Category Archives: Cold War Economics

The Cold War Oxymoron

Why did the Cold War (1947-1991) unfold? Wars are declared by states for one reason or another; self-protection, resources, or territorial expansion are a few of the reasons.  To fight

Cold War Exhibit Entry. The Ford Library

Cold War Exhibit Entry. The Ford Library

a war, however, a nation’s people must be inflamed and rallied around a noble cause, else the people required to fight the war might have to be chained in place.  WWII was declared in the West when Germany and Russia invaded Poland in 1939 and, in the Pacific, when the Empire of Japan invaded the Republic of China in 1937.  Democracy and the Western way-of-life was the noble idea in the U.S., but in Western Europe and Great Britain, the noble cause was protecting the physical shores or recapturing one’s country. WWI was declared following the assassination of Austria’s Archduke Franz Ferdinand and his wife Sophie in Sarajevo, Bosnia by the ‘Black Hand’, a Serbian secret society. The noble idea was national pride.

The preceding is gross oversimplification.  To be sure, the learned have written volumes on each war throughout known history. And each tome was penned through the author’s particular analytical lens.  Every scholarly argument as to why and how a particular war began is stated, properly supported, and documented. However, if the observer is far enough away, the date of the war and the mechanism by which governments mobilize the citizenry to fight and die in it, are fairly discrete and unpretentious. On the receiving side mobilizing the citizenry is very simple; they fight to defend themselves or their culture from a perceived threat, or to help a friend do it. The Cold War, however, does not reduce to a reason and a noble idea. It is vexing.

The Cold War more closely resembles an economic construct; some weird and wonderful 6a00e551f080038834017d40ff1fa7970cKeynesian cycle whose bubble finally burst in 1991, when President Clinton declared the Cold War over. A British economist, civil servant, director of the British Eugenics Society, director of the Bank of England, part of the Bloomsbury Group of intellectuals, et cetera, John Maynard Keynes, is one of the founders of modern macroeconomics, and he greatly influenced the economic policies of western governments. Developed during the 1930s, Keynesian economics is a theory promoting government intervention in the marketplace and monetary policy as the best way to warrant economic growth and stability as well as level out the ‘boom and bust’ cycles[1].  In the U.S. in 2007, the intervention first by the Bush administration and continuing through the Obama administration to save the ‘too-big-to-fail’ companies through the Troubled Asset Relief Program, TARP, and the Federal Reserve’s $80 billion a month bond buying program are direct applications of Keynes’ theory.

Keynes theories were 180 degrees juxtaposed from the classical (or neo-classical) liberal economists who argued for a free market with the role of government being very small andHayek confined. Friedrich Hayek and Milton Friedman, two such economists, argued that government should be as small as possible in order to allow the exercise of individual freedom. They maintained that free markets would, in the short to medium term, automatically provide full employment, as long as workers were flexible in their wage demands. Not surprisingly, almost all governments adopting or adapting Keynesian policy recommendations versus the classical liberal approach have resulted in the crony capitalism that is destroying personal freedom and the marketplace in today’s world.  For the record, my bias is to the classical liberal.  Continue reading

“…America’s greatest days are yet to come….” Jim Bennett and Mike Lotus

Today, December 21, 2013, marks the changing of the seasons. It is a good day to reflect on517Oz3UR0BL._SY344_PJlook-inside-v2,TopRight,1,0_SH20_BO1,204,203,200_ another safe journey around the sun and anticipate the beauty we may behold as spring bursts forth with life renewed.  It is a good day to listen to the message of hope in the Jim Bennett and Mike Lotus book, America 3.0: Rebooting American Prosperity in the 21st Century-Why America’s Greatest Days Are Yet to Come.  It is even better because you can.  Tonight, John B. Wells will be interviewing the authors on Coast to Coast AM.

Some decades ago, the U.S. marked a sea change of ideas. I write about the legacy of the Cold War because I lived it and, right or wrong, contributed to its propagation.  The Cold War was the implementation of the ideas perpetrated during the time that Bennett and Lotus call America 2.0.  The ideas and their implementation have led the American people down a garden path of debt, socialism, massive central government, a standing military, loss of individual rights, and entitlement.  They have achieved what Frédéric Bastiat described as a Complete Perversion of The Law in the late 1840s:

The law has been used to destroy its own objective: It has been applied to annihilating the justice that it was supposed to maintain; to limiting and destroying rights which its real purpose was to respect. The law has placed the collective force at the disposal of the unscrupulous who wish, without risk, to exploit the person, liberty, and property of others. It has converted plunder into a right, in order to protect plunder. And it has converted lawful defense into a crime, in order to punish lawful defense.

There is a restlessness, an uneasiness among the population that is palpable.  The federal government’s response has been one of fear.  The government gets more abusive as it becomes increasingly fearful.  The tide will change. The people will rebel at the ballot box and in the picket line but then what? What is the plan?  Voices decry the current situation but few offer solutions.  America 3.0 is the right idea presented at the right time.  The John Wells interview is a long format so the ideas can be explored.

 

Cold War Economics – That Demmed, Elusive Pimpernel

As chief spy-catcher Chauvelin chased that demmed,[1] elusive Scarlet Pimpernel to no availThe Scarlet Pimpernel Book Club 20116 in 1793, I have gone to great lengths to understand the legacy of Cold War Economics.  Until recently, Chauvelin and I were vying for first place in the ‘we-don’t-get-it’ category.  That “Aha” moment was not accompanied by a drumroll or lightning bolt, it quietly unfolded in Peter J. Boettke’s The Mystery of the Mundane  in the November issue of The Freeman Magazine.  In Boettke’s words, I was outfitted with the right lens to be amazed by the mystery of the mundane.

Cold War economics in the U.S. was a coup d’état played out over sixty years in slow motion.

Lieutenant General Walter Krueger, Commanding General, U.S. Sixth Army (left), General Douglas MacArthur, Supreme Commander, Allied Forces, Southwest Pacific Area, and General George C. Marshall,  Chief of Staff, U.S. Army (right)  At a field headquarters in the Southwest Pacific Area, late 1943. (Photograph from the Army Signal Corps Collection in the U.S. National Archives. Photo #: SC 183951)

Lieutenant General Walter Krueger, Commanding General, U.S. Sixth Army (left), General Douglas MacArthur, Supreme Commander, Allied Forces, Southwest Pacific Area, and General George C. Marshall, Chief of Staff, U.S. Army (right) At a field headquarters in the Southwest Pacific Area, late 1943. (Photograph from the Army Signal Corps Collection in the U.S. National Archives. Photo #: SC 183951)

The government toppled the people.  Using a cycle of fear and legislation, the federal government consolidated power in an ever increasing spiral over time.  General Douglas MacArthur, in his book A Soldier Speaks, said it best, “Our government has kept us in a perpetual state of fear—kept us in a continuous stampede of patriotic fervor—with the cry of grave national emergency. Always there has been some terrible evil at home or some monstrous foreign power that was going to gobble us up if we did not blindly rally behind it by furnishing the exorbitant funds demanded. Yet, in retrospect, these disasters seem never to have happened, seem never to have been quite real.”

Robert Higgs’ research article, The Cold War Economy; Opportunity Costs, Ideology, and the Politics of Crisis published in 1994 illustrates how the Cold War forever changed the cost and use of the military.  Higgs states that:

“Before World War II the allocation of resources to military purposes remained at token levels, typically no more than one percent of GNP, except during actual warfare, which occurred infrequently. Wartime and peacetime were distinct, and during peacetime—that is, nearly all the time—the societal opportunity cost of “guns” was nearly nil. The old regime ended in 1939. The massive mobilization of the early 1940s drove the military share of GNP to more than 41 percent at its peak in 1943-44.   Despite an enormous demobilization after 1944, the military sector in 1947, at the postwar trough, still accounted for 4.3 percent of GNP, three times the 1939 share.” Continue reading

From the Ashes a Cheetah Rises – A Peculiar Ghanaian Tale

Kwame Nkrumah, Ghana’s Prime Minister, was deposed in a bloodless coup d’état inmap-ghana-africa-imp February 1966. For once, the CIA was not involved, but I was there.  Well…I was ‘sort of’ there.  It was my very first coup d’état and I slept through it.  It was hot, gray and raining when I rose to consciousness on February 25, 1966 so it was either 10:00 a.m. or 2:00 p.m. but how I knew that is anyone’s guess.  I snatched at the vestiges of images in my mind to form a thought. Any thought I could recognize as such would do.  Finally, it occurred to me I had no idea where I was.  It was no small relief to feel my control-freak kicking in to begin its inventory of the situation.  The data packets were sorted and re-sorted until they made sense.  Ah ha! I was in a hospital room in Tema, Ghana smack in the middle of West Africa.  Although I recalled curling up to receive a spinal tap I had no idea why I had gotten one or how I got here.  To my great relief, Audrey entered the room.  Answers would come now.

Audrey was my friend.  Typically Ghanaian, she was beautiful, elegant, and graceful.  Audrey was also the mother of five and very wise.  She entered the room silently and began to bubble in Twi, her native Akan language, when she realized I was awake.  My command of Twi was much less than hers of English or Dutch but I gathered I’d been unconscious for several days as a result of a bout with meningitis.  She had brought wonderful cut oranges, which my parched body fairly inhaled, and some bloody awful tasting tea, which she said would heal me quickly.  Later I wondered if she came prepared with these wonders daily or if she knew that that day I’d be back.  The Ghanaians I know and love are incredibly intuitive.

In the early morning hours of 24 Feb., 1966, Ghana's armed forces, with the cooperation of the National Police, took over government in "Operation Cold Chop", a well-organized coup d'etat. The first announcement made from Radio Ghana said that the coup was led by Kotoka.  Nkrumah`s statue was pulled down! Here children are seen standing on Nkrumah`s statue”

In the early morning hours of 24 Feb., 1966, Ghana’s armed forces, with the cooperation of the National Police, took over government in “Operation Cold Chop”, a well-organized coup d’etat. The first announcement made from Radio Ghana said that the coup was led by Kotoka. Nkrumah`s statue was pulled down! Here children are seen standing on Nkrumah`s statue”

As the excitement settled, Audrey unfolded the tale of the coup.  She said that the generals had seen Kwame Nkrumah safely out of the country and then taken over.  She also spun images of very dark happenings in Accra, Ghana’s capitol.  The zoo had been broken into and many animals slaughtered and, she said, when the people toppled a statue of Nkrumah they found the skeletal remains of twins. Bad Juju.  Prime Minister Nkrumah had worshiped in his own temple and completely embraced his surrogate title, Osagyefo, which means “redeemer”.   Times would become even more difficult for the Ghanaians and very strange for expatriates like me as General Joseph Arthur Ankrah took the reins of power.

All of us faced a new Ghana, a new order to life as the military closed the harbors, set up checkpoints, and inserted themselves into schools, unions, and the workplace.  The dash-bribes-became virtually codified and bottles of Simba (beer) would no longer do. Cash became king. This is not to say that Nkrumah had done less, it was just that he did it differently.  Nkrumah was focused on his intellectual legacy as well as his in-country power.  Ankrah’s administration was corrupted at a far more fundamental level. Continue reading

Freedom and Empire in America – A Cold War Identity Crisis

The Rule of Freedom (Courtesy of theruleoffreedom.wordpress.com)

The Rule of Freedom (Courtesy of theruleoffreedom.wordpress.com)

Four decades of Cold War wanderings around the world yielded a few answers to the important questions of life for this itinerant engineer, but one vital query went wanting. Why did the people I meet in Africa, Australia, South America, the Pacific, Europe, and Asia love and embrace me, a lowly American, but hate the country I loved?  Starving under various socio-political-economic systems drove iterations of learning and deepened my belief in the underlying truth and integrity of the governance wrapped by ideals that the founding brothers attempted to frame during the development of the Constitution of the United States.  When did the U.S. stop being the ‘good guys’ and join the roster of ‘bad guys’?

In WWII, the U.S. played the good guys rescuing the world from the nightmares of Hitler and Japan.  U.S. soldiers from farms, factories and villages across the country fought and died in places they did not know existed. There are American soldiers buried in cemeteries in

American Military Cemetery in Margraten, Netherlands

American Military Cemetery in Margraten, Netherlands

France, Belgium, England, Italy, Luxembourg, Philippines, Netherlands, and Tunisia. In 2012, the Times- Herald’s Alex McRae wrote, “When Netherlands resident Marco Weijers adopted the grave of Newnan’s Albert Partridge, he became one of 8,301 local residents who adopted the grave of an American soldier at the American Military Cemetery in Margraten, Netherlands.”[1]  The U.S. was far from angelic during WWII, but the overall review was good. Following WWII, the American public pushed to ‘restore its natural order’.  They expected the soldiers to come home, the war machine to be trimmed down smartly and the business of making a living and a life to resume.  Surprise! Peace was a dream and, for a while, it was an illusion.   The Cold War clicked on and the nation’s long journey to the ‘dark side’ began with unsteady first steps.  But wait, there’s more!

The Borg Generation – A Cold War Legacy

It was cold and dark that early December 1982 night when stew, homemade biscuits and honey warmed the insides of five hungry, tired people. I remember it well because it was the night of my

It is all about how our children are educated.

It is all about how our children are educated.

awakening; the realization that I no longer lived in my father’s America. Dinner was followed by chores and homework. Our son was assigned dishes and the two girls were told to bundle up the trash and take it out. We, the parents, took care of clearing the table, putting excess food away, and sweeping up. Right then is when the trouble started. Our eldest daughter informed us that we had no right to force her to take out the trash as that constituted psychological abuse. What?

The next day found us at the elementary school principal’s office demanding to know what was happening in that particular classroom. The principal made soothing, cooing noises as she explained that twenty-five percent of children in the United States were abused and the federal government was sponsoring an abuse awareness campaign. But wait, there’s more!

Wizard’s Chess

The pieces on the geopolitical chess board are in play in all three dimensions. Politically, nations are reacting to cultures in transition. Economically, there is a reordering of monetary and commodity values. Militarily, there is movement on a global scale. The tension mounts. The fishmongers ramp-up the volume as they compete for our attention with their wares wrapped in newsprint, byte segments and blog-tissue. The neurons that, in a single black box fleck of time, take data and make information we can understand, are fairly glowing with activity. Scandals riddle the federal government. Gold is dropping like a rock and oil is skyrocketing. The U.S. is hunting Snowden, the NSA whistleblower. Egypt is in flames. North Korea is playing games. India and China are facing off. So much is happening simultaneously, it is difficult to focus the present picture of our little globe. We humans do like our patterns and pictures to help us understand how events impact us individually. What is going on?

Is there, as some believe, a conspiracy of the global elite? It is no theory that a group of elite people, the Bilderberg Group, representing “government, finance, industry, labour, education and communications”[1] have been meeting annually to discuss the world situation for over fifty years. The Bilderberg Group even summons individuals from the bourgeoisie to attend from time-to-time. In Montreal, they interviewed President Obama before his first run. While I have no doubt they would like and, perhaps, even try to be puppet masters, there are too many variables. Humans, as individuals and groups of individuals, are too unpredictable.  On the other hand, it would not make sense to discount the Bilderberg Group and their agenda. There is no doubt that the members are players on the global stage and specific initiatives, such as the United Nations Agenda 21, are integrated into plans and vigorously promoted.

What is the problem with the UN’s Agenda 21 and its benign label of ‘Sustainable Development’? “Agenda 21, Sustainable Development, is the action plan implemented worldwide to inventory and control all land, all water, all minerals, all plants, all animals, all construction, all means of production, all energy, all education, all information, and all human beings in the world.  INVENTORY AND CONTROL.”[2]—Rosa Koire.  For a start, it removes resources from the hands of individuals and places them in the hands of a bureaucracy and it herds people into central population centers. Agenda 21 is the antithesis of the founding principles of the U.S., the concept of Natural Law. “Life, faculties, production — in other words, individuality, liberty, property — this is man.” Frédéric Bastiat, The Law (written in 1850). The U.S. Agenda 21 process is well underway in central planning processes.

If not a global puppet master, what then? Wizard’s Chess in three dimensions-political, economic, and military- appears to be the game of choice.  In Wizard’s Chess, the pieces move of their own

Let the games begin.

Let the games begin.

accord when commanded by the player. “When a piece is taken, it is removed by the attacking piece, often in a barbaric manner where the losing piece is smashed violently by the winning piece.”[3] Depending upon the number of players, the chess board can become a chaotic place.

China, the Wizard’s Rook, is trying the wings of its newly found economic growth. With the tentative measure of placing troops in Mali, China is stepping off-continent. At the economic chess board, China is also ‘stepping out’, broadening its horizons with arms sales according to Reuters. “China’s volume of weapons exports between 2008 and 2012 rose 162 percent compared with the previous five-year period, with its share of the global arms trade rising from 2 percent to 5 percent, the Stockholm International Peace Research Institute (SIPRI) said.”[4] For instance, China’s recent sale of missiles to Turkey has NATO all abuzz.[5]

China is busy taking care of business politically as well. Overcoming past bad blood with Russia, China is reaching out for an alliance. The Diplomat points out that managing expectations about the relationship; expanding bilateral trade in energy and arms; and cooperation on international security affairs was the focus of a March 2013 conference between Russia’s Putin and China’s Jinping.[6] In the Indian Ocean, China is building harbors for trade but according to Stimson’s Ellen Laipson, “China’s maritime objectives in shipbuilding and port construction around the Indian Ocean are driven by commercial interests, although it’s reasonable to assume that the large investments could later evolve or be adapted for military purposes.”[7]

While the U.S. is the reigning superpower in the region, its light is fading. Combinations of other countries, like India, Pakistan, China, and the Koreas, are moving their respective chess pieces to fill in the voids and take up the slack. The U.S. is, arguably, the largest super power the world has ever seen. For the decades it engaged the Cold War (1947-1991), it grew to be a full service super

Waiting in the wings.

Waiting in the wings.

power provider. It built infrastructure, protected and manipulated countries without conquest, bolstered, bought and traded its way to its objectives, fought political wars, and ‘policed’ the world.  The U.S. played its pawns; installed and toppled leaders, bought and sold countries, and befriended and betrayed rogue groups. The U.S. may be a poor empire builder but she is a great super power who, until recently, controlled the seven seas. She is the Wizard’s queen and she is on the run. No one with any wisdom, however, would count the queen in check.

Russia, the Wizard’s Bishop, is on the move, double-time, since Vladimir Putin re-ascended the presidency. Putin does not trust the U.S. and most in the U.S. do not trust Putin. Each side has valid reasons for their distrust. Putin senses that the U.S. is a tired super power and is moving to fill some of the void. Putin knows, as we all do, that the U.S. is strapped for cash as he bolsters his oil and gas resources and backs Syria’s Assad. Putin has noted the U.S.’s current penchant for kinder, softer tactics like ‘winning hearts and minds’ and ‘leading from behind’ as he backs Iran. Arming both hemispheres of the world, a business area traditionally under the almost exclusive control of the U.S., has become a pastime for Putin’s government. The Wizard’s Bishop and Rook have teamed up on some policy fronts. Their combined capabilities rival the Wizard Queen’s.

Others of the Wizard’s pawns are moving smartly to avoid becoming victims of the super-storm cells that are swirling about in an apparently random fashion. India has a rocket, Agni-V, which can accurately deliver a payload over 3,000 miles. Pakistan is redoubling its nuclear saber rattling in its dispute with India over the Kashmir region, a legacy of the colonial breakup. Of course, India is reciprocating. Venezuela is buying missiles and submarines. North Korea is bellowing about its nuclear capability. Brazil, if it doesn’t disintegrate, is an emerging giant and prepared to defend its position. The Arab conflicts, mostly a Shi’a/Sunni issue and a legacy of decolonization, are ripping the Middle East apart. Every player, except the U.S., is amassing gold bullion; a sign of coming monetary upheaval.  Bread baskets in countries across the world are being fortified with defenses; yet another sign of global insecurity.

The Wizard’s chess boards are chaotic on all three levels; political, economic, and military. While chaos is disconcerting and unsettling to the human psyche, creative solutions frequently precipitate from the mess. While the Wizard’s chess game is unfolding quickly, others are preparing to play the next game. The odds-makers cipher the probabilities and the poker players are amusing themselves shuffling the geopolitical deck.  If the old Queen is placed in check, the world will look different. The key to stability on all three levels of Wizard’s chess, is the behavior of the Queen. Can she withdraw to her color without sacrificing her power? At the moment it is dicey. As China and Russia emerge from socialism and communism to trade-based economies, the U.S. is rocketing headlong into that failed experiment. It has never been more important that the U.S. hold onto its founding principles for it is a dangerous game being played. If the U.S. Queen fails in her withdrawal strategy and is captured, the destruction will be monumental and cultures of the world will reel backwards.




[2] Behind the Green Mask; Rosa Koire; http://www.democratsagainstunagenda21.com/

[4] Reuters; China replaces Britain in world’s top five arms exporters: report; http://www.reuters.com/article/2013/03/18/us-china-arms-exports-idUSBRE92G0L120130318

[6] The Diplomat; April 12, 2013; A Russia-China Alliance Brewing?; http://thediplomat.com/2013/04/12/a-russia-china-alliance-brewing/

[7] International Business Times; June 27 2013; Ellen Laipson; New Geopolitics In The Indian Ocean Region?; http://www.ibtimes.com/new-geopolitics-indian-ocean-region-1326305

Choice of Legacy

Choices, the exercises of an individual’s free will, are the stepping stones that line the paths of our lives. Once made, the path that follows is fairly well defined. Barring unforeseen storms, or other intervention, the only way to avoid the path’s destination is to modify the original choice. So, too, it is with a country’s destiny. Today the U.S. trudges along such a path. The last big change in the path’s direction occurred in 1947with Truman’s decision to enter the Cold War (1947-1991).  Harry Truman could have chosen the ‘damn-the-torpedoes’ route and told the U.S.’s Josef Stalin to return our POW’s or the U.S. would come and get them. “Here’s the deal. Both ways, Joe, we will bring our soldiers home and only then will we go our separate ways,” he could have said. But he did not.

One of my indulgences is wondering. What might have happened if the U.S. had chosen to ‘go its own way’ after WWII? The big military contractors could have returned to what they had done best before the War. Raytheon might have continued manufacturing transformers, power equipment, electronics and vacuum tubes. With their employees’ creativity and skill, who can guess what wonders would have been performed in the market place. Northrop Grumman might have teamed with Martin Marietta and Lockheed for the Mars terraforming project. Cold fusion could have been pursued and solar paint perfected so, by now, we all could generate the energy we use in the closet or by painting the house. Instead of dreaming up biological weapons and their antidotes, medical research could have teamed with nano-tech developers to solve the ills of the world.

The tens of thousands of returning WWII veterans would have joined the manufacturing and development boom in response to a need for skilled, hard-working employees. Disposable incomes would have risen and the economy would be healthier. Of course, the hard part for government would be staying out of the way and allowing the winnowing process to occur. Crony capitalism and the unholy matrimony of corporations to government would have to die. Big bloated companies would fail without their political patronage and individuals with new and creative ideas could sew the fields and grow.  Okay, so we might have done better but what about the rest of the world?

Europe was reconstructed with a large influx of U.S. Marshall Plan dollars. Asia essentially brought itself back by its bootstraps. Guess which geopolitical area won the race of most improved living condition for the most people? Once ‘Communism’ was no longer defined as a national security issue, the trillions of dollars in foreign aid could have been saved. There would be no demand for the ‘pathological altruism’ that drives billions of taxpayer dollars into the hands of people who openly call us ‘enemy’. The CIA would have had no need to overthrow governments or back cruel, corrupt ‘leaders’. Yes, the world would still have had to ‘settle out’ from the colonial legacy. Then again, it is ‘settling out’ anyway in countries and continents like India, Pakistan, Saudi Arabia, Syria, Iraq, Iran, and Africa. Energy could have been spent on encouraging free and open trade and manufacturing. It is the one thing we know works. China, Russia, and Taiwan are all examples where markets drive a culture forward for more people faster than bureaucracies ever could. No, these countries’ cultures do not look like the U.S. culture but they do not have to look the same to be successful.

With Communism off the national security table, there is no justification for stationing the military in over 200 countries across the globe. To illustrate, the U.S. has three bases in Bulgaria. Bush wanted the bases ostensibly to rapidly deploy troops to the Middle East where, of course, we have no national security dog in the fight. For goodness sake, why on earth does the U.S. want or need to maintain three military bases in Bulgaria?  In the meanders of my mind, the Navy would be committed, as it was, to keeping the lanes of commerce open. The war knowledge, competencies, and lessons learned would have been continued through the marines, surface, naval air, and submarine services. The other services could have been reduced in force to a minimum. Oh we would still be playing tit-for-tat on weapons development but no arms race means the effort would have been reduced by orders of magnitude. There is no need to police the world and try to make it over in our own image. Many think tanks and foundations work and play better with our brothers and sisters across the globe than the government ever could.

None of it happened. We chose to engage the Cold War and are living the legacy of that choice. In the U.S. effort to defeat Communism, the country has embraced socialism. The U.S. can be likened to a big fish with a line of lamprey eels locked on and sucking its life blood. The lamprey eels even have names; agriculture, health care, education, military/industrial, federal lands, environment, big pharma. No matter how much the big fish eats there is not enough to feed the parasites so the big fish begins to devour its young. As the big fish slowly dies, all energy is focused on survival not creative problem solving. The federal government has indebted the young, innocent, and upcoming taxpayers to a point where none may draw a breath free for their own choices.

Unrealistic, you say. Perhaps it is, but I venture to guess that if Harry Truman knew the destination of the path his choice made, he’d have laughed in disbelief. The U.S. is a lousy imperialist. Others, such as the European nations, Russia, and the remnants of Persia have been at the imperialism game for centuries and are much better suited to the role. Imperialism is not a part of the U.S.’s culture heritage, yet here it is, playing imperialist. The U.S. is so inept that it cannot even understand it has lost the game so it keeps trying harder.

One thing the U.S. has historically done well is to breed and foster individual exceptionalism.  The individuals, who dream, build, excel, and fail with equal enthusiasm only to tackle the challenge anew or again, built this land; rooted in industry, farming, mining and business. It is they, with their creative sweat, who laid block upon block to build the greatest country in the world. Even today, during some tough times, most of us have no concept of real poverty or pain. Instead of embracing what it does well, building a working environment fit for an exceptional people, the federal government appears bent on complete annihilation of the individual.

Once each individual is pushed, pulled, compressed or stamped into the federal government’s ‘ideal’ bottle, we’ll all be on the pills seventy percent of us already take. Once the individual allows the theft of the creative sweat that provides the unique nature of each person, the nation will die. I do not like to be labeled. I like chocolate and cupcakes, kids who climb trees and play Jedi knights in shining armor saving a world. Sometimes I choose to engage in ‘high-risk behavior’ like not fastening my seat belt or playing with nukes. I do not want my refrigerator to make my grocery list or report its contents to the government (just in case I am not following my dietary restrictions). All of these labels are defined by someone else who thinks they know best. How I spend my money, what I write to my friends is my business; not the federal government’s business. I love the current hue and cry and all the scandals for they encourage a long overdue dialog among the American people on the role of their government. I hear individual voices choosing to rise in a chorus, rather than be told to sing in a predefined harmony. It is the music of the streets and it is beautiful; it is the choice being made for the future’s path.

A Lost Highway: Foreign Aid

We, the people of the United States, overburdened with taxes, fighting for survival and a way of life, struggling with out-of-touch and out-of-control politicians from all political bents are, in spite of the odds, generous to a fault. Last night the boys and I watched twelve Israeli Scouts perform in the Caravan Gilad; a celebration of Israel through the eyes of its young people. It was energetic, fun and inspiring to watch these youngsters hail life with such enthusiasm. Following the performance, the boys gathered around to listen to Israeli scout tales and, as I was a stranger at the Jewish Community Center, I sat by myself quietly waiting. One of the young women performers joined me

The Caravan Gilad

The Caravan Gilad

for a spot of conversation. It did not take long for her to share all of the wonderful welcomes and generosity she had discovered in Los Angeles, Las Vegas, and Tucson. Her story is repeated as complete strangers in the United States donate everything from kidneys to money to other complete strangers just because they want to help. The United States is, indeed, a marvelously giving country. These very same benefactors, the everyday taxpayers, almost to a person, loathe foreign aid. Why?

A cursory evaluation of foreign aid could lead one to believe that it helps people outside of the United States by supplying food or money when they need it. If that were so, I think we’d all be pleased, or at least feel slightly less ill-at-ease. The historical foundation and current application of foreign aid, however, are a case study in unintended consequences. The historical roots of today’s foreign aid can be traced to three distinct acts in the foreign aid play.

Act I occurred at a meeting of representatives of forty five countries in Bretton Woods, New Hampshire in 1944. The Bretton Woods conference,[1] also known as the United Nations Monetary and Financial Conference, turned the world on its fiscal ear including the effective elimination of the bothersome gold standard, which required nations to take the nasty deflation medicine when their economies got out of balance. At the same conference, this group laid the cornerstone of the International Monetary Fund, IMF, an organization which pegs the exchange rates to the U.S. dollar. This is also called the par value system. Nineteen countries eventually signed the original Articles of Agreement and the IMF went into business in 1947.[2]  Additionally, this august body also established the foundation for the World Bank, to assist in the reconstruction of Europe following WWII. France became its first customer when the country borrowed $250 million for reconstruction, in 1947.[3]  The IMF and World Bank evolved and changed as they defined and re-defined and expanded their missions. Their tentacles reach around the world, seducing countries and influencing the geopolitical play. For the most part, their losses, which are significant, are underwritten by the taxpayer in the United States.

At the time, Henry Hazlitt, a leading editorialist for the New York Times argued against the Bretton Woods model stating that it would break down over time. In a stroke of genius or prophesy, Hazlitt maintained that “…the result of trusting governments and tying their fates together would be inflation and the collapse of what remained of sound money.” He opined that, to achieve stability, each country should maintain its own monetary system. Hazlitt’s position on the Bretton Woods model eventually cost him his job. He later published From Bretton Woods to World Inflation: A Study of Causes and Consequences; a collection of the articles.

Act II, The Marshall Plan[4] or the European Recovery Program resulted in $13 billion in aid over a four year period from 1947 through 1951. Sixteen of Europe’s war torn nations were the beneficiaries of the original package including technical assistance as well as food, fuel and machinery from the United States. Later there were direct investments in Europe’s industrial sector. President Truman appointed General Marshall as Secretary of State in 1947. The new secretary’s challenge was to address the reconstruction of Europe. Marshall probably already had the roadmap in his head because The Marshall Plan came together quickly and solidly. During a speech rolling out the plan at Harvard, Marshall gave a preview of how the aid would politically benefit the U.S. as it entered the Cold War (1947-1991). Marshall posited that political stability in Western Europe was vital to countering communist expansion in that region, and he believed that political stability was integral to the recovery of Europe’s national economies.

Act III, the Truman Doctrine, was simple and succinct. In February 1947, Undersecretary of State Dean Acheson introduced the domino theory when he explained that more was at stake in the Greek crisis than Greece and Turkey during a meeting with members of both houses of congress. If those two key states fell, he clarified, then communism would likely spread south to Iran and as far east as India. Using the set point of Rome and Carthage, Acheson explained the extent of the polarization of power. The legislators believed, and quickly cut a ‘deal’. They agreed to endorse the program if President Truman would emphasize the severity of the crisis publicly in an address to Congress and in a radio broadcast to the American people. Truman complied. He set the doctrine in few words as he asserted, “It must be the policy of the United States to support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures.” The Republican Congress sanctioned the aid to Greece and Turkey, which marked the beginning of a long and enduring bipartisan cold war foreign policy.[5]

Currently U.S. foreign aid is divided into two broad categories: military and economic assistance. The State Department is no longer directly responsible for handing out the civilian half of the direct U.S. foreign aid. That task was handed to the United States Agency for International Development, USAID, in 1961 and it is the only place where a firm number can be obtained. In 2013, USAID, under the State Department’s budget requested $51.6 billion. According to the USAID web site[6] this money is invested in agricultural productivity, combating maternal and child mortality and deadly diseases, providing life-saving assistance in the wake of disaster, promoting democracy, human rights and good governance around the world, fostering private sector development and sustainable economic growth, helping communities adapt to a changing environment, and elevating the role of women and girls.

The total cost of foreign aid is tough to grasp since the only firm number is the USAID budget request of $51.6 billion. The U.S. military currently has a presence in 78 per of the world’s countries. Some of the cost of occupation is in the DoD budget but much of it is funded directly through other congressional appropriations. The cost of the IMF and World Bank is mired in mirrors and misdirection. The only thing certain is that the U.S. taxpayer funds most of it and most of their extensive losses. At least the military still does what the military does. The World Bank is currently directing most of its effort to ‘alleviating poverty’ (See Footnote 3) and USAID is engineering societies.

Both missions are a far cry from reconstruction following a world war. But, while the fruits of reconstruction are still visible, the aid of today rarely reaches the people it claims to help. As a person who has lived and worked in many of the places foreign aid claims as victories, I will bear witness that foreign aid does more harm than good. It creates incentives for dishonesty and lines the pockets of corrupt politicians and crony capitalists. It does little for the people. I stood on the docks in Antofagasta, Chile, while wheat from the U.S. was being unloaded to help the Chilean people following the huge earthquakes there in the early 1960s. The wheat was loaded into government trucks and transshipped to the highest bidder. I survived a 1966 coup d’état in Ghana and the foreign aid for education and democratic systems along with food poured directly into the hands of General Ankrah  and his coup cronies; nothing much reached the thousands in need. I lived on Guam in the 1990s while the State Department turned a knowing blind eye to slavery, while sending foreign aid money to the government to stop it. In the Congo, the U.S. backed Mobutu had bank accounts approximating the sum of the World Bank and IMF loans and grant while his people died of starvation during the many famines. To add insult to injury, we underwrite our enemies with foreign aid. On June 8, 2013, Secretary of State John Kerry released of $1.8 billion in military foreign aid to Egypt[7] even after the release of a video in which they denounced the U.S. as an enemy[8].  Foreign aid is a travesty, another secret pipeline for politicians to use for whatever agenda is on their minds.

Perhaps the American taxpayer is uncomfortable with foreign aid because, while each taxpayer makes a choice to be generous, foreign aid takes taxpayer money by force and spends it to promote political agendas.

 



[1] This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research; http://www.nber.org/chapters/c6867.pdf

[2] International Monetary Fund; History; http://www.imf.org/external/about/history.htm

[5] Harry S. Truman Library and Museum; The Truman Doctrine; http://www.trumanlibrary.org/whistlestop/study_collections/doctrine/large/index.php

[7] Al Arabiya; 8 June 2013; Kerry quietly releases $1.3bn military aid package for Egypt; http://english.alarabiya.net/en/business/economy/2013/06/08/Kerry-renews-1-3bn-military-aid-package-for-Egypt-.html

[8] The Blaze; Jun. 12, 2013; Hot Mic Catches Egyptian Politician Discussing ‘War’ with ‘Enemies’ Israel and America; http://www.theblaze.com/stories/2013/06/12/im-very-fond-of-battles-egyptian-cabinet-minister-caught-on-hot-mic-discussing-war-with-enemies-israel-and-america/

The Congo: Crunch Time

“This accidental meeting of possibilities calls itself I. I ask: what am I doing here? And, at once, this I becomes unreal.”  ― Dag Hammarskjöld, Markings

 ‘Old Shaky’, the Douglas C-124 Globemaster II, argued with her pilot, Captain Richard T. Johnson, about taking that last turn into the Elizabethville (now called Lubumbashi) Airport

C124 Globemaster

C124 Globemaster

before landing in 1961. Noted as a heavy lift airplane, this evening it was loaded to the gills with Gurkhas[1] from the Indian Independent Brigade Group and their gear. Deployed by NATO to quell the latest fighting between the mineral rich Katanga province, whose citizens viewed the rest of the Congo as a nation of thieves, and the rest of the old Belgian Congo, the Gurkhas were battle hardened and ready. Capt. Johnson, a veteran Cold War (1947-1991) pilot, was no fool. He knew this was a Cold War strategy pure and simple. The United Sates and the Soviet Union were ‘duking’ it out for the Congo’s mineral wealth; but they were doing so by deputation. As he fought to bring the Globemaster in line for the approach, there was no friendly voice from the control tower;

The Gurkhas in the Congo

The Gurkhas in the Congo

there was no control tower. His second enemy was the surrender of daylight, Johnson couldn’t be certain he was at the correct airfield but it was the only flat spot in view that was big enough to land the old girl. Gunfire erupting to the port side confirmed he was at the right place, and Johnson wondered once again, if that old airplane was prescient. Landing quickly, safely and deploying the Gurkhas became a burning priority. A quick conference with their commander as the airplane made contact with the tarmac brought the Globemaster to a quick turn to port with the doors already opening. The Gurkhas[2] rolled straight out of the aircraft directly into the battle. Taking care of business, they were. After unloading the last of the supplies, a quick salute sent the old airplane back to the runway and she was off.

 The 1960-1965 uprising in the Congo had its roots back in 1884-1885  when German Chancellor Otto Von Bismarck invited fourteen countries to The Berlin Conference to sit down and establish who was doing what to whom in Africa. France, Great Britain, Germany, and Portugal were among the important players. Going into The Berlin Conference, the European countries maintained isolated posts and the vast majority of the African Continent was still ruled by local tribes in a traditional fashion. By the end of the conference, Africa was covered with boundary lines that took no account of local mores or tribes. The Belgian Congo, the Democratic Republic of Congo, some 900 thousand square miles, was picked up by Belgium and King Leopold II. The rest of the continent was divided as well:[3]

  • Great Britain took a Cape-to-Cairo collection of colonies from Egypt, Sudan, Uganda, Kenya, South Africa, and Zambia, Zimbabwe (Rhodesia), and Botswana. The British also controlled Nigeria and Ghana.
  • France grabbed much of western Africa, from Mauritania to Chad (French West Africa) and Gabon and the Republic of Congo (French Equatorial Africa).  
  • Portugal got Mozambique in the east and Angola in the west.
  • Italy was given Somalia (Italian Somaliland) and a portion of Ethiopia. 
  • Germany picked up Namibia (German Southwest Africa) and Tanzania (German East Africa).
  • Spain ended up with little Equatorial Guinea (Rio Muni).

Much of the terrible fighting, bloodshed, and famine is a legacy of The Berlin Conference. The fifty ‘countries’ that were formed in a conference room made no sense in the context of the centuries old cultures that were Africa. Groups that were culturally poles apart and didn’t even like each other were forced to live together. This mess, which worked fairly well while the colonies stayed in place, blew up as the colonies began to receive their independence from the home countries in the 1950s. The traditional cultures, you see, had not been erased; they had just been ignored or controlled by the colonial interests. The old Belgian Congo was one such place.

Belgium treated the Africans in the Congo as children. They were cared for, trained and their rulers

The Congo, a beautiful, rich land filled with violence and contradiction.

The Congo, a beautiful, rich land filled with violence and contradiction.

were used for tasks like tax collection or to recruit labor but they played no part of the legislative process. The bad or uncooperative children/rulers were deposed and replaced. While the United Kingdom and France began preparing their colonies for independence, Belgium made no such effort. Following WWI, American as well as European corporations invested in cotton, coffee, cacao, and rubber operations as well as livestock ventures. The Katanga province was developed for its mineral wealth; gold, copper, tin, cobalt, and zinc. During WWII, the U.S. used the Belgian Congo as a source of uranium. During this time, Africans worked four to seven year contracts as indentured servants in mining, agricultural and public infrastructure sectors. They built electric generation, roads, railroads and public buildings.

Agitation for independence began in 1958 with the formation Patrice Lumumba’s Congo National Movement, the first nationwide Congolese political party. By January 1959, they were rioting for independence in Leopoldville (now Kinshasa) and continued for a year. Belgium, which asserted that there was no possibility of independence in the immediate future, suddenly changed its political mind and the Congo became an independent republic on June 30, 1960.  The problem was the cultural context. The tribes enclosed by the Belgian Congo’s border did not really like each other. Before the First Republic in 1960, the native Congolese elites formed semi-political organizations based on ethnic relationships, personal relationships, and urban intellectualism which evolved into Lumumba’s party pushing for independence. It was a perfect set-up for interference by the Cold War rivals; the U.S. and the Soviet Union.

Katanga picked up it marbles, business interests, mines, and 6,000 Belgian troops and left the new republic in July 1960, less than a month after independence. Katanga declared itself independent under the leadership of Moise Tshombe. Diamond rich South Kasai followed in October. This was not good as Katanga and Kasai were wealth generators. Money grew short and the crisis grew hot.

In July 1960, The United Nations passed a resolution to force the Belgian troops out of the Congo, including Katanga and Kasai. UN Secretary General Dag Hammarskjöld disagreed with Lumumba that the UN force could be used to subdue the rebel government of Katanga. Hammarskjöld believed that the secession of Katanga was an internal Congolese matter and the UN was forbidden to intervene by Article 2 of the United Nations Charter. And so it went.

When the United Nations refused to intervene, Lumumba asked for and received Soviet military assistance to bring Katanga and Kasai to heel. Soviet ANC troops were airlifted into Kasai resulting in the deaths of hundreds of local Baluba tribesmen and 250,000 refugees. Lumumba’s decision engage the Soviet’s POed  the Eisenhower administration in the U.S. resulting in the CIA being given its head to support Joseph Mobutu and Kasa-Vubu, two other political hopefuls. Rumor has it that the CIA planned to poison Lumumba’s food. What can be established is that the CIA station chief in Leopoldville did cable his director to saying: “Congo [is] experiencing [a] classic communist effort [to] takeover government… there may be little time to take action to avoid another Cuba”.[4]

'Che' Guevara in the Congo.

‘Che’ Guevara in the Congo.

In 1965, following the assassination of Congolese independence hero Patrice Lumumba Cuba did join the fight.  Fidel Castro sent  ‘Che’ Guevara to the Congo to try and spark a revolution against the pro-Western regime, which had emerged after . Guevara’s attempt was defeated by mercenaries led by Colonel “Mad Mike” Hoare.  According to BBC News:

“…Che Guevara’s seven-month stay in the Fizi Baraka mountains was, as he admits himself, an “unmitigated disaster”. 

The mercenary Colonel “Mad Mike” Hoare, who had been contracted by the American-influenced government in Kinshasa, squeezed Che’s small Cuban force into an ever smaller area until he had to escape back across Lake Tanganyika into the then-friendly territory of revolutionary Tanzania….”

 Katanga remained a free and independent state for three years; Kasai for much less time. In the five bloody years it took to bring the old Belgian Congo together as a new country, thousands died and over a million became refugees. Famine, in a country that four years before could feed itself and have enough left over to export, killed thousands more. Lumumba, Mobuto and others ripped up the farms, deforested, and looted the country to starvation. Lumumba was killed by Joseph Mobutu’s forces; Che Guevara went to the Congo to ‘help’ in 1965, and UN Secretary General Dag Hammarskjöld died in a plane crash in Africa while on a quest to find some middle Congolese ground. The U.S. saw their choice, Mobutu, in power. In 1997, when he died, his bank accounts just about equaled the amount the World Bank had loaned and granted the Congo; Zaire as it was called by then.

Capt. Johnson was lucky; he flew away. The Gurkhas’s and others fought admirably in a terrible situation. And all of this horror happened because a bunch of people in Berlin, who

The Congo is incredibly rich in minerals.

The Congo is incredibly rich in minerals.

only knew what they wanted, drew lines on maps in 1914. When freedom in Africa tried to stick its head out in the 1950s, the country borders formed lay lines of power and greed. The colonists took the people of Africa for granted and their lack of respect for their cultural fabric has ripped the continent apart. The natural resources are an irresistible attraction for more ‘developed’ predator nations. The continuing upheavals leave the peoples and the nations of Africa vulnerable.

Was it all inevitable with or without the colonial period? Maybe, but it didn’t need to happen this way.

 

“They’re rioting in Africa. There’s strife in Iran. What nature doesn’t do to us. Will be done by our fellow man.”-

The Merry Minuet

Copyright Alley Music Corp. and Trio Music co., Inc.

 


[2] Firefight in Elizabethville, Congo – Lt Lee Ah Pow PGB of C Squadron, 2nd Reconnaissance Regiment; April 10, 2011; http://renjervalour.blogspot.com/2006/03/firefight-in-elizabethville-congo-lt.html

[3] Berlin Conference of 1884-1885 to Divide Africa; http://geography.about.com/cs/politicalgeog/a/berlinconferenc.htm

[4] The Church Committee; Assassination Planning and the Plots; http://www.history-matters.com/archive/church/reports/ir/pdf/ChurchIR_3A_Congo.pdf