Hecate, Ancient Greek goddess of magic, wooed by politicians, ignored by economists
Why economists are ready recruits to the peace movement
The very useful discipline of economics is sometimes regarded as a science, sometimes as an art, but never, by economists, as magic. As economics is concerned not only with how goods and services are produced, but also how distributed, it inevitably becomes involved in ethics, about how wealth may be shared. On a broader stage, realising that there are limits to growth on a finite planet, that the attempt to produce ever more goods from limited resources can actually damage capacity, modern economics has to be more concerned with such priorities than ever before. Modern economists have to be prepared to refute the jibe that the only people who believe in the possibility of continuous growth on a finite planet are either fools or economists. In fact it has been economists, from Malthus onwards, who have drawn attention to the potential problems of unlimited growth.
But the business of modern economic planners is too complex an issue to be attempted, especially by a novice, and the main concern here is to claim that the discipline of economics has nothing to do with magic. To add to the wealth of the nation, production has to be of something useful. It is pointless giving employment, when the fruits of the labour are poisonous. Common sense would claim this much, but it has also been plainly stated by economists.
This point is of particular importance for the peace movement. How often have you heard the claim that the great depression of the 1930s ended when the threat of war kick-started industry and created full employment! This claim has been made recently by both Simon Jenkins and Polly Toynbee, intelligent analysts, though not economists. Or heard politicians asserting that the arms trade is of great commercial benefit to Britain, and that it generates £35 billion in exports each year, that it employs over 300,000 (stats quoted by my MP, Dominic Raab, explaining the vital importance of the arms trade)? Note that such claims are not made by economists, who look at what is produced. From an economist’s viewpoint, money spent in unproductive areas is money thrown away.
The logical flaw in asserting that the economy benefits by giving people unproductive work to do, as they will then increase the general demand by boosting sales when they spend their wages in the shops, is that these people are being paid from the public purse. The public purse being derived from taxes, we are paying these producers of nothing to go out and spend our money. Perhaps we would rather spend our money ourselves, and set these producers of nothing something better to do.
The case of Britain gaining by exports of weapons is similarly flawed, though here the losers are the buyers of goods that are capable of nothing but destruction. On the global scale on which the arms trade operates, the world as a whole pays at the rate of $1.5 trillion dollars every year in defence expenditure, as a result of the failure to achieve a peaceful world by a genuine cooperative effort. The vast waste of producing goods and services that can only be used for destruction can only be justified either by pseudo-economic false logic, or, more frankly, on the grounds of necessity for security.
Wars have always been too expensive to fund on a pay-as-you-go basis. We pay today for wars long gone, and some of the burden of the wars of today will be borne by our unborn descendants, as we, and they, will pay in taxes the interest on the National Debt. This is another story, for another time: the relevance here is how the cost of non-productive work has been deferred for others to pay.
In justification of all this, here are some quotes from well-known economists on the subject of the true cost of unproductive labour, starting with the best-known economist of all, Adam Smith.
But had not those wars [four wars against the Dutch, and two against the French] given this particular direction to so large a capital, the greater part of it would naturally have been employed in maintaining productive hands, whose labour would have replaced, with a profit, the whole value of their consumption. . . . More houses would have been built, more lands would have been improved . . . more manufactures would have been established . . . and to what height the real wealth and revenue of the country might, by this time, have been raised, is not perhaps very easy even to imagine. (The Wealth of Nations, Everyman edition, Vol 1 p 306)
Smith looked upon the lavish courts of the monarch and his unproductive grasshopper entourage with an acerbic, economist’s eye. Even more radically, he regarded what we would today classify as defence expenditure as a severe drain on the public purse.
Great nations are never impoverished by private, though they sometimes are by public prodigality and misconduct. The whole, or almost the whole public revenue is employed in maintaining unproductive hands. Such are the people who compose a numerous and splendid court, a great ecclesiastical establishment, great fleets and armies, who in time of peace produce nothing, and in time of war acquire nothing which can compensate the expense of maintaining them, even while the war lasts.(Wealth of Nations, page 306)
J. K. Galbraith, professor of economics at Harvard and inner-circle adviser to four US presidents, was also in no doubt concerning the economic waste involved in military security. The claim that military spending boosted the economy by giving employment exasperated him. Speaking at the 1986 conference of the International Physicians for the Prevention of Nuclear War he said:
I am disturbed by the number of intelligent people who believe that the modern economy is somehow sustained by military spending, and would collapse without it. . . [Reduction in military spending would have] a strongly beneficial effect on the economic life of both East and West. The German Federal Republic and Japan have been the two great economic success stories since World War 11. Both have used resources in lesser measure for sterile military purpose, more for refreshing the capital of civilian industry.’
Nobel-Prize-winning economist Joseph Stiglitz echoes Adam Smith.
Government money spent in Iraq does not stimulate the economy in the way the same amounts spent at home would. We can ask, what would the country’s output have been if even part of the money that was spent on building military bases in Iraq was spent on building schools in the United States? Such expenditure switching would have led to higher output in both the short run and the long. (The Three Trillion Dollar War, page 120)
Economists are the last to claim magical powers. It’s not so much economists, as politicians, who claim that that there is a hidden virtue in spending our money to no productive purpose, in order to justify defence expenditure on false economic grounds.
There is indeed something magical about money. On a grand scale, as capital it is vital for the construction of huge infrastructure projects, for building railways, schools, hospitals; on a smaller scale, it is needed to expand businesses, creating wealth and employment in the process; on an individual scale, money can unlock talent that would otherwise remain forever latent. That is why it is so distressing to see money, which is limited in amount, squandered on sterile and even evil projects.
From Noel Hamel
My godfather believed that if people refused to fight WWII would be cancelled. He joined the Peace Pledge Union and was briefly imprisoned before farming in Devon. Unfortunately Hitler had other ideas. But, are the weapons the real problem, without which the killing is impossible? The machete-wielding Hutus of Rwanda partly answered that question though, if weapons are plentiful, surely isn’t it likely they will be used?
The 20th century was a bonanza for agents of death, for inventors, engineers, weapons manufacturers, and the parasites who deal arms. Stimulated by wars and conflict, the killing industries advanced by leaps and bounds. The cold war contests maintained upward pressure. But, with the fall of the Berlin Wall in 1989, many who anticipated a peace dividend and a period of rationality were to be bitterly disappointed. It’s as if a habit, once established, became a hard-to-break addiction. And, with every modernisation, upgrade and rearmament, proliferation gets another shot of adrenalin.
Weapons spending did decline somewhat after 1989 but US spending soared from 30% to 34% of global total. NATO (including the US) Japan & S.Korea now account for 60%. It is claimed that threats from N.Korea, Iran, Iraq, Cuba, Sudan and Syria, ‘rogue’ nations, dictate vital increases to the extent that the US alone spends 18 times that of the ‘rogue’ nations together; or twice that of the ‘rogues’ plus Russia and China. The US military wants yet more spending to maintain a ‘minimum’ capacity to fight and quickly win two wars simultaneously. Evidently Afghanistan and Iraq, despite weaponry 50/100 years behind NATO’s, had other ideas.
Having thriving arms industries creates insatiable corporate pressures to sell, sell, sell to any willing buyers. The pressures on governments and the machinations of arms sales tactics are so effective that some describe it as “the tail wagging the dog”. Making and selling weapons is a sure way to riches and even as austerity bites, bankruptcies and profits warnings among the arms traders are as rare as hen’s teeth. The litany of arms companies under investigation for corruption is endless and accounts for an estimated 40% of world corruption. Governments are schmoozed, government codes of conduct for exports disregarded, and emotional blackmail about employment and job losses are deployed with a string of spurious claims about national economic benefits of arms exports.
Time and again exported weapons are used to kill off democratic dissent. Dictators whose armies keep them in power are a ready market. Britain has found itself on the receiving end of our own weapons as allegiances change. Wily salesmen wilfully sell to countries financially unable to afford large arms purchases, knowing default means UK taxpayers will pick up the bill. And bills may be settled at the expense of basic needs and essential services. Greece is essentially bankrupt but arms exporters are lobbying for the European bailout to guarantee £millions in unpaid bills; and tyrants toppled in the Arab Spring have left a trail of unpaid arms bills for others to pick up. David Cameron and Vince Cable have been on world arms sales tours recently to places like Egypt, Libya and Bahrain to help them replenish their stocks even as conflict continues.
Vijay Mehta has published a book, “The Economics of Killing”, (ISBN 978-0-7453-3224-6). It is a critique of the pervasive and sinister influences of the arms trade and obsessive military spending.
Increasingly now voices critical of the hegemonic influence of the single superpower, through projected military might typical of the Regan and Bush eras, are being heard. It’s said the Arab Spring is a portent of nations and peoples around the globe restlessly rejecting the dominant influence and values of the US which are blamed for their comparative deprivation. In this scenario, in the context of greater political diversity and dynamism, it is claimed it will be impossible for a single superpower to assert influence without consent.
A group of officers at the National Defense University in Washington, charged with strategic thinking about the future of the US military is defying every preconception about US military strategy. They argue that the US is too dependent on the military and present spending is unsustainable. According to them, the debt burden is the greatest threat to the US. They believe the US still has options to influence world events but the “window on American hegemony is closing” as the world balance of political and economic power changes. Less US military spending would allow economic and industrial regeneration to help maintain US global status. [30 cents out of every US taxpayer’s dollar goes on ‘defence’. More on this next month. Ed. ]
Americans are largely convinced that their children’s prospects are inferior to their own as US share of world income has declined from 31% in 2000 to 23% now; and is heading downwards. Drastic cuts in military spending are recommended including closing most military bases, pulling soldiers back from overseas wars, reducing uniformed staff by 100,000, reducing the aircraft carrier fleet, and cutting the Pentagon budget by 20%. More, they believe, should be spent on foreign aid, and the influence of the military-industrial complex should be kerbed.
A great step in the right direction, but could the future really be arms reduction and demilitarization? Not on the strength of recent UK example.
Now Kingston Peace Council/CND together with Richmond & Kingston Green Party, Richmond & Twickenham Amnesty, Richmond & Twickenham Friends of the Earth, Richmond & Twickenham World Development Group, Richmond & Kingston Greenpeace, and Richmond & Kingston Palestine Solidarity Campaign are running a campaign to influence UK government arms sales policy. We have formed a group, TRAKNAT.org.uk and are collecting petition signatures objecting to the alacrity with which Vince Cable’s department has been pursuing overseas arms sales contracts with unstable and/or repressive regimes, in our view, in contravention of its own code of conduct. The aim is for a public meeting on 29 November as an opportunity for a face off between local campaigners and local MPs.
Despite a promising start to the day, the weather turned wet on Bank Holiday Monday 7 May and not much sun was seen for the rest of the day. It was therefore not a day for taking a stroll down to the bank of the Thames past a garage sale where lots of really interesting items and books were on sale for very reasonable prices. Our profit was £165.75 which we were pleased with considering the circumstances and it is yet one more contribution to the funds which enable us to produce this newsletter, respond to appeals, print leaflets, attend conferences, hire venues and book speakers.
Thanks to a few members and friends we have received some very good bric-a-brac in recent weeks. Most of this is being saved for Ham Fair which takes place on Ham Common on 16 June. This event is very popular and has lots of community involvement. Last year we made a very good profit at this event. As the Fair is on from 11 am to 4.30 much help is needed to sell and help on our stall. Any time offered - however long or short - would be very welcome. Ham Common is easily accessible as it is on the Kingston/Richmond /Ealing 65 bus route.
A recent donation of goods by one of our members has caused me some concern in the best possible way. The crockery, porcelain and ornaments are of such good quality – and some of great age – that we are probably unable to obtain the true value for these at our outlets. It would be a great help to have the advice of someone with knowledge in order to sell them to KPC’s best advantage. Can you do this or do you know someone who can?
Due to a few people’s generosity we are not in need at present of more goods to sell – my garage (and conservatory) cannot hold any more! If the next two sales are successful, we shall certainly need more bric-a-brac, unwanted gifts and books in good condition for New Malden Fortnight Fair on Saturday 7 July and the excellent Carshalton Environment Fair on Bank Holiday Monday 27 August so please think of us and give me a ring or email nearer these dates. We are unable to accept electrical items and clothes.
Many thanks to all for your support.
Vampires, creatures that subsisted by drinking the blood of their victims, were notoriously hard to kill. Many and complex measures were devised to prevent revival of an apparently dead person judged to have been a vampire. One popular method was to drive a stake, variously of ash, oak or hawthorn according to location, through the supposed vampire’s wicked heart. In case this was insufficient, suspected vampires were sometimes also decapitated, cut into small pieces, incinerated or drowned, to make quite sure they were really dead. Even then . . .
Readers will remember that nuclear power started by accident. At first the heat of reaction in the plant designed to make plutonium for bombs was a nuisance, then someone had the bright idea of using it to make electricity as a sideline. The idea of ‘atoms for peace’ was born. Killing two birds with one stone, the nuclear plant not only made the necessary plutonium for bombs, but also provided commercial quantities of electricity. The prime function of providing the material for bombs being all-important, a blind eye was turned to some awkward problems and disadvantages of these atoms for peace.
In the first place there was the radioactive waste, some of which was virtually immortal, and would need to be stored safely somewhere forever. As more and more nuclear power stations were built all over the world, the waste began to accumulate, and to this day a solution has not been found as to where to store it safely. The radioactive contamination of the environment might have been enough to have killed nuclear power, but somehow it survived.
Then leaks occurred around nuclear power stations. Some of the radioactive waste from Sellafield, for example, contaminated local beaches and found its way into the local wildlife (lobsters accumulated so much radioactive substance that they qualified as needing safe disposal as low-level radioactive waste!). Discharges into the Irish Sea were detected in Ireland, and as far away as Norway, eliciting official protests from those nations. Clusters of cancers were found in the vicinity of nuclear power stations, especially childhood leukaemia. The latest evidence comes from research in the areas surrounding German nuclear power stations. Was this enough to kill nuclear power? It was enough for Germany, but elsewhere the authorities shrugged and made their plans for yet more nuclear stations.
The new technology was going to cost virtually nothing to maintain. Nuclear was going to produce electricity that was ‘too cheap to meter’. Whether this famous original estimate was a genuine but mistaken belief or a deliberate public-relations lie is open to question. We now know that nuclear is on the contrary the most expensive form of electricity. An attempt to privatise the industry failed, when City analysts took fright at the unknown decommissioning costs, and the risk of impossibly large compensation payouts if an accident should occur. The nuclear beast, needed by government to produce bomb plutonium, has always needed the blood of taxpayers’ money to keep it alive.
Was the beast as tame as advertised? What could possibly go wrong? A near-disaster in the US at the nuclear plant at Three Mile Island, where an accident in 1979 resulted in the release of radioactive gas, focused minds. A core melt-down, with almost unimaginable consequences, was narrowly avoided, and frightened US authorities into refusing permission to build any more nuclear power stations for a time. Yet the dead beast has stirred once again, and in Britain today more nuclear power plants are being planned.
Those consequences did not have to be imagined seven years later, when an explosion occurred at the Chernobyl nuclear power plant, releasing radioactive clouds that drifted across Europe as far west as Wales, where the soil was so contaminated that the lambs became too radioactive to be eaten. Estimates of deaths that have resulted from the radioactive contamination from Chernobyl vary wildly, from a WHO estimate of 4,000, a Greenpeace estimate of cancer deaths of 200,000, to a Russian estimate of 985,000 excess deaths from the radioactive contamination. The cost of the clean-up ran into billions of roubles. Chernobyl was the worst nuclear accident until recently. The Fukushima nuclear plant in Japan, destroyed by the recent calamitous tsunami, will challenge for first place after current efforts to close it down succeed. (See Jim McCluskey, below)
The dangerous nature of the beast was glossed over by governments with nuclear weapon ambitions. Nations with nuclear power stations were only a step away from becoming nuclear powers. By producing plutonium as a by-product of operation, nuclear power plants provided the vital ingredient for nuclear bombs. Spent fuel rods were sent to refining facilities such as Sellafield in Britain or Le Hague in France, where the plutonium was separated out and returned to the nation of origin in a form that could be converted to pure plutonium. No need for all those complicated centrifuges to obtain U235 : plutonium would do just as well!
Other disadvantages of keeping the nuclear beast come readily to mind. The consequences of a bomb on a nuclear power plant can hardly be imagined. In a world awash with plutonium, the risk of terrorists acquiring some to make a ‘dirty’ bomb that would make a great city uninhabitable increases. With all these heavy contra-indications, there must surely be some advantages to justify keeping the beast alive. Well, only one has been put forward. Nuclear power can be generated virtually without producing the greenhouse gas carbon dioxide.
That does not mean that making a nuclear power plant is carbon-free, or even useful to combat global warming. Far from it: these huge plants cost a lot of carbon to build, and the process of mining of uranium is also carbon-costly. The plants take many years to construct, and a decision taken today to build a new nuclear power station will take probably at least 10 years to implement. All this energy and money, if directed today towards renewable energy forms, wind, tide, solar, instead, is likely to produce far greater environmental dividends, and have effect immediately, when it is urgently needed.
It is hard to see what is keeping the dangerous nuclear beast alive. Expensive to feed and maintain, dirty in its habits, untameable, yet it appears impossible to kill. Just when you think it has died, a government-sponsored plan revives it. Incinerated at Chernobyl, drowned at Fukushima, somehow it survives. What will have to happen to destroy the nuclear vampire?
One false step leads to another.
The evil that men do lives after them,
The good is oft interred with their bones.
Mark Anthony’s pessimistic view that bad acts are more likely to have consequences than good acts does have a ring of truth about it. For instance, look at what happened to the Baruch Plan, put forward after WW2 as a way to rid the world of the new menace, the nuclear bomb. The failure to agree on what looks now like a minor detail led on, it seemed inevitably, to proliferation, escalation, the H-bomb, and the arms race that cripples the world’s economies today.
It is 30 years since Margaret Thatcher sent a task force to the South Atlantic to retake the Falklands, after an Argentine seizure of the islands. In his analysis of the resulting war and its consequences, Simon Jenkins traces a similar path of malign consequences of that British victory, until we arrive at modern Britain, ready to join the US in one elective war after another (30 years on, we still feel the effects of Thatcher’s lucky war, Guardian 2/4/12).
At the time Thatcher was an unpopular leader, facing possible resignation after failing to send any warning ultimatum to Galtieri to deter the Argentinian invasion. Inspired by the head of navy, admiral Leach, Thatcher overrode doubters in her Cabinet, who favoured a diplomatic route, and determined on a task force to retake the territory.
Jenkins describes the course of the war shortly, but focuses more on the aftermath. After the military victory, the mood changed in Britain, and this mood change was translated into military adventures. Before the Falklands, Britain had ceded Hong Kong to the Chinese, Rhodesia to Mugabe. Now ‘the Falklands spirit’ inspired a more militarist vision. We bought expensive aircraft carriers, we spent more on ‘defence’ than any other nation on earth, with only the exceptions of the US and Russia (we have been recently relegated to fourth in this malign league, with China now in second place). Britain, led by Thatcher, Major, Blair, Brown and Cameron, became a nation proud to ‘punch above our weight’ in a world that became torn by elective wars. Without British support, it is quite likely that the US could not have embarked upon the war in Iraq, and even possibly Afghanistan.
Impressively, on the eve of the Falklands war the National Executive Committee of the Labour party, in a resolution agreed on 6th April declared: The Labour Party wishes to avoid war, widespread destruction and bloodshed and believes it is not in the best interests of the country to allow a jingoistic, militaristic frame of mind to develop which would have disastrous consequences for the future peace of the world. (Quoted in Tony Benn’s diaries: The End of an Era) Prescient! And a Labour Party to die for.
The major justification presented to the British public for the war to retake the Falklands was the rescue of the islanders. They wanted to remain British, and the wishes of the islanders were ‘paramount’. Prior to the Falklands war, in 1970, the island of Diego Garcia, in the British territory of the Chagos archipelago in the Indian Ocean, was handed over to the US for construction of a major military base. The islanders in this case were forcibly deported to Mauritius and the Seychelles. It seems that in the matter of islanders’ wishes, those of some islanders are more paramount than others.
Was Mark Anthony right? Is it only malign events that can start off a chain of sequels? Is the good always ‘interred with their bones’? Maybe not. After some trouble, the UN Security Council finally came to a unanimous decision to demand a Syrian ceasefire. Amid great scepticism from nearly all the pundits, UN monitors have now been sent to check that the ceasefire is being adhered to. Maybe the ceasefire will hold. Maybe the murder will cease, and the Arab Spring will spread to Syria. Assad may be deposed, and a government of the people elected. Maybe this success will so bolster the world opinion of the UN mediation, that in future world leaders will keep quiet, and conflicts will be referred to the UN. ‘Coalitions of the willing’ may become a thing of the past. We can only hope.
From Jim McCluskey
Citizens in the UK (and elsewhere) are being kept in the dark about the on-going planet-threatening scale of the disaster at Fukushima.
Arnold Gundersen is a highly qualified and experienced nuclear expert. He is a licensed reactor operator with 39 years of nuclear power engineering experience, managing and coordinating projects at 70 nuclear power plants around the US. Among his distinctions he was chair of the Claremont Nuclear Plant Oversight Panel and is a former nuclear industry senior vice president. He recently told Al Jazeera that "Fukushima is the biggest industrial catastrophe in the history of mankind."
He says, "Fukushima has three nuclear reactors exposed and four fuel cores exposed ... You probably have the equivalent of 20 nuclear reactor cores because of the fuel cores, and they are all in desperate need of being cooled, and there is no means to cool them effectively. The fuels are now a molten blob at the bottom of the reactor." Gundersen explains that the fuel cores must be continuously cooled. This is being done with sea water. “The water picks up enormous amounts of radiation, so you add more water and you are generating hundreds of thousands of tons of highly radioactive water. There is no way of safely disposing of this water."
"We have 20 nuclear cores exposed, the fuel pools have several cores each, that is 20 times the potential to be released than Chernobyl..........The data I'm seeing shows that we are finding hot spots further away than we had from Chernobyl, and the amount of radiation in many of them was the amount that caused areas to be declared no-man's-land for Chernobyl. We are seeing square kilometres being found 60 to 70 kilometres away from the reactor. You can't clean all this up. We still have radioactive wild boar in Germany, 30 years after Chernobyl."
An especial danger is Unit 4, which is currently in a state of near collapse. Mitsuhei Murata, is former Japanese Ambassador to Switzerland and Senegal, and Executive Director of the Japan Society for Global System and Ethics. He declares “It is no exaggeration to say that the fate of Japan and the whole world depends on number 4 reactor”.
Then again, Mr. Robert Alvarez is former Senior Policy Adviser to the Secretary and Deputy Assistant Secretary for National Security and the Environment at the U.S. Department of Energy: He tells us that "The number 4 pool is about 100 feet above ground, is structurally damaged and is exposed to the open elements. If an earthquake or other event were to cause this pool to drain this could result in a catastrophic radiological fire involving nearly 10 times the amount of Cs-137 released by the Chernobyl accident.
At the May KPC meeting the question was raised ‘Why do we want to find out about this? It will just frighten people.’ The point is that the government agenda on nuclear power is different from that of citizens. If citizens become informed about the dangers to which they are being exposed they will put pressure on governments so that adequate resources will be brought to bear to overcome the threat. There is a great deal more to be said about the threat from Fukushima, which I hope to detail in another issue of KPN.
Newsletter Editor for this issue: Harry Davis
Disclaimer: The views expressed in this edition are not necessarily those of Kingston Peace Council/CND