Thursday, January 31, 2008

Iraq and Recession

"The Iraq war is a sucking chest wound on the American economy."
Kiko's House has a post essentially blaming the recession on Iraq. My response tries to put things into perspective.
Your thoughts mesh nicely with those of Paul Kennedy who points out that serious wars are generally won by the side with the biggest GDP. IMO, the big problem in Iraq is the dollar kill-ratio.

If we fought with the Soviet Union, it was pretty much straight up -- dollar for dollar. Whatever we spent, they had to match. At least, that's the CW on Reagan's success against them. The USSR ran out of money before we did.

In the case of asymmetric warfare, the money is the most asymmetric part of it. Force projection is very expensive. Any action on the other side of the planet is going to drain us. But this is worse because each dollar the enemy spends must be matched by some large number of dollars on our part. My swag is that the battlefield kill-ratio is at least 20 to 1 for sunni types. I heard much higher in anti-Sadr actions early on. Maintaining that ratio is expensive, but, I think you would agree, worthwhile.

My guess for the dollar kill-ratio, however, is that it is much higher. Let's just venture that it's $1 to $10,000. So every time we drop a meg worth of bombs, the enemy can match it with equal effectiveness using a hundred dollars worth of IED. The problem is that they are getting it. We have been giving it to them! We are paying for both sides in this war. It is extremely hard to keep the huge flow of petro-dollars from dripping a little bit into their hands. The Islamic "charities" are not helping either.

Our strategy, as far as I can tell, is now to emphasize the CLCs, who operate on a dollar-dollar basis against the AQ forces. Every dollar we give them that gets used against AQ saves us 10,000. Penetration is what matters here. How many of the dollars are directed correctly?

Now, to the question of whether we can afford it, remember that the war represents a fraction of our national debt. At two trillion, the per capita cost of the war is about $6,000 spread over, let us say, ten years. How much do you suppose we spend on SUV's? In other words, this is not the cause of our economic problems. Note also that much of the war money churns back into our own economy, upgrading, to a degree, generalizable skills and facilities, and keeping people employed.

IMO, our economy has been stung, not by the war, but by corrupt financial activity extending over a decade, causing extensive and pervasive misallocation of housing resources. This folly was also funded, or at least encouraged, by our own government. Please tell me, which party is the anti-bubble party?

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Wednesday, January 02, 2008

Fred Reed's Fulminations

Here is a delightful rebuttal (click on article #380) to my previous post. Fred Reed has written an article that attacks Ralph Peters' pieties about war. This is the first time I've seen anything by Fred Reed. He reminds me of a comedian, George Carlin or Lenny Bruce or even Mark Twain. He's not a happy camper and he's absolutely right about the world and how it works.
Ralph of course speaks of the sacrifices our boys are making. They aren’t making sacrifices. They are being sacrificed. Sacrifices are voluntary, but if the troops decline to fight, they go to jail. The mechanics go this way: Having an all-volunteer army minimizes objections to the war since no one of any influence has to go; if a lot of high-school grads from Tennessee are getting killed, well, it’s not a good thing of course, but who really cares? This facilitates hobbyist wars. A voluntary army is a small army, so you have to send the same troops for tour after tour until they are half-mad and their families wrecked. Who cares? They are just rednecks anyway—not our sort of people, nobody a general would let his daughter date.
He is absolutely right about the disgraceful behavior and general stupidity of our leaders, and, in particular, our way of staffing the military, the whole national chickenhawk movement. What he is wrong about, however, is fundamental. Our governance is in fact superior to most other places. Whatever our faults and moral failings, the US is up against other forces which are even more reprehensible. You only have to look at the deteriorization of Iran and the once productive Southern Rhodesia, for example, to realize that unseating the evildoers is insufficient to bring about a happy outcome. You can't walk away from these things just because you know that your own motives aren't pure. The vacuum will be filled. And the place from which the vacuum is filled is far worse that we are, far worse perhaps than you can imagine. Let's take Pakistan as our recent example on that.

We owe it to ourselves to listen to and internalize the message that Fred Reed is sending, but I believe Ralph Peters is wiser and closer to the proper policy perspective. If you can read only one, go for Ralph.

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