War is Still a Racket

In 1935, Major General Smedley Butler wrote War is a Racket. It still is.

Pick any topic. Choose ‘War.’

via Wikimedia

Can you identify how many ways in which ‘War’ is a scam?

What about the history of the scam?

In 1935 — after WWI, but before WWII, Major General Smedley Butler named names.

In piecing apart some of the excerpts from the book, particularly the companies and families that benefited from the Great World War I Scam (“..to end all other wars”) — it seems not much changes over the generations.

Simply replace the companies listed in this piece with companies like Raytheon, BAE Systems, private military contractors, subcontractors, and — for practical purposes — anything involved with the machinery of war. From support & auxiliary providers of boots, food, and weapons systems — all up and down the chain, there is a great scam being perpetuated. And naturally, you are on the hook for all of it.

WAR is a racket. It always has been.

It is possibly the oldest, easily the most profitable, surely the most vicious. It is the only one international in scope. It is the only one in which the profits are reckoned in dollars and the losses in lives.

A racket is best described, I believe, as something that is not what it seems to the majority of the people. Only a small “inside” group knows what it is about. It is conducted for the benefit of the very few, at the expense of the very many. Out of war a few people make huge fortunes.

In the World War a mere handful garnered the profits of the conflict. At least 21.000 new millionaires and billionaires were made in the United States during the World War. That many admitted their huge blood gains in their income tax returns. How many other war millionaires falsified their tax returns no one knows.

How many of these war millionaires shouldered a rifle? How many of them dug a trench? How many of them knew what it meant to go hungry in a rat-infested dug-out? How many of them spent sleepless, frightened nights, ducking shells and shrapnel and machine gun bullets? How many of them parried a bayonet thrust of an enemy? How many of them were wounded or killed in battle?

Out of war nations acquire additional territory, if they are victorious. They just take it. This newly acquired territory promptly is exploited by the few —the selfsame few who wrung dollars out of blood in the war. The general public shoulders the bill.

Du Ponts

Where to begin with this one? Let me know in the comments if you are unaware of the shifty connections of the du Pont family and I’ll go into it in a follow up.

Take our friends the du Ponts, the powder people —didn’t one of them testify before a Senate committee recently that their powder won the war? Or saved the world for democracy? Or something? How did they do in the war? They were a patriotic corporation. Well, the average earnings of the du Ponts for the period 1910 to 1914 were $6.000.000 a year. It wasn’t much, but the du Ponts managed to get along on it. Now let’s look at their average yearly profit during the war years, 1914 to 1918. Fifty-eight million dollars a year profit we find! Nearly ten times that of normal times, and the profits of normal times were pretty good. An increase in profits of more than 950 per cent.

United States Steel, Anaconda, Utah Copper, etc.

Titans of industry abound. The United States Steel concern was primarily owned by people like Andrew Carnegie, J.P. Morgan, and Charles Schwab. Be mindful that these sums of money were enormous in the early 1900’s, particularly when adjusted for inflation as compared to today. $34,000,000 in 1914 would be worth about a billion today — and that is before adjusting for the matter of any return on investments made with that capital.

Or, let’s take United States Steel. The normal earnings during the five-year period prior to the war were $105.000.000 a year. Not bad. Then along came the war and up went the profits. The average yearly profit for the period 1914-1918 was $240.000.000. Not bad.

There you have some of the steel and powder earnings. Let’s look at something else. A little copper, perhaps. That always does well in war times.

Anaconda, for instance. Average yearly earnings during the pre-war years 1910-1914 of $10.000.000. During the war years 1914-1918 profits leaped to $34.000.000 per year.

Or Utah Copper. Average of $5.000.000 per year during the 1910-1914 period. Jumped to an average of $21.000.000 yearly profits for the war period.

Let’s group these five, with three smaller companies. The total yearly average profits of the pre-war period 1910-1914 were $137.480.000. Then along came the war. The average yearly profits for this group skyrocketed to $408.300.000.

A little increase in profits of approximately 200 per cent.

Does war pay? It paid them. But they aren’t the only ones. There are still others. Let’s take leather.

For the three-year period before the war the total profits of Central Leather Company were $3.500.000. That was approximately $1.167.000 a year. Well, in 1916 Central Leather returned a profit of $15.000.000, a small increase of 1.100 per cent. That’s all. The General Chemical Company averaged a profit for the three years before the war of a little over $800.000 a year. Came the war, and the profits jumped to $12.000.000, a leap of 1.400 per cent.

Identifying Who Pays

Major General Butler identified, quite early on, that the taxpayer is ultimately on the hook for this scam. But the soldier pays the ultimate price.

Who provides the profits —these nice little profits of 20, 100, 300, 1.500 and 1.800 per cent? We all pay them —in taxation—. We paid the bankers their profits when we bought Liberty Bonds at $100.00 and sold them back at $84 or $86 to the bankers. These bankers collected $100 plus. It was a simple manipulation. The bankers control the security marts. It was easy for them to depress the price of these bonds. Then all of us —the people— got frightened and sold the bonds at $84 or $86. The bankers bought them. Then these same bankers stimulated a boom and government bonds went to par —and above—. Then the bankers collected their profits.

But the soldier pays the biggest part of the bill.

[…]

Boys with a normal viewpoint were taken out of the fields and offices and factories and classrooms and put into the ranks. There they were remolded; they were made over; they were made to “about face”; to regard murder as the order of the day. They were put shoulder to shoulder and, through mass psychology, they were entirely changed. We used them for a couple of years and trained them to think nothing at all of killing or of being killed.

Then, suddenly, we discharged them and told them to make another “about face”! This time they had to do their own readjustment, sans mass psychology, sans officers’ aid and advice and sans nation-wide propaganda. We didn’t need them any more. So we scattered them about without any “three-minute” or “Liberty Loan” speeches or parades. Many, too many, of these fine young boys are eventually destroyed, mentally, because they could not make that final “about face” alone.

Solutions to the Racket

Here are some bright ideas that still seem fairly applicable, despite all recent technological advancements. However unlikely.

The ships of our navy, it can be seen, should be specifically limited, by law, to within 200 miles of our coastline. Had that been the law in 1898 the Maine would never have gone to Havana Harbor. She never would have been blown up. There would have been no war with Spain with its attendant loss of life. Two hundred miles is ample, in the opinion of experts, for defense purposes. Our nation cannot start an offensive war if its ships can’t go further than 200 miles from the coastline. Planes might be permitted to go as far as 500 miles from the coast for purposes of reconnaissance. And the army should never leave the territorial limits of our nation.

To summarize: Three steps must be taken to smash the war racket.

1. We must take the profit out of war.

2. We must permit the youth of the land who would bear arms to decide whether or not there should be war.

3. We must limit our military forces to home defense purposes.

“To Hell With War”

Maj. Gen. Butler also correctly identifies that the secrecy underlying the buildup of arms and prefiguration to war, along with the unrealistic ideas (and shadowy forces) that undermine disarmament & arms limitation agreements are several key factors that ultimately drive total-war.

He writes:

They cannot be for limitations of arms. And at all these conferences, lurking in the background but all-powerful, just the same, are the sinister agents of those who profit by war. They see to it that these conferences do not disarm or seriously limit armaments.

[…]

Secretly each nation is studying and perfecting newer and ghastlier means of annihilating its foes wholesale. Yes, ships will continue to be built, for the shipbuilders must make their profits. And guns still will be manufactured and powder and rifles will be made, for the munitions makers must make their huge profits. And the soldiers, of course, must wear uniforms, for the manufacturer must make their war profits too.

But victory or defeat will be determined by the skill and ingenuity of our scientists.

If we put them to work making poison gas and more and more fiendish mechanical and explosive instruments of destruction, they will have no time for the constructive job of building greater prosperity for all peoples. By putting them to this useful job, we can all make more money out of peace than we can out of war —even the munitions makers.

More reading about some of these phenomenon:

Sleepwalking into Total War