5 November 2017   Leave a comment

Since 11 September 2001 the US has engaged in many conflicts in what was called a “war on terror”.  It has been a very expensive war that has been paid for by increased government debt and not tax increases.  The US Department of Defense has released a 74-page report entitled “Cost of War Update as of June 30, 2017.”  The report focuses only on the actual costs incurred because of combat operations and does not include future costs of the wars which will include medical care and pensions and other benefits guaranteed to military veterans.  So it is a very constrained estimate of the costs of the war on terror.  Nonetheless, it is extraordinary to know that even with this limited definition of cost, the US has averaged $3.6 billion a month on combat operations.  The report is quite detailed and for those who wish to examine the entire range of expenditures necessary to support war.   There are other, higher estimates of the costs of these wars.  One is by the Congressional Research Service.  The highest estimate, by the Watson Institute on International and Public Affairs at Brown University puts the costs at $4.79 trillion.   The entire Defense Department budget is significantly larger, amplified by the massive military footprint the US maintains in its more than 800-military bases abroad.

 

US Military Bases Abroad

 

 

Saudi Arabia’s Crown Prince Mohammed bin Salman, the likely next King of Saudi Arabia and often referred to as MbS, launched a corruption purge of Saudi officials which included some of the highest ranking members of the royal family.  Among those arrested include Prince Alwaleed bin Talal, one of the world’s richest persons and a major investor in many global corporations including Twitter, Lyft, and Citigroup.  It is highly likely that Alwaleed will ask many of his co-investors, which include many of the richest people in the US, to intervene on his behalf.  If those interventions actually occur, it will complicate US relations with Saudi Arabia tremendously.  But corruption is hardly the main concern of the Crown Prince.  Patrick Wintour, the Diplomatic Editor of the Guardian, interprets the move in this way:

“The crown prince will say the arrests show his determination to root out corruption, a precondition of a more open economy. But few think the arrests, and related ministerial sackings, are the independent decision of a new corruption body, established just hours before to replace an existing one, rather than part of a wider reshuffle to centralise all security authority under MbS.”

The Crown Prince has shown that he is not afraid to take risks, initiating a brutal war against rebels in Yemen he believes to be agents of Iran and cutting Qatar off from normal economic and political ties from other Gulf States.  Neither of those moves has proven to be particularly effective, and we will see what the repercussions of this purge will be to Saudi political stability.

Crown Prince Mohammed bin Salman

 

The International Consortium of Investigative Journalists, (ICIJ) has published an unbelievable number of offshore banking accounts which reveal the world of the very richest people in the world and how they use money that they were assured would be held secretly.  The leaked documents, labelled the “Paradise Papers” reveal “the offshore ties of more than a dozen Trump advisers, Cabinet members and major donors”.   For those with interest in pursuing some of the papers, the site offers the opportunity to search the 13.4 million records.  The article lists some of the more prominent investors, and the activities are characterized in this way by the ICIJ:

“The offshore industry makes ‘the poor poorer’ and is ‘deepening wealth inequality,’ said Brooke Harrington, a certified wealth manager and Copenhagen Business School professor who is the author of ‘Capital without Borders: Wealth Managers and the One Percent.’

“’There is this small group of people who are not equally subject to the laws as the rest of us, and that’s on purpose,’ Harrington said. These people ‘live the dream’ of enjoying ‘the benefits of society without being subject to any of its constraints.’”

These loopholes are very expensive to create and therefore beyond the means of most people.  But once created, they shelter trillions of dollars from taxation.

Posted November 5, 2017 by vferraro1971 in World Politics

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