Study: Military Spending Ineffective for Creating Jobs

Study: Military Spending Ineffective for Creating Jobs


SHARMINI PERIES: It’s the Real News Network. I’m Sharmini Peries coming to you from Baltimore. A new study by the Watson Institute at Brown
University shows that defense spending is an inferior way to create jobs. The report, authored by Heidi Garrett-Peltier,
compares how many jobs are created for each million dollars of public spending in different
sectors. President Trump boasts a massive increase
in military spending, and also promises to create jobs for Americans. Can the two things happen simultaneously? To discuss this question, I’m being joined
by Heidi Garrett-Peltier, the author of the study that I mentioned. She is an Assistant Research Professor at
the Political Economy Research Institute, PERI, at the University of Massachusetts,
Amherst. She is a researcher in the impact of public
and private investments on employment, especially investments in low-carbon economy. She authored the book, “Creating a Clean Energy
Economy.” Heidi, I thank you so much for joining me
today. H. GARRETT-PELTIER: Thanks very much for having
me, Sharmini. SHARMINI PERIES: Now Heidi, before we get
into the nitty gritty of this study, let’s start off by giving us a sense of your general
hypothesis here, and why you conducted this particular study in this economic climate. H. GARRETT-PELTIER: Sure. We often hear the argument that military spending
is good for jobs. And there are certainly lots of different
sources of support for military spending. Military spending happens in just about every
Congressional district, if not every single Congressional district across the U.S. So there’s been a lot of support for military
spending. But one of the main arguments that we hear
is that it’s good for job creation, and this argument has been around for decades. It used to be referred to as “military Keynesianism.” And so what we wanted to do was look at the
question of how does public spending affect job creation? And if it’s true – and it is true that military
spending creates jobs – how does that compare to other sectors? How does that compare to job creation in clean
energy, or infrastructure, or education, or healthcare? So we’re not just saying “Does military spending
create jobs?” It’s not a ‘yes’ or ‘no’ question. It’s what is the alternative? Is it the best way to create jobs? Could we be creating more jobs investing federal
dollars in a different way? So that was really the overall theme that
we wanted to look at. And the hypothesis was that some of the other
sectors of the economy would actually create more jobs than the military. SHARMINI PERIES: Now Heidi, during the Cold
War, the U.S. spending on defense was even greater than today in terms of the ratio of
spending to GDP. And the term “military Keynesianism” as you
said, was coined by economists who argued that defense spending actually contributes
to growth, which kept the U.S. ahead during Cold War, not just in terms of military power
but also in terms of standard of living. What is your response to this? H. GARRETT-PELTIER: What we should really
be interested in is what is the trade off? Our federal budget comes from tax dollars,
and people want to put their tax dollars to the best use possible. So if we’re looking at spending American tax
dollars on something like the military, we want to know that that’s actually the best
use of our tax dollars. So we can look at what are the trade-offs? What does it really cost to do this? So one trade-off is if we’re investing, excuse
me, if we’re spending on the military and we don’t have the money in the budget, we
go into deficit spending. Then we’re taking on interest, and we’re paying
interest on the loans that we need to take out for increased military spending. If we’re not doing that, then we’re taking
money from another section of the budget, from other domestic spending in order to fund
the military. So we are taking money from education or healthcare
or infrastructure or emergency relief, which is particularly relevant right now. So we need to ask, is it worth paying the
extra interest to take on this additional military spending? Or is it worth reducing spending in some other
sector in order to support a greater military budget? Because those are the two choices we have. SHARMINI PERIES: Is there any military spending
that’s good for the economy and for job creation? And I’m asking this because you were recently
quoted in an article about the new Columbia class of nuclear submarines which cost $2.7
billion dollars each apparently, and the contract with the Navy for this was something like
$5.1 billion dollars. But maybe there are other forms of spending
that are more labor intensive, and are there such things that the military can do that
it has a positive impact on the economy? H. GARRETT-PELTIER: Well, it’s true that within
the military, there are very different types of spending. And actually one of the things that the military
is doing that I find a very positive development is they’re becoming much more energy efficient
and using much more renewable energy. So the military is the sector or the segment
of the economy that uses the most energy of all. If you look at one institution using energy,
the military is an extreme user of energy. SHARMINI PERIES: And carbon emission contributor
as well. H. GARRETT-PELTIER: And, therefore, carbon
emissions. Exactly. So you beat me to the punch. So they are using a lot of energy; they’re
emitting a lot of carbon. And so one of the positive things that they’re
doing is investing in energy efficiency and investing in renewable energy, and those are
both ways to create jobs. In this case, you’re creating jobs in the
military and you’re also expanding clean energy. So in that sense, it’s one of the best ways
that we can spend money within the military sector. But if we look at outside the military sector,
other industries, other sectors like healthcare and like education are much more labor intensive. So in the military, a lot of our spending
goes not just to employ military personnel and civilians, but also to support payments
for various capital, for equipment, for structures, for all kinds of capital investments. And if you compare that to something like
education, where there are capital investments there, too, especially for educational buildings. But much more of the spending goes directly
to labor; goes directly to employing administrators and teachers and the staff that work in schools,
and that work throughout the supply chain, book publishers and bus drivers and so on. And so, it’s a much more labor intensive sector,
and therefore, $1 million dollars goes a lot further in employing people than it does in
the military. SHARMINI PERIES: What about the issue of corruption
and transparency as far as military spending is concerned? Civilian, public expenditure is normally regulated,
but with the corporations in there and the military industrial complex, military spending
is much more secretive. They don’t want to have their trade secrets,
A, stolen by other nations, or they don’t want other companies to steal it. And the federal agencies that actually check,
do the checks and balances in terms of audits and so on, is often kept out of the process
because of this, the secrecy around the model of submarine or the airplane. And so all of this secrecy is justified. So how do we actually know whether $2.7 billion
dollars for a submarine is a good price, and is it a good way to spend public dollars? H. GARRETT-PELTIER: That’s an excellent question,
and it is really difficult to track the money that goes through military, payments through
military contracts. And this is one of the issues, is that a lot
of the federal spending, a lot of our tax dollars are going to private companies in
the form of contracts. And it becomes very difficult as you have
a big contractor like Lockheed-Martin or Boeing, or the big corporations that are taking on
these military contracts. Then they have subcontractors, and they have
subcontractors, and it becomes really difficult to trace the money. And now, on top of that, you have the issue
that you just raised, which is that there has to be some level of confidentiality for
reasons of national security, and then much more of the money ends up being hidden. So we don’t know exactly how all of these
dollars are being spent, but we know, for example, Lockheed-Martin gets upwards of 3
percent of the federal discretionary budget. So this is one company that’s getting a giant
chunk of our tax dollars. And we can’t trace all of those dollars. We know the total amount that’s paid out in
terms of the contract, but then we don’t know exactly where that goes afterwards. It becomes very difficult to trace. SHARMINI PERIES: Now, one argument that you
mentioned is that we are spending so much money on defense, arguing that this is for
job creation, and that there are other sectors of the economy that are suffering, like education
and healthcare and so on. How do we actually determine what is healthy,
good defense spending and what isn’t? H. GARRETT-PELTIER: You know, there are people
who are working on exactly that question. So there have been a number of economists
and others who have, in recent years, produced something called the “unified security budget.” And so, that looks at what do we actually
need, concerned about national security. And we do think that there is a need for a
defense budget. And the argument is not, in this case, to
completely slash it to zero, but to look at what actually would keep us safe. And there are professionals working on these
questions. How many aircraft carriers do we need? How much ammunition? How much would everything tally up to, and
how does that compare to what we’re actually spending? And there are many types of weapons systems
that are either redundant or that have had huge cost overruns that may never actually
… vehicles that may never see the light of day, that may never be put into action,
but millions and billions of dollars are spent on these. So there is a way to cut back the military
budget by a significant percentage and still maintain the same level of security we have
now, actually. But another question I think we need to think
about is what does security mean in a broader sense? So our national security is not just the threat
of attack from an outside force, but it’s also the attack from climate change. It’s the potential attack on our electrical
grid that we’re more vulnerable to if we continue to have centralized fossil fuel power as opposed
to more decentralized, renewable energy. It’s the vulnerability to our coastal cities
that are, and to places like Puerto Rico that are just being ravaged by extreme weather
events. And those extreme weather events are increasing
due to climate change, due to increased moisture in the atmosphere. So all of those need to be, I believe, part
of what we think of as our national security. SHARMINI PERIES: And that’s a very good point
because education, having a good healthcare system, having good housing for people, are
also securing the population and their well-being. It’s a good way to look at some of these issues. Heidi, I thank you so much for joining us
today. H. GARRETT-PELTIER: Thanks very much for having
me. SHARMINI PERIES: And thank you for joining
us here on the Real News Network.

15 comments

  1. this is a poor attempt at framing a false narrative designed to appeal to economic illiterates, but she does a good job of explaining her way out of it.

  2. education is ??? it cost to much to become something university and discrimination to get in…training of life starts in Kinder-garden…..

  3. GOooo Trump ……at its not WELFARE and what is HER agenda and bias in her study…….then you have something …….she is at university and ………SOoooo I or not trust her or the findings…The study by economist Heidi Garrett-Peltier findings that federal spending on domestic programs, such as healthcare, education, and clean energy, are……as a retired elem HS a and college educator/social worker-administrator …………………..SCAMSsssss over my own 5 decades in the field not talking the Chit but doin the time on the street

  4. I don't like working on military assets but I do from time to time. Half of my last weeks wages came from navy spending.

  5. More nuclear submarines yeah that's what we need.
    Let's Nuke our way into spreading democracy. It want effect us.
    6.5 trillion dollars missing from the Pentagon – let's give them a trillion more plus boots on the ground!

  6. Hello darling, is there anything a matter with your breathing? You seem to take in huge in breaths like you're about to go under water.

  7. Why would anyone use slaughter and destruction as an economic means, how sick. The rest of the world’s countries must sanction and boycott the U.S to force it to change from a DEATH economy to a PEACEFUL one. Just so ugly and demented. Peace ✌️

  8. What a sick yank murderer you brought on to explain how they’ll accept the slaughter and destruction as long as they see it’s worth their tax dollars. Totally disgusting.
    Peace ✌️

  9. the General and whistleblower Smedley B. Butler said it best in his short book and many speeches "War is a racket" nothing more then militarized organized crime on a global scale. its also the ultimate crime against humanity.

  10. US Military budget fun facts….. 1) 54 cents of every US tax dollar
    goes to the military…2) The military spends 41.6 million dollars on Viagra
    alone, and about 84 million over all for hard on medication US military budget fun fact… 1) 54 cents of
    every tax dollar goes to the military…2) The US military spends 41.6 million
    on Viagra alone, 84 million total for hard onsUS military budget fun fact… 1)
    54 cents of every tax dollar goes to the military…2) The US military spends
    41.6 million on Viagra alone, 84 million total for hard ons

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