Ponesrečen ameriški umik iz Afganistana po ponesrečeni ameriški vojaški intervenciji v Afganistanu je ponovno odprl vprašanje stroškov in smiselnosti tega početja. Podatki kažejo, da so ZDA v zadnjih 20 letih (2001-2020) za financiranje “vojne proti terorju” in njene posledice (sredstva za oskrbo in odškodnine veteranov) porabile 5,484 milijard dolarjev, pri čemer je umrlo okrog 800,000 ljudi. Jasno je, da bi lahko ZDA sredstva bistveno bolj koristno porabila (denimo za financiranje javne infrastrukture, javnega šolstva, socialne programe itd.).

Vendar pa, kot odlično ugotavlja ekonomski zgodovinar progresivne provenience Adam Tooze, na ta porabljena  sredstva ne smemo gledati iz vidika neoliberalne ekonomike, kot sta tega projekta lotila Joseph Stiglitz in Linda Bilmes v “The Three Trillion War“. Namreč financiranje vojne ni imelo učinkov izrivanja (crowding out), zaradi financiranja vojaških izdatkov sredstva niso bila odtegnjena za druge namene, to ni dvignilo obrestnih mer, zaradi katerih bi zasebniki manj investirali. Še več, nobene zgornje meje ni za financiranje javnih izdatkov, kot je ugotovil že John M. Keynes (“we can afford anything we can actually do“). Problem ni v tem, da si ZDA vojne proti terorizmu ne bi mogle privoščiti in zaradi česar bi trpeli drugi (bolj koristni) programi. O tem računovodska in neoliberalna ekonomska logika (ki izhaja iz vidika posameznika) ne moreta presojati, pač pa delno, iz funkcionalnega vidika, morda le keynesianska in sodobna makroekonomija – torej ali bi izdatki za druge namene imeli večje multiplikativne učinke in večje učinke na dolgoročno gospodarsko rast, neenakost itd.

O smiselnosti vojaških izdatkov lahko presoja le politika. In tukaj se skriva ključno vprašanje: zakaj je ameriška politika, demokratska in republikanska z roko v roki, tako dolgo presojala, da je za ZDA bolj pomembno, da skoraj 5,500 milijard dolarjev nameni za vprašljivo politiko ameriških intervencij od Iraka do Afganistana namesto za financiranje javne infrastrukture, javnega šolstva, socialne programe itd. Ni vprašanje, ali si ZDA financiranje vojaških izdatkov lahko privoščijo, pač pa, zakaj (združena) ameriška politika bolj preferira financiranje vojaških intervencij kot pa javno infrastrukturo, šolstvo, socialne programe itd.

No, morda je Bidenov ponesrečen umik iz Afganistana koristen iz tega vidika, da bo spremenil politične preference pri alokaciji ameriških javnih izdatkov. Morda Američani pridejo do tega, da je bolj smiselno zadovoljevanje javnega interesa kot pa interesov lobijev, ki so prisesani na vojaški proračun.

In tukaj pa smo že pri smiselnosti “Toninovega vojaškega programa”. Zakaj politična preferenca po tako povečanih vojaških izdatkih, namesto po izdatkih za raziskave in razvoj, infrastrukturo, zeleno tranzicijo, socialne programe…? Ne, da si Slovenija tega ne more privoščiti, pač pa zakaj toliko dodatnih sredstev za vojsko.

But returning to these studies in the summer of 2021, they trigger not only political flashbacks. After the great awakening of functional finance and Modern Monetary Theory in recent years, the encounter with the economic critique of the War on Terror also induces a sense of intellectual dysphoria. Much as one sympathizes with the critical project of accounting for the War on Terror, it is impossible to agree with the economics on which the critique is based.

Reading Stiglitz and Bilmes, who lay out the case most explicitly, one is hurled back into a conservative discourse of budgetary common sense. As far as the economics is concerned, their message is that the War on Terror was a crime against frugality and good housekeeping. The critique of wars “financed on credit cards” is straight out of the lexicon of the householder analogy – the common fallacy that confuses state budgets with those of a cash-constrained household that is struggling to get by on credit. When it comes to macroeconomic analysis, Stiglitz and Bilmes start, without hesitation, from the assumption of crowding out. Spending on the war displaces other public spending or private investment. This is the foundation of the conservative critique of “big government” for the last century or more.

Of course, no one would deny that in an economy operating at 100 percent full capacity – as in the kind of European war economy that Keynes analyzed in the 1940s – crowding out may occur. But that is a highly unusual state of affairs and is precisely not what a progressive analysis of capitalism should take for granted. There is no reason to believe that the US economy at any point in the last 20 years has operated close to that absolute limit, at which trade offs are zero sum. Labour force participation has trended down. Recent estimates by a Roosevelt Institute team of J.W. Mason, Mike Konczal and Lauren Melodia suggest that tens of millions of Americans could potentially join the labour force. Meanwhile, in capital markets, even in the face of an unprecedented volume of borrowing, interest rates have trended down, not up. The combination of monetary and fiscal policy has been a desperate effort to crowd private investment “in”, not “out”.

But, if in Stiglitz and Bilmes’s Three Trillion Dollar War you replaced mentions of Afghanistan and Iraq with references to a progressive program for infrastructure, climate or health spending, their manifesto could have been issued by a hit team of Republican fiscal hawk, back when the Republicans had fiscal hawks.

The gist would be something like this: “Gratuitous spending on public investment, raises debt, burdens future generations, pushes up interest rates and squeezes out other more productive investment, resulting in net GDP losses”. In other words, it would be precisely the kind of argument deployed against Biden’s infrastructure plan earlier this year.

What is happening here? Why do progressive critiques of the war fall back on conservative versions of economics to underpin an anti-war position?

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To explain how an anti-war critique ends up relying on conservative economics, you could simply point to the residual neoclassical tendencies of new Keynesian economics. You could blame the Clintonian/Rubinite consensus of the 1990s. But there is also a more specific war-related political vector at work here.

It was not by accident, after all, that it was the “good war”, World War II that drove home the lesson of Keynesianism and functional finance. The total ideological commitment to the war had a solvent effect on Victorian economic orthodoxies. It took a “good war” to teach us the radical pragmatism of functional finance.

A mobilization we believed in enabled us to see that the state was not like a household. Taxes, bond issuance and “money printing” were not a moral hierarchy, but simply alternate ways of funding public spending with different implications for private balance sheets. The real limit on government spending was not some artificial debt ceiling, or the risk of “running out of money”, but the productive capacity of the economy and the risk of sparking either inflation, or a ruinous multiplication of bottlenecks and dysfunctional backlogs of unmet orders. As Keynes said, we can afford anything we can actually do.

Keynesianism was an ideology of mobilization, an intellectual project for winning the war. And there were Keynesians everywhere. German economists, aligned with the Nazi regime, made the same discoveries at the same time. They conducted extensive debates in 1943 and 1944 as to whether there was any upper limit to the debt that might constrain the final mobilization for Hitler’s Endsieg. It was dangerous to be a fiscal conservative in Hitler’s Germany, especially as the end approached. More on that another time.

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Why did left-wing parties, such as the British Labour party, cleave to the conservative financial and monetary orthodoxies of the 1920s all the way through to the nadir of the Great Depression in 1931, even though this disabled their progressive social and economic policies and led to disaster? An important part of the answer is that progressive liberals and social democrats saw in the gold standard and tight budgets a guard against militarism. The really big spenders, up to that point in history, were war-mongers not socialists. Support for disarmament and peace went hand in hand with austerity.

As that example illustrates, it may be tempting to underpin progressive politics with common sense kitchen sink economics, but it is also risky. Not only will your economic analysis become muddled. Even more dangerous is the possibility that by advocating austerity in a good cause, you leave the power of expansive economics to the bad guys.

In the 1930s, the alignment of austerity with disarmament opened up on the right-wing the possibility of pairing rearmament with an expansionary economic policy. That was the formula in Imperial Japan and Nazi Germany. We have seen our own mini version of that played out in the USA in the 2010s when the conservative fiscal instincts of the Obama administration hobbled its response to the Lehman crisis, helping to open the door to Trump, who didn’t give a damn for fiscal orthodoxy.

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Short-period macroeconomics of a Keynesian type, which pays no immediate attention to long-run growth, can be relatively indifferent with regard to what it is that the flows of consumption, investment and government expenditure are spent on, so long as they set the circular flow in motion.

This, of course, does not excuse us from making judgements about what we spend money on. It just means that economics cannot decide for you. It is an inescapably and appropriately political question.

When Stephanie Kelton says that freeing fiscal policy from the deficit myth makes budgetary decision more not less significant, she is absolutely right. When you don’t have artificial and imaginary budgetary constraints to limit debate, when you admit that, as Keynes says, we can afford anything we can actually do, then the question of what we actually do can no longer be handed off to accountants. There are no longer any excuses.

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Anyway, back to the War on Terror.

If we want to criticize the War on Terror from a perspective that does not betray sensible macroeconomics, we should not rely on calculations of cost, or suggestions of crowding out to do the work for us. America could easily afford the War on Terror. It wasn’t pouring money into the sand. Most of the dollars flowed back to America. But that doesn’t make the wars a good idea. The problem is not that we could not afford the wars, or that we paid for them on credit card. The problem is that the powers available to a monetary sovereign were used to pursue such a misguided and destructive project.

If you insist on making the argument against war-fighting on economic grounds then point to real disequilibria that it triggered. Inflationary pressure for instance. Or overheating. But the fact is that the War on Terror would have needed to be far larger than it was to have significantly impacted the macroeconomic balance. The War on Terror would have needed to been more like the 1950s Korean war, to push the US towards the point at which crowding out might have become relevant.

You might talk about the impact of military spending in tracking R&D towards destructive purposes. In 2021 the Pentagon has its own critique on those grounds. The military now regard the focus on counterinsurgency in Iraq and Afghanistan as a distraction from peer competition with China.

Criticize the war profiteering, the privatization of military services and investigate their impact on social and economic inequality. A problem here may be that the US military is widely reputed to be one of most successful multi-racial institutions in the US.

Talk about the impact of a surge of military spending on political economy i.e. on the struggle for power: who has the right to make decisions and where they are made?

Talk, seriously, about the role that concerns for global oil supplies and control over them may, or may not have played in launching the wars in the first place.

All these are real problems. None of them involve you in the householder fallacy or talking about “crowding out”. But for good measure let us take one last look at the version of the “crowding out” argument that is hardest to resist.

Given the sums involved – $5.484 trillion – how can we not criticize this spending? There are so many other things that “the money” could have been spent on. That is, of course, true in the sense that it would have been lovely to spend $5.484 trillion on social and racial justice, American families, or the energy transition. The fallacy lies in founding this argument on the idea of a discreet pot, “the” money that we foolishly allocated to futile wars, rather than sensible societal investment.

There is no such pot. There is a productive apparatus and resources that feed it – what we are gesturing towards when we talk about “the economy”. They can be mobilized using flows of spending generated by public or private credit, to move in one direction or another. Those resources and that machinery can be stretched. Or not. For most of the last twenty years they have been chronically underutilized.

The constraints here are politics and political economy in the widest sense on one side, and real economic resources on the other. There is no pot of money in between that defines limits or possibilities. We should by all means spend time thinking about what it would be good to spend $ 5 trillion on, but given the available resources and the amount of slack at our disposal that is a case to be made independent of the spending on the war.

The tragedy is not that the War on Terror crowded out better projects. The tragedy is that the better projects were never on the agenda of power at all. The tragedy is that the one thing that those with power and influence could agree on was war-fighting. In a profoundly divided polity, with deep divisions extending into the elite itself, national security is the one area where a degree of bipartisan agreement was still possible.

Other than making good the damage done by the frailty of the financial system, the War on Terror was by far and away the largest collective undertaking of the United States elite in the last twenty years. That is what the numbers so carefully compiled by the left critics of the war show. It is indictment enough.

Vir: Adam Tooze