The US Maxes Out Its Credit Card

The US dollar sank further last week and gold hit $1,500 an ounce, frightening investors and destabilizing financial markets. A leading credit rating agency warned the US AAA rating might be downgraded.
While Rome burned, President Obama and the Republican-controlled US Congress traded childish taunts and hot air. Both parties refused to tell Americans the painful truth: government’s yawning $1.4 trillion US budget deficit had to be slashed to prevent a financial meltdown. That would mean pain for everyone.
But the two political parties are deadlocked: Obama’s Democrats want to raise taxes. Republicans demand tax cuts. They want to cut health, education and welfare, all three sacred cows to the Democrats, while increasing military spending when 40 million Americans draw government food aid.
This dishonest debate mostly ignores the 800-lb gorilla in the room: America’s bloated $750-900 billion annual military spending. Some experts put total annual US military and intelligence spending at $1.2 trillion.


Few American politicians dare suggest seriously trimming the Pentagon’s runaway spending.
The US National Priorities Project estimates that in 2011, out of one dollar of US federal spending, 27.4% is military; 21.5% health; 13.8% interest on the debt; 10.9% social security benefits; 3.5% on education; and 23% on everything else.
In 2010, US military spending exceeded by 50% the average spent in the Cold War years when America had a serious rival in the Soviet Union. Since 2000, US military spending has grown by 67% (all figures adjusted for inflation). Yet today America has no real military rival.