Even without the costs of the wars in Iraq and Afghanistan, which are fast surpassing half a trillion dollars, U.S. military spending is now the largest item in the Federal budget.
A proposed supplemental appropriation to pay for the wars in Afghanistan and Iraq “brings proposed military spending for FY 2008 to $647.2 billion, the highest level of military spending since the end of World War II—higher than Vietnam, higher than Korea, higher than the peak of the Reagan buildup.”
The skyrocketing Pentagon budget has been a boon for its contractors. It has driven shares of leading Pentagon contractors Lockheed Martin Corp., Northrop Grumman Corp., and General Dynamics Corp. to all-time highs.
[Meanwhile] low- and middle-income Americans are squeezed out of economic or subsistence resources in order to make up for the resulting budgetary shortfalls. For example, as the official Pentagon budget for 2008 fiscal year is projected to rise by more than 10 percent, or nearly $50 billion, “a total of 141 government programs will be eliminated or sharply reduced” to pay for the increase. These would include cuts in housing assistance for low-income seniors by 25 percent, home heating/energy assistance to low-income people by 18 percent, funding for community development grants by 12.7 percent, and grants for education and employment training by 8 percent.”
The following are some specific statistics of how redistributive militarism and supply-side fiscal policies have exacerbated income inequality since the late 1970s and early 1980s—making after-tax income gaps wider than pre-tax ones. According to recently released data by the Congressional Budget Office (CBO), since 1979 income gains among high-income households have dwarfed those of middle- and low-income households. Specifically:
· The average after-tax income of the top one percent of the population nearly tripled, rising from $314,000 to nearly $868,000—for a total increase of $554,000, or 176 percent. (Figures are adjusted by CBO for inflation.)
· By contrast, the average after-tax income of the middle fifth of the population rose a relatively modest 21 percent, or $8,500, reaching $48,400 in 2004.
· The average after-tax income of the poorest fifth of the population rose just 6 percent, or $800, during this period, reaching $14,700 in 2004.
[The author, Ismael Hossein-zadeh, is an economics professor at Drake University, Des Moines, Iowa. This excerpt above draws upon his recently published book, The Political Economy of U.S. Militarism ]
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