Is Jim Kunstler Serious?

Can Jim Kunstler be serious when he says "Forget about 'Recovery'?" He is as serious as a financial cataclysm. And if you missed his essay on the "Peak Oil story" . . . . Don't. He's one of the best futurist writers we have today. Frida Berrigan is also hot on the track of the defense contractor bad guys. (Emphasis marks were inserted - Ed.)

While the good times rolled during the long slide from surplus to deficit, from no war to global war, it wasn't just the Merrill Lynches and subprime mortgage giants that cleaned up. Lockheed Martin, Boeing, and Northrop Grumman - the top three defense contractors - had a ball, too. In 2002, the first full year of what came to be known as the Global War on Terror, for instance, those three companies - ranking first, second, and third on the Pentagon's list of top ten contractors - split $42 billion in contract awards, more than two-thirds of the $67 billion distributed among the top 10 Pentagon contractors. In 2007, the last year for which full contracting data is available, the same Big Three split $69 billion in Pentagon contracts, which was more than the total received by the top 10 companies just five years earlier. The top 10 divvied up $121 billion in contracts in 2007, an 80% increase over 2002. Lockheed Martin, the number one Pentagon contractor, graduated from a mere $17 billion in awarded contracts in 2002 to $28 billion in 2007. That's a leap of 64%. Given such figures, it's easy enough to understand how the basic military budget - excluding money for actual war-fighting - jumped from about $300 billion to more than $500 billion during the Bush years. Given the economic climate, it's no surprise that the three defense giants have all posted losses in the past few weeks. But before the hankies come out and the histrionics start, it should be noted that Lockheed Martin alone has an $81 billion backlog in orders, enough to keep chugging along for another two years without a single new contract. If such war spending had been an effective stimulus for the economy, we would be roaring along on 12 cylinders today. But increasingly this kind of spending mainly stimulates corporate shareholders, stock prices, and (of course) war itself. No matter, the staggering new defense budget ensures that, for the defense industry, some version of good times will continue to roll, even if the economic impact of these huge military investments proves negligible and the need in other areas is staggering.

Suzan ___________________