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Every
month, David Galland and his co-editors –
among them Doug Casey – of The Casey Report research
and analyze significant events in the U.S. and global economy, as well as in
politics and the markets. Their goal is to recognize the trends in the making
that will directly or indirectly affect investors… and to provide the
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Recently,
I read a book titled The Good
Soldiers that also serves as an object lesson in the disconnect
between what’s going on in Washington D.C. and reality. It was written
by David Finkel, a Pulitzer-winning author, and it
came to me via a friend who is going through a stage where she feels drawn to
books about war, mostly about World War II. Showing flexibility, her interest
has expanded to the ongoing conflict in Iraq – the theater of
operations that serves as backdrop for The
Good Soldiers.
Despite it going solidly against my literary
preferences, I dragged the book along during a quick trip to Florida –
a spur-of-the-moment thing to attend a golf school (I figured it was either
that or get thrown off the local course for energetic exclamations of
elaborate expletives resulting from my golf shots constantly flying off in
unexpected and unwelcomed directions). Out of courtesy if nothing else, I figured
I’d read a few pages of the book before putting it down – and so
was surprised when it sucked me in, and kept me in, pretty much until I was
finished.
The
background story is that the author of the book traveled to Iraq with a
battalion of U.S. soldiers sent as part of the “surge,” then
lived with them for the 14 months of their deployment. As far as I can tell,
he approached his topic with no overt political intentions – rather, he
just wanted to document the war as experienced by a battalion operating from
a small base in one of the worst corners of Baghdad.
As
one might expect, as they departed from the United States for Baghdad, the
soldiers and their brigade commander, Col. Ralph Kauzlarich,
were full of fight, patriotism, and the confidence that only a chosen people
can possess. It was, in their view, a just war and they deeply believed that
in no time at all they'd use their superior war-making capabilities –
supported by the sure knowledge that they held the moral high ground –
to clean the bad guys out of Dodge and get the whole mess straightened out
pronto.
Reality,
however, turned out to be significantly different, starting with the fact
that rather than being welcoming, the population was overtly hostile –
so much so that almost every time the soldiers drove off the base (which was
part of the daily routine), the locals would try to maim and kill them. And
they had considerable success at it.
In
addition to trying to kill them, the community’s leaders seemed
uninterested in the outreach efforts the colonel was instructed to make,
including an initiative to rebuild the sewers and fix the power and water
delivery systems in the area around his command. Of course, it didn’t
help that it was the blunt-force approach used by the U.S. military in capturing
Baghdad that destroyed so much of the infrastructure in the first place.
Regardless, all attempts at doing “good works” were stalled and
disappointed at every turn, with billions of dollars wasted in the process.
As
the book progresses, the author juxtaposes President Bush's and General Petraeus' rosy comments about how well the surge is
working with the on-the-ground realities. And those realities are presented
as raw and graphic as they are – with the tops of soldiers’ heads
being taken off by IEDs, or burning to death in Humvees
while friends watch helplessly.
So
successful was the military and political leadership in convincing Congress
and the media that the surge was a winning strategy that, to this day, its
acceptance as a fact has become a meme throughout the body politic. Back on
the ground in Iraq, however, the daily grinding down of the front-line forces
continues apace.
During
the period of time covered in The
Good Soldiers, the Iraqi insurgent attacks lightened up only
slightly – but only because the ruling mullah in the battalion’s
area of operation unilaterally called a cease-fire. The resulting
dialing-back of attacks on U.S. forces was immediately pounced upon by the
military leadership and the Bush administration as proof that the surge was
working.
That
that wasn’t the case became clear the day the same mullah called off
his cease-fire and hell opened up. One minute the area was relatively quiet
– the next, the streets were filled with armed gunmen and snipers, and
bombs were going off on what seemed like every corner.
One
of the more remarkable aspects of the war, an aspect that largely goes
unreported, was just how sophisticated the Iraqi opposition became in their
attacks against the occupying forces. Not only did their roadside bombs
become murderously powerful – so powerful that they could almost
evaporate a fully armored Humvee – but the
Iraqis began attacking the U.S. bases using everything from mortars to
rockets and even homemade missiles.
The
lob bomb, for example, was created out of propane tanks, filled with ball
bearings and shrapnel, with a triggering device welded to the nose, and a
rocket on the rear. In one instance, two large dump trucks drove near the
base; after tilting up their backs to drop their loads, they revealed rails
which were then used to guide a barrage of lob bombs, resulting in millions
of dollars of damage to the American base.
By
the end of the battalion’s stay, the soldiers were mentally and, in
many cases, physically ruined. One chapter near the end of the book, which
recounted Col. Kauzlarich’s visits to some of
his wounded soldiers back in the States – soldiers who suffered truly
catastrophic injuries – I had to skip after just a couple of pages. It
was just too painful to read.
Lessons from The Good
Soldiers…
There
are a number of important lessons that can be derived from The Good Soldiers,
including:
- The
on-the-ground commanders and soldiers being sent into places like Iraq
and Afghanistan have only the best of intentions. Though their reasons
for joining up may vary, as they head off for war, most believe their
leaders wouldn’t deploy them unless there was good reason to do
so. Thus when it becomes clear to them just how ill-used they have been
– that they have lost friends and limbs for no discernable purpose
– it creates a deep sense of disillusionment. The odds of another
Timothy McVeigh emerging from the crowd of returning vets are very high.
- Despite the
U.S. government spending tens of millions of dollars a day in Iraq
– with the total spent now approaching $1 trillion – the
mission has accomplished nothing other than antagonizing the Iraqis
whose doors the U.S. troops kick down regularly. When I say
“accomplished nothing,” that is actually an overstatement.
In fact, other than toppling Saddam, the outcome of the mission has been
to create an everlasting antipathy between many Iraqis and the United
States, blowing wind into the sails of the most radical elements of
Iraqi society. What a mess.
- The U.S.
occupation has turned into a very effective laboratory for the
insurgents. At the beginning of the conflict, the resistance fighters
were relatively weak – but as time has gone by, the natural ability
of humans to adapt and improvise has led to the development of an array
of inexpensive but seriously lethal antipersonnel weaponry. That these
technologies are now spreading throughout the region can be seen in the
recent death of eight U.S. soldiers in Afghanistan, in a single blast.
- Short of
staging a scorched-earth form of warfare – turning these cities
into parking lots – the U.S. cannot possibly ever win one of these
conflicts. There is no fixed enemy that the U.S. can target with its
superior weapons. And it’s unrealistic that the military can hunt
down all of the opposition by going door to door.
- The U.S.
political and military leadership is straight out lying to its troops
and to the public at large. It is hard to comprehend why, but I dare you
to read The Good
Soldiers and come away with any other conclusion. Maybe they
continue the tragic farce because to cut and run – as we
ultimately did in Vietnam – is just too embarrassing. Maybe
it’s because they are so effectively lobbied by the war profiteers
– may they eventually rot in the hottest corner of hell. Maybe
it’s because they are allowed to wage war from a safe distance (no
politicians visited the forward operating base where Kauzlarich
and his battalion were based during their stay there,
and Petraeus only made a single, quick
stopover).
Meanwhile, the U.S. continues to bleed billions in these misguided wars,
while the soldiers just bleed.
Someone,
and probably a lot of people, should be held accountable for this travesty
– as in being brought up on serious charges and, if found to have
propagated lies resulting in the loss of lives and the wasting of hundreds of
billions of dollars, sent to jail for a very, very long time. Or, better
still, turned over to the Iraqis to punish. I’m sure they’d
figure out something appropriately medieval.
Why This Is Important to Us as Investors
Given
the urgency of addressing the U.S. debt and deficits, the bloated U.S.
military budget is clearly the most obvious place to start making cuts that
will actually matter. Yet Congress made no such cuts when passing the $690
billion budget requested by the Defense Department – doing so last week
by an overwhelming margin.
That
budget includes another $119 billion to flush down the toilets of Iraq and
Afghanistan. Showing that it has learned no lessons, the Obama administration
– encouraged no doubt by new friends in the military-industrial complex
– has already managed to spend $750 million in the undeclared war on
Libya.
There
is a way to use this understanding that the bankrupt U.S. and its allies are
doing little more than breaking furniture and making enemies in the Middle
East to one’s advantage. Simply, unless and until the U.S. politicians
muster enough spine to pull out of Iraq and
Afghanistan and slash the military budget, the government’s massive
budget deficits will continue.
And
if the budget deficits continue, then the trend for the U.S. dollar is
sharply downward (though I remain convinced we’ll see a rally in the
near term, a topic we’ll be tackling in greater detail in the upcoming
edition of The
Casey Report).
That
is not conjecture, but the unavoidable conclusion uncovered by a number of
objective analyses done on past sovereign debt crises by folks such as
Kenneth Rogoff and Casey’s Chief Economist
Bud Conrad.
To
those readers who think that cutting the military budget, or pulling out
wholesale from the Middle East, will increase threats to the continental
United States, we will have to agree to disagree. In my view, destroying our
economy to wage war – in the process squandering the huge commercial
advantage of providing the world its reserve currency – is far more
destabilizing. As is making yet more enemies by continuing to lob bombs and
kick in doors here, there, and everywhere.
Unfortunately,
the U.S. leadership and, I guess, some significant swath of the voting public
who supports that leadership are suffering from some sort of mass psychosis
(or maybe it’s paranoia), that actually has them thinking that it is
somehow in the country’s interest to continue flinging billions of
dollars and the lives of its good soldiers into lost causes overseas.
But
don’t take my word on the topic – do yourself a favor and pick up
a copy of The Good Soldiers
today. As I can’t know where you stand on these wars, I can’t say
whether or not reading the book will change your mind. But I can guarantee
you that its on-the-ground perspective will enlighten you as to the true and
disturbing nature of what’s really going on, and the futility of it
all. It is anything but entertaining, but is very well written and very
illuminating.
Meanwhile,
use the military budget as a proxy for the seriousness (or lack thereof) of
the government’s intent to reduce its spending
by any significant amount. And, absent any serious cuts in that spending,
continue to take measures to protect yourself against wholesale debasement of
the currency.
David Galland
Managing
Editor, Casey Research
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