Announcement

Collapse
No announcement yet.

Why aren't we richer after the end of the Cold War... or are we...?

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • Why aren't we richer after the end of the Cold War... or are we...?

    I always found economic mechanisms quite difficult to understand, and there is an issues that has puzzled me for a long time. I'm old enough to remember the Cold War, even the times of high tension in the late 70s and early 80s. One of the arguments I heard very often at that time (especially from pacifists) was the costs of the arms race. At that time Western countries were spending gargantuan amounts of money on the military. Critics were always talking about how this enormous military spending was a sorry waste, how that money could have been employed to make the world better. With that money, they were claiming, we could solve world problems like hunger and disease, social problems, and do a lot of wondrous things using technology for peaceful purposes. Then the Cold War ended, and Western countries reduced their military expenses massively. Especially in Europe the size of the armed forces and armament stocks have been reduced by several times, becoming only a small fraction of what they were at the height of the Cold War. And what happened? Not much if you ask me. I would have expected (maybe naively) huge economic benefits: either massive reductions of taxes, or much higher living standards, or much better welfare, or maybe huge programs to benefit Western countries or the whole world, like space colonies and the like. I have noticed nothing of the above. From the 90s I have lived, studied and worked in several European countries, and I haven't noticed any real changes or improvements. I mean not for the common people, for the average Joe. If nothing, I have the impression that living standards have worsened, and life costs in relation to purchase power have increased. We even had one of the worst recessions in modern times. Maybe I'm wrong, as I said economy is not my strong side and I'm probably missing something. Maybe Western countries would have gone down the drain faster if the Cold War had not ended. I don't know. That's why I would be interested to hear the opinion of people here who are more knowledgeable than me in economic issues.
    Last edited by Proconsul; 12 Jun 19, 16:29.

  • #2
    The governments have not cut back on spending. They are spending the "saved" money on other things.

    Pruitt
    Pruitt, you are truly an expert! Kelt06

    Have you been struck by the jawbone of an ASS lately?

    by Khepesh "This is the logic of Pruitt"

    Comment


    • #3
      Originally posted by Pruitt View Post
      The governments have not cut back on spending. They are spending the "saved" money on other things.

      Pruitt
      Yeah...I guess so. But what things? Not things that have benefited ordinary people it seems. Not the middle class and apparently not the poor either. Or am i wrong? What am I missing?

      Comment


      • #4

        Blame it on Putin.....

        Fred
        Saving MacArthur - a book series - https://www.amazon.com/gp/product/B0...ies_rw_dp_labf
        River Wide, Ocean Deep - Operation Sealion - https://www.amazon.com/product-revie...owViewpoints=1

        Comment


        • #5
          Military expenditures were never that high to begin with (Eg. around 10% during Vietnam and decreasing) to be of that huge impact.

          Also there are network effects where military expenditures actually INCREASE economic growth and wealth, like the US military buildup in WW2, which literally gave the fastest increase in growth/living standards (1945-1950s). The death and maiming of 1 million men ended up being sunk costs compared to the huge increase in capital stock (human, industrial, technological, etc.)

          The cost-benefit may have turned negative if, say, 40 million men were casualties.

          Then there was globalization and information technology which shocked the economy in the 1990s- until today, which lowered wages and put pressure on middle class growth by competing intentionally rather than just domestically.

          Baby boomers are the worst generation
          Zhitomir-Berdichev, West of Kiev: 24 Dec 1943-31 Jan 1944
          Stalin's Favorite: The Combat History of the 2nd Guards Tank Army
          Barbarossa Derailed I & II
          Battle of Kalinin October 1941

          Comment


          • #6
            The Iraq and Afghanistan wars are estimated to cost 5.6 Trillion Dollars most of which is borrowed money. That pretty well wiped out any savings from the cold war supposedly ending.
            We hunt the hunters

            Comment


            • #7
              Originally posted by Proconsul View Post
              I always found economic mechanisms quite difficult to understand, and there is an issues that has puzzled me for a long time. I'm old enough to remember the Cold War, even the times of high tension in the late 70s and early 80s. One of the arguments I heard very often at that time (especially from pacifists) was the costs of the arms race. At that time Western countries were spending gargantuan amounts of money on the military. Critics were always talking about how this enormous military spending was a sorry waste, how that money could have been employed to make the world better. With that money, they were claiming, we could solve world problems like hunger and disease, social problems, and do a lot of wondrous things using technology for peaceful purposes. Then the Cold War ended, and Western countries reduced their military expenses massively. Especially in Europe the size of the armed forces and armament stocks have been reduced by several times, becoming only a small fraction of what they were at the height of the Cold War. And what happened? Not much if you ask me. I would have expected (maybe naively) huge economic benefits: either massive reductions of taxes, or much higher living standards, or much better welfare, or maybe huge programs to benefit Western countries or the whole world, like space colonies and the like. I have noticed nothing of the above. From the 90s I have lived, studied and worked in several European countries, and I haven't noticed any real changes or improvements. I mean not for the common people, for the average Joe. If nothing, I have the impression that living standards have worsened, and life costs in relation to purchase power have increased. We even had one of the worst recessions in modern times. Maybe I'm wrong, as I said economy is not my strong side and I'm probably missing something. Maybe Western countries would have gone down the drain faster if the Cold War had not ended. I don't know. That's why I would be interested to hear the opinion of people here who are more knowledgeable than me in economic issues.
              There are always "important, critical projects" waiting in the wings, and both corporate and military America are after every dollar they can get.

              At the top of your personal list of things you will never see, ever, should be a drop in taxes or government spending.
              Quis Custodiet Ipsos Custodes? Who is watching the watchers?

              Comment


              • #8
                Originally posted by Proconsul View Post
                I always found economic mechanisms quite difficult to understand, and there is an issues that has puzzled me for a long time. I'm old enough to remember the Cold War, even the times of high tension in the late 70s and early 80s. One of the arguments I heard very often at that time (especially from pacifists) was the costs of the arms race. At that time Western countries were spending gargantuan amounts of money on the military. Critics were always talking about how this enormous military spending was a sorry waste, how that money could have been employed to make the world better. With that money, they were claiming, we could solve world problems like hunger and disease, social problems, and do a lot of wondrous things using technology for peaceful purposes. Then the Cold War ended, and Western countries reduced their military expenses massively. Especially in Europe the size of the armed forces and armament stocks have been reduced by several times, becoming only a small fraction of what they were at the height of the Cold War. And what happened? Not much if you ask me. I would have expected (maybe naively) huge economic benefits: either massive reductions of taxes, or much higher living standards, or much better welfare, or maybe huge programs to benefit Western countries or the whole world, like space colonies and the like. I have noticed nothing of the above. From the 90s I have lived, studied and worked in several European countries, and I haven't noticed any real changes or improvements. I mean not for the common people, for the average Joe. If nothing, I have the impression that living standards have worsened, and life costs in relation to purchase power have increased. We even had one of the worst recessions in modern times. Maybe I'm wrong, as I said economy is not my strong side and I'm probably missing something. Maybe Western countries would have gone down the drain faster if the Cold War had not ended. I don't know. That's why I would be interested to hear the opinion of people here who are more knowledgeable than me in economic issues.
                There are many subtopics there worth addressing, but basically, as mentioned/suggested above, the USA(West) funded the Cold War on Deficit and Debt, and the D&D continued afterward. Thing is once the USSR "collapsed" and the "Cold War" ended, there were other things to direct that D&D towards.

                Using data from a useful source, and it's "time machine" numbers: ... https://www.usdebtclock.org/

                1980:
                US National Debt: $889,993,000,000.+
                US Federal Spending: $ 552,850,+++,+++
                US Federal Budget Deficit: $49,941,+++,+++
                Debt per Citizen: $ 4,047
                Debt per Taxpayer: $ 11,413
                https://www.usdebtclock.org/1980.html

                1990:
                US National Debt: $3,017,653,+++,+++
                US Federal Spending: $1,192,172,+++,+++
                US Federal Budget Deficit: $ 182,885,+++,+++
                Debt per Citizen: $12,414
                Debt per Taxpayer: $35,349
                https://www.usdebtclock.org/1990.html

                2000:
                US National Debt: $5,696,582,+++,+++
                US Federal Spending: $ 1,763,318,+++,+++
                US Federal Budget Surplus: $ 202,200,+++,+++
                Debt per Citizen: $ 20,198
                Debt per Taxpayer: $ 54,822
                https://www.usdebtclock.org/2000.html

                2008:
                US National Debt: $ 10,256,001,+++,+++
                US Federal Spending: $ 2,906,349,+++,+++
                US Federal Budget Deficit: $369,071,+++,+++
                Debt per Citizen: $33,713
                Debt per Taxpayer: $ 94,895
                https://www.usdebtclock.org/2008.html

                2016:
                US National Debt: $ 19,657.932,+++,+++
                US Federal Spending: $ 3,803,906,+++,+++
                US Federal Budget Deficit: $ 542,036,+++,+++
                Debt per Citizen: $ 60,707
                Debt per Taxpayer: $ 170,256
                https://www.usdebtclock.org/2016.html

                2019:
                US National Debt: $ 22,371,490,+++,+++
                US Federal Spending: $ 4,401,956,+++,+++
                US Federal Budget Deficit: $996,151,+++,+++
                Debt per Citizen: $67,973
                Debt per Taxpayer: $ 182,124
                https://www.usdebtclock.org/index.html

                These numbers for each "benchmark" year continue to rise from those I've posted because this a running relative tally web source.

                However, the trends are clear. One way or another USA Federal Deficits and National Debt continue to rise, because "we" spend more than we make(in tax revenues), and the transferred obligation to "citizen" and "taxpayer" also continues to rise.

                Results may vary with other nations over this time span, but in general it would seem most also have continued that growing trend of deficit and debt;
                World Debt Clocks;
                https://www.usdebtclock.org/world-debt-clock.html
                TANSTAAFL = There Ain't No Such Thing As A Free Lunch

                Comment


                • #9
                  The Clintons cut back the Military with a smile on their lips and great joy in their hearts. Reagan tried throwing money at the "Problem" and he did improve our Military, at least with reserve munitions. Bush, Sr came along and cut back the Military again. Bush was trying to cut half of our troops in Germany. I remember the 2nd Armor Division being split up to fight in Desert Storm. The 2nd and 3rd Armor Divisions are now gone.

                  Pruitt
                  Pruitt, you are truly an expert! Kelt06

                  Have you been struck by the jawbone of an ASS lately?

                  by Khepesh "This is the logic of Pruitt"

                  Comment


                  • #10
                    One oft overlooked factor is that the USA provides more and better benefits to our military service members both while serving and afterwards than nearly any other nation. This is a significant chunk of our "military budget/expenditures".
                    TANSTAAFL = There Ain't No Such Thing As A Free Lunch

                    Comment


                    • #11
                      Originally posted by G David Bock View Post
                      One oft overlooked factor is that the USA provides more and better benefits to our military service members both while serving and afterwards than nearly any other nation. This is a significant chunk of our "military budget/expenditures".
                      I understand it is 70 percent of the budget meaning cutting costs is much harder than most people want to believe.
                      We hunt the hunters

                      Comment


                      • #12
                        Originally posted by wolfhnd View Post

                        I understand it is 70 percent of the budget meaning cutting costs is much harder than most people want to believe.
                        70% of what budget?

                        The DOD overall is APPROXIMATELY 25% of federal spending, if you have include the "nondiscretionary" Social Security, Medicare, and Medicaid.

                        Direct Personnel costs are ~25% of the DOD budget, ~40% if you count all pay and benefits.

                        Comment


                        • #13
                          Originally posted by 82redleg View Post

                          70% of what budget?

                          The DOD overall is APPROXIMATELY 25% of federal spending, if you have include the "nondiscretionary" Social Security, Medicare, and Medicaid.

                          Direct Personnel costs are ~25% of the DOD budget, ~40% if you count all pay and benefits.
                          I will let the experts sort this out because it is complicated and yes I should not have said budget. What makes it complicated is apparently that a lot of costs associated with personnel are not in the DoD budget.

                          https://www.mercatus.org/publication...defense-budget

                          You could just as easily pointed out that the figured for the cost of the Iraq and Afghanistan wars I used are inflated. Estimates vary by 3 trillion dollars depending on what you include.

                          We hunt the hunters

                          Comment


                          • #14
                            ^ There are a few different accounting methods and variables regards costs, settling on an acceptable one can be a challenge.
                            I'm leaning towards somewhere in range of 40-50% of DoD budget, put some post-service costs may not be shown here.
                            TANSTAAFL = There Ain't No Such Thing As A Free Lunch

                            Comment


                            • #15
                              Originally posted by Pruitt View Post
                              The Clintons cut back the Military with a smile on their lips and great joy in their hearts. Reagan tried throwing money at the "Problem" and he did improve our Military, at least with reserve munitions. Bush, Sr came along and cut back the Military again. Bush was trying to cut half of our troops in Germany. I remember the 2nd Armor Division being split up to fight in Desert Storm. The 2nd and 3rd Armor Divisions are now gone.

                              Pruitt
                              8th Infantry Division, my former division during my Cold War service overseas, was entirely disbanded and the colors retired. Every so often I go back via Google Earth to visit - not a trace remains of our former presence for so many years.

                              The military always gets cut after wars. After WWII the US military went from 11 million in uniform to 1.5 million! This happened in a remarkably short period of time and played havoc with civilian jobs, especially among the female workforce, which was the backbone of many industries such as the aircraft industries.

                              Ironically, however, the number of generals and admirals stayed about the same, around 1500!


                              Meanwhile, to re-address the original question posed by the OP, we don't profit as a nation because our government has no intention of dong so. Take a good, long look at the way all of the Allies performed at the end of the war for a comparison. We looted Germany for reparations, while at the same time we turned them, and Japan, into captive markets for our goods.

                              Now, in our "enlightened" PC Age of New and Improved Warfare, we do it all at our own expense, and for the profit of the few corporate war profiteers.

                              How many people here think we went to war in Viet Nam because of "treaty obligations", as opposed to a tremendous boost in certain aspects of our economy based on the built-in destruction of huge amounts of goods in the war? The major military contractors made a fortune, while we taxpayers footed the bill, and we got literally nothing in return except a lot of dead and maimed young soldiers.

                              Our, if you prefer, how many here understand that FDR's desperate desire to go to war in Europe was based on our Great Depression and the need to use a major war to get the economy going again?

                              We also have this peculiar habit of rebuilding our former enemies in the mistaken belief that they will love us forever afterwards.


                              Always follow the money.
                              Last edited by Mountain Man; 28 Jun 19, 13:32.
                              Quis Custodiet Ipsos Custodes? Who is watching the watchers?

                              Comment

                              Latest Topics

                              Collapse

                              Working...
                              X