WHERE TAXES GO

By Jack A. Smith


It's tax time again. Time to think about the Pentagon.

Despite the end of the Cold War, the Pentagon's war budget has
been reduced by only token amounts. Judging by the Clinton
administration's pronouncements, not many more cuts are expected.

Present war expenditures are listed at about $280 billion a year.
That's more than the next 10 highest spenders combined.

According to information in the March 14 Business Week, if the
defense budgets of Russia, China, France, England and Germany are
added together with the next five biggest, you still get only
$250 billion--or $30 billion less than Washington admits to
spending each year.

But even the $280 billion is an understatement. The War Resisters
League estimates that when military categories hidden in the
budgets of other U.S. government departments are considered, the
figure comes to $302 billion.

And there's much more. Yet another $286 billion is earmarked for
past military adventures--$37 billion for veterans' benefits and
$249 billion for interest on the national debt. That's not the
entire interest the government pays the banks each year, just the
80 percent that stems from military overspending in the past.

So altogether, you're paying about $588 billion this year for
past, present and future wars.

This amounts to 52 percent of the federal budget.

This isn't what the Clinton administration says, however. It
claims that "only" 18 percent of the budget is spent on the
military. This leaves out all the extras explained here.

It also is calculating percentages using a trick that was
introduced toward the end of the Vietnam war.

Before then, Social Security and other trust funds were not
included in the federal budget because they are not paid out of
general tax monies. If you look at a pay stub, you'll see that
Social Security (FICA) and Medicare are separate deductions on
top of federal, state and local taxes.

By adding the trust funds to the "pie" of government
expenditures, it made it appear that military budgets were
shrinking because they were presented as a smaller percentage of
a much larger whole. It was nothing but a bookkeeping scam.

WHAT COULD BE DONE

Suppose the $302 billion current U.S. military expenditure were
reduced to $100 billion--something that both Democrats and
Republicans will say is impossible. That would still leave the
U.S. far ahead of Russia, the only country in the world that
comes close to being a nuclear equal. Russia spends $40 billion
annually on its military.

It would make the world a lot safer as well.

Then suppose a moratorium were imposed on the $249 billion
interest on the military part of the debt.

Together, that's a saving of $450 billion a year--enough money to
put everyone to work wiping out poverty and transforming the
health care, education and housing of this country.

Then, if the rich were taxed even at the level of the 1950s, a
lot more money would be available to invest in raising the living
standards of the workers here and throughout the world--
especially those countries where wages are low because they have
been pillaged and invaded by the Pentagon.

None of this would be surrendered by the capitalist ruling class
without an extremely sharp struggle. Imperialism needs a bloated
military establishment in order to rule the world and extract
super-profits.

But it is clear that, theoretically at least, even under the
existing system hundreds of billions of dollars a year could be
transferred from the military budget to the areas of job creation
and social protection for the working people. It's certainly
worth fighting for.

                               -30-

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