America’s Monopoly Crisis Hits the Military | The American Conservative

Source: America’s Monopoly Crisis Hits the Military | The American Conservative, by Matt Stoller and Lucas Kunce

the destruction of America’s once vibrant military and commercial industrial capacity in many sectors has become the single biggest unacknowledged threat to our national security. Because of public policies focused on finance instead of production, the United States increasingly cannot produce or maintain vital systems upon which our economy, our military, and our allies rely.

As part of his case for higher budgets, Mattis told Congress that “our military remains capable, but our competitive edge has eroded in every domain of warfare—air, land, sea, space, and cyber.” In some cases, our competitive edge has not just been eroded, but is at risk of being—or already is—surpassed. … And yet, the U.S. military budget, even at stalled levels, is still larger than the next nine countries’ budgets combined. So there’s a second natural follow-up question: is the defense budget the primary reason our military advantage is slipping away, or is it something deeper?

“The national ability to produce is a national treasure. If you can’t produce you won’t consume, and you can’t defend yourself.”

— Bill Hickey

First, in the 1980s and 1990s, Wall Street financiers focused on short-term profits, market power, and executive pay-outs over core competencies like research and production, often rolling an industry up into a monopoly producer. Then, in the 2000s, they offshored production to the lowest cost producer.

When Wall Street targeted the commercial industrial base in the 1990s, the same financial trends shifted the defense industry. … financial pressure led to a change in focus for many in the defense industry—from technological engineering to balance sheet engineering. The result is that some of the biggest names in the industry have never created any defense product. Instead of innovating new technology to support our national security, they innovate new ways of creating monopolies to take advantage of it. … Fleecing the Defense Department is big business. … It is no wonder our military capacities are ebbing, despite the large budget outlays—the money isn’t going to defense.

The United States has, for instance, lost much of its fasteners and casting industries, which are key inputs to virtually every industrial product. It has lost much of its capacity in grain oriented flat-rolled electrical steel, a specialized metal required for highly efficient electrical motors. Aluminum that goes into American aircraft carriers now often comes from China.

In September 2018, the Department of Defense released findings of its analysis into its supply chain. … The report listed dozens of militarily significant items and inputs with only one or two domestic producers, or even none at all. .. Mortar tubes, for example, are made on just one production line, and some Marine aircraft parts are made by just one company—one which recently filed for bankruptcy.

the seldom-discussed background to our dependence on China for rare earths is that, just like with telecom equipment, the United States used to be the world leader in the industry until the financial sector shipped the whole thing to China. … China has a near-complete monopoly on rare earth elements, and the U.S. military, according to U.S. government studies, is now 100 percent reliant upon China for the resources to produce its advanced weapon systems.

[Representative Carol Shea-Porter] recounted a CEO once telling her, in response to her concern about the outsourcing of defense industry parts, that he “[has] to answer to stockholders.” Who are these stockholders that CEOs are so compelled to answer to? Oftentimes, China.

China has systematically targeted U.S. greenfield investments, “technology goods (especially semiconductors), R&D networks, and advanced manufacturing.” … “China’s foreign direct investment (FDI) stock in the U.S. increased some 800% between 2009 and 2015,” she wrote. Then, from 2015 to 2017, “Chinese FDI in the U.S. …climbed nearly four-fold, reaching roughly $45.6 billion in 2016, up from just $12.8 billion in 2014.”

CEOs not being able to worry about national security because they have to answer to the Chinese should elevate the issue to the top of our national security discussion.

the problems—diminished innovation, marginal quality, higher prices, less redundancy, dependence on overseas supply chains, a lack of defense industry competition, and reduced investment in research and development—are not independent. They are the result of the financialization of industry and of monopoly.

We must begin once again to recognize that private industrial capacity is a vital national security asset … a public good and short-term actors on Wall Street have become a serious national security vulnerability.

The Plunging Morale of America’s Service Members – The Atlantic

Source: The Plunging Morale of America’s Service Members – The Atlantic, by Phil Klay

If the courage of young men and women in battle truly does depend on the nature and quality of our civic society, we should be very worried.

interpersonal attraction—the qualities someone has that, under normal circumstances, make you want to spend time with them outside of work—had no reliable impact on unit effectiveness. In fact, high social cohesion could even hurt unit effectiveness, by shifting individuals’ priorities from the organizational to the social. Instead, the most important element was a shared commitment to a task. Emphasis on unity—rather than divisions along gender and race—as well as on the importance of the mission, was the crucial factor.

When a threat is existential, the qualities you value in an individual shift. Marines like Decaul weren’t willing to work with a Klansman and a drug addict in spite of the fact that their lives might be on the line—they were willing to work with them because their lives were on the line.

Which means, when talking about making a military unit effective, we’re not just talking about a grudging choice. … They need a mission—one that is achievable, moral, and in keeping with the values of the society they represent and whose flag they wear on their uniform.

In the long term, the strength and legitimacy of the military will be a function of the perceived strength and legitimacy of the project it is supposed to represent. The clarity of purpose so central to bonding men in combat cannot emerge purely from the military itself.

Can service members maintain a sense of purpose when nobody—not the public, or Congress, or the commander in chief himself—seems to take the wars we’re fighting seriously?

This is reminiscent of what one officer said of the later stages of the Vietnam War: “The gung-ho attitude that made our soldiers so effective in 1966, ’67, was replaced by the will to survive.” It’s not that those troops lacked courage, but that the ends shifted. … if you think the mission your country keeps sending you on is pointless or impossible and that you’re only deploying to protect your brothers and sisters in arms from danger, then it’s not the Taliban or al-Qaeda or isis that’s trying to kill you, it’s America.

How America Shed the Taboo Against Preventive War – The Atlantic

If Harry Truman, Dwight Eisenhower, or Ronald Reagan were transported to 2017, they would be shocked that the United States is considering an attack on North Korea.

A hidden assumption underlies the debate over North Korea. The assumption is that preventive war—war against a country that poses no imminent threat but could pose a threat in the future—is morally legitimate. … By historical standards, that’s astounding. … During the Cold War, the dominant figures in American foreign policy considered preventive war to be fundamentally un-American.

In the second half of the 20th century, when America’s leaders heard “preventive war,” they thought about Nazi Germany and Imperial Japan. And for good reason. Both regimes had used the doctrine to justify their attacks in World War II. … Americans wanted a postwar system that outlawed such logic.

If Clinton peeked under a door that his predecessors had tried to bolt shut, George W. Bush flung it open. … Among the duplicities that attended Bush’s new doctrine was a linguistic one. Instead of admitting that he was embracing preventive war, Bush called it “preemption.” That was a lie. Preemptive war has an entirely different status in international law because it refers to an entirely different thing: a response to imminent attack.

It’s hard to recapture the horror that earlier generations of Americans felt about preventive war when it was still something that other countries did to the United States and not merely something Americans contemplate doing to others. They viewed it the way some Americans still view torture: as liberation from the moral restraints that human beings require. … Because Americans recognized that they were fallible, fallen creatures, they did not grant themselves the illegitimate, corrupting power of preventive war.

That humility has been lost. If asked whether China, Russia, or even France, has the right to launch wars against countries merely because those countries are building weapons that could one day pose a threat, Americans would quickly say no. They would recognize immediately that such a right, if universalized, threatens the peace of the world. Yet in both parties, policymakers grant that right to America.

Source: How America Shed the Taboo Against Preventive War – The Atlantic

Bill Perry Is Terrified. Why Aren’t You? – POLITICO Magazine

nukes are suddenly—insanely, by Perry’s estimate—once again a contemporary nightmare, and an emphatically ascendant one.

Americans no longer think about the threat every day. Nuclear war isn’t the subtext of popular movies, or novels; disarmament has fallen far from the top of the policy priority list.

Perry’s hypothesis for the disconnect is that much of the population, especially that rising portion with no clear memories of the first Cold War, is suffering from a deficit of comprehension. Even a single nuclear explosion in a major city would represent an abrupt and possibly irreversible turn in modern life, upending the global economy, forcing every open society to suspend traditional liberties and remake itself into a security state.

As for a nuclear explosion, by Perry’s lights, the consequences are so grave that the rational thing would be for people in the United States and everywhere to be in a state of peak alarm about their vulnerability, and for political debate to be dominated by discussion of how to reduce the risk.

And just how high is the risk? The answer of course is ultimately unknowable. Perry’s point, though, is that it’s a hell of a lot higher than you think.

“Nuclear weapons are the biggest public health issue I can think of.”

“As a 90s baby I never lived in the Cold War era,” wrote one participant, with the Reddit username BobinForApples. “What is one thing today’s generations will never understand about life during the Cold War?”

Perry’s answered, as SecDef19: “Because you were born in the 1990s, you did not experience the daily terror of ‘duck and cover’ drills as my children did. Therefore the appropriate fear of nuclear weapons is not part of your heritage, but the danger is just as real now as it was then. It will be up to your generation to develop the policies to deal with the deadly nuclear legacy that is still very much with us.”

Source: Bill Perry Is Terrified. Why Aren’t You? – POLITICO Magazine