlefields" (p. i).

"Moreover, America stands at the head of a system of alliances which includes the world’s other leading democratic powers. At present the United States faces no global rival. America’s grand strategy should aim to preserve and extend this advantageous position as far into the future as possible. There are, however, potentially powerful states dissatisfied with the current situation and eager to change it, if they can, in directions that endanger the relatively peaceful, prosperous and free condition the world enjoys today. Up to now, they have been deterred from doing so by the capability and global presence of American military power. But, as that power declines, relatively and absolutely, the happy conditions that follow from it will be inevitably undermined" (p. i).

B. Securing Global Hegemony

"In a larger sense, the new president will choose whether today’s 'unipolar moment,' to use columnist Charles Krauthammer’s phrase for America’s current geopolitical preeminence, will be extended along with the peace and prosperity that it provides" (p. 4).

"RAD" takes the posture that only the U.S. should manipulate international relations and points out "trouble spots" that may cause future problems, like Iraq, Iran, Korea and all of East Asia. There is concern that several nations might come together to challenge U.S. interests. Consequently any nation that produces nuclear weapons or engages in significant arms build-up will be viewed as a potential threat.

"America’s global leadership, and its role as the guarantor of the current great-power peace, relies upon the safety of the American homeland; the preservation of a favorable balance of power in Europe, the Middle East and surrounding energy-producing region, and East Asia; and the general stability of the international system of nation-states relative to terrorists, organized crime, and other 'non-state actors.' The relative importance of these elements, and the threats to U.S. interests, may rise and fall over time. Europe, for example, is now extraordinarily peaceful and stable, despite the turmoil in the Balkans. Conversely, East Asia appears to be entering a period with increased potential for instability and competition. In the Gulf, American power and presence has achieved relative external security for U.S. allies, but the longer-term prospects are murkier. Generally, American strategy for the coming decades should seek to consolidate the great victories won in the 20th century – which have made Germany and Japan into stable democracies, for example – maintain stability in the Middle East, while setting the conditions for 21st century successes, especially in East Asia.

"A retreat from any one of these requirements would call America’s status as the world’s leading power into question. As we have seen, even a small failure like that in Somalia or a halting and incomplete triumph as in the Balkans can cast doubt on American credibility. The failure to define a coherent global security and military strategy during the post-Cold War period has invited challenges; states seeking to establish regional hegemony continue to probe for the limits of the American security perimeter" (p. 5).

Iraq and the Persian Gulf

"After eight years of no-fly-zone operations, there is little reason to anticipate that the U.S. air presence in the region should diminish significantly as long as Saddam Hussein remains in power. Although Saudi domestic sensibilities demand that the forces based in the Kingdom nominally remain rotational forces, it has become apparent that this is now a semi-permanent mission. From an American perspective, the value of such bases would endure even should Saddam pass from the scene. Over the long term, Iran may well prove as large a threat to U.S. interests in the Gulf as Iraq has. And even should U.S.-Iranian relations improve, retaining forward-based forces in the region would still be an essential element in U.S. security strategy given the longstanding American interests in the region" (p. 17).

"In the Persian Gulf region, the presence of American forces, along with British and French units, has become a semi-permanent fact of life. Though the immediate mission of those forces is to enforce the no-fly zones over northern and southern Iraq, they represent the long-term commitment of the United States and its major allies to a region of vital importance. Indeed, the United States has for decades sought to play a more permanent role in Gulf regional security. While the unresolved conflict with Iraq provides the immediate justification, the need for a substantial American force presence in the Gulf transcends the issue of the regime of Saddam Hussein" (p. 14).

"Although the no-fly-zone air operations over northern and southern Iraq have continued without pause for almost a decade, they remain an essential element in U.S. strategy and force posture in the Persian Gulf region. Ending these operations would hand Saddam Hussein an important victory, something any American leader would be loath to do. Likewise, withdrawing from the Balkans would place American leadership in Europe – indeed, the viability of NATO – in question. While none of these operations involves a mortal threat, they do engage U.S. national security interests directly, as well as engaging American moral interests" (p. 11).

"In Europe, the Persian Gulf and East Asia, enduring U.S. security interests argue forcefully for an enduring American military presence" (p. 74).

"The Air Force presence in the Gulf region is a vital one for U.S. military strategy, and the United States should consider it a de facto permanent presence, even as it seeks ways to lessen Saudi, Kuwaiti and regional concerns about U.S. presence" (p. 35).

Axis of Evil

"It is now commonly understood that information and other new technologies – as well as widespread technological and weapons proliferation – are creating a dynamic that may threaten America’s ability to exercise its dominant military power. Potential rivals such as China are anxious to exploit these transformational technologies broadly, while adversaries like Iran, Iraq and North Korea are rushing to develop ballistic missiles and nuclear weapons as a deterrent to American intervention in regions they seek to dominate" (p. 4).

"The current American peace will be short-lived if the United States becomes vulnerable to rogue powers with small, inexpensive arsenals of ballistic missiles and nuclear warheads or other weapons of mass destruction. We cannot allow North Korea, Iran, Iraq or similar states to undermine American leadership, intimidate American allies or threaten the American homeland itself. The blessings of the American peace, purchased at fearful cost and a century of effort, should not be so trivially squandered" (p. 75).

East Asia

"Reflecting the gradual shift in the focus of American strategic concerns toward East Asia, a majority of the U.S. fleet, including two thirds of all carrier battle groups, should be concentrated in the Pacific. A new, permanent forward base should be established in Southeast Asia (p. 39).

"As stressed several times above, the United States should seek to establish – or reestablish – a more robust naval presence in Southeast Asia, marked by a long-term, semi-permanent home port in the region, perhaps in the Philippines, Australia, or both" (p. 44).

"In Southeast Asia, American forces are too sparse to adequately address rising security requirements….Except for routine patrols by naval and Marine forces, the security of this strategically significant and increasingly tumultuous region has suffered from American neglect…..Southeast Asia region has long been an area of great interest to China, which clearly seeks to regain influence in the region. In recent years, China has gradually increased its presence and operations in the region.

"Raising U.S. military strength in East Asia is the key to coping with the rise of China to great-power status. For this to proceed peacefully, U.S. armed forces must retain their military preeminence and thereby reassure our regional allies. In Northeast Asia, the United States must maintain and tighten its ties with the Republic of Korea and Japan. In Southeast Asia, only the United States can reach out to regional powers like Australia, Indonesia and Malaysia and others. This will be a difficult task requiring sensitivity to diverse national sentiments, but it is made all the more compelling by the emergence of new democratic governments in the region. By guaranteeing the security of our current allies and newly democratic nations in East Asia, the United States can help ensure that the rise of China is a peaceful one. Indeed, in time, American and allied power in the region may provide a spur to the process of democratization inside China itself….A heightened U.S. military presence in Southeast Asia would be a strong spur to regional security cooperation, providing the core around which a de facto coalition could jell" (pp. 18-19).

"The prospect is that East Asia will become an increasingly important region, marked by the rise of Chinese power….A similar rationale argues in favor of retaining substantial forces in Japan. In recent years, the stationing of large forces in Okinawa has become increasingly controversial in Japanese domestic politics, and while efforts to accommodate local sensibilities are warranted, it is essential to retain the capabilities U.S. forces in Okinawa represent. If the United States is to remain the guarantor of security in Northeast Asia, and to hold together a de facto alliance whose other main pillars are Korea and Japan maintaining forward-based U.S. forces is essential" (p. 18).

Europe

"As discussed above, the focus of American security strategy for the coming century is likely to shift to East Asia. This reflects the success of American strategy in the 20th century, and particularly the success of the NATO alliance through the Cold War, which has created what appears to be a generally stable and enduring peace in Europe. The pressing new problem of European security – instability in Southeastern Europe – will be best addressed by the continued stability operations in the Balkans by U.S. and NATO ground forces supported by land-based air forces. Likewise, the new opportunity for greater European stability offered by further NATO expansion will make demands first of all on ground and land-based air forces. As the American security perimeter in Europe is removed eastward, this pattern will endure, although naval forces will play an important role in the Baltic Sea, eastern Mediterranean and Black Sea, and will continue to support U.S. and NATO operations ashore" (pp. 43-44).

"The Balkans, and southeastern Europe more generally, present the major hurdle toward the creation of a Europe 'whole and free' from the Baltic to the Black Sea. The delay in bringing security and stability to southeastern Europe has not only prevented the consolidation of the victory in the Cold War, it has created a zone of violence and conflict and introduced uncertainty about America’s role in Europe" (pp. 15-16).

"Despite the shifting focus of conflict in Europe, a requirement to station U.S. forces in northern and central Europe remains. The region is stable, but a continued American presence helps to assure the major European powers, especially Germany, that the United States retains its longstanding security interest in the continent. This is especially important in light of the nascent European moves toward an independent defense 'identity' and policy; it is important that NATO not be replaced by the European Union, leaving the United States without a voice in European security affairs" (p. 16).

"Although U.S. Navy and Marine forces generally operate on a regular cycle of deployments to European waters, they rely on a network of permanent bases in the region, especially in the Mediterranean. These should be retained, and consideration given to establishing a more robust presence in the Black Sea" (p. 17).

Regime Change

Several statements advocating the possible necessity of removing hostile regimes can be found in the document.

"American military preeminence will continue to rest in significant part on the ability to maintain sufficient land forces to achieve political goals such as removing a dangerous and

hostile regime when necessary" (p. 61).

"The need to respond with decisive force in the event of a major theater war in Europe, the Persian Gulf or East Asia will remain the principal factor in determining Army force structure for U.S.-based units. However one judges the likelihood of such wars occurring, it is essential to retain sufficient capabilities to bring them to a satisfactory conclusion, including the possibility of a decisive victory that results in long-term political or regime change" (p. 25).

"America’s adversaries will continue to resist the building of the American peace; when they see an opportunity as Saddam Hussein did in 1990, they will employ their most powerful armed forces to win on the battle-field what they could not win in peaceful competition; and American armed forces will remain the core of efforts to deter, defeat, or remove from power regional aggressors" (p. 10).

C. Rebuilding the Military

"If an American peace is to be maintained, and expanded, it must have a secure foundation on unquestioned U.S. military preeminence" (p. 4).

One stated objective of "RAD" is "to outline the large, 'full-spectrum' forces that are necessary to conduct the varied tasks demanded by a strategy of American preeminence for today and tomorrow" (p. 5). Much of the document is an elucidation of those missions and includes specific recommendations about weaponry, deployment patterns, increased personnel and defense spending.

"In sum, the 1990s have been a 'decade of defense neglect'. This leaves the next president of the United States with an enormous challenge: he must increase military spending to preserve American geopolitical leadership, or he must pull back from the security commitments that are the measure of America’s position as the world’s sole superpower and the final guarantee of security, democratic freedoms and individual political rights" (p. 4).

"Preserving the desirable strategic situation in which the United States now finds itself requires a globally preeminent military capability both today and in the future. But years of cuts in defense spending have eroded the American military’s combat readiness, and put in jeopardy the Pentagon’s plans for maintaining military superiority in the years ahead. Increasingly, the U.S. military has found itself undermanned, inadequately equipped and trained, straining to handle contingency operations, and ill-prepared to adapt itself to the revolution in military affairs" (p. i).

The four core missions of PNAC referred to below were outlined in section A. Pax Americana.

"To carry out these core missions, we need to provide sufficient force and budgetary allocations. In particular, the United States must:

MAINTAIN NUCLEAR STRATEGIC SUPERIORITY, basing the U.S. nuclear deterrent upon a global, nuclear net assessment that weighs the full range of current and emerging threats, not merely the U.S.-Russia balance.

RESTORE THE PERSONNEL STRENGTH of today’s force to roughly the levels anticipated in the 'Base Force' outlined by the Bush Administration, an increase in active-duty strength from 1.4 million to 1.6 million.

REPOSITION U.S. FORCES to respond to 21st century strategic realities by shifting permanently based forces to Southeast Europe and Southeast Asia, and by changing naval deployment patterns to reflect growing U.S. strategic concerns in East Asia.

MODERNIZE CURRENT U.S. FORCES SELECTIVELY, proceeding with the F-22 program while increasing purchases of lift, electronic support and other aircraft; expanding submarine and surface combatant fleets; purchasing Comanche helicopters and medium-weight ground vehicles for the Army, and the V-22 Osprey 'tilt-rotor' aircraft for the Marine Corps.

CANCEL 'ROADBLOCK' PROGRAMS such as the Joint Strike Fighter, CVX aircraft carrier, and Crusader howitzer system that would absorb exorbitant amounts of Pentagon funding while providing limited improvements to current capabilities. Savings from these canceled programs should be used to spur the process of military transformation.

DEVELOP AND DEPLOY GLOBAL MISSILE DEFENSES to defend the American homeland and American allies, and to provide a secure basis for U.S. power projection around the world.

CONTROL THE NEW 'INTERNATIONAL COMMONS' OF SPACE AND 'CYBERSPACE,' and pave the way for the creation of a new military service – U.S. Space Forces – with the mission of space control.

EXPLOIT THE 'REVOLUTION IN MILITARY AFFAIRS' to ensure the long-term superiority of U.S. conventional forces. Establish a two-stage transformation process which

• ?maximizes the value of current weapons systems through the application of advanced technologies, and,

• ?produces more profound improvements in military capabilities, encourages competition between single services and joint-service experimentation efforts.

INCREASE DEFENSE SPENDING gradually to a minimum level of 3.5 to 3.8 percent of gross domestic product, adding $15 billion to $20 billion to total defense spending annually" (p. v).

"In general terms, it seems likely that the process of transformation will take several decades and that U.S. forces will continue to operate many, if not most, of today’s weapons systems for a decade or more. Thus, it can be foreseen that the process of transformation will in fact be a two-stage process: first of transition, then of more thoroughgoing transformation. The break-point will come when a preponderance of new weapons systems begins to enter service, perhaps when, for example, unmanned aerial vehicles begin to be as numerous as manned aircraft. In this regard, the Pentagon should be very wary of making large investments in new programs – tanks, planes, aircraft carriers, for example – that would commit U.S. forces to current paradigms of warfare for many decades to come" (p. 13).

Army

List of recommendations for modernizing the Army (see p. 23).

"American landpower remains the essential link in the chain that translates U.S. military supremacy into American geopolitical preeminence. Even as the means for delivering firepower on the battlefield shift – strike aircraft have realized all but the wildest dreams of air power enthusiasts, unmanned aerial vehicles promise to extend strike power in the near future, and the ability to conduct strikes from space appears on the not-too-distant horizon – the need for ground maneuvers to achieve decisive political results endures. Regimes are difficult to change based upon punishment alone. If land forces are to survive and retain their unique strategic purpose in a world where it is increasingly easy to deliver firepower precisely at long ranges, they must change as well, becoming more stealthy, mobile, deployable and able to operate in a dispersed fashion. The U.S. Army, and American land forces more generally, must increasingly complement the strike capabilities of the other services. Conversely, an American military force that lacks the ability to employ ground forces that can survive and maneuver rapidly on future battlefields will deprive U.S. political leaders of a decisive tool of diplomacy" (p. 30).

Air Force — Toward a Global First-Strike Force

List of recommendations for modernizing the Air Force (See p. 31).

"Although air power remains the most flexible and responsive element of U.S. military power, the Air Force needs to be restructured, repositioned, revitalized and enlarged to assure continued 'global reach, global power'" (p. 31).

"Because of its inherent mobility and flexibility, the Air Force will be the first U.S. military force to arrive in a theater during times of crisis; as such, the Air Force must retain its ability to deploy and sustain sufficient numbers of aircraft to deter wars and shape any conflict in its earliest stages. Indeed, it is the Air Force, along with the Army, that remains the core of America’s ability to apply decisive military power when its pleases. To dissipate this ability to deliver a rapid hammer blow is to lose the key component of American military preeminence" (p. 37).

"A gradual increase in Air Force spending back to a $110 billion to $115 billion level is required to increase service personnel strength; build new units, especially the composite wings required to perform the 'air constabulary missions' such as no-fly zones; add the support capabilities necessary to complement the fleet of tactical aircraft; reinvest in space capabilities and begin the process of transformation" (p. 37).

"The ability to have access to, operate in, and dominate the aerospace environment has become the key to military success in modern, high-technology warfare. Indeed, as will be discussed below, space dominance may become so essential to the preservation of American military preeminence that it may require a separate service. How well the Air Force rises to the many challenges it faces – even should it receive increased budgets – will go far toward determining whether U.S. military forces retain the combat edge they now enjoy" (pp. 38-39).

"A recent study done for the Air Force indicates that a worldwide network of forward operating bases….might cost $5 billion to $10 billion through 2010. The study speculates that some of the cost might be paid for by host nations anxious to cement ties with the United States, or, in Europe, be considered as common NATO assets and charged to the NATO common fund" (p. 20).

Navy/Marine Corps

List of recommendations for modernizing the Navy (See pp. 39-40).

List of recommendations for modernizing the Marines (See pp. 47-48).

"The end of the Cold War leaves the U.S. Navy in a position of unchallenged supremacy on the high seas, a dominance surpassing that even of the British Navy in the 19th and early parts of the 20th century. With the remains of the Soviet fleet now largely rusting in port, the open oceans are America’s, and the lines of communication open from the coasts of the United States to Europe, the Persian Gulf and East Asia. Yet this very success calls the need for the current force structure into question. Further, the advance of precision-strike technology may mean that naval surface combatants, and especially the large-deck aircraft carriers that are the Navy’s capital ships, may not survive in the high-technology wars of the coming decades. Finally, the nature and pattern of Navy presence missions may be out of synch with emerging strategic realities. In sum, though it stands without peer today, the Navy faces major challenges to its traditional and, in the past, highly successful methods of operation" (p. 39).

"Thus, while naval presence, including carrier presence, in the western Pacific should be increased, the Navy should begin to conduct many of its presence missions with other kinds of battle groups based around cruisers, destroyers and other surface combatants as well as submarines. Indeed, the Navy needs to better understand the requirement to have substantial numbers of cruise-missile platforms at sea and in close proximity to regional hot spots, using carriers and naval aviation as reinforcing elements" (p. 46).

"The Navy’s force of attack submarines also should be expanded. It is unclear that the current and planned generations of attack submarines (to say nothing of new ballistic missile submarines) will be flexible enough to meet future demands. The Navy should reassess its submarine requirements not merely in light of current missions but with an expansive view of possible future missions as well" (p. 46).

"The Navy must begin to transition away from its heavy dependence on carrier operations….. Design and research on a future CVX carrier should continue, but should aim at a radical design change to accommodate an air wing based primarily on unmanned aerial vehicles" (p. 40).

"To offset the reduced role of carriers, the Navy should slightly increase its fleets of current-generation surface combatants and submarines for improved strike capabilities in littoral waters and to conduct an increasing proportion of naval presence missions with surface action groups. Additional investments in counter-mine warfare are needed, as well" (p. 40).

"In particular, the Marine Corps, like the Navy, must turn its focus on the requirements for operations in East Asia, including Southeast Asia. In many ways, this will be a 'back to the future' mission for the Corps, recalling the innovative thinking done during the period between the two world wars and which established the Marines’ expertise in amphibious landings and operations" (p. 47).

Overseas Bases

"As a supplement to forces stationed abroad under long-term basing arrangements, the United States should seek to establish a network of 'deployment bases' or 'forward operating bases' to increase the reach of current and future forces. Not only will such an approach improve the ability to project force to outlying regions, it will help circumvent the political, practical and financial constraints on expanding the network of American bases overseas" (p. 19).

"There should be a strong strategic synergy between U.S. forces overseas and in a reinforcing posture: units operating abroad are an indication of American geopolitical interests and leadership, provide significant military power to shape events and, in wartime, create the conditions for victory when reinforced. Conversely, maintaining the ability to deliver an unquestioned 'knockout punch' through the rapid introduction of stateside units will increase the shaping power of forces operating overseas and the vitality of our alliances. In sum, we see an enduring need for large-scale American forces" (p. 74).

"Further, improvements should be made to existing air bases in new and potential NATO countries to allow for rapid deployments, contingency exercises, and extended initial operations in times of crisis. These preparations should include modernized air traffic control, fuel, and weapons storage facilities, and perhaps small stocks of prepositioned munitions, as well as sufficient ramp space to accommodate surges in operations. Improvements also should be made to existing facilities in England to allow forward operation of B-2 bombers in times of crisis, to increase sortie rates if needed" (p. 34).

"The Air Force should be redeployed to reflect the shifts in international politics. Independent, expeditionary air wings containing a broad mix of aircraft, including electronic warfare, airborne command and control, and other support aircraft, should be based in Italy, Southeastern Europe, central and perhaps eastern Turkey, the Persian Gulf, and Southeast Asia"

(p. 31).

Nuclear Expansion

"…significant reductions in U.S. nuclear forces might well have unforeseen consequences that lessen rather than enhance the security of the United States and its allies" (p. 8).

"Over the past decade, efforts to design and build effective missile defenses have been ill-conceived and underfunded, and the Clinton Administration has proposed deep reductions in U.S. nuclear forces without sufficient analysis of the changing global nuclear balance of forces" (p. 6).

"Rather than maintain and improve America’s nuclear deterrent, the Clinton Administration has put its faith in new arms control measures, most notably by signing the Comprehensive Test Ban Treaty (CTBT). The treaty proposed a new multilateral regime, consisting of some 150 states, whose principal effect would be to constrain America's unique role in providing the global nuclear umbrella that helps to keep states like Japan and South Korea from developing the weapons that are well within their scientific capability, while doing little to stem nuclear weapons proliferation. Although the Senate refused to ratify the treaty, the administration continues to abide by its basic strictures. And while it may make sense to continue the current moratorium on nuclear testing for the moment – since it would take a number of years to refurbish the neglected testing infrastructure in any case – ultimately this is an untenable situation. If the United States is to have a nuclear deterrent that is both effective and safe, it will need to test." (pp. 7-8).

"…of all the elements of U.S. military force posture, perhaps none is more in need of reevaluation than America’s nuclear weapons. Nuclear weapons remain a critical component of American military power but it is unclear whether the current U.S. nuclear arsenal is well-suited to the emerging post-Cold War world. Today’s strategic calculus encompasses more factors than just the balance of terror between the United States and Russia. U.S. nuclear force planning and related arms control policies must take account of a larger set of variables than in the past, including the growing number of small nuclear arsenals – from North Korea to Pakistan to, perhaps soon, Iran and Iraq – and a modernized and expanded Chinese nuclear force. Moreover, there is a question about the role nuclear weapons should play in deterring the use of other kinds of weapons of mass destruction, such as chemical and biological, with the U.S. having foresworn those weapons’ development and use. It addition, there may be a need to develop a new family of nuclear weapons designed to address new sets of military requirements, such as would be required in targeting the very deep under-ground, hardened bunkers that are being built by many of our potential adversaries" (p. 8).

"But what should finally drive the size and character of our nuclear forces is not numerical parity with Russian capabilities but maintaining American strategic superiority – and, with that superiority, a capability to deter possible hostile coalitions of nuclear powers. U.S. nuclear superiority is nothing to be ashamed of; rather, it will be an essential element in preserving American leadership in a more complex and chaotic world" (p. 8).

D. Future Wars of Pax Americana

"Until the process of transformation is treated as an enduring military mission – worthy of a constant allocation of dollars and forces – it will remain stillborn" (p. 60).

"RAD" envisions a future in which the United States is in complete control of land, sea, air, space and cyberspace of planet Earth. It finds objectionable the limitations imposed by the ABM treaty and urges a newer rendition of Reagan's 'Star Wars' defense shield program. Three missions are seen as crucial.

1. Global Missile Defenses — "A network against limited strikes, capable of protecting the United States, its allies and forward-deployed forces, must be constructed. This must be a layered system of land, sea, air and space-based components" (p. 51).

"The first element in any missile defense network should be a galaxy of surveillance satellites with sensors capable of acquiring enemy ballistic missiles immediately upon launch" (p. 52).

"At the same time, the administration’s devotion to the 1972 Anti-Ballistic Missile (ABM) Treaty with the Soviet Union has frustrated development of useful ballistic missile defenses. This is reflected in deep budget cuts – planned spending on missile defenses for the late 1990s has been more than halved, halting work on space-based interceptors, cutting funds for a national missile defense system by 80 percent and theater defenses by 30 percent. Further, the administration has cut funding just at the crucial moments when individual programs begin to show promise. Only upgrades of currently existing systems like the Patriot missile – originally designed primarily for air defense against jet fighters, not missile defense – have proceeded generally on course.

"Most damaging of all was the decision in 1993 to terminate the 'Brilliant Pebbles' project. This legacy of the original Reagan-era 'Star Wars' effort had matured to the point where it was becoming feasible to develop a space-based interceptor capable of destroying ballistic missiles in the early or middle portion of their flight – far preferable than attempting to hit individual warheads surrounded by clusters of decoys on their final course toward their targets. But since a space-based system would violate the ABM Treaty, the administration killed the 'Brilliant Pebbles' program, choosing instead to proceed with a ground-based interceptor and radar system – one that will be costly without being especially effective" (p. 52).

2. Control of Space — "RAD" advises instituting a new "Space Service" thereby escalating U.S. military preparedness "from the theatre level to the global level" in order to achieve worldwide dominance, both militarily and commercially.

"Yet to truly transform itself for the coming century, the Air Force must accelerate its efforts to create the new systems – and, to repeat, the space-based systems – that are necessary to shift the scope of air operations from the theater level to the global level" (p. 64).

"…control of space – defined by Space Command as 'the ability to assure access to space, freedom of operations within the space medium, and an ability to deny others the use of space' – must be an essential element of our military strategy" (p. 55).

"Much as control of the high seas – and the protection of international commerce – defined global powers in the past, so will control of the new 'international commons' be a key to world power in the future. An America incapable of protecting its interests or that of its allies in space or the 'infosphere' will find it difficult to exert global political leadership" (p. 51).

"The proliferation of technologies for delivering highly accurate fires over increasingly great distances poses a great challenge for both the Army and the Marine Corps, but rather than attempting to compete in the game of applying long-range fires, both services would be better off attempting to complement the vastly improved strike capabilities of the Navy and Air Force, and indeed in linking decisive maneuvers to future space capabilities as well" (p. 68).

"Target significant new investments toward creating capabilities for operating in space, including inexpensive launch vehicles, new satellites and transatmospheric vehicles, in preparation for a decision as to whether space warfare is sufficiently different from combat within earth’s atmosphere so as to require a separate 'space service'. Such a transformation would in fact better realize the Air Force’s stated goal of becoming a service with true global reach and global strike capabilities" (p. 64).

"Given the advantages U.S. armed forces enjoy as a result of this unrestricted use of space, it is shortsighted to expect potential adversaries to refrain from attempting to disable or offset U.S. space capabilities. And with the proliferation of space know-how and related technology around the world, our adversaries will inevitably seek to enjoy many of the same space advantages in the future. Moreover, 'space commerce' is a growing part of the global economy. In 1996, commercial United States, and commercial revenues exceeded government expenditures on space. Today, more than 1,100 commercial companies across more than 50 countries are developing, building, and operating space systems.

"The complexity of space control will only grow as commercial activity increases. American and other allied investments in space systems will create a requirement to secure and protect these space assets; they are already an important measure of American power. Yet it will not merely be enough to protect friendly commercial uses of space.

"As Space Command also recognizes, the United States must also have the capability to deny America's adversaries the use of commercial space platforms for military purposes in times of crises and conflicts. Indeed, space is likely to become the new 'international commons', where commercial and security interests are intertwined and related. Just as Alfred Thayer Mahan wrote about 'sea-power' at the beginning of the 20th century in this sense, American strategists will be forced to regard 'space-power' in the 21st" (pp. 54-55).

"In short, the unequivocal supremacy in space enjoyed by the United States today will be increasingly at risk" (p. 55).

"As Colin Gray and John Sheldon have written, 'Space control is not an avoidable issue. It is not an optional extra.' For U.S. armed forces to continue to assert military preeminence, control of space – defined by Space Command as 'the ability to assure access to space, freedom of operations within the space medium, and an ability to deny others the use of space' – must be an essential element of our military strategy. If America cannot maintain that control, its ability to conduct global military operations will be severely complicated, far more costly, and potentially fatally compromised" (p. 55).

"But, over the longer term, maintaining control of space will inevitably require the application of force both in space and from space, including but not limited to anti-missile defenses and defensive systems capable of protecting U.S. and allied satellites; space control cannot be sustained in any other fashion, with conventional land, sea, or airforce, or by electronic warfare. This eventuality is already recognized by official U.S. national space policy, which states that the 'Department of Defense shall maintain a capability to execute the mission areas of space support, force enhancement, space control and force application.' (Emphasis added.)" (p. 56).

3. Control of Cyberspace — "Although many concepts of 'cyber-war' have elements of science fiction about them, and the role of the Defense Department in establishing 'control,' or even what 'security' on the Internet means, requires a consideration of a host of legal, moral and political issues, there nonetheless will remain an imperative to be able to deny America and its allies' enemies the ability to disrupt or paralyze either the military's or the commercial sector's computer networks.

"Conversely, an offensive capability could offer America's military and political leaders an invaluable tool in disabling an adversary in a decisive manner. Taken together, the prospects for space war or 'cyberspace war' represent the truly revolutionary potential inherent in the notion of military transformation. These future forms of warfare are technologically immature, to be sure. But, it is also clear that for the U.S. armed forces to remain preeminent and avoid an Achilles Heel in the exercise of its power they must be sure that these potential future forms of warfare favor America just as today’s air, land and sea warfare reflect United States military dominance" (p. 57).

Strategy for Transforming Conventional Forces

Read below notions of how conventional warfare will be conducted in the future, including the use of microbes and "advanced forms of biological warfare that can 'target' specific genotypes."

"In exploiting the 'revolution in military affairs,' the Pentagon must be driven by the enduring missions for U.S. forces. This process will have two stages: transition, featuring a mix of current and new systems; and true transformation, featuring new systems, organizations and operational concepts. This process must take a competitive approach, with services and joint-service operations competing for new roles and missions. Any successful process of transformation must be linked to the services, which are the institutions within the Defense Department with the ability and the responsibility for linking budgets and resources to specific missions" (p. 51).

"Although it may take several decades for the process of transformation to unfold, in time, the art of warfare on air, land, and sea will be vastly different than it is today, and 'combat' likely will take place in new dimensions: in space, 'cyber-space,' and perhaps the world of microbes. Air warfare may no longer be fought by pilots manning tactical fighter aircraft sweeping the skies of opposing fighters, but a regime dominated by long-range, stealthy unmanned craft. On land, the clash of massive, combined-arms armored forces may be replaced by the dashes of much lighter, stealthier and information-intensive forces, augmented by fleets of robots, some small enough to fit in soldiers’ pockets. Control of the sea could be largely determined not by fleets of surface combatants and aircraft carriers, but from land- and space-based systems, forcing navies to maneuver and fight underwater. Space itself will become a theater of war, as nations gain access to space capabilities and come to rely on them; further, the distinction between military and commercial space systems – combatants and noncombatants – will become blurred. Information systems will become an important focus of attack, particularly for U.S. enemies seeking to short-circuit sophisticated American forces. And advanced forms of biological warfare that can target specific genotypes may transform biological warfare from the realm of terror to a politically useful tool" (p. 60).

Changes in Naval Warfare: "Beyond immediate opportunities such as conversion of Trident submarines, consideration should be given to employing a deactivated carrier to better understand the possibilities of operating large fleets of UAVs at sea. Likewise, submerged 'missile pods,' either permanently deployed or laid covertly by submarines in times of crisis, could increase strike capabilities without risking surface vessels in littoral waters. In general, if the Navy is moving toward 'network-centric' warfare, it should explore ways of increasing the number of 'nodes on the net'" (p. 67).

Army of the Future: "Consider just the potential changes that might effect the infantryman. Future soldiers may operate in encapsulated, climate-controlled, powered fighting suits, laced with sensors, and boasting chameleon-like 'active' camouflage. 'Skin-patch' pharmaceuticals help regulate fears, focus concentration and enhance endurance and strength. A display mounted on a soldier’s helmet permits a comprehensive view of the battlefield – in effect to look around corners and over hills – and allows the soldier to access the entire combat information and intelligence system while filtering incoming data to prevent overload. Individual weapons are more lethal, and a soldier’s ability to call for highly precise and reliable indirect fires – not only from Army systems but those of other services – allows each individual to have great influence over huge spaces. Under the 'Land Warrior' program, some Army experts envision a 'squad' of seven soldiers able to dominate an area the size of the Gettysburg battlefield – where, in 1863, some 165,000 men fought" (p. 62).