An arms-run economy: remembering Eisenhower's warning

WE'VE ignored too long President Eisenhower's warnings and it's time we considered problems created by growth of the United States military-industrial complex: rising federal deficits; escalated risks of nuclear war; spreading military violence from conventional weapons; high interest rates and unemployment levels; indolence of our manufacturers to be productive or innovative or competitive in our own and foreign markets; eroding US leadership and Western solidarity.

Root causes of these problems are the Pentagon's arms policies of ''buy American'' exclusively and ''export American'' aggressively to compete with democratic allies as much as with Soviet-bloc nations.

Per capita income for Americans and Europeans is about equal. But per capita military spending in the United States has been three times that in Europe. For the past decade, according to the CIA, NATO military expenditures have exceeded those of Warsaw Pact governments. But NATO maintains its 35-year-old threat of first use of nuclear weapons against conventional forces led by the Soviets. Risks of nuclear war are certainly increasing because of Soviet deployment of SS-20 missiles and US deployment of Pershing II and cruise missiles in Europe. Now, Washington leaders are threatening withdrawal of US conventional military forces from Europe, if NATO allies refuse to boost their military expenditures by at least 3 percent above their inflation rates.

By blocking European manufacturers from opportunities to compete with or join US counterparts on sales to US military departments, Washington denies European governments the political and economic incentives they need to boost their shares of the total cost of NATO military security. By competing with European governments for arms exports to nonaligned governments, Washington has unnecessarily spread and intensified the arms race and jeopardized Western security. That Iraqi forces use French-produced weapons against Iranian forces using American-produced weapons, and that both imperil oil supplies required by Western democracies, is but one bit of irony in US military-industrial leadership. Nonaligned nations have vastly increased their loans to finance imports of weapons and other products of Western manufacturers; now they threaten default in payment of interest and principal, hence the potential collapse of Western banking and currency systems.

The Pentagon prevails in its demands for more (and ever more scarce) capital funds and scientific and engineering talents for weapons manufacturers. Whether they utilize those resources productively is exempted from the systems of open democratic, free, competitive market accountability. Yet this is the system the military-industrial complex is supposed to preserve!

Meanwhile, the White House argues with Congress about whether the Pentagon budget should be increased by $1.5 trillion or $1.7 trillion, by 1988. Presidential candidates Ronald Reagan and Walter Mondale argued about needs for increased taxes to reduce the federal deficits and interest rates. And business leaders and economists argue for national industrial policies to revitalize growth of US ''smokestack'' industries, to protect advantages of US ''high technology'' manufacturers, or to improve US infrastructures of roads, bridges, and water-resource and waste-control systems.

Unless the Pentagon budget is reduced and the military-industrial establishment held more accountable, such debate is probably futile.

The US should abandon its security strategy of military-industrial independence. It should initiate proposals for cooperation by Western democracies: first, in reducing per capita costs and increasing the effectiveness of conventional military forces so the West can renounce the threat of first use and eliminate its mutual competition for arms exports to nonaligned nations; second, in launching programs for developing resources, markets, and employment, and boosting per capita income in nonaligned nations so as to strengthen Western political/economic interdependence and security.

Washington should authorize and fund ongoing or planned programs to develop, produce, and deploy conventional weapons only if one or more governments of NATO , Japan, or Australia agreed to cooperate by funding at least 35 percent of the estimated cost of the program. Thus, US defense expenditures could be reduced by at least 35 percent, or more than $100 billion. Allied governments would have incentives to increase their defense budgets, because the US would buy from their industries. US and allied defense firms would be free to compete, consort on, or merge interests in the larger common weapons market created by US-allied cooperation.

The US Army, Navy, and Air Force would be pressed to obtain cooperative allied partners to sustain their weapons acquisition programs. Thus, longstanding and wasteful rivalries among the Army, Navy, and Air Force for supremacy in Western military security missions, and for sustaining US political/military pork-barrel expenditures - would be reduced. US and allied governments and industries would strengthen their solidarity by agreeing on common contract terms (technical, financial, legal) of accountability for performance, settlement of disputes, transfers of funds, conservation of energy and environment, conditions of employment, etc. US managers and labor leaders could adopt cooperative and abandon adversarial modes of relations, and thus, from their European or Japanese counterparts, learn to work more productively and cooperatively together. In short, Western military security, political and economic solidarity, and US leadership vis-a-vis relations with the Soviets and nonaligned countries would be strengthened.

Conventional capabilities in the West would be increased from 50 to 300 percent, according to Gen. Andrew Goodpaster, former commander of NATO military forces. NATO military costs could be reduced by $20 billion. NATO could renounce its threat of first use of nuclear weapons against invasion by Soviet-led conventional forces. The US could initiate talks with the USSR for a nuclear-free zone in Europe and for reductions in strategic weapons.

The 35 percent savings from the Pentagon budget would enable the US to reduce its federal deficit. Interest rates could be reduced. The US could afford to revive its Marshall Plan for developing nations, and thereby to expand its exports of consumer-industrial products. This would improve employment and living standards in the US and nonaligned nations. Lower interest rates would relieve pressures for capital outflows from Western markets; nonaligned nations would acquire more equitable status as trading partners with the West.

The Soviets would be pressed to respond with their own economic programs or else to suffer containment or contraction of their Marxist revolution. Thus, the superpowers' arms race could be transformed to more peaceful uses of conflict.