“We Are Now at a Historical Inflection Point at Which the Time Has Arrived for a Classic Post-War Demobilization of the Entire Military Establishment" → Washingtons Blog
“We Are Now at a Historical Inflection Point at Which the Time Has Arrived for a Classic Post-War Demobilization of the Entire Military Establishment" - Washingtons Blog

Monday, January 10, 2011

“We Are Now at a Historical Inflection Point at Which the Time Has Arrived for a Classic Post-War Demobilization of the Entire Military Establishment"

Ronald Reagan's budget director - David Stockman - pulls no punches in a must-read interview with Raw Story:

We are now at a historical inflection point at which the time has arrived for a classic post-war demobilization of the entire military establishment," David Stockman said in an exclusive interview.

"The Cold War is long over," he continued. "The wars of occupation are almost over and were complete failures -- Afghanistan and Iraq. The American empire is done. There are no real seriously armed enemies left in the world that can possibly justify an $800 billion national defense and security establishment, including Homeland Security."

Short of that, he suggested, the United States has "reached the point of no return" with its artificial creation of wealth, and will eventually face a sharp economic decline.


This is a profound disappointment that there's not even a debate -- a serious debate about dramatic change in our imperialist foreign policy and war-making establishment in this administration -- allegedly the most left-wing administration that we've had in modern time."

"I don't have much hope that what needs to be done will be done until it's finally forced on us by a world bond market crisis, which will happen sooner or later," Stockman added.


That's why we're just at the beginning of solving this massive financial collapse we had in 2008 and not in the process of healthy recovery as some of the pals in the White House or on Capitol Hill or on Wall Street would have you believe."
For more on why wars are bad for the economy, see this. For other recent statements from Stockman, see this and this.


  1. Quite surprisingly good for a Reagan minister, IMO. I would almost wholeheartedly agree except that I think that some of his time-frame considerations are a bit optimistic.

    "... will eventually face a sharp economic decline" should read "is already facing..." or "will very soon face..." at best.

    "which will happen sooner or later" should read, "which will happen sooner than later".


  2. Well he doesn't understand monetary policy, not a bit.
    He talks about monetary system dead from 1973, what's more limitations of gold standard have no apliction to fiat currency regime. Stealing from the future - but how...???
    Also, debt doesn't finance anything currently, but it's nice form of corporate welfare...

  3. There is a limit as to how much taxation a society will tolerate. Oppressive burdens lead by taxation has been the cause of destruction of all great societies.

    Stockman ties the economic downturn to high taxation required to fund continual military aggression of the past sixty years---and to conclude a continuation will be ruinous.

    But he is too late. As Mr. Bernanke recently related to Congress, a reduction in the deficit spending will have a destructive affect on the economy. An interest bearing national economy is a Ponzi scheme which cannot be downsized.

    We are faced with an economic collapse if federal spending is reduced and hyper inflation if the humongous federal spending is continued.

    Ref. http://www.synapticsparks.info/dialog/index.php?topic=32.msg192

  4. Nothing less than a complete reordering of government's relationship to the economy... ending of the war funding Stockman proposes, yes, but ending of ALL "entitlements...Social Security, Medicare, Medicaid, welfare and more. How to address social ills without compromising equality inder law? Here's an outline"

    1. All persons residing in the U.S. shall come together in households for the purpose of reporting all income from any source, each item to be identified by payer's and payee's tax number. Members of a household need not be related, need not reside together, and a household may consist of as few as one person.
    2. Each year congress shall set by legislation a "minimum wage" and a "tax rate".
    3. The following income shall not be subject to taxation:
    • An amount equal to a year's earnings at the minimum wage rate, for each adult (age 20-65) member of the household, decreasing 10% per year to 50% at age 15 and increasing 10% per year to 150% at age 70.
    • All payments for what is classified as necessary health care for all members of the household including medical care, any pharmaceuticals prescribed by a recognized health care professional, vision and hearing aids, and membership fees for health-enhancing entities such as gyms or other exercise facilities. Health care insurance premiums may be deducted but not health care expense paid for by such insurance.
    • All educational expenses including day care for young children or legally incompetent persons, that portion of state and local taxes identified as spent on education, that portion of parochial school tuition, fees and other expenses identified as going for non-sectarian education, tuition, fees and educational materials for private school education at any level, and a per-diem allowance for students traveling more than 50 miles from primary residence for education.
    • All income saved into an identified account from which investments may be made.
    4. The "tax rate" shall be applied to any income over and above the deductions listed above, regardless of amount.
    5. There shall be no federal tax on corporations or other business entities.
    6. The Office of Management and Budget shall compute revenues to be expected using the newly set tax rate and minimum wage, applied to the previous year's reported incomes. No expenses in excess of that amount may be authorized or made by the federal government without approval by 75% of each house of Congress.
    7. At the request, by legislation duly enacted by a municipality having greater than 100,000 inhabitants or a state, a surtax may be imposed on citizens of that municipality or state which shall be applied in a manner exactly as applied for the Federal tax.
    8. For households whose deductions exceed total income, the Federal Government shall make payment equal to the tax rate multiplied by the shortfall in income, as shall municipalities and states.

  5. It is frequently suggested : “If taxation would be my way, it will be fair.” and under such a rubric, tyranny originates.

    A maxim of law has been established; if an object is properly subject to taxation, it is not a concern of the courts if the object being taxed is destroyed.

    Is the pursuit of a livelihood a suitable object for taxation ? NO. The pursuit of a livelihood is but one facet of the basic Constitutional Right of Liberty confirmed by 200 years of unbroken adjudication. Constitutional rights, such as your right to a trial by jury, cannot be properly subject to taxation. The power to tax is the power to destroy and Constitutional Rights cannot properly be subject to destruction.

    Have the courts ever held that an income tax levied upon a citizen’s pursuit of a livelihood is not a violation of an INDIVIDUAL’s constitutional right ?? NO. Ref. http://www.usa-the-republic.com/revenue/liberty/index.html Part 2.

    Have the courts upheld income tax indictments with Opinions that conflict with holdings of the same court and with numerous holdings of the Supreme Court of the United States ? IMO, definitely. . http://www.usa-the-republic.com/revenue/liberty/index.html , Part 4 & 5, addendum.

  6. Only Sure and an Honorable way out for the U.S
    1. Request Emergency Meeting of UN / WB/IMF/ All Heads of States/ Finance Minister to review the Friendly Request Proposal of USA saying that:
    A. It agrees that series of wrong move landed US and its creditors to such a situation are recognized, understood and the faults admitted.
    B. Request rest of the world to consider bailing out USA as this is first time in the History of our times and this mistake would not be repeated as America must swear to cut down its Domestic Extravagent Expenses, Ready to live with slight;y lower standard for a few years.
    Close its Armament and War Industry, call all troops back, Declare No War Pacts with its Rival Nations, initiate Economic as well Banking reforms from/ People friendly reforms
    in the UN and global Fin Institutions likeIMF, WB, Adequately reflect its foreign policy.

    D. If these steps are initiated, perhaps rest of the world would bail out United States this time.

    Let us not forget that admist this gloom and Chaos Universe has provided us an opportunity NOW to reduce global tensions, forge Unity, Bring a Global binding Resolution to enforce all Nations for Complete and Comprehensive Nuclear Disarmament and for America to move ahead with head held High with a Resolve to end Poverty and establish Lasting Peace on this Wonderful Planet. I look forward to positive moves coming from this great nation USA !

    Ashok Sharma


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