Sunday, January 04, 2015

peak empire (is the u.s. military past its peak ROI and subject to collapse?)

cluborlov |  In the case of the US empire, it has not continued to expand by territorial acquisition. The last territory acquired was the Marshall Islands in 1947, which then became a UN Trust Territory, followed by Independence in 1986. What has continued to expand is the presence of US military installations all over the world. As the recently deceased analyst Chalmers Johnson explained, the US is an “empire of bases”, not an empire of colonies. The US has 800-1000 foreign military bases and 4-5000 bases in the US. Colonies are so passé these days. Why bother with colonies when you can impose your will with a few bases, and you don’t have to manage the whole country. Besides you can outsource most everything to contractors, so you don’t even need the consent of the governed. All you need is their tax money, which the sheeple continue to provide with barely a bleat.

Looking at the DOD Base Structure reports it is possible to graph the total acreage owned by the US military both in the US, in foreign countries, and in US foreign territories. Since both foreign countries and territories are occupied, I will lump them together. It is also valid to use total military acreage including the US, since the 50 states of the US are essentially occupied territory of the US military as well.

 I was unable to find data before 1957, but total acreage under management by the US military had a recent peak in 2007, while foreign acreage peaked in 2004. This data is from official US DOD base structure reports, which according to Chalmers Johnson leaves out quite a bit, but from a relative point of view over time, it is probably adequate. I have included the excel sheet data, and others are welcome to add to the data and do a more thorough job graphing this data.

Military spending

Looking at US military spending below, it has continued to rise, despite the recent decline in acreage under management. This is entirely consistent with Tainter’s theory of declining marginal utility to expanding empires, as imperial overstretch becomes more and more expensive, and returns to expenditures begins to decline, and even become negative. It would be entirely consistent for the expenditures to continue to rise as the empire attempts to hold onto its existing level of military acreage, until interest on the debt causes a default, and then expenditures also collapse.


John Kurman said...

What Dmitry calls barter, I call community.

DD said...

I like Orlov and thank you for bothering to post based on my comments. But it's a weak argument and doesn't address my point really. The ROI in dollars doesn't matter-we know and our creditors know that debt will not be paid.

Also, Dmitri always reminds me of that old joke that's also tossed at Zero Hedge--they've correctly predicted 9 of the last 3 recessions.

Happy Belated New Year to all the Subrealists!

CNu said...

Would you mind expanding on this notion just a little bit? we know and our creditors know that debt will not be paidFor example, who comprises that "creditor" demography permitting(benefiting from) such license?

DD said...

Damn you for making me think critically!

There are tons of creditors. Foreign, Domestic, Big, Small, Insiders, Outsiders. Perhaps I misspoke slightly. Look at the financial crisis. JP Morgan, B of A, and a few others swallowed some horseshit before everything could unravel. They've subsequently been made more than whole for their service to the empire, at least the ones who pulled the trigger (which is why everyone bitches about no jail and fat bonuses for bankers.)

There is money, and there are physical goods. There are also two forms of control. Soft (financial) and hard (physical).

Why bother
with colonies when you can impose your will with a few bases, and you
don’t have to manage the whole country. Besides you can outsource most
everything to contractors, so you don’t even need the consent of the
governed. All you need is their tax money, which the sheeple continue
to provide with barely a bleat.

To take this to the very obvious next step, why use physical control when financial control will do? It costs much less in resources to let Jamie Dimon be a jerkoff with $1B annually in pool parties and houses than it does to occupy a foreign country.

But I''ll go ahead and address his claim of a loss of acreage under management anyway. Orlov's spreadsheet is actually full of bogus data. He shows the significant base closure (and loss of territory) happening in 2005. That refers to BRAC Friday (which is a funny play on words.)

Most all the closed bases were in the US. But Orlov claims the US military occupies the US (a reasonable assertion) so to say they've lost acreage is just him talking out his ass. Closing US bases does not suddenly make those acres fall outside of US control.

Even without the actual data, to imply that a lack of redundant bases in other countries ( means that areas are no longer in our control is facetious.

CNu said...

I suppose so long as Japan, Germany, and the Saudi's were our primary creditors, I could see your point, i.e., the first two still being on the hook for their crushing defeat in WW-II and the third providing the soft controls required in our current conflict with Russia and others - in exchange for our protection in the M.E.

However, it's a bit of a stretch for me to figure out how China benefits in any manner form or fashion from holding our long-term worthless paper and I suspect that they have every intention of collecting on our debt.

The way in which the Saudi's have weaponized their $3.00/barrel oil is the most interesting economic development I've witnessed in the past twenty years, though I must admit to being more than a little puzzled concerning their perceived end-game with/for this gambit.

John Kurman said...

Why do people freak out about debt?

New Guinea is poised to experience 15% growth and its all fueled by the debt of the Anglo-American empire. Why would the Chinese kill the golden goose?

ken said...

I think the end game is America's oil production needs $80 a barrel to be profitable. Drop the price to $50 and you stop new oil exploration. The Saudi's keep and gain market share at this rate, and when the higher priced oil production cost producers bail out, you are back in a position to raise the price. I think that would be one of your great minds awhile back called intentional sabotage.

CNu said...

Invictus capitalism...,

I almost threw in the towel on Roman Catholicism during the first week in October. Waiting for the parish priest to say something(anything) about Ferguson, I got fed up with the abject cowardice I was instead witnessing as he avoided that topic like the plague. So we went "roamin" and visited another parish. There, an itinerant priest was begging on behalf of the mission in Papua New Guinea. This parish had one of those sad little fixtures in the form of a diminutive altar man. When I saw the altar man, listened to the traveling priest begging for New Guinea, my mind flipped to the anomaly that was Robert Rayford because of course the Ebola scare had legs by then, as well.

I don't know what the empire is busy stealing in New Guinea, but for damn certain the church has more than enough mission work cut out for it in the various and sundry little rancid hamlets of St. Louis county Missouri. Since credit (credo-faith) is the modern church in its full glory with Roman columns on bank buildings and everything, I'm sure we have scant little to fear, but I bet the poor pacific islanders on the cusp of 15% imperial rapinage should be terrified about now.

Constructive_Feedback said...

To All:

KNOWING WHAT YOU KNOW About The "Future Collapse Of The American Empire"........................

TO THE PROGRESSIVE COLONIZER - Would You Tell Them That "YOUR HOPES OF 'SOCIAL JUSTICE' Through 'REDISTRIBUTIVE JUSTICE' Per The Statues Enforced By THE EMPIRE Are FOLLY? YOU Had Better Start Using The HOPES FOR SALVATION From The People, Channeled Through POPULARIST POLITICAL ACTIVISM Against 'The Enemies In The System' Into Effective ORGANIC COMPETENCY DEVELOPMENT Of Your Flock, In Which Any Entitlement That They Recognize Has Come From The Ranks Of Their Own Institutions?

TO THE CONSERVATIVE MARKET HAWK: Would You Tell Them That The SYSTEM Which Allows Them To Move Capital And Goods Around The World, The US Military Protecting It From 'Piracy' - Will Be Diminished. You Will Need To Scale Your System Of Advantage Into A Network More Close To Home. LET NO ASSET FROM YOUR EYESIGHT?

TO THE AMERICANIZED BLACK FAUX-AFRO-CENTRIST - WOULD You Tell Them That Their Recent Spate Of Corruption By Which They Arrested Their Protests Against What They Used To Call "Global White Supremacist Military Aggression Against NATIONS OF COLOR" Was A Strategic WRONG MOVE? Their Choice To Remain Silent Or Complicit As The American Executive Administration Who They Sought TO USE TO FIGHT THEIR DOMESTIC IDEOLOGICAL BATTLE Against Their "Domestic White Racist Enemy" Continued With AMERICAN FOREIGN POLICY Unchanged - NOW THEY WILL SOON BE "The PEOPLE OF COLOR" Outside Of The PROTECTORATE And Upon Reconvergence Of Their Long Time White European Oppressor - THEY WILL BECOME THE "SAND NINJAS" To Which This POWER BLOC Sees As "A Sovereign Nation Of Color HAS NO RIGHTS THAT WE NEED RESPECT"?

Tom said...

It is a problem. What happens when you get into permanent debt is a long period when investors holding 10-year bonds close their eyes and say "my bond shall not default. No, no, my bond shall not default." * Because the debtor will "always" be able to borrow more when the principal comes due on the note.

But it's Musical Chairs. As long as somebody's putting more chairs out, nothing can ever go wrong. In the home mortgage market, everyone was so totally mellow and not-freaked-out, for exactly this reason, that people who obviously couldn't even make interest payments were eventually able to get loans. Cause they can just roll them over.

Unfortunately when credit markets seize up, nobody can roll anything over. The US wouldn't need to officially default because our debt is denominated in a currency we can print. But we would need to massively devalue the currency. And we would permanently lose the advantage of being able to issue debt denominated in our own scrip.


Tom said...

Yeah, that's my guess too.

Could be, though, that someone recognized the insanity of $25/bbl oil in the age of Peak Oil and Global Warming. Especially from the US strategic point of view. Could be. I think it's good that the price is up.

Only I doubt it needed to be strategic & for the good of the country, I think it's just that when you have oil guys in the White House, obviously high oil prices are a temptation. You get the high prices the same way a financier would -- by making a move to corner the supply. In Bush & Cheney's case, they used the military. The tightened control on oil frightened people like China into paying any amount of money for oil properties, oil futures, etc. Then US oil companies benefited. Doesn't hurt to send a message to China either -- Tightening the oil supply is the same ploy we used on Japan in the 1930s.