NATO: The Case To Get Out Now

The case for getting out of NATO encompasses four fundamental propositions:

• First, the Federal budget has become a self-fueling fiscal doomsday machine, even as the Fed has run out of capacity to monetize the skyrocketing public debt.

• Second, the only viable starting point for fiscal salvation is slashing the nation’s elephantine Warfare State by at least $500 billion per year.

• Third, the route to that end is a return to the “no entangling alliance” wisdom of the Founders, which means bringing the Empire Home, closing the 750 US bases abroad, scuttling much of the US Navy and Army and withdrawing from NATO and similar lesser commitments elsewhere.

• Fourthly, canceling NATO requires debunking its Origins Story and the false claim that it brought peace and security to post-war America when what it actually did was transform Washington into the War Capital of the World, dominated by a panoptic complex of arms merchants, paladins of foreign intervention, neocon warmongers and a vast Warfare State nomenklatura.

As to the impending fiscal calamity, just recall this sequence. When Ronald Reagan attacked the soaring Federal deficits in 1980 the public debt was $930 billion and about 30% of GDP. But it had erupted to $20 trillion by Donald Trump’s first election, now stands at $36 trillion and 125% of GDP and will be hitting $62 trillion by the mid-2030s.

Yet even that figure embodies CBO’s most recent Rosy Scenario fairy tale under which—-

• Congress never again adopts a single new spending increase or tax cut.

• The $5 trillion of Trump’s 2017 tax cuts are allowed to expire next year.

• There’s no recessions, no inflation recurrence, nor any other economic crises for the remainder of this decade and forever thereafter, world without end.

• Despite 7% of GDP deficits and annual interest expense of $1.7 trillion by 2034 the average yield on the public debt clocks in at a minuscule 3.4%.

Yes, and if dogs could whistle the world would be a chorus! Boost the average yield by a minimally realistic 250 basis points, however, and now you have $3 trillion of annual debt service expense and a $4.5 trillion annual deficit by 2034.

In short, there is a doom-loop building inside the Federal fiscal equation under which soaring interest expense will ignite a veritable fiscal wildfire, powering the public debt upward to $150 trillion by mid-century, even under CBO’s cheery baseline.