Military-Economic Fascism: How Business Corrupts Government, and Vice Versa

By Higgs, Robert | Independent Review, Fall 2007 | Go to article overview

Military-Economic Fascism: How Business Corrupts Government, and Vice Versa


Higgs, Robert, Independent Review


The business of buying weapons that takes place in the Pentagon is a corrupt business--ethically and morally corrupt from top to bottom. The process is dominated by advocacy, with few, if any, checks and balances. Most people in power like this system of doing business and do not want it changed.

--Colonel James G. Burton, The Pentagon Wars

In countries such as the United States, whose economies are commonly, though inaccurately, described as "capitalist" or "free market," war and preparation for war systematically corrupt both parties in the state-private transactions by which the government obtains the bulk of its military goods and services. On one side, business interests seek to bend the state's decisions in their favor by corrupting official decision makers with outright and de facto bribes. The outright bribes include cash, gifts in kind, loans, entertainment, transportation, lodging, prostitutes' services, inside information about personal investment opportunities, overly generous speaking fees, and promises of future employment or consulting patronage for officials or their family members. The de facto bribes include campaign contributions (sometimes legal, sometimes illegal), sponsorship of political fund-raising events, and donations to charities or other causes favored by the relevant government officials. Reports of this sort of corruption appear from time to time in the press under the rubric of "military scandal" (see, for example, Biddle 1985; Wines 1989; Hinds 1992; "National Briefing" 2003; Colarusso 2004; Pasztor and Karp 2004; Calbreath and Kammer 2005; Wood 2005; Babcock 2006; "Defense Contractor Guilty in Bribe Case" 2006; Ross 2006; "5 Americans Indicted" 2007; "Feinstein Quits Committee" 2007; and Levesque 2007). On the other, much more important side, the state corrupts businesspeople by effectively turning them into co-conspirators in and beneficiaries of its most fundamental activity--plundering the general public.

Participants in the military-industrial-congressional complex (MICC) are routinely blamed for mismanagement; frequently accused of waste, fraud, and abuse; and from time to time indicted for criminal offenses (Higgs 1988, 1990, xx-xxiii, 2004; Fitzgerald 1989; Kovacic 1990a, 1990b). All of these unsavory actions, however, are typically viewed as "aberrations"--misfeasances to be rectified or malfeasances to be punished while retaining the basic system of state-private cooperation in the production of military goods and services (for an explicit example of the "aberration" claim, see Fitzgerald 1989, 197-98). I maintain, in contrast, that these offenses and even more serious ones are not simply unfortunate blemishes on a basically sound arrangement, but surface expressions of a thoroughgoing, intrinsic rottenness in the entire setup.

It is regrettable in any event for people to suffer under the weight of a state and its military apparatus, but the present arrangement--a system of military-economic fascism as instantiated in the United States by the MICC--is worse than full-fledged military-economic socialism. In the latter, people are oppressed by being taxed, conscripted, and regimented, but they are not co-opted and corrupted by joining forces with their rapacious rulers; a clear line separates them from the predators on the "dark side." In the former, however, the line becomes blurred, and a substantial number of people actively hop back and forth across it: advisory committees, such as the Defense Science Board and the Defense Policy Board, (1) and university administrators meet regularly with Pentagon officials (see Borger 2003 for a report of an especially remarkable meeting). The revolving door spins furiously: according to a September 2002 report, "[t]hirty-two major Bush appointees are former executives, consultants, or major shareholders of top weapons contractors" (Ciarrocca 2002; see also Stubbing 1986, 90, 96; Kotz 1988, 230; Doward 2003; Hamburger 2003; Barlett and Steele 2007), and a much greater number cross the line at lower levels. …

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