“He is learning that in any war, the victors may be destroyed as completely as the vanquished. They still have their lives, but they have given up everything else in order to keep them. They sacrifice what they do not realize they have until they have lost it. And so the man who can win the war can only rarely survive the peace.”

Dear Reader,

Today is the 20th anniversary of 9/11. Far be it for us to blaspheme, but blaspheme we will.

From the outset, MacNamara’s War in Vietnam, as MacNamara himself said, was “wrong, terribly, wrong.” Indeed, the war was waged at terrible cost:

Duration: 17 years, 9 months

U.S. military deaths: 58,220

South Vietnamese military deaths: 200,000

North Vietnamese military deaths: 1,100,000

Civilian deaths: thought to be more the 2,000,000

Cost in 2020 US$: $843.63 billion

The Vietnam War was heretofore America’s longest. But only its fourth most expensive.

As far as wars fought by the Empire of Debt, the U.S. government’s adamantine effort to avenge 9/11 takes the cake. The Afghan War by the numbers:

Duration: Just shy of 20 years

Military Deaths: 2,448

US Contractor Deaths: 3,846

Afghan Military deaths: 66,000

Taliban deaths: 51,191

Afghan civilians: 47,245

Cost in 2020 US$: $2.3 Trillion (throw in Iraq and Syria, cost: ~$5 Trillion). Source: Brown University

But here’s the rub. President Truman “temporarily” raised the top tax rate to 92% to pay for the Korean War: President Johnson “temporarily” raised the top rate to 77% pay for “MacNamara’s War.”

President Bush cut taxes at the top by 8% along the way to declaring “Mission Accomplished” in Iraq. Having done so, ‘W” set in motion an unsettling trend. Not only would the war in Afghanistan go on to be the nation’s longest, but also the first to be waged entirely on debt.

“Vini, vidi, vici,” a Roman general would say: “I came, I saw, I conquered.” By virtue of the invasion of Afghanistan, the U.S. government put these words in their generals’ mouths: “Veni, vidi, mutuo sum.” I’m sure you can imagine what that means.

According to our back-of-the-envelope calculations, by 2050 the financed portion of the wars in Afghanistan, Iraq and Syria will reach somewhere in the neighborhood of $16 trillion.

Earlier this week, a Reserve member wrote in chastising us for writing about history and offering up “political bullsh$t.”

Ignore politics at your peril, we say.

The financial debt from these concurrent wars will hang like the sword of Democles over the economic prospects of your family for generations. The debt also lays the foundation of your future investment choices. And we haven’t even begun to pile the cost of financing pandemic relief on top of this heap Afghani detritus.

Ah, with that uplifting note, here’s our complete load of bullsh$t from the week:

Twenty Years After

A few networks have already started their looks at the 20th anniversary of the 9/11 attacks… and more will follow. By the end of the week, there will be an endless parade of survivors, retrospectives and regurgitated footage of the calamity taking up almost all of the available airtime. Coverage may be even more somber in the wake of the U.S. withdrawal from Afghanistan. You may remember 9/11 was a causa bellis for invading the central Asian nation — to punish the ruling Taliban for harboring the Al Qaeda blamed for the attacks. After two decades and over $2 trillion, U.S. troops are gone and the Taliban are back in control.

French Lessons

When the first U.S. military forces entered Afghanistan in October 2001, they were hoping to succeed where the Soviet Union and Great Britain had failed before them. There was a similar confidence when U.S. forces started fighting in Vietnam in March 1965. Except in this case, they were hoping to outperform the French… who had exited the country in defeat just a decade earlier. The U.S. probably assumed it had nothing to learn from France — dismissing it as a nation of “cheese-eating surrender monkeys” after it submitted to Germany early in World World War II. But when it came to butchering each other, what the French didn’t know about it probably wasn’t worth knowing.

Fighting Intangible Enemies

The lingering memories of the burning Twin Towers are the reason Americans so readily backed U.S. involvement in Afghanistan. The words “9/11” were all the justification needed to keep the military there for the next 20 years. The 9/11 planners, at least, provided a more visceral enemy than the boogeyman that drove the Vietnam war — communism. In 1954, President Dwight Eisenhower warned that the fall of French Indochina would give communists a foothold. As the ideology took root in one country, it would spread to all the others… and soon all of Asia would be under red flags. Today, the “domino theory” is about as fashionable as poodle skirts or brogues with spats… mostly because it doesn’t make a lick of sense.

The Fog of War

When a man sticks a knife in his neighbor, it is not easy to disguise what is really happening. The event is right in front of him. But the fog of war, as Prussian General Carl Clausewitz called it, multiplies by the square of the distance from it. In the Oval Office or the war rooms of the Pentagon, the transactions that took place in Vietnam became “costs” or “losses” or “collateral damage.” Moreover, the loss in Vietnam didn’t put an end to our country’s distorted view of empire building.

Next week, we’ll return to our look at alternative investments.

Regards,

Addison Wiggin
Founder, The Financial Reserve

P.S. Don’t misunderstand me, I’m all for dropping the top tax rate. But while launching a foreign war halfway around the world? Something seems wrong, terribly, wrong about the idea.

P. P.S. According to The Balance: “Compensation benefits for Vietnam veterans and families still cost $22 billion a year. Surviving spouses qualify for lifetime benefits if the veteran died from war wounds. Veterans’ children receive benefits until age 18. If the children are disabled, they receive lifetime benefits. Since 1970, the post-war benefits for veterans and families have cost $270 billion.”

The same $270 billion in 1970 would be the equivalent of $1.8 trillion today, reflecting an inflation rate of 603% in the past half century… and stellar financial management on behalf of the monetary mandarins in Washington.

All the more reason to…