The New Empire of Debt: The Rise and Fall of an Epic Financial Bubble (26 page)

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Authors: Addison Wiggin,William Bonner,Agora

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BOOK: The New Empire of Debt: The Rise and Fall of an Epic Financial Bubble
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In World War I, the French battered themselves against the Germans for two years—and suffered more casualties than America had in all its wars put together—before Pershing ever set foot in France. Again, in World War II, Americans waited until the combatants had been softened up before entering the war with an extraordinary advantage in fresh soldiers and almost unlimited supplies.

Americans have no history. Probably just as well. The French, on the other hand, have too much. Practically every street in Paris reminds them of a slaughter somewhere. On the Arc de Triomphe, Les Invalides, and dozens of other piles of stone, the names of towns in Germany, Spain, Italy, Poland, Russia, or North Africa are inscribed. Each one marks the deaths of thousands of French soldiers—gone early to their graves for who-remembers-what important national purpose. Every town in France, even the most remote and forlorn little burg, has at its center a pillar of granite or marble—with the names of the men whose bodies were torn to bits by flying lead or corroded by some battlefield disease. A whole race of orphans grew up after World War I and special seats on the subway were designated for those “mutilated in war” including thousands of
sans gueules
—men who had had their jaws blown away and yet survived, too horrible to look on.

The French have had enough of war—at least for now. Let them enjoy a well-earned cowardice.

MACNAMARA’S WAR

 

On May 1, 1995, the world—or at least the part of it that happened to be gathered at the LBJ Library in Austin, Texas, witnessed a rare and remarkable thing. Robert S. MacNamara was in tears. He had just explained how what he had done as Secretary of Defense during the years from 1961 to 1968 was “terribly, terribly wrong.”

“War Criminal says Sorry, Sobs” was how Alexander Cockburn described it in his column in the
Nation,
February 9, 2004
.
Heads of state, their ministers, and their generals get people killed often. Rarely do they apologize for it. If they’re lucky, the war goes their way and they don’t have to. If they are unlucky, they get strung up like Mussolini, or they shoot themselves like Hitler. Mr. MacNamara didn’t have to do either. The North Vietnamese never posed any real danger to the United States, so there was never much danger in bombing them—unless China or Russia got spooked and fired nuclear warheads toward North America. There was no way Ho and his men were ever going to seize Washington and put U.S. leaders in the dock for war crimes. Nor did Mr. MacNamara, Mr. Kennedy, Mr. Johnson, or any other of the vast cast of earnest incompetents who had a hand in the Vietnam affair ever volunteer for the front lines. If anyone was going to die, it wasn’t going to be them. And it was not their money paying for it either.

Mr. MacNamara was never really cut out to be an empire builder. He was too circumspect. The typical world improver goes to his grave believing he has done people a favor and is often bitter that they don’t seem to appreciate it. In 1945 when Berlin was near starvation and being overrun by Soviet troops, the Führer complained about the ingratitude of the German people.

Wilson, too, felt abandoned and betrayed—first because Democrats wanted nothing to do with the brain-damaged president in the election of 1920 and second, because in rejecting his League of Nations, Congress seemed to repudiate him and all he stood for.

“I beseech you in the bowels of Christ to consider that you may be wrong.”
9
Oliver Cromwell’s warning has no effect on real empire builders; you might as well caution sailors against getting drunk on shore leave. No matter what you say, they’ll find a way to get themselves in trouble.

According to his memoirs,MacNamara was always plagued by doubts. He seems a decent man, who had no business at the Department of Defense. He said so much himself. “I’m not qualified,” he told President Kennedy when the job was offered to him. But he took the post, and over the next seven years, he proved it.

What is astonishing about MacNamara’s mea culpa is not his admission that he made a colossal error—though that is extraordinary in itself and places him in a superior category to most public officials—but his candid record of how life-and-death decisions are made by supposedly intelligent and responsible governments.

When MacNamara took over the most lethal armed forces in the world, what preparation did he have? Did he know anything about war? Strategy? The history of combat? He had been a junior officer in World War II doing statistical analysis. Then, he had gone to work for the Ford Motor Company as an executive. Had he even read Sun Tzu or Clausewitz or Machiavelli, or Caesar or Bonaparte? Had he tried to learn a single thing from the millions of dead soldiers, the thousands of battles, the hundreds of wars? If so, he doesn’t mention it.

“I entered the Pentagon with a limited grasp of military affairs and even less grasp of covert operations,” he says.
10

What about Vietnam? He knew nothing, zero, about the place. But then, as he points out, neither did Kennedy or National Security Advisor McGeorge Bundy, or military advisor General Maxwell Taylor. The only people in the Western world who knew anything about Vietnam were the French. And the American team decided to ignore the French; they were losers. By this time, the French were becoming cynical of military affairs. Every war they had been involved in since the time of Napoleon had gone bad, even those they won. By contrast, every war America had fought—at least since the War between the States—had been a reasonable success. Americans were still bright eyed, full of energy, ambition, and “can do” spirit. Robert MacNamara was one of the “brightest and best” of the lot—the kind of American who makes you proud to be one. He was a problem solver, a doer, a take-charge guy, the youngest Secretary of Defense ever, badly in need of some Gallic cynicism. He was surrounded by people who were even bigger blockheads than he was. In their minds, they were stopping the advance of communism in Southeast Asia. Could they do so? Why would they want to do so? What would happen if they didn’t? Even if they could do it, how should it be done? Could it be done in some other way that didn’t involve killing people or spending a lot of money?

You would think that the brightest and best would have thoroughly chatted-out such basic questions. Apparently not.There was plenty of discussion, but the major question was never really answered: What damned difference did it make? Instead, the whole team merely went from one gaff to the next, improvising as they went along. Many were the reasons given why Vietnam was important to America, but all were generalities or theories. If Vietnam fell, so would all of Southeast Asia, like a “row of dominoes,” as Eisenhower had put it.
11
Even if that had been true, why did it matter to the United States of America what kind of governments ruled the region? As far as the American republic was concerned, it was of no interest whatever.

But in the new empire, any change of allegiance set off alarms. MacNamara, Kennedy, Johnson—all the guardians of Wilsonian foreign policy—heard the tinkle and rushed to take action. They hardly noticed that none had the blurriest notion of what they were really up to. “I am convinced that it would be disastrous for the United States and the Free World to permit Southeast Asia to be overrun by the Communist North,” said Dean Rusk.Why? Had anyone gone to talk to Uncle Ho? Did anyone know if his plans were compatible with U.S. interests? It did not seem to matter to them. Nor did it matter that the actions they were taking were contradictory to even their own stated aims.

“Some others are eager to enlarge the conflict,” said President Johnson in 1964. “They call upon us to supply American boys to do the job that Asian boys should do . . . . Such action would offer no solution at all to the real problem of Vietnam ....The South Vietnamese have the basic responsibility for the defense of their own freedom.”
12

Thus, did the president repeat what President Kennedy had said before him, and what every American felt in his heart: If the South Vietnamese wanted independence, they could fight for it just as we had. There was a practical consideration behind the sentiment. If the South Vietnamese could not organize or motivate their own people to protect themselves, it would be impossible for foreigners to do the job for them.

No one likes to admit that he is going to war for reasons of vanity or pride. That kind of ambition is, like a bad facelift, not a pretty sight. Ordinary citizens usually turn away from it; they don’t like the idea of getting their sons killed and their wallets stolen to support a brassy campaign of self-aggrandizement. So, real ambitions are usually hidden so well that not even the leaders themselves can see their own vanity in them. In 1965, Presidential Military Advisor, General Maxwell Taylor explained: “The situation in Vietnam is deteriorating and without new U.S. action defeat appears inevitable . . . the stakes in Vietnam are extremely high . . . . The international prestige of the United States, and a substantial part of our influence are directly at risk in Vietnam . . . . Any negotiated withdrawal would mean surrender on the installment plan.”
13

Not just Johnson, MacNamara, and Taylor had their pride on the line, but the whole nation.There may never have been a good reason for fighting in MacNamara’s war, but Americans began to feel that if they didn’t prevail they’d never be able to hold their heads high again.

Still, as late as 1964, Johnson chose not to admit that he would send half a million American boys to do the fighting that Asian boys wouldn’t or couldn’t do. America was an empire, but still a reluctant one. Maybe he didn’t know himself. Besides, it was probably not a good time to mention it. MacNamara, in testimony before defense subcommittees of Congress, failed to disclose the level of troop commitments the administration knew would be required. MacNamara testified to the Defense Subcommittee of the Senate Appropriations Committee on August 4, 1965, that 175,000 troops would have to be deployed by November, to be followed by another 100,000 the following year. He did
not
bother to say that he already estimated the need for an additional 340,000 men to be added to the tour through the draft and extended tours.

Two years later, MacNamara testified before the Senate Armed Services Committee. Asked whether he could provide a monthly breakdown of the costs of Vietnam, he said, “It is almost impossible to do it on a yearly basis, and it is really impossible to do it on a monthly basis. I can tell you how much we are spending in total for defense per month of course, but splitting that into Vietnam and non-Vietnam is honestly almost impossible.”
14

Wilson’s platform slogan when he ran for a second term was “He Kept Us out of War.” Franklin Roosevelt ran for office saying he would not send troops to fight in Europe’s war. And in the election campaign of 1964, Lyndon Johnson maintained that it was still a Vietnamese war, not an American one. The spirit of empire got the better of all of them. Whether you wanted to get into the Vietnam War, or stay out of it, you could find all the reasons and arguments you could want. But the arguments scarcely mattered; temperatures were already rising; war fever was bubbling up all over.

“Aggression and upheaval, in any part of the world,” said Lyndon Johnson on the 1964 campaign trail, sounding Wilsonian, “carry the seeds of destruction to our own freedom and perhaps to civilization itself.... Friendly cynics and fierce enemies alike often underestimate or ignore the strong thread of moral purpose which runs through the fabric of American history.”
15

By the early 1960s, there was hardly a half-wit in all North America who didn’t think that the country was in danger. This time it wasn’t the Huns who threatened Western civilization; it was communists.They’d heard it on television. Even the
New York Times
said so.

In a modern democracy, it is relatively easy to stir the masses to absurdity. People are all tuned into the national television stations and read the papers. Just as Americans in 1917 came to believe that their way of life had been put in jeopardy by the Germans, now they came to believe that the communists were a grave and growing threat. If they weren’t stopped in Vietnam, said the papers, soon they’d be landing in California. It was preposterous. But that didn’t make it unpopular.

In the mid-and late-1960s, the war in Vietnam seemed like the biggest, most urgent foreign policy challenge the United States faced. The French were gone; nowVietnam could be added to America’s slushy empire. There was little question in Americans’ minds that they could succeed where the frogs had failed. Curiously, but not unexpectedly, public support for the war grew as the United States got itself in deeper. The big question:“Why are we involved in this war?” disappeared, pushed out by a more urgent and practical question:“How are we going to win it?” In the middle of all this, though, the economic aspects (the cost of the war itself) as well as the required level of “boots on the ground” were purposely understated. It was apparent, even within the Johnson administration, that there would be little support for the war if the real costs were known. Head of the Council of Economic Advisors,Walter Heller (who resigned in 1966 and was succeeded by Gardner Ackley) said in 1965:

We had no concrete idea how much Vietnam was going to cost. First, I think fundamentally it was being underestimated to begin with. And, second, some of the estimates were somehow or another not getting across the Potomac from the Pentagon to the Executive Office Building, at least not to the Council’s part of the Executive Office Building. Anyway, the Council was operating partially in the dark.
16

 

After supporting the French, the United States backed the regime of the Diem brothers, a pair of staunchly Catholic conservatives with a talent for corruption and political clumsiness, one of whom was married to a sorceress known as Madame Nhu. As a bulwark against the commies, the Diem regime proved as ineffective as it was quirky. The United States gave the go-ahead to a group of generals to replace the brothers. This decision, like so many others, was not taken after careful consideration of the alternatives by the top policymakers. MacNamara says it was inspired by lower-echelon functionaries who set it in motion while Kennedy, MacNamara, and the leading decision makers were on vacation. Then, it took on a momentum of its own. On November 2, 1963, a group of generals led by General Minh rounded up Ngo Dinh Diem and Madame Nhu. Their hands were bound behind their backs and they were shoved into an armored personnel carrier. When the vehicle arrived at General Headquarters, Diem and Nhu had been shot; Nhu had also been knifed several times. The South Vietnamese said it was a suicide.The two were, no doubt, capable of great mischief. But people who have their hands tied behind their backs do not often shoot and knife themselves.The official version of events serves as a eulogy for the entire Vietnam adventure—improbable at the very least, criminal at worst.

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