Hackers in Government 4: Discretionary Spending That Produces No Value

Herein Nick Farr makes an insight into key traits of the current defense spending in the US, putting accent on what could be changed to raise its expediency.

I guess politicians are the most brown-nosing, trying to find a way to not kiss a certain part of the anatomy, but that’s fundamentally what politicians do. I see this now: people who are young, who are just outside of college and getting into politics, are being trained from a very early age to be incredibly differential to power, to take the unpleasantness, put a little shine on it and present it to the person above them. And so people who are elected, people who become politicians, have had their entire careers working, essentially, lying to people.

I think successful hackers, on the other hand, get to be successful hackers precisely by doing the opposite: by telling the truth to power, by saying: “Look, your system sucks and you need to fix it, and this is how you fix it.” I think that’s how hackers become successful hackers.

Mudge, hacker from the Cult of the Dead Cow, who was the first image in my fun slide, was unafraid, went before Congress and said: “Yeah, if we felt like it, we could disable the Internet here in 15 minutes,” which was true then and possibly is true now. He knew he could do that, he had the courage of his convictions to know that he could do that, and he was unafraid of telling people that. And politicians were stunned; they didn’t know how to react; politicians don’t know how to react to somebody telling them unpleasant truth. And I think that’s something that today we desperately, desperately need.

How expedient is the US defense spending? To get to more concrete examples, and I think this is an example that would be applicable to wherever you are in the political spectrum. The cold fact of the matter is: the cold war is over. We don’t have two opposing sides building increasingly technical systems to annihilate each other. That’s not the way war is fought today. The wars that are fought today are asymmetric warfare: you have large, centrally bureaucratized armies fighting small, decentralized guerilla outfits.

This isn’t exactly true in Germany, since we spend a lot more money on the defense of Germany than Germany spends on the defense of Germany, and that’s the thing when you look at the pie chart in government. There is this thing called “discretionary spending”. That’s spending that they have the option to do. A lot of social programs, social security and medic care in the United States are entitlement programs which people pay into.

Just a quick example: social security and medic care for retirees; people, whenever they work in the United States, pay a portion of their paycheck, and employers pay a portion of what they pay their employees into this system, so that when they retire, they get a check, they get health care at the end of their life. And that’s non-discretionary spending, because people pay into that system, and then they get those benefits at the end when they retire.

So, the discretionary budget is money that’s generated through taxes and through the issuance of debt that politicians have the option to control. In the United States, the largest portion in the discretionary budget is in defense spending. When you take apart the costs to maintain troops here and to do different things like that, the largest budget line items that we know of are in the defense department budget.

In Defense, they’re throwing money away into systems that don’t produce value.

And that’s actually an important point to make, that a lot of spending in the defense budget is “dark spending” that they don’t publish the exact budget numbers on, because the going belief is that enemies of the state could extract intelligence information by figuring out where the government is spending that money.

But it’s still pretty well known where a lot of that “dark money” goes; it’s in building these incredibly complex technical weapon systems that, when you actually talk to people in the military, they say: “We don’t need them. We don’t need Stealth Bombers; we don’t need incredibly advanced fighter aircraft; we don’t need these huge ships that don’t work as advertised, that cost hundreds of billions of dollars in aggregate.” The military will tell you they don’t need it.

The reason a lot of these weapon systems exist is because they provide jobs to well-connected politicians in their districts. And the sad fact of the matter that the politicians don’t want to address, that these companies that are building these systems don’t want to address, is that you’re throwing money away into systems that don’t produce value.

Defense spending is enormous and not quite justified When you build a big fighter plane, when you build a big ship, once you’ve finished spending the money on it, that ship does not continue to create value. The things that you build into these weapon systems are not discoveries, are not scientific innovations that you can take and apply elsewhere. Once you’ve spent 1 billion dollars on that plane, what’s that plane going to do? It’s going to fly around for a little bit, they’re going to train people how to use it, and at some point that asset is going to be retired, having created no additional value. When you build a bomb and put it on a plane, fly over something and drop that bomb, the bomb blows up; you’ve annihilated the value of the bomb and you’ve annihilated the value of whatever the bomb blew up.

The difference here, and we saw this in looking at the budget of the Apollo program, the Moon shot, what landed man on the Moon – all of the technical innovation that went into that program continues to create value today. The technologies that were developed in putting man on the Moon exist and are embedded in a lot of the technical systems and a lot of the things that we use today. And a lot of the advances that have come since then are because of those discoveries and because they were open. Even though that system was run by government contracts, a lot of the discoveries that were made in that time period were shared among a large group of people, which people continued to build on.

And so, I think, if you put hackers in charge of government, and you say: “Ok, you need to adjust the defense budget,” they would say: “Instead of spending all this money on advanced technical systems, on bombers and ships that we’re never really going to use, that are never going to fight, that add nothing to the defense of the country, knowing that we need to continue to create jobs for people in these politically connected districts, we will need to apply a lot of that technical money and a lot of that expertise into space exploration.”

Think about how ridiculous it is to actually reach the Moon and then stop, and to not go back.

I like to say this a lot: if you were a non-human intelligent species looking down on planet Earth, and you had a basic outline in the history of what was going on here, and then you said: “Ok, they made it to the Moon in the 1970s. 30 years later, they’re still just putting things in orbit around their planet.” I mean, think about how ridiculous that is to actually reach the Moon and then stop, and to not go back. Does anybody think that there is something fundamentally wrong with that? Who thinks that’s a little weird? I think that does not work and does not compute.

And if you had hackers devoted to spending time on things like that in government, it seems they’d be like: “No, when you reach an important milestone, you go on from there, you don’t just quit.” But the sad reality of that is that the defense contractors, politicians, people who are connected, people who are living in a world of lies and living in a world of political expediency, say: “No, we have to keep doing the same thing that we’ve been doing over and over again” – the core definition of insanity.

I think if you had hackers who are really looking at this problem, who are really providing leadership in government, they would take things like this, and they would say: “Look, we can’t continue. If we’re going to borrow money from all around the world, and if we’re going to borrow money from the people who are, essentially, buying the products that they make, and then refinance our debt through that, we’d say No, we have to eliminate these sorts of value sinks, and we have to provide funding to people who are actually doing incredibly great work on literally no budget, and sort of encourage that, and do those sorts of things; and instead of applying money to the same thing we’ve been applying money to since the end of World War II, we should be applying money and resources in things like that which continue to create value.”

Read previous: Hackers in Government 3: Viewing Government as a Network

Read next: Hackers in Government 5: Addressing the Economic and Climate Change Problems

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