“America has succeeded in forcing other nations to pay for its wars on a systematic basis, something never before accomplished by any nation in history .”

– Michael Hudson

I’d like to recommend two books I just finished reading, Blowback: The Costs and Consequences of American Empire by Chalmers Johnson and Super Imperialism:  The Origins and Fundamentals of US World Dominance by Michael Hudson.  Blowback is a much easier read, so I’d start there if you’re interested.  It’s also more famous, in part for having predicted in 1999 that something like 9/11 and the financial crisis of 9/08 (and thereafter) were bound to happen if the US continued to uphold its current policies.

Before I read these two books, I thought that corporations were to blame for outsourcing, the problem the character of Frank Sobotka once highlighted in the second season of The Wire by saying, “we used to actually make things in this country.  Now we just have our hands in other people’s pockets.”  Well-paying unionized factory jobs with good benefits were lost as big firms transferred their manufacturing plants overseas where they could hire cheap non-unionized labor.  Corporations did this because they cared more about their profit margins than the livelihoods of their former workers and the economic well-being of their own country.  This is the basic story I picked up over the years, from films like Roger & Me (1989) to the rhetoric of the current Occupy movement.

Blowback shows this narrative is oversimplified.  It argues that the US government in general, and the White House and the Pentagon in particular, basically gave away the manufacturing base of this country in exchange for the right to maintain a string of military bases across the globe.  Japan began a strategy that was subsequently copied by other countries from Indonesia to Thailand to Turkey to Saudi Arabia.  These countries know they can demand concessions in areas like trade policy and human rights issues in exchange for granting the US the right to build unpopular military colonies on their soil. Johnson argues that the rise of Japan’s automobile and electronics industries, for example, was made possible not just by technical innovation, but also by preferential trade agreements the Japanese were able to pry loose from US negotiators by threatening to close down the hugely unpopular US base in Okinawa, which was used as the main launching pad during the Vietnam War.

Johnson also shows that the CIA has been involved with efforts to undermine political movements in Japan and Korea that aim to remove American military bases from those countries.  The government we supported in Korea after the end of Japanese occupation suppressed the Cheju Uprising of 1948 by killing between 14 and 30 thousand protesters in the southernmost province of South Korea.  For nearly  50 years afterward, you could be arrested, imprisoned and tortured in South Korea for even mentioning this event.  (An official apology was issued in 2006, followed by the establishment of a Truth and Reconciliation Commission that looked into atrocities committed during both the period of Japanese occupation that began in 1910, and the US sponsored military dictatorship that succeeded it after World War II, which held power until the return to civilian rule in 1993.)  Blowback argues that the Cheju massacre is quite similar to China’s 1989 crackdown in Tiennamen Square, as well as to the crackdown that crushed the Prague Spring in 1968.   Johnson questions why the latter two episodes are much better known in the US, despite the fact that not as many people died in either case as did in Cheju.

This undermining of democracy in the interests of US military objectives is fairly well known at this point to have taken place in countries in the Global South like Guatemala and Chile.  Blowback shows it happens to our allies in the North as well.  In that sense, countries like Japan and Korea are really satellites of the US in a relationship that is quite similar to the way countries like Hungary were once satellites of another empire Johnson rightly opposes as having been even worse than the one he focuses on in this book.  That would be the empire maintained by the now-defunct USSR.  (For a look at how the process of decolonization applies to nations that were once a part of this system, see Imperium by Ryszard Kapuscinski.)

In Super Imperialism, Michael Hudson shows that the expense of the Korean and Vietnam wars turned what had been a huge US trade surplus into a huge deficit.  Hudson describes how Nixon decided to pay for the Vietnam War by forcing our trade partners to lend their profits back to the US by taking the dollar off the gold standard.  The gold standard used to encourage balance in trade by allowing countries like France that were paid for their exports in a foreign currency like dollars to convert that currency into gold, which they could then deposit in their own treasury.   If a country like the US spent much more on imports than it made from exports, it risked losing the gold its currency was based on.

This is what happened to England during the First and Second World Wars.  The first part of Super Imperialism shows how the US used those conflicts as a way to pry the assets of the British Empire loose, bringing about the era of US global dominance.  The more money Britain, France and other allies spent on US-made armaments, the more gold the US could remove from their treasuries.  If Nixon had not taken the US off the gold standard, the same thing would have happened here.  As the US blew more and more dough on the Vietnam War, foreign countries cashed in the dollars we spent.  More and more gold left the country until the US could no longer adhere to the requirement of a certain amount of gold to back its currency.  When Nixon took the US off the gold standard, European countries that we had paid in dollars for their exports were prevented from cashing those dollars in for gold.  The dollars they were left holding became, as a result, deposits held in the bank of the United States.  Much in the same way that firms like Bank Of America used customers’ deposits to fund predatory racist lending practices on the real estate market, the US could then use the deposits its trading partners were required to keep in our treasury to do things like drop more bombs on Cambodia than were dropped by all combatants in WW2 combined.  (See Sideshow by William Shawcross for more on US bombing of Cambodia during the Vietnam War.  He argues that the damage this secret campaign inflicted on Cambodia allowed Pol Pot’s previously unpopular and marginal Communist Party to come to power.)

Even in the wake of the end of the Vietnam war in 1976 and the cold war by 1991, the economic machine that funneled cash to the Pentagon remained.   US trade negotiators decided that their priority was to maintain the global network of military bases left over from those conflicts, in part because the weapons manufacturers and soldiers had come to expect to make a living from one of the few industries that had not been outsourced.  So the US had to keep giving host nations trade deals that led to massive losses in civilian blue collar jobs at home.  One of the tragic effects of 9/11 was that it provided a new rationale for the maintenance of this hugely expensive network of military colonies.  If terrorism can strike anywhere at any time, and can never be completely defeated, the military can justify the stone it places around the neck of our economy for the foreseeable future. This means that our main competitive advantage in the global economy has now been reduced to killing people, as the journalist Tom Nairn has observed.

The current crisis points to the main way in which the empire of military bases could be brought down: by a global collapse of the trade systems that pay for it.  The industrial manufacturing base that countries like Japan and its imitators have leveraged through the granting of military colonies depends on the ability of the US to buy the stuff it makes.  But how is the US to keep buying all these products if it’s plunging further and further into debt?  Some in Asia feel that the economic crises that swept across Asia in the ’90’s were engineered by the United States to fend off this impasse.  As currency traders gained access to markets in places like Thailand and Korea, they brought about a massive crash in their economies that then allowed US firms to go in and buy up much of the industrial infrastructure these nations had built up.  Another way in which the US has managed to keep paying for its military empire is by means of the stock market bubbles engineered by the FIRE (financial, insurance and real estate) sectors so rightly condemned by the Occupy Wall Street movement.

But while the Occupy movement envisions an end to the bubble economy era by limiting the influence of corporate cash on the electoral process, it has yet to articulate the necessity for a similar reversal of the kind of influence the military establishment holds over Washington.  Blowback and Super Imperialism argue convincingly that the US must give up its global network of military bases and the wars that they enable in order to bring our economy back into balance.  The addiction to basing our economy on the Wall Street shell games can only be kicked if we restore our manufacturing base.  We can’t do that as long as our military empire prevents us from striking more equitable bargains in trade negotiations. This adjustment could also stabilize other countries besides our own.  Situations like the current European debt crisis and the aftershocks of the 1997 Asian meltdown could be improved if those economies were less dependent on selling to the US.  As it is, they function largely as satellites of the US that suffer when their center of gravity is revealed to be shaky.

All of which makes me think of the impending Super Bowl.  It’s a celebration of the compulsion to be number 1, champion of the world, to conquer dominate and defeat.  That’s why General Petraeus performed the ceremonial coin toss before the title match played by the Steelers and the Cardinals a few years ago.  The Super Bowl cements the political rhetoric that pays for Petraeus’s strategy, while throwing everyone from Ph.D. candidates to auto workers out of work in this country.  Fortunately, there will be plenty of beer commercials running in between plays to help us forget about all that.