paranoia and economic growth
Source Eubulides
Date 06/04/08/23:43

Rallying 'Round the Flag
Since al-Qaeda declared war on Washington five years ago, the federal
city has responded the way it knows best

By David Von Drehle
Sunday, April 9, 2006

LATE ONE WINTER afternoon, not long before he stepped down as chief of
the U.S. Capitol Police, Terrance Gainer was discussing security in
the age of catastrophic terrorism. Behind him, his office windows
displayed a spectacular view: nearly 180 degrees of Washington
skyline, anchored by a huge, incandescently white dome. To some
people, the Capitol dome stands for power. To others, freedom. To the
Americans who watched as the dome was built during the desperate years
of the Civil War, its alabaster gleam represented the idea of the
nation itself.

Gainer would see the dome and think: "Quite a target."

And the Mall, with its monuments, memorials, artifacts and treasures?
"It's like a runway," Gainer observed. Macabre? Perhaps, but Gainer,
like many others in Washington, was paid to think unpleasant thoughts,
including one in which a terrorist steers a jet down the wide landing
path of the Mall, descending over the Reflecting Pool, accelerating
above the Washington Monument, the Smithsonian Castle on his right,
the National Gallery on his left, to slam spectacularly into the dome.

The White House, with its low profile and wooded surroundings, is a
much trickier objective, Gainer noted.

This was all said matter-of-factly. It's just the world we live in
today. See plane, think missile; see landmark, think fireball; feel
breeze, think anthrax. And so I found myself nodding agreeably as
Gainer continued in this apocalyptic vein, comparing the relative
threats posed by deadly germs in the air vents, a dirty bomb, a
suicide bomber in a room full of VIPs. He spoke smilingly about the
inevitable panic, the gridlocked roads, the trapped humans frantic to
escape. Is evacuation even a good idea in most cases? Gainer asked
rhetorically. After all, a basement makes a sturdy bunker against even
a violent blast. On the other hand, if the basement fills with highly
flammable jet fuel . . .

"And what if a bomb the size of the Hiroshima bomb was set off around
here?" Gainer asked finally, then answered his own question. "Well,
we'd all be dead, so we wouldn't have to worry about a mass

For a brief moment, I imagined a blinding flash outside Gainer's
windows, and a rush of superheated wind, and the windows bursting as
the walls imploded. But just as quickly, the vision retreated to the
grim corner of the brain where most Washingtonians endeavor to keep
it. In place of the horror there was, once more, a fine view of the
coppery winter dusk. The dome. A construction crane. Lights winking
on. Another construction crane. The Washington Monument. Another
construction crane.

And another construction crane.

And another.

Construction cranes occupied nearly every point of the compass, in the
foreground and in the background, looming nearby, tiny on the horizon.
Bombs and missiles aren't the only things that go boom. Economies do,

Thus, the yin and yang of life in Washington were balanced there amid
the homey confines of Chief Gainer's office. Visions of disaster
alongside hard evidence of good times. The fact is, since the al-Qaeda
attacks of September 11, 2001, life has been fat here in the cross
hairs (apart from the occasional night sweat). The Washington area has
enjoyed the best economy in the nation during the past four years --
by a mile. What doesn't kill us makes us richer.

Perhaps, if you live here, you have found yourself wondering whether
you should stay. Maybe the thought crossed your mind the day the folks
from Human Resources distributed plastic escape hoods,
mini-flashlights and whistles to blow should you find yourself pinned
under rubble. Or maybe it was the day your spouse came home with an
armload of duct tape and plastic sheeting for your "safe room." Maybe
it was when the guys in the mailroom started walking around in
surgical masks, or when you attended that dinner party where your
neighbors explained their strategy for evacuating via bicycle or
canoe. But you stayed, and seemingly everyone else did, too. And many
thousands more poured into the region, filling the subdivisions and
condo blocks and office towers rising from Dulles to downtown,
Leesburg to Largo, Dale City to Hyattsville.

Meanwhile, this thriving metropolis has been forested with strange,
man-made flora: the hardened posts, known as bollards, cemented into
the ground at strategic points to thwart car bombs; the slender poles
blossoming with surveillance cameras; the stumpy boxes that give no
outward sign of the radiation detectors inside. Above it all, like a
forest canopy, rise the busy booms (that word again!) of the
construction cranes. The stubby bollard and the towering crane, one
representing fear, the other prosperity -- incongruous, yes, but also
ubiquitous. They are the symbols of our time.

THE FIRST REACTIONS TO 9/11 included panic, disbelief, outrage, shock,
sorrow, fury and a righteous patriotism. There was a lot of
speculation about crowds at the military recruiting stations and a
general wave of bear-any-burden determination. It was a blood, sweat,
toil and tears sort of moment. President Bush, congressional leaders
and Pentagon brass gathered at the National Cathedral a few days after
the attacks to pray for God's assistance in the smiting of our
enemies. As they stood to leave, the pipe organ roared out "The Battle
Hymn of the Republic" -- which, you may remember, is not exactly a
pastoral. Some fateful lightning was about to be loosed from our
terrible, swift sword.

And indeed there has been lightning in distant places around the
world. Closer to home, however, the response has been less martial
than monetary. Military recruitment is down, not up. Rather than meet
any hardship, we have loosed the fateful charge cards of America's fat

Which makes a certain brand of sense: A basic doctrine of war says to
mass your strength against your enemy's weakness, and the United
States has no more tangible, flexible strength than its economy. It's
no coincidence that, among the five living former secretaries of
defense since 1977, four have become financiers (the other is vice
president). Our money and our muscle are strategically meshed. Experts
can argue about the long-term vitality of America's money muscle,
given our outsourced jobs, sagging industrial base, looming old-age
crisis and national debt. But for the time being, U.S. cash flow
remains awesome. The federal government is the world's largest
consumer of goods and services. The United States produces more buying
power each year than the 25 European Union nations combined, though
Europe has 160 million more people. With less than 5 percent of the
world's population, we produce more than 20 percent of the world's
dough. Faced with a crisis, our leaders did what they know best. They
started shoveling money.

It's impossible to say precisely how much the U.S. government has
spent in response to 9/11. The National Commission on Terrorist
Attacks Upon the United States -- better known as the 9/11 Commission
-- noted in 2004 that the country's defense and security spending was
escalating more steeply than at any time in the past 50 years. This
money is contained in thousands of budget items, some of which are
misleading, others of which are classified. We can see the tips of
some icebergs, though. According to the Congressional Budget Office,
funding specifically for homeland security, one small part of the
overall security spending spree, more than doubled in the first two
years after the attacks, from $20 billion to more than $40 billion.
Some federal spending is an obvious response to Osama bin Laden, such
as the billions to fortify federal office buildings and update
government computer networks. Some comes under less obvious headings,
such as the billions in new spending at military hospitals to treat
and rehabilitate the wounded soldiers of the Iraq war. Some money
remains inside government agencies, such as the billions in new
spending at the National Institutes of Health in Bethesda, funding
research into anthrax, smallpox and other germ terrorism. Some of it
pours into private companies, especially private companies with big
Washington area offices. All told, it's safe to say that hundreds of
billions have gushed forth in a torrent of money that has washed
across the globe, puddling in pockets from Kandahar to Kansas City.
And the great lakes of cash have collected right here in the
government's back yard.

"What you see in all the new construction, all the new jobs and so
forth, is the benefit the Washington area receives from having a very
rich uncle -- you know, Uncle Sam," says Stephen Fuller, director of
the Center for Regional Analysis at George Mason University. "Every
quarter, and especially on April 15, we receive an enormous transfer
of wealth from the rest of the country."

Fuller is a slim, graying fellow who has built a small empire on his
diligent collection and smooth explication of Washington area economic
data. He has numbers for everything, usually right at his fingertips,
from the size of the federal workforce under Lyndon Johnson to the
current growth rate of the dry-cleaning sector. Merchants, developers,
politicians and journalists look to Fuller and his PowerPoint slides
for illumination of the world outside their windows. Suppose you want
to know why the unemployment rate in Northern Virginia has been the
lowest in the country for much of the past four years. Fuller has a
slide to explain it.

"Government procurement," he summarizes.

Fuller continues. "In Fairfax County, federal procurement amounted to
$16 billion last year alone." That is the richest windfall in America,
by far -- roughly 10 times as much, per capita, as the government
doled out for goods and services in Los Angeles, for example.
"Procurement" does not describe all government spending, just the
goods the government buys and the outside work it commissions. So that
$16 billion, while huge, doesn't include the salaries of government
workers, who are legion in Fairfax and throughout the Washington
region. Nor does it include the rent the government pays for office
space, even though the feds and their contractors are this area's
biggest tenants, by far. Since 9/11, the Washington region has boasted
the strongest commercial real estate market in America, with low
vacancy rates producing rents second only to New York City.

All these spending streams flow into the region, but procurement
spending "is something far more potent," Fuller says. "We've found
that procurement dollars have twice as much impact in the economy as
government payroll dollars. The money churns more through the economy.
There's a bigger bang for the buck."

That bang is reflected in the huge new houses with the two-story
foyers, in the fancy late-model cars, in the oversubscribed private
schools, and, most of all, in the chain of construction cranes sited
in the past few years from the Pentagon to past Dulles International
Airport. In terms perfectly chosen for the prosperous citizens of
Northern Virginia, Fuller compares this stretch to a high-class
galleria, with the Defense Department and the airport as the anchor
stores. "The Pentagon is like Neiman Marcus," he says, "and Dulles is
like Nordstrom." Between them lies a long line of upscale boutiques
doing record business -- weapons contractors, management consultants,
data processing giants, communications providers, information
technology firms. Big names, such as Accenture, BearingPoint, Computer
Sciences Corp., General Dynamics, Titan, Oracle, Raytheon and SAIC.
Countless smaller contractors as well. These companies are selling
everything from missiles to disaster-modeling software to computer
integration at the Department of Homeland Security.

Northern Virginia has prospered the most, but don't cry for Maryland
or the District. According to another of Fuller's slides, federal
procurement spending has been frenzied there, too. From 2003 to 2004,
to focus on a single year, federal contracting increased 16 percent in
the District and 19 percent in the Maryland suburbs.

If you spend it, they will come: Since al-Qaeda hit the Pentagon, more
people have moved to greater Washington than to any other non-Sunbelt
region. Call it denial, call it playing the odds; having weighed the
certainty of good jobs versus the threat of future catastrophe, people
have voted with their moving vans. The threat is real. Last year, Rand
Corp., the granddaddy of national security think tanks, proposed a
complex formula for estimating the risk of major terrorist attacks in
U.S. cities. The cities with the most dense urban cores, New York and
Chicago, ranked first and second because of the prospect of many
deaths in a relatively small area. Washington, despite much lower
density, was third, because of its obvious strategic importance.

That's enough risk to inspire the bollards and cameras and radiation
detectors, but not enough to persuade people to leave. If you want
perfect safety, you could buy a government-surplus missile silo in
sparsely populated Kansas or Wyoming. They come on the market from
time to time. Once you seal the hatch on an Atlas E silo, encased in
18 inches of steel-reinforced concrete beneath at least six feet of
prairie sod, you can ride out a nuke more than 50 times the size of
the Hiroshima bomb. But the silo market is slumping, while two-bedroom
condos in Kalorama, within walking distance of prime al-Qaeda targets,
are going for $750,000 and up.

Government procurement was rising even before the attacks, because
presidents going back to Ronald Reagan have shared a belief that
contracting with private companies for services is better than hiring
more government employees to do the work. Everything about the United
States has grown significantly since the 1980s--the population, the
economy, the federal budget--except for the size of the federal
workforce. Still, Fuller has a pretty good handle on how much the war
on terror has supercharged the spending.

"We've calculated that, without 9/11, procurement spending in the
region would have grown $5.5 billion over the last four years," he
explains. "But 9/11 happened, and the actual growth was $18.5
billion." The difference between those two numbers -- $13 billion --
is another way of glimpsing the prosperity that has followed after the
fireballs. "Each billion in additional procurement spending generates
approximately 7,000 new jobs," Fuller adds.

What kinds of jobs? Fuller has still more PowerPoint slides.
Washington leads the nation in total job production over the past five
years, thanks to the post-9/11 rush, with other thriving cities far,
far behind. This region has created some 200,000 new jobs in that

And yet, the Washington area actually trails the rest of the country
in the growth of most job categories. Even with all the construction
cranes and federal office renovations, we're a bit behind the average
in construction jobs. We're way behind in retail, in financial
services, in education and health-care jobs. Our new jobs are
concentrated in just two categories, Fuller says. First, "professional
services" -- meaning highly paid technical, scientific, managerial,
consulting and computer-design jobs. And the second category, more
mysterious: "other services."

"Those are the people who baby-sit, cut lawns, do dry cleaning and
clean the homes of the professional services people," Fuller explains.

The war on terror has given Washington an E-Z Pass for the turnpike to
the future. These are precisely the sort of jobs that experts believe
will hold the key to tomorrow's economy. The region has roughly 2
percent of the total American workforce, but more than 10 percent of
the computer systems designers, 8 percent of the consultants and the
scientific researchers, 6 percent of the professors and the
technologists and the Internet operators. "This is the new economy,"
Fuller sums up. So we should be very well positioned to prosper
indefinitely, provided we don't get incinerated.

MONEY IS HOW GOVERNMENT SAYS, "I CARE." Frowny politicians can hug
disaster victims amid scenes of devastation, and that's fine for a day
or two. Then people want the bottom line: What's the appropriation?
When President Bush went to flooded New Orleans in September to talk
about Hurricane Katrina, the key quote was, "I have asked for, and the
Congress has provided, more than $60 billion."

The collapse of the twin towers on live television, and the direct hit
on the Pentagon, focused governmental concern -- meaning spending --
to an intensity not seen in generations, going back to Pearl Harbor.
But something had changed in the intervening decades. After Pearl
Harbor, it was easy to see exactly where the money was going. Millions
of young men and women joined the government as soldiers, seamen,
airmen and clerks. Tanks, airplanes, destroyers and aircraft carriers
rolled out of factories and shipyards on round-the-clock shifts. The
work never stopped. Bombs, bullets, guns, uniforms, packs, tents,
Jeeps, mess kits -- all highly tangible and easily understood. Even
the most highly classified supersecret expenditure went searingly
public less than four years after Pearl Harbor, when Hiroshima was
destroyed by a single bomb.

Today, the output is more elusive. Where is the money going? You can
read about a spending bill. You can visit one of the publications or
Web sites devoted to tracking the parade of new, rich,
inscrutable-sounding government contracts awarded each day. A sampling
from a January issue of Washington Technology magazine:

ManTech International Corp., Fairfax, Va., won a $300 million,
two-year subcontract from VSE Corp., Alexandria, Va., to provide the
Army with support services in Afghanistan and Iraq . . .

Multimax Inc., Largo, Md., won two five-year contracts worth a total
of $75.7 million from the Air Force for communications support,
testing and IT security services to Air Force organizations at Manas
Air Base in Kyrgyzstan for $32.8 million; and Maxwell Air Force Base,
Ala., for $42.9 million . . . .

Science Applications International Corp. . . . won two contracts worth
a total of $68.4 million over three years from the Centers for Disease
Control and Prevention to help implement and support the agency's
BioSense national syndromic surveillance program. . .

Or you can tour the bollards and cranes.

But it's all amorphous, compared with the sheds full of government
workers thrown up on the Mall in the 1940s.

Hoping for a peek at the new wartime economy, I visited last year's
Government Security Expo & Conference, or GOVSEC, at the Washington
Convention Center. Launched in 2002, GOVSEC is an annual event "for
those responsible for protecting government's physical, information
and cyber security at the federal, state and local levels." The 2005
conference attracted 6,000 people, many of whom obviously had
influence over government spending, because more than 500 companies --
from small inventors to charter members of the military-industrial
complex -- waited eagerly to meet them in the exhibition hall.

Booths covering acres of floor space displayed products ranging from
flashlights to speedboats. Some of the merchandise was brutally
prosaic: jacks for lifting rubble, protective suits for cleaning up
toxic debris, civil defense sirens, gas masks, stretchers,
shatter-resistant windows. Some of the gear was old technology
repackaged for new sales: traffic cones as evacuation markers; police
vans souped up into mobile crisis command centers.

Other offerings were snazzy and high-tech; for example, a computer
software package called VIS2TA. It was sold by Northrop Grumman, a Los
Angeles company that happens to have four offices in Northern Virginia
and yet another in Maryland. During World War II, the companies that
now make up Northrop Grumman built airplanes and ships. Now they're
raking in money writing software. VIS2TA was designed to reduce reams
of emergency information into a single database. Suppose a bomb
exploded in a VIS2TA town. The computer would quickly produce a city
map showing every building in the vicinity of the blast. Click on a
building, and up would pop a detailed floor plan and evacuation route.
Every hospital, firehouse and police station would feed information
into the map, updated as the crisis unfolded. Another layer of data
would reveal the weather conditions and project the fallout based on
prevailing winds.

But no one would buy just the software package. The same officials who
would want VIS2TA would want a powerful new computer network to run
it. They would want to house the network in a custom-built command
center, like the one Gainer showed me last year inside Capitol Police
headquarters. There, inside a secure room, I counted at least 10 big
flat-panel displays and dozens of smaller screens showing views from
surveillance cameras planted throughout Capitol Hill. There were also
scores of phones and computer consoles. One display tracked the
direction of the wind, and another reported the locations of key
members of Congress. Yet another displayed the paths of nearby

What chief would not like to have a space-age setup like this, whether
or not he has Gainer's obvious reasons for needing it? And, of course,
the command post must be connected to a mobile headquarters, which
must be linked to rescue unit crews wearing new hazmat suits and
carrying pricey hand-held radios. Multiply all those chiefs times all
that gear, connect them through lobbyists and members of Congress to
the pipeline of federal money, and you can begin to picture one
tributary of the great Doom Boom. One of many.

Strolling up one aisle of GOVSEC and down the next, I was chilled at
first by the horrible assumptions underpinning the bazaar. Portable
anthrax tests. Bomb-defusing tents. Personal climate systems, for
hunting terrorists in extreme heat or cold. Holographic weapons
sights. Everything trailed a stink of death and dismemberment. But
soon enough an almost giddy feeling of gee whiz replaced the horror:
Wow, can they really do that? Have they actually perfected a
voice-analyzing "truth verification system"? Is it true that sensors
can identify people based on their unique pattern of blood vessels
beneath the skin? Can a lightweight barrier really be strong enough to
stop a speeding truck? And look at all this James Bond stuff: a
cellphone that performs video surveillance; another cellphone that
eavesdrops on the conversations of callers nearby.

Not every company hawking a product was based locally, of course. One
of the most intriguing devices on display was produced by American
Science and Engineering (AS&E), of Billerica, Mass. The company's ZBVs
-- "Z Backscatter Vans" -- appeared to be ordinary white delivery
trucks, but inside they were packed with supersensitive scanning
machines. According to the company sales pitch, one driver in a ZBV
can thoroughly search more than 100 cars, trucks, shipping containers,
Dumpsters, boxcars -- you name it -- every hour, just by driving
slowly past. From the sidewalk, it looks like Mr. Repairman needs a
parking space, but, in fact, the van is emitting "backscatter X-rays,"
whatever those are, in a search for bombs, hidden passengers, illegal
drug stashes and so on. Another machine, at the same time, is probing
the air for radioactive telltales of nukes and dirty bombs. A ZBV can
look through the walls of some buildings and the clothes of passersby.
It can park at the curb and scan traffic, or it can race along at
highway speeds, scanning the cars alongside. And if you paint FTD on
the side, everyone will think it's roses.

AS&E makes these vans in Billerica, but Washington is the place to
turn sneaky vans into profits. This is where America keeps its
checkbook. This is where the grants are bestowed for purchasing
bomb-finders and nuke-sniffers. This is where the money comes from for
research and development on the next generation of scanning
technologies. This is where a company's executives can have lunch with
their lobbyists, should they wish to seek counsel on the best way to
dip their corporate pail into the government's cataract of cash.

And so the convention center was a hive of government employees and
the smiling salespeople waiting to meet them. Above the bustle,
banners announced the presence of mega-companies such as Philips,
Raytheon, Glock, Mitsubishi, CompuDyne and many more. Everyone had
converged on Washington to think about explosions, fires, piles of
rubble, chaos, deadly germs, radiation. And then to translate those
thoughts into the more soothing contemplation of moneymaking. And, of
course, to enjoy the shops and restaurants.

IS IT BAD TO PROSPER IN A CRISIS, to thrive on adversity? The moral
factors are not clear. Doctors do well in an epidemic, and everyone
says thank you. On the other hand, a lawyer who passes out cards in
the emergency room after a school bus crash is slime. So what about
Washington? Are we more like the healers or the ambulance-chasers?

However you answer that one, the link between bad news and good times
is central to this city's history. The Civil War worked wonders for
the development of Washington. In 1860, on the eve of the catastrophe,
Washington had just two paved streets, no standing police force and an
open sewer behind the White House. A Union private, arriving from New
York shortly after the first shots were fired at Fort Sumter, was
disappointed to find the capital "little better than a country town."
Within a few months, however, 100,000 soldiers had followed him to
Washington, and the transformation had begun.

That boom surely felt a bit like our own, at least in the beginning:
tense, anxious, rife with intrigue and rumors of an impending attack.
And yet, the hotels were packed, the saloons bustling, the theaters
sold out. Inventors streamed to the capital carrying prototypes for
repeating rifles, machine guns, artillery and bombs. The big hotel run
by the Willard brothers at 14th Street and Pennsylvania Avenue became
"a 'seething cauldron' of commercial intrigues," in the words of
writer Ernest B. Furgurson, "jammed with cigar-smoking salesmen and
lobbyists touting materials of war." In his history of Civil War
Washington, Freedom Rising, Furgurson described a frenzied scramble
for the barrels of money that Lincoln poured into saving the Union --
fantastic sums for the time, more than $1 million a day.

James "Big Jim" Fisk, for instance, was a failing salesman for the
Boston retailer Jordan, Marsh. He heard Lincoln's call for volunteers
and, rather than joining a regiment, "remembered the thousands of
unsold blankets he had once seen moldering in the store's attic,"
Furgurson recounted. "Confident that the army would be needing
blankets, he came to Washington and set up at Willard's. Stocking the
best suite in the house with food, liquor and lighthearted ladies, he
became a generous, cork-popping host" to squads of freshly minted
government purchasing clerks. Fisk "soon disposed of the moldy
blankets for such an absurd profit that the firm was delighted for him
to stay on."

"You can sell anything to the government at almost any price you've
got the guts to ask," Fisk confided. He wasn't the only person who
noticed. One-third of all military contract spending went to
overcharges in the early months of the Civil War, a congressional
investigation later concluded.

As the war continued, Washington grew into the nerve center for the
largest armies the continent had ever seen. Thousands of clerks
collected hundreds of millions in new taxes, and spent the money on
countless tons of weaponry, food and supplies. True, these
Washingtonians weren't dying at places like Antietam and Chickamauga,
and not every dollar they spent was spent wisely, honestly or well.
But money was the tide that bore the North to its victory, so their
frenzy was not in vain.

Some of those clerks stayed in Washington after the crisis was over --
the population of the city grew by 80 percent from 1860 to 1870. Thus,
a pattern was begun: What Washington gains in bad times, it never
gives up. We see the pattern repeat 70 years later, during the
back-to-back disasters of the Great Depression and World War II.
Again, Uncle Sam opened wide the money tap. As before, clerks and
contractors flocked to the capital for jobs or a piece of the action.
The population rose by nearly two-thirds from 1930 to 1950, to more
than 800,000 people in the District, with more in the newly sprouting
suburbs. The size of the federal workforce in Washington nearly
doubled in the five years from 1940 to 1945, from 139,000 to 265,000.

David Brinkley noted in his book about World War II, Washington Goes
to War, that many economists predicted a gloomy future for the
Washington region once peace returned and the bureaucrats went home.
But "they did not understand the basic nature of government," Brinkley
explained. "They did not see that with the wartime innovation of the
withholding tax, previously unimaginable amounts of money were being
extracted from the American people with relatively few complaints.
Federal tax collections in 1940 had totaled $5 billion. In 1945, $49
billion. And it was all spent."

It is almost always all spent. The great lesson of Washington,
according to veteran lobbyist Ed Rogers, who has watched budgets be
made by both Democrats and Republicans, is that "whoever wants to
spend the most, wins."

Instead of a postwar recession, the boom continued in peacetime -- a
fact, Brinkley noted, that stamped many government leaders as
disciples of the British economist John Maynard Keynes. In simplest
terms, Keynes advised governments to increase spending during economic
downturns as a way to stimulate growth. Sure enough, Washington's
unbridled spending on the war had cured the national depression. A
generation would go by before Washington saw the rise of a competing
school of thought. Economist Robert Mundell's "supply-side" economics
contended that, instead of borrowing and spending to spur the economy,
government should cut taxes and let the private sector allocate the

Today's Doom Boom might be seen as an experiment in combining the
two--substantial tax cuts and massive spending. The supply-siders in
the Bush administration and the Republican Congress have dramatically
cut taxes while simultaneously saturating the capital with new
spending. Two stimulants instead of one. Like sugar-coated chocolate,
like diet pills washed down with coffee, this combination has been so
economically potent that the whole region is practically vibrating.
Most economists are forecasting yet another year of brisk growth in
the Washington area, with tens of thousands of new jobs added, new
office buildings filling with new tenants, and home prices stabilizing
at or near record highs.

The Wall Street Journal recently reported record revenue for the
lobbying industry. There's a $68 steak on the menu at Charlie Palmer's
on the Hill. And, as I write this sentence, there is a construction
crane going up outside my downtown Washington window.

Can this be what bin Laden had in mind?

ANYONE WHO HOPES TO DEFEAT the United States must have a strategy for
neutralizing our money. In 1941, Adm. Isoroku Yamamoto, commander of
the Japanese Combined Fleet, prepared the surprise attack on the
American Navy at Pearl Harbor. Having completed two tours at the
Japanese Embassy in Washington as naval attache, Yamamoto had no
illusions about American money muscle. Therefore his strategy was to
cripple the U.S. fleet just long enough for Japan to seize control of
Southeast Asia, which was rich in the natural resources, such as oil
and rubber, that Japan needed for its dreams of empire. The best Japan
could hope for, Yamamoto told his superiors, was to set the United
States back 18 months -- and then seek a treaty. Beyond that, American
industry was too strong to be defeated.

As it turned out, the United States needed just six months, not 18, to
snap the spine of Yamamoto's navy, but the admiral was correct on the
larger point. By 1943, a year and a half after Pearl Harbor, American
factories had increased their production of tanks a hundredfold, and
were turning out more tanks in a year than Germany produced during the
entire war. Construction of warships was up more than tenfold: In
1943, the United States built 15 aircraft carriers -- nearly as many
as Japan produced in its entire history. America built nearly 86,000
airplanes in 1943, roughly equal to Japan's output for the whole war.
As military historian Alan Gropman of the National Defense University
has documented, all this happened despite bureaucratic bungles and
nagging inefficiencies from the top of the production chain to the
bottom. Still, 18 months after Pearl Harbor -- as the U.S. economy
approached its peak wartime effort -- this country was "manufacturing
munitions almost equal to the combined total of both its friends and
adversaries," Gropman wrote.

And the U.S. economy has only grown mightier since then.

However, bin Laden and company have a very different strategy than
Japan did, a "policy in bleeding America to the point of bankruptcy,"
as bin Laden put it in a videotaped address to the American people
just before the 2004 presidential election. It is a sort of judo, a
leveraging of weakness into strength, known as asymmetric warfare, in
which small investments by al-Qaeda defeat huge investments by the
United States. Asymmetrically speaking, the cost of destroying the
tallest buildings in Manhattan, in 2001, was little more than a plane
ticket and a box cutter, given ideologues willing to do it. So it
didn't matter that, according to intelligence estimates, the U.S.
military was outspending al-Qaeda by more than 10,000 to 1.

Since then, the United States has increased spending on security by
more than two-thirds, but our foes are still working that same judo,
blowing up commuter trains and military convoys with surplus
explosives and junk from around the house: backpacks, trash bags,
cellphones, toy cars. The United States has hundreds of billions of
dollars' worth of surveillance equipment on the ground, in the air and
orbiting in space, but none of those gadgets can find bin Laden or his
deputy, Ayman al-Zawahiri. The only time we see or hear from them is
when they smuggle another cheap audio or videotape to al-Jazeera
television. As Secretary of Defense Donald Rumsfeld summed up in a
2003 memo to his staff: "The cost-benefit ratio is against us! Our
cost is billions against the terrorists' cost of millions."

Exactly, bin Laden said in the videotape. It worked during the 1980s
in Afghanistan. Using "guerrilla warfare and the war of attrition"
jihadists "bled Russia for 10 years until it went bankrupt and was
forced to withdraw in defeat," the al-Qaeda leader said.

Can they do the same to the United States?

You may not be surprised to learn that experts disagree about how much
damage our budget deficits are doing to the country. Over time, large
deficits soak up capital that could go to more useful investments, and
America potentially becomes vulnerable to the demands of overseas
lenders. But that doesn't mean that, as bin Laden seemed to suggest,
the United States is as fragile as the old Soviet Union was. As the
Bush administration points out, the U.S. economy has survived more
intense spending binges than this one. "Spending as a percentage of
the economy is lower than it was under four of the last five
presidents," White House strategist Peter Wehner argued in a recent
memo, "and the high-water mark for the budget deficit as a percentage
of the [economy] . . . is significantly less than was the case in the

So the immediate problem may not be bankruptcy. It might be
frustration, if Americans conclude that the massive expenditures since
9/11 aren't buying results. While the federal government has been
flexing the money muscle of the United States -- hyperstimulating the
Washington economy -- the enemy has drawn strength from the economic
and political weakness of the Arab world. There's that judo, again.
Our strong economy is cranking out software and sensors, bollards and
cranes, but weak Muslim economies are cranking out extremists just as
fast or faster. "The combined gross domestic product of the 22
countries in the Arab League is less than the GDP of Spain," the 9/11
Commission noted in its 2004 report. "Forty percent of adult Arabs are
illiterate, two-thirds of them women. One-third of the broader Middle
East lives on less than two dollars a day. Less than 2 percent of the
population has access to the Internet."

The Joint Chiefs of Staff recently completed a broad review of
American strategy in the war on terror. In the fifth year of
Washington's Doom Boom, the generals concluded that we need to be
building up Muslim countries with at least as much enthusiasm as we
have shown for building up the corridor between Dulles and the
Pentagon. If the United States could figure out how to transplant a
bit of the energy and prosperity of the Doom Boom to the failing
countries of the Middle East, it would do us more good in the long run
than bollards in every driveway and scanners on every roof.

This will take a long time, the Joint Chiefs acknowledged, but America
will not win this war until ordinary Muslims can safely bet on a
moderate future. "The conditions that extremist networks exploit to
operate and survive have developed over long periods," the new
strategy declared. And so "the effort to alter those conditions will
require a long-term, sustained approach," as well.

Leaders from across the political spectrum talk about a Marshall Plan
for the Middle East, but, as scholars Derek Chollet and James M.
Goldgeier explained in a recent essay, the task may be even more
complicated than the successful rebuilding of war-ravaged Europe, if
only because building a modern country is more complicated than
rebuilding it. They quoted former German chancellor Helmut Schmidt
explaining the difference. "Europe possessed a long-standing
entrepreneurial heritage, a base of business acumen, a high level of
general education and technological knowledge as well as engineering
capabilities," Schmidt said. "No Marshall Plan can succeed where such
prerequisites do not exist."

Let's hope the government is spending a lot of money on smart people
to solve this problem.

If so, maybe someday these smart, prosperous people can live in posh
apartments and walk to work in new offices and shop in upscale stores
-- all built on the site of the old Washington Convention Center,
demolished in 2004. Not long ago, I visited the site at 10th and Eye
streets NW. Thanks to the Doom Boom, it is one of the most valuable
undeveloped pieces of real estate in America, prime downtown acreage
in a thriving city, close to subways and hotels and theaters. My
purpose in wandering over was to picture the latent possibilities of
such emptiness in this time of extraordinary growth. I tried to think
of the space as seeded with future wealth and luxury, requiring
nothing but the current government money rain to bring it bloom.

Instead, I found myself thinking: Here's what it looks like after a
Washington landmark is destroyed. A huge, fenced scar. An aid to the
imagination, should you need one. A glimpse of how failure might look
in the battle with bin Ladenism.

David Von Drehle is a Magazine staff writer.

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