Making Money on a New Cold War
The Russia-Georgia clash has generated heated anti-Moscow rhetoric from John McCain and U.S. neoconservatives about a new Cold War, a prospect that most people might see in a negative light but which many military contractors surely view as a financial plus.
One unstated reality about revived tensions between Washington and Moscow is that it will mean a bonanza in military spending – billions of additional dollars for anti-missile weapons systems, larger armies, construction of new bases in Eastern Europe, etc.
Indeed, the spending on Cold War II could dwarf what military contractors are now making on the “war on terror” – and the prospect of spending on both conflicts simultaneously should make arms industry executives drool.
Others who stand to profit grandly from a new East-West showdown include tough-talking politicians and their friends in Washington think tanks – like Heritage, AEI and CSIS – that have long fattened up on contributions from the defense industry and related corporations.
There would be losers, too, like taxpayers who would see more of their dollars go to “national security” and less to domestic needs, from repairs to the crumbling infrastructure to the costs of health care, education, the environment and Social Security.
But, in many ways, the exploitation of Cold War fears – to divert money away from domestic needs to the coffers of what Dwight Eisenhower dubbed “the military-industrial complex” – is nothing new.
Arguably, the original Cold War ended under Eisenhower’s former Vice President, Richard Nixon, who as President returned from Moscow in 1972 carrying a strategic agreement that he had reached with what was already a rapidly decaying Soviet Union.
“In Moscow, we witnessed the beginning of the end of that era which began in 1945,” Nixon said. “With this step, we have enhanced the security of both nations. We have begun to reduce the level of fear, by reducing the causes of fear, our two peoples, and for all the peoples of the world.”
Nixon unveiled a new era of realpolitik cooperation between Washington and Moscow that he called “détente.”
However, while reducing fears and lowering tensions might be good news for many people, it wasn’t welcomed by the corporations that profited from the fears and the tensions, nor by the intellectual hired guns who had built lucrative careers in politics, media and academia by exaggerating those fears and exacerbating those tensions.
So, Nixon’s era of “détente” was short-lived. After his ouster over the Watergate scandal in 1974, a new batch of Cold Warriors – some operating from conviction and others from expediency – returned to the old patterns of hyping threats and stoking paranoia.
In 1975, with President Gerald Ford confronting an internal Republican challenge from Ronald Reagan on the Right, many key figures associated with “détente” were purged, while hard-liners were given key jobs.
The so-called Halloween Massacre saw Henry Kissinger, the chief architect of détente, stripped of his post as national security adviser to be replaced by Gen. Brent Scowcroft; James Schlesinger was out as Defense Secretary while Donald Rumsfeld was in; CIA Director William Colby lost his job to George H.W. Bush; and Dick Cheney was promoted to Ford’s White House chief of staff.
Soon, alarming rumors began spreading around Washington about a new Soviet secret weapon, a nuclear-armed submarine that was undetectable to American technology. These Soviet subs could be lurking off the Atlantic and Pacific coasts ready to launch a nuclear attack without warning, a frightened public was told.
So, as Ford struggled in Republican primaries against Reagan, the word “détente” was banished from the administration’s lexicon. Then, to appease the Right further, CIA Director Bush let a right-wing panel of outsiders critique the work of CIA analysts who had been detecting a declining Soviet threat.
The outsiders, known as “Team B” and including a young neocon named Paul Wolfowitz, tore into the CIA professionals and insisted that the Soviet Union was rapidly outstripping the United States as a strategic power. “Team B” concluded that the Soviets were building a new generation of terrifying weapons, including those undetectable subs.
Years later, after the Soviet Union collapsed, it would become clear that “Team B” had been living in a fantasy world. Not only did the Soviets lack the new weapons systems, but they were falling rapidly behind the United States in technology and thus the development of sophisticated weapons.
But the “Team B” report served its purpose. Its dramatic findings shaped an alarmist CIA intelligence estimate that CIA Director Bush left behind to limit the arms-control initiatives of Jimmy Carter’s incoming administration. [For details, see Robert Parry’s Secrecy & Privilege.]
During the late 1970s, the hysteria on the Right about mythical Soviet weapons continued to grow, pushed along by an arch-conservative group called the Committee on the Present Danger, which warned of a “window of vulnerability.”
The fear about secret Soviet capabilities seeped into mainstream news coverage critical of Carter’s proposed arms deals with Moscow.
‘Winning’ the Cold War
By 1980 and the election of Ronald Reagan, the old Cold Warriors and their younger neoconservative allies had gained the upper hand. Assuming power under Reagan, they immediately sought to bury any remnants of the Nixon-Kissinger détente.
At the CIA, hard-line Director William Casey and his deputy, Robert Gates, purged CIA analysts who still insisted on seeing a Soviet decline. The only acceptable analysis was to agree that the Soviets were on the march and set on world domination.
In reaction to this perceived Soviet threat, there was a massive expansion in U.S. military spending, combined with aggressive covert operations in dirty wars from Central America to Afghanistan. There, the Reagan administration sent sophisticated weapons to rebel forces that included Islamic fundamentalists, such as Osama bin Laden.
Ironically, when the Soviet Union finally collapsed in 1991, the CIA analytical division was mocked for having “missed” this momentous event. Meanwhile, the U.S. news media credited Reagan’s vast military spending, especially his “Star Wars” missile defense program and the Afghan war, with “winning” the Cold War.
The counter-analysis – that the Soviet Union was in a death spiral by the early 1970s and that Reagan’s aggressive strategies may have, if anything, prolonged the Cold War by strengthening the hands of Moscow’s hardliners – was ignored or dismissed.
Reagan’s legacy had another consequence. The triumphant neocons insisted on dispatching to Moscow free-market “shock therapists” who aided and abetted a new class of rapacious “robber barons” as they stripped the country of its assets and stuck the nation’s capital in offshore accounts.
U.S. policy also supported the dismemberment of the old Soviet empire and humiliated Moscow by expanding NATO deep into its traditional sphere of influence. In 1999, Russia faced a new disgrace when the Clinton administration spearheaded a NATO war against Moscow’s longtime allies in Serbia, over the breakaway province of Kosovo.
When George W. Bush became President in 2001, his administration welcomed back many of the key neocons and hardliners who had served in previous Republican administrations. Cheney was Vice President; Rumsfeld was Defense Secretary; Wolfowitz was Rumsfeld’s deputy.
On the other hand, Bush claimed to have forged a bond of personal trust with Vladimir Putin by looking into the Russian president’s eyes.
“I was able to get a sense of his soul, a man deeply committed to his country and the best interests of his country,” Bush said on June 16, 2001.
Though many U.S. observers mocked Bush’s comment and cited Putin’s history as a KGB agent, the underlying reality was that Bush never treated Putin as a trustworthy partner. The kind words represented a façade for a continued U.S. campaign to box in and undermine Russia.
In June 2002, for instance, Bush withdrew the United States from Nixon’s 1972 Ballistic Missile Treaty to clear the way for deployment of a missile defense system that Moscow saw as a strategic threat given its deteriorating nuclear-missile arsenal.
As Russia’s leaders fumed about the abrogated ABM Treaty, Bush spoke cavalierly. “The treaty is now behind us,” he said, while reaffirming his commitment to deploy a missile defense system “as soon as possible.”
The Bush administration and its oil-industry allies also supported the construction of the Baku-Tblisi-Ceyhan pipeline, which was designed to deliver Caspian oil to the West and to Israel while avoiding Russian territory. The pipeline’s primary contractor was Bechtel, a company with long-standing ties to powerful Republicans.
The pipeline also enhanced the need to make sure that the former Soviet republic of Georgia was under the control of a reliably pro-Western leader.
So, U.S.-financed political organizations, such as the National Endowment for Democracy, poured in money to help an anti-Russian political movement called the Rose Revolution, as well as to groom pro-Washington politicians like Mikheil Saakashvili.
In 2003, the bloodless Rose Revolution brought Saakashvili to power and, in his gratitude, the new president named a major boulevard in the capital of Tiblisi after George W. Bush. Saakashvili also committed Georgian soldiers to Bush’s “coalition of the willing” in Iraq, and brought in U.S. and Israeli military trainers to advise the Georgian army.
Meanwhile, the Bush administration kept up the pressure on Moscow by adding more of the former Warsaw Pact nations to NATO, pushing the Western military alliance right up to Russia’s borders.
In 2007, Bush announced plans to deploy interceptor missiles to Poland with supporting radar tracking stations in the Czech Republic. Though Bush insisted the missile defense was intended to counter potential threats from rogue states, like Iran, the Russians saw the move as threatening to them.
Arms Export magazine editor Mikhail Barabanov, writing in the Moscow newspaper Kommersant, said the real U.S. motivation for placing interceptor missiles in Poland was to expand U.S. military and strategic capacities and constrict those of other nuclear states, such as Russia and China.
Russia Strikes Back
In effect, Russian leaders became convinced that Bush’s words about partnership were just sweet talk disguising the neocon agenda, as described by the Project for the New American Century, of crippling potential challengers to American global dominance.
Yet, under Putin’s firm grip, Russian authorities were steadily regaining control of the nation’s political destiny. “Robber barons” were exiled or jailed, their media outlets throttled, their businesses brought under the Kremlin’s thumb.
The rise in commodities prices for Russian oil, natural gas and metals also put money into the national treasury and helped Putin rebuild his military might.
That was the backdrop to the crisis in Georgia. President Saakashvili, trusting in the support of his neocon American allies, decided the time was ripe to crush pro-Russian separatists in South Ossetia, an attack he launched on Aug. 7, the eve of the Olympics.
If Saakashvili thought his offensive would go answered – that the Russians again would retreat rather than risk offending the West – he thought wrong. The Russians counterattacked, expelled Georgia forces from both South Ossetia and another breakaway province Abkhazia, and took up strategic positions inside Georgia.
The American political elite, led by Sen. McCain and President Bush, and neocon editorialists, including at the Washington Post, raged against the Russian military thrust, but the Russians were not deterred. They agreed to a ceasefire largely on their terms and left Saakashvili to fume about his betrayal by Western powers.
Bush, however, did back up his angry words with some action.
On Aug. 15, the United States and Poland finalized an agreement to deploy American missile defenses onto Polish territory. Patriot anti-missile missiles, now in Germany, were to be moved to Poland along with support crews.
The next day, the Russian Ministry of Foreign Affairs ratcheted up the tensions by defining the American move as a provocative threat to Russian security and warning of possible military action against Poland.
“The Russian side in such a situation will take adequate measures to compensate for potential threats to its national security,” the Ministry said, referring not to diplomatic but to “military-technological methods.”
Russian President Dmitry Medvedev added, “Placing elements of a global anti-missile system by the U.S. in Eastern Europe only deepens the situation, and we will be forced to react to this adequately.”
Some observers suggested that the Russians were now facing a situation similar to what President John Kennedy confronted in 1962 when the Soviets installed missiles in Cuba, a crisis that pushed the world to the brink of a nuclear confrontation before Moscow relented and removed the missiles.
Still, despite the risks to humanity, the rewards of a revived Cold War – with fatter defense budgets and greater demand for anti-Russian propaganda – will benefit military contractors, neocon theorists and politicians who again can exploit the fears of the American people.
Morgan Strong is a former professor of Middle Eastern and Russian History, and was an advisor to CBS News’ “60 Minutes” on the Middle East.
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