http://bastiat.mises.org/2014/03/tri...warfare-state/

Especially interesting is his takedown of Reagan:

Regrettably the Reagan Presidency brought on the final apotheosis of the American Warfare State. The massive $1.5 trillion defense build-up launched without shred of analysis in February 1981 was not only an unnecessary and utter waste, but it also left four legacies that enabled today’s trillion dollar Warfare State, and which now propel the nation on its appointed path toward fiscal bankruptcy.

First, the only politician of modern times who honestly campaigned against Big Government and the national debt was reduced to enunciating pure fiscal babble once in office. Ronald Reagan was so mesmerized by the brass and so bamboozled by the neo-cons’ scary bedtime stories about the Soviets that he not only gave the Pentagon a blank check, but he then proclaimed that there was no deficit problem because the flood of red ink on his watch amounted to necessary and excusable “war debt”.

Secondly, when the national debt skyrocketed from $1 trillion to $3.5 trillion during the Reagan-Bush era, the GOP interred the old time fiscal religion once and for all and proclaimed the modest debt fueled boom of those years as a victory for tax-cutting and the gospel of painless growth. So with two fiscal free lunch parties now in incumbent in the machinery of governance, the Warfare State was unleashed like never before.

Indeed, in due course the fatuous Dick Cheney proclaimed that Reagan proved deficits don’t matter, and then charted the most reckless fiscal course in modern history: massive tax cuts and a doubling of the defense budget during the midst of a Fed induced credit boom that was destined to collapse.

When it did, the Federal deficit surged to nearly 10 percent of GDP—even before Obama’s Keynesian witch doctors got their hands in the public till.

The War Machine the Gipper Built: Armada of Invasion and Occupation

Thirdly, the massive Reagan defense buildup did not go to countering the alleged strategic nuclear threat posed by the Evil Empire because there wasn’t one in the first place, and there was not much to spend it on anyway—-except the rank fantasy of Star Wars which even the Congressional porkers couldn’t abide.

Instead, the Pentagon poured hundreds of billions into a vast conventional war machine, including the 600-ship Navy and its 13 lethal carrier-battle groups; 12,000 new tanks and armored fighting vehicles; 16,000 fighters, bombers, attack helicopters, close air support and transport planes; and a blizzard of cruise missiles and electronic warfare suites.

All of this soon proved well suited to wars of invasion and occupation in the lands of the unwilling and among the desert and mountain redoubts of the mostly unarmed.

In short, the wherewithal for the pointless invasions of 1991, 2001 and 2003 and all the lesser American aggressions in-between and after was requisitioned during the Reagan defense spending binge to thwart an enemy of liberty that had already failed by eating its own cooking.

Finally, if the truth be told the Reagan White House could not get rid of Paul Volcker soon enough. Doing so in 1987, it removed from what was already a rogue central bank the last vestige of sound money discipline and fearless independence from Wall Street.

Treasury Secretary Jim Baker, a policy descendent of John Connally, wanted low interest rates, a weak dollar and a politically pliant disposition at the Fed. Alan Greenspan 2.0 accomplished all of the above and much more, turning the Fed into a pliant tool of GOP triumphalism and Wall Street speculation—even as he spent 19 years in the Eccles Building institutionalization the destruction of the very doctrines of sound finance and gold-backed money about which Greenspan 1.0 had written so eloquently before he came to Washington.

Now caught up fueling a repetitive and destructive cycle of financial bubbles and busts, the Greenspan-Bernanke-Yellen Fed has taken monetary central planning into the deep waters of wanton monetization of the public debt.

Under these circumstances there is no fiscal governance—-just an inexorable drift toward monetary catastrophe. In the interim, our senseless and dangerous trillion dollar Warfare State rolls on.

Keynesian statism and monetary central planning have triumphed, meaning that the American Republic has no remaining fiscal defenses, nor immunities from its extractions.