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The Cold War Is Over, but U.S. Preparation for It Continues

by Robert Higgs (rlatham [at] independent.org)
Defense against terrorism requires spending priorities different from those favored since the onset of the Cold War. Unfortunately—and unsurprisingly, given its incentives—the military-industrial-congressional complex has been preparing to fight the last war rather than addressing America's current security needs.
As George W. Bush’s administration took office in January 2001, you could almost hear the sighs of relief coming from the Pentagon and the corporate headquarters of Lockheed Martin, Boeing, Raytheon, General Dynamics, Northrup Grumman, Litton Industries, and other big defense contractors. After all, the Bush campaign had championed a $45 billion increase in annual military spending over the next decade. Appearing at a Senate confirmation hearing on his nomination as secretary of defense, Donald Rumsfeld advocated an even greater increase, remarking that “it is not a time to preside and tweak and calibrate,” though the administration’s tactics dictated that the big increase not be requested immediately (Rumsfeld qtd. by Jaffe and Schlesinger 2001; see also Jaffe and McKinnon 2001). Just eleven days later, the press disclosed that “the dash for missile-defense profits is on” (Jaffe and Squeo 2001). Nor were the missile-defense-system contractors the only ones who stood to benefit from the new administration’s defense program. Bush’s budget, introduced at the end of February, called for an increase of $14.2 billion, or 4.8 percent, in defense spending, but the budget’s proposed “continency reserve” held additional funds that could be tapped by the military (Bush’s Budget Balance 2001, A14), and the Pentagon has been no stranger to supplemental appropriations. As the preliminary maneuvering proceeded, with an eye toward fiscal year 2003 and beyond, Rumsfeld’s staff produced a plan to increase the weapons-procurement budget by 42 percent over seven years “with big increases for fighter jets, ballistic-missile defense, cargo planes and bombers” (Jaffee 2001). Throughout the military-industrial-congressional complex (hereafter, the MICC), the pork-hawks preened their feathers and prepared to take flight. <p>
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