War, Children: It’s Just a Welfare Check Away

When pundits name-check “the welfare-warfare state,” we usually mean, and are usually understood to mean, something along the lines of “bread and circuses at home, military adventurism abroad.”

That’s as good a definition as any, I suppose, and certainly an accurate description of today’s global political environment, but it fails to really capture the nature of the post-WWII trend in US politics.

In America, the “welfare” and “warfare” aspects of the state have, over that period, achieved a near-perfect merger. Rather than representing one side of two mutually reinforcing but nominally separate sets of policies, US “defense” spending has become the single largest, and by far most redistributive, welfare program in the federal budget.

This phenomenon is best illustrated by the Hobson’s Choice offered in the final debate between US president Barack Obama and Republican presidential nominee Mitt Romney: “Draconian cuts” of 10% growth (yes, you read that right) over the next five years (Obama) or 18% growth over the same period (Romney). Real cuts aren’t even on the table. Like Henry Ford said, you can get any color Model T you want, as long as it’s black.

The numbers are constantly changing, but a 2010 baseline looks like this:

Approximately 1.4 million Americans work as members of the armed forces, and another 1.6 million workers labor in the civilian “defense” industry. These Americans are welfare clients of the “workfare” variety.

As an economic factor, they might just as well be digging holes and filling them back in (in fact, as a US Marine infantryman, I did quite a bit of exactly that!). The vast bulk of the work they do serves no “legitimate” function with respect to actual defense of the United States from attack or invasion, and in fact more likely increases the risks of such.

Some high double-digit percentage — I think 75% is a reasonable and conservative estimate — of “defense” spending is not about “defense” in any meaningful sense of the word. It’s about keeping those 3 million workers on the clock, and keeping their politically connected employers in profit.

Those 3 million workfare clients cost the American taxpayer $700 billion per year — $233,000 per client. But they don’t take that much home, of course. If their average income tracks to US per capita, they take home an average of $41,500 per year each, or a total of nearly $125 billion.

Where does the other $575 billion go? That’s the gross rakeoff, after workfare costs but before other overhead, of the real welfare queens: “Defense contractors.” If we generously assume that 25% of that rakeoff actually does produce “legitimate” defense benefits, they are knocking down more than $430 billion in welfare checks. But let’s be fair: According to the US Department of Defense, the top 20 “defense” contractors average a profit margin of only about 4%. So, $17 billion.

With that much money at stake, the $30 million or so that “defense”-related contributors have spent on the 2012 election so far is chump change: About 2/10ths of 1% of the profits they get from having politicians on their side.

If that was the end of it, it would be pretty bad — one out of every five dollars earned by American workers siphoned off on an incredibly inefficient welfare program. But that’s not the end of it at all. The existence of the welfare program is a major incentive for going to war early and often.

First, when you have a $700 billion hammer, it’s easy to fall into the habit of looking at every problem as a nail.

And secondly, welfare programs are expected, by everyone involved, to demonstrate their own necessity. If peace breaks out, the workfare clients go back to doing something else … and “defense” contractors have to cut back on the caviar and brie.

There’s no easy way out of the situation. If we have a welfare-warfare state, we’re going to spend a lot of blood and treasure on wars. And if we have a state, it’s going to become, and do everything in its operators’ power to remain, a welfare-warfare state. You can have politics or you can have peace, but you can’t have both.

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