114
A Century of War
potential of the Third World for U.S. industrial exports. More sensible for the nation perhaps, but not for the power of certain influential New York banks. If a given national economy produces the same volume of saleable goods under the same technological basis over a period of, say, ten years, and prints double the volume of its domestic currency for that same volume of goods as at the beginning of the decade, the ‘consumer’ notes the effect as a significant price inflation. He pays two dollars in 1960 for a loaf of bread which cost him only one dollar in 1950. But when this effect was spread around the entire world economy by virtue of the dominant position of the U.S. dollar, the inflated reality could be masked for a bit longer. The results, however, were every bit as destructive. In his first days in office, under guidance from his advisers, President Lyndon Baines Johnson, a small-town Texas politician with little knowledge of international politics, let alone monetary policy, reversed the earlier decision of John Kennedy. President Johnson was led to believe that a full-scale military war in southeast Asia would solve many problems of the stagnant U.S. economy and show the world that America was still resolute. THE VIETNAM OPTION IS TAKEN Volumes have been written since the tragic Vietnam war about the reasons and causes for it. But, on one level, it was clear that a significant faction of the American defense industry and New York finance had encouraged the decision of Washington to go to war, despite its absurd military justification and a divisive domestic reaction, because the military buildup offered their interests a politically saleable excuse to revive a massive diversion of U.S. industry into the production of defense goods. More and more during the 1960s, the heart of the U.S. economy was being transformed into a kind of military economy, in which the cold war against communist danger was used to justify tens of billions of dollars of spending. The military spending became the backup for the global economic interests of the New York financial and oil interests, another echo of nineteenth-century British Empire, dressed in the garb of twentieth-century anticommunism. The Vietnam war strategy was deliberately designed by Defense Secretary Robert McNamara, National Security Adviser McGeorge Bundy, with Pentagon planners and key advisers around Lyndon Johnson, to be a ‘no-win war’ from the onset, in order to ensure a
Engdahl 02 chap08 114
24/8/04 8:17:43 am
