What’s America’s Biggest National Security Threat?

What’s the biggest threat to US national security? It’s neither Iran nor North Korea, neither China’s defense spending nor Russia’s missile system. Syria doesn’t have that capacity to appear the biggest. It’s the domestic issues related to economy that pose the biggest national security threat to US. Richard Haass, the president of the Council on Foreign Relations, has made the observation in early-April 2012.

In an interview with The Daily Ticker Haass said: “The most important national security question for the coming year is actually the domestic set of issues that involves the economy.” “What we do to improve our schools, our infrastructure, what we do to reduce the budget deficit…this is going to be critical in years and decades ahead”, said Haass. (“America’s Biggest National Security Threat: U.S. Debt”)

In an increasingly global economy, Haass said, these policy failures and intransigence by lawmakers to seriously and vigorously tackle the budget crisis indicate a weaker US. “The United States right now has put itself in a position of some vulnerability. We’re vulnerable to the inflows of dollars, we’re vulnerable on the energy front, and the challenge for the United States in the national security realm is to do things that reduce our vulnerability to the decisions and behaviors be it foreign governments or markets.”

Almost similar was another observation. A few years ago, the US Directorate of National Intelligence in its 2009 threat assessment cited the global economic downturn as “the primary security challenge facing the US.” (Time, Sept. 11, 2009)

Neither CFR nor Richard Haass should be taken casually. The think tank is a responsible part of establishment and Haass is not a mindless member of the section he belongs to. The DNI observation that Time referred to is not part of a time killing talk-shop. Rather their observations are articulated after thorough exercises. These are macro views with eyes on far-reaching implications.

Economy of a country, no doubt, determines issues related to the country, its internal and external relations, its world-position, state of life of its citizens, its capacity to dominate or the opposite, etc. With a problem ridden internal situation any country turns vulnerable. The Great Financial Crisis (GFC) has intensified and widened domestic problems in many countries including US. Increasing hunger, poverty and rich-poor gap, annoying number and ratio of homeless and hungry children, finance-problem pressed schools, and debt burdened students are now not new news from the Empire, the richest land in the world. Mainstream admits all these facts although it declines to look at the root of the problems.

In 2011, Matthew Hartmann wrote in a commentary: More Americans than ever were living in poverty. “I have legitimate concerns about the future of this country […]” (“As Government Flirts with Shutdown, American Dream Again Questioned, Personal Reflections on the Great Recession”, Sept. 27)

Citing a report by the Joint Report Committee Hartmann referred the poverty level that rose in 46 states as a result of the Great Recession. He turned astonished: “Not even the nation’s capital was able to escape the influence of the Great Recession and, in fact, has become one of the hardest hit locations in this country.” Hartmann quoted the report: “[…] Washington also had the third highest poverty rate in the country, 19.2 percent, and the largest rise in the share of children living in poverty, rising 7.7 percentage points to 30.4 percent.” Similar data reflecting dire living condition for many in US are now in abundance.

Narrating experience Hartmann said: “[M]y own family has struggled over the past couple years because of the state of the economy. My father works at a high-paying medical job and yet struggles because we lost many investments when the Great Recession began.” His parents were renting after they lost their home. “[W]e’re living in very hard times”, he wrote. “What got me writing today was the revelation that the government nearly shut down again as it’s been threatening to do for the past couple of months. If our own federal government can hardly keep its doors open then I personally see it as a sign that our nation is still in a very precarious situation.” Possibility of shutting down a number of government departments is also old news.

State of teachers, students and class rooms, and as a whole, of education is being discussed by the mainstream in the Empire. A dismal picture comes to light. A recently released report by a Council on Foreign Relations Task Force found the not-so-well public school system that “threatens the country’s ability to thrive in a global economy and maintain its leadership role”. “[E]ducational failure”, the report said, “puts the United States’ future economic prosperity, global position, and physical safety at risk.”

Closure of many schools is reported in the mainstream media. ABC News reported closure of nearly half of schools and firing of hundreds of teachers in a district that “sent shockwaves through the country, and experts say this could just be the beginning.” There was “a $50 million budget shortfall”. In Detroit, a plan was announced “to close 45 schools in the next five years”. (“Budget, Quality, Population Issues Lead Cities to Close Schools: Is Yours Next?”, March 17, 2010) Mismanagement, failure to keep up with changing dynamics, declining enrollment, demographic shifts, budget deficits and draconian budget cuts are cited as reasons behind decision/plans for closing of the schools.

Adducing physicists a news report said: “The United States is at risk of ceding its leadership in science”. Five physicists expressed their worries about US’ scientific future saying that governmental funding for science research is in crisis, and not enough US students graduate with degrees in science, technology, engineering and math. The physicists were participating in a panel discussion in Atlanta at the April 2012 meeting of the American Physics Society. Pushpa Bhat, a physicist at Illinois’ Fermi Accelerator National Laboratory (Fermilab), lamented the lack of cutting-edge physics facilities in US. She was speaking at a press conference preceding the panel. She said: While many of the world’s best instruments including Illinois’ Tevatron particle accelerator used to be housed in US that frontier has moved elsewhere. Tevatron has shut down. Nobel Prize winner Frank Wilczek of MIT said: US “attracts students from all over the world. […] But […] we make it difficult for them to stay. I think for science, it’s a tragedy.” He cited immigration laws and cultural attitudes toward foreigners that “could be more welcoming.” “[T]he physicists acknowledged that scientists will have to confront a hard reality: There is simply less money for research in the current economy. Jim Siegrist, director of the Office of High Energy Physics in DOE’s Office of Science, agreed. ‘We need to find a way to do more science with a fixed amount of money’, Siegrist said.” Wilczek said “society doesn’t adequately value and recognize the economic benefits of basic science.” (“Crisis for US Science Is Looming, Physicists Warn”, Apr. 6, 2012)

These facts related to education and science lead to questions fundamental in nature. Answers to those questions will lead further to question related to the nature of the political economy that owns unimaginable resource, that once operated for longer period within favorable conditions, that has accumulated hundreds of years of experience but that now fails to provide adequate funds for scientific research and education, organize efficient management, keep up with shifting dynamics, that produces a society failing to adequately value science, etc.

Naturally, questions haunt: reasons behind declining enrollment, budget deficits, budget cuts, etc. How and why does an advanced capitalist economy fail to find required budget to keep its schools open and retain its teachers while it does not fail to find trillions of dollars to invest in speculation and billions of dollars for waging wars in distant lands that produce pain and tears in home and deaths and devastation in invaded society, and that leaves behind bitter memories and sense of hatred only? Is it that now basic science and a number of schools are not needed for making profit? Is it that the economy doesn’t need those schools and teachers? Or, is it the economy’s failure?
Referring a recent report from the Federal Reserve Bank of New York Time and Washington Post said $36 billion in student debt belongs to Americans who are 60 or older. Some of them are still rassling with their student loans while others took on new loans as they resumed education later in life in hopes of effectively competing in labor market. Many are co-signatories for loans with their children or grandchildren to afford increasing tuition cost. More than 10% of these loans are delinquent. About 5% of the $85 billion delinquent student loans in the US is owed by borrowers in the age group 60 and over, and another 12% of the total is in the age group 50-59. The unemployment rate among America’s recent grads is high enough that compels them to live with parents.

It’s a difficult reality for the hard pressed section of a society. It’s also a part of the political economy of education that ultimately thrives on appropriating labor power of a society.

There is another fact. Laid off workers in the age group 55 and over, according to SmartMoney, are unemployed for an average of 53.6 weeks compared to just 39.4 weeks for those 54 and under. Older Americans are increasingly finding it necessary to keep working — because of the losses made by the GFC, and/or they still need to pay off credit cards, mortgages, student loans, and other debt. In 2001, just 13% of Americans in the age group 65 and over were employed. The percentage increased to 18% by last summer. Isn’t it the bitter reality of more work, generation of more surplus value, appropriation of more surplus value, and more hardship?

Width of the hardship can be gauged with a figure related to loss. “There are a hundred different ways of looking at the economy, and a million different statistics” wrote Rex Nutting. “But if you wanted to focus on just one number that explains why the economy can’t really recover, this is the one: $7.38 trillion. That’s the amount of wealth that’s been lost from the bursting of housing bubble, according to the Federal Reserve’s comprehensive Flow of Funds report. It’s how much homeowners lost when housing prices plunged 30% nationwide. The loss for these homeowners was much greater than 30%, however, because they were heavily leveraged.” (Rex Nutting, “How the Bubble Destroyed the Middle Class”, Market Watch, July 8, 2011)

After the burst, Rex wrote: “Most families don’t have any extra money to spend. […] The crazy thing is that our leaders aren’t even talking about this crisis. With the upper classes prospering and global markets booming, they don’t need the U.S. middle class any more. The market is up, profits are soaring, and the corporate jet is fueled and ready for takeoff.” His sarcastic comment actually unmasks the indifferent, cruel face of a political economy which bears the name capitalism: “And if the middle class can’t buy bread? Let them eat cake.”

Debt creates new chain, new moral standard, new disciplining tact as hassles and humiliation crown debtors’ lives. The GFC brought debt- reality to many debtors. “Debt collectors are getting desperate and dirty. Harassing phone calls, abusive language and physical violence are becoming a bigger part of business as debt collectors struggle to round up money from people who don’t have it. […] Complaints of harassment by debt collectors surged 50% to 67,550 in 2009, according to the Federal Trade Commission. […] The No. 1 complaint is repeated calls, and it is not uncommon for collectors to bombard consumers with back-to-back calls for days, weeks, months and even years. When debt collectors finally get someone on the other end of the phone, they are more likely to use nastier language. Complaints of debt collectors using obscene or abusive language spiked 35% last year. A 55-year old New York woman […] said a collection agent called her home repeatedly, personally attacking her and her husband. When she refused to answer the phone, the collector called her estranged sister, an ex-boyfriend and her husband’s ex-wife’s mother. ‘This guy was out of his mind and he kept calling and calling, telling me “you better talk to me, you deadbeat,”’ she said. ‘He was very threatening and the whole thing was just really unsettling -- it made you wonder who was going to show up at your door.’ She had reason to worry, since complaints of debt collectors threatening – or actually using – violence more than doubled last year, to 2,517. Keary Floyd, an attorney […] in Atlanta said that while most of his debt collection cases involve excessive phone calls, one of his recent clients recorded a disturbing phone conversation where a debt collector threatened that he or someone else would come to the client’s house to get the money in any way that he could. […] Other aggressive tactics that are becoming more common are debt collectors calling before 8 a.m. or after 9 p.m., demanding more money than what is owed, revealing a consumer’s debt to a third party or threatening ‘dire consequences’ like prosecution, jail time, property seizure or job loss. (Blake Ellis, “Debt collectors sock it to consumers”, CNNMoney.com, July 9, 2010) A single question will haunt if all fundamental questions are bluntly kept aside: How does this debtor-indignity or creditor-power correspond to freedom and liberty which are a people’s driving spirit?

Since the onset of the GFC the number of city/county/municipality gone bankrupt or filing for bankruptcy is also not insignificant in the Empire. Finance, related politics and pulls of competing interests were at the root of these cases of bankruptcy/filing for bankruptcy. There are allegations of widespread corruption, bribery and fraud charges. The last few years came across a number of important names related to bankruptcy: Harrisburg, Pennsylvania’s capital city, Alabama’s Jefferson County – home of Birmingham, the state’s biggest city and economic powerhouse, Stockton, California. In 2008, Vallejo became the biggest California city to file for bankruptcy. The city later emerged from bankruptcy. There is Central Falls, Rhode Island also.

Jefferson County’s filing for bankruptcy is the biggest municipal bankruptcy in US history. Harrisburg was having a crushing debt, listed about $458 million in creditors and claims, legal actions by creditors, and a power struggle. Stockton is the largest US city to file for bankruptcy. The city had the second-highest foreclosure rate in US and one of the highest crime and unemployment rates.

The bankrupt-situation with cost cutting, higher taxes and pension reductions puts pressure on health and safety services to citizens. The poor suffer the most. The situation also increases concerns in the $3.7 trillion US municipal bond market. A seemingly strange cycle: market bankrupts and bankruptcy trembles market!

But hardship, debt and gloom in the life of many don’t dominate everyone everywhere. Profit pervades powerfully, and lets a few to enjoy all the moments.

In the third quarter of 2010, corporate profits rode to a record height: $1.67 trillion. It was a 28% rise from a year ago. Non-financial US companies, according Fed, held $1.93 trillion in cash and other liquid assets at the end of September. And 7.4% of companies’ total assets were cash – the highest share since 1959. These cash-burdened companies announced $150 billion in stock buybacks in 2010. (Zachary Roth, “Record corporate profits not producing jobs”, Dec 10, 2010) Along with news of super-high profits cases of criminal and civil fraud including crimes of tax evasion, insider trading, mortgage lending and payment collection, false statements and public corruption are coming to public view.

There are war ventures that cost billions. Two economists including a Nobel laureate have already made a calculation of cost of only one such venture. There are others, declared and undeclared ones.

A reality full with contradictory segments – sick science research and education and well-oiled war efforts, haunted debtor and overwhelming creditor, poverty and profit – impregnate society with contradictions, intensify contradictions that appear threat in the long run. Fault lines in the base of the society widen, that in turn weaken status quo, and a question raises its voice: cui bono?, for whose benefit is it? who is the gainer? The louder the question will be the more insecure will be the status quo.