America needs a new war? For the economy to survive? Job market to revive? Capitalism thrive? Maybe. Here’s why:
Forbes reported that GDP data “fell for the first time in three and a half years in the fourth quarter … declining by an annualized 0.1%” while “economists had expected GDP to increase 1%. A dramatic 15% drop in government spending dragged on economic activity. Defense outlays were cut the most, falling by 22.2%, the largest decrease in defense since the Vietnam War’s end in 1972.”
Wars stimulate the economy and we are a warrior nation: Didn’t WWII get us out of the Great Depression? And the Iraq/Afghan Wars, longest in history, sure stimulated the economy … the Pentagon war machine doubled from $260 billion in 2000 to roughly $550 billion last year … GDP increased 50% from $10 trillion to $15 trillion … and federal debt tripled to over $15 trillion from under $5 trillion back when our leaders believed “debt didn’t matter.”
But most of all, wars are great for capitalists: Forbes list of world billionaires skyrocketed from 322 in 2000 to 1,426 recently. Yes the adjusted household income of the rest of Americans flatlined the past generation.
But still, life’s great for capitalism and for 1,426 capitalists across America and worldwide, a tribute to the “disaster capitalism” doctrines of Nobel economist Milton Friedman and Ayn Rand’s free-market capitalism dogma.
American politicians conflicted, cut debt but not the war machine
However, with the Afghan and Iraq Wars winding down, capitalism needs an economic stimulus: a new war. It’s so American: Neocons believe a new war would boost GDP. They must be praying North Korea’s Lil’ Kim will do something impulsive. Give us an excuse.
Yet Washington politicians are conflicted. Some want to shrink government, cut debt and are cheering the “dramatic 15% drop in government spending.” On the other hand, the “largest decrease in defense since the Vietnam War’s end in 1972” is unnerving neocons, warhawks and politicians heavily dependent on defense contractors, lobbyists and voters at military bases in their districts.
So what’s next? If American capitalism needs a new war to survive … if we’re slowing down the Afghan and Iraq war theaters … if North Korea’s just saber-rattling … if China has too much to lose … if new wars are fought by drones from video screens in one of the Pentagon’s 70 drone bases … but if all the military-industrial complex capitalists who get rich off wars are still itching to attack … then who will trigger a new war for America’s “disaster capitalists?”
10 unpredictable flash points where new global wars can ignite
Although black swans are by definition unpredictable, there are 11 hot-spot pressure points already ramping up global tension and conflicts. And suddenly, the pressure can easily spark over the line, hit a flash point, and be ignited by any one of multiple unpredictable events that suddenly explode, and spread like a virus to all 10.
Then capitalist warhawks can take advantage of it, as they did by linking 9/11 with launching the Iraq War. So yes, in Worldwatch Institute’s report we see at least 11 challenging black swan hot spots that could surprise and ignite new wars:
Here’s Worldwatch’s blunt challenge: “Planet’s Tug-of-War Between Carrying Capacity and Rising Demand: Can We Keep This Up?” No: The planet’s “shrinking resources” cannot satisfy the exploding population’s “growing demand for food and energy.”
Why? It’s “impossible, we can’t keep this up.” Robert Engelman warns: “Rising trends will not last forever. They can’t.” The world will collapse under epidemics, famines, warfare.
When? A decade ago the Bush Pentagon predicted that “by 2020 there is little doubt something drastic is happening,” they told Fortune. “As the planet’s carrying capacity shrinks, an ancient pattern of desperate, all-out wars over food, water, and energy supplies would emerge … warfare is defining human life.” 2020 is dead ahead.
The coming capitalist wars reminds me of fighting depicted in the brutal “Hunger Games” movie. A perfect metaphor. With over one billion of seven billion people in the world living on two dollars a day … with accelerating food and commodity prices pushing more humans and emerging nations over the edge … with rising real food shortages, real hunger, real malnutrition, real starvation, real poverty … with the living standards of developed nations demanding an ever-increasing share of ever-scarcer resources … we see Worldwatch’s 11 vital signs as hot spots and black swans that can easily ignite rebellions, revolutions and full-scale wars in the near future:
1. Population explosion — planet can’t feed 3 billion more people
Back during the Great Depression the world had 3 billion people. Twelve years ago it had doubled to 6 billion. Now it’s 7 billion, with the United Nations predicting 10 billion by 2050. Worldwatch says “although fertility rates are falling worldwide, many countries with high birth rates will have to accommodate a rapidly expanding labor force in the next few decades. In Uganda, where women give birth to six children on average, this means needing to generate more than 1.5 million new jobs by the late 2030s.”
2. Factory farming — chemicals, water shortage, health risks, diseases
Big Agriculture “has contributed to a tripling in global meat production over the last four decades.” Texas cattlemen may be getting richer but this is “associated with heavy use of chemical inputs, the spread of disease, antibiotic overuse and resistance, massive water consumption, and declines in human health.”
3. Food production — skyrocketing demand, speculative pricing
Last year’s data tells us “grain production is recovering from a slump.” However, a longer-term recovery “is being seriously hindered by climatic changes and by rising demand for ethanol fuel, producing ripple effects throughout the economy through increased grain prices.”
4. Rain forest, timber lands — lost to urbanization and agriculture
As the demand for food and the price of agricultural lands continues rising, the world’s forests continue to disappear, wiping out species and habitats, displacing native cultures, disrupting climate patterns and contaminating the environment. For example, a few years ago Bloomberg Markets specifically exposed Cargill and Alcoa for “destruction of the world’s largest rain forest … robbing the earth of its best shield against global warming.”
5. Meat products — huge gas emissions impacting climate and ozone
Worldwatch reports that “livestock are responsible for 40% of the world’s methane emissions and 65% of nitrous oxide emissions,” emitting toxic “greenhouse gases 25 to 100 times more potent than carbon dioxide.”
6. Organic foods — unintended consequences and high costs
Organic foods bought at stores like Whole Foods Markets make you feel spiritual. But Worldwatch warns that the organic movement is now being challenged by “rising farmland prices, inconsistencies in organic standards and higher prices of organic foods.” Moreover, organic farming is actually impeding “a broad global shift to sustainable agriculture.”
7. Starvation and obesity — both rise to global health pandemic
Imagine, “statistics from 177 countries show that 38% of adults — those 15 years or older — are now overweight, with trends on the rise across different regions of the world and different income levels.” Yes, both hunger and obesity accelerating, threatening billions.
8. Oil and alternative energy — increasing demand vs. finite supply
Global oil consumption reached a new high of 87.4 million barrels per day in 2010. Oil remains the largest commercial source of energy.” Meanwhile “global production of biofuels reached an all-time high of 105 billion liters in 2010, up 17% from 2009, mostly as a result of high oil prices, global economic rebound and new biofuel-related laws and mandates.”
9. Natural gas — fracking and shale gas damage to the environment
Fossil-fuel demand is being “driven by surging natural-gas consumption in Asia and the United States.” As a result natural-gas consumption increased 7.4% in 2009-2010 hitting a record 113 trillion cubic feet. The dark side: New technologies and sources such as fracking and shale gas are now environmental threats along with spill risks to aquifers and from deep-water explorations.
10. Nuclear power — meltdowns, terrorists and spent-fuel storage
Yes, the “generation of nuclear power fell in 2011” due to the “increasing costs of production, a slowed demand for electricity, and fresh memories of disaster in Japan,” plus Chernobyl, Three Mile Island, and the increasing risks of storing spent fuel.
Check out the Worldwatch site. Get their newsletters, get into action. And read the “Hunger Games” trilogy, a powerful metaphor for the world’s real “Hunger Games,” a global war for survival being fought every day, driven by an ever-increasing population with a seemingly insatiable “demand for food and energy” on a planet with “shrinking resources.”
Until we wake up to the coming wars, we’re just happy capitalists trapped in the mind-set of Robert Mankoff’s brilliant New Yorker cartoon: “While the end-of-the-world scenario will be rife with unimaginable horrors,” says the head of a too-greedy-to-fail bank, “we believe that the pre-end period will be filled with unprecedented opportunities for profit.” Go capitalism!
Paul B. Farrell is a MarketWatch columnist based in San Luis Obispo, Calif. Follow him on Twitter @MKTWFarrell.==========================================================================