The Geopolitics of American Homelessness and Rent Distress
The homeless folks you see in the streets of the United States are part of the price paid to sustain a militarist foreign policy.
During a recent livestream, I had an extended discussion about how I relate American poverty and economic insecurity to the warmaking and war preparations of the national security state. Here’s that discussion:
This issue is sufficiently important and enduring to expand on it.
These days, pretty much everybody—even many reactionaries—understand that what we do abroad affects the lives of Americans. The domestic and the international are connected in profound ways. The trouble is that there’s widespread disagreement about how best to relate foreign and domestic policy.
The training in international relations (and adjacent disciplines) that wonks get conditions us to see the world in a way that cleaves off problems you see in everyday life from foreign policy. To the average think tanker, the bullets and bombers the national security state sprinkles across the planet have nothing to do with your trouble paying rent, or the busker you pass outside the metro station. That’s incorrect and a moral travesty, but I have to think it persists as a way of seeing because it has functional value for oligarchs and other enemies of economic democracy. To be able to think about geopolitical games stripped of their full cost makes it so much easier to play the games in the first place.
My rage veins are throbbing.
For anyone unaware, the US is experiencing acute levels of rent distress, credit card default, and homelessness right now. This graph from Stephen Semler makes the homesslessness point vivid.1
According to the Financial Times, credit defaults have not reached the current level since 2010, deep in the bowels of the Great Recession:
It would be a mistake to see these trends of compounding economic insecurity as unrelated to foreign policy. They are very related!
First, at the obvious, almost facile, level, next year’s defense budget is going to eclipse $895 billion while these domestic failings grow. Flagrant. We spend more on interest payments for the financing of defense spending than we pay for anti-poverty programs.
Second, and less well known, is that US fiscal and monetary policies since the passage of the Inflation Reduction Act (IRA) in 2022 have been poverty-inducing. For those who don’t remember, Biden pivoted to austerity policies the minute the IRA—which pays out some $391 billion to corporations—passed.2 It’s not necessarily that Democrats wanted to shrink the welfare state; it’s that doing so was a condition for getting the necessary votes for the IRA while still financing military primacy. Much was sacrificed in order to get the IRA, even though—as Adam Tooze explained so well—the IRA wasn’t remotely what it needed to be in order to meet our historical moment. Yet, Biden made sacrifices for the IRA because 1) it was far better than doing nothing, and 2) it was a vehicle for “out-competing” China, which, his team believed, was worth any price. Economic policy was run out of the National Security Council—tell me that’s not about foreign policy.
Third, dollar primacy—the US dollar as the reserve currency for global transactions—is a necessary part of America’s primacist foreign policy, but it has necessarily come at the expense of the working class. Check out this discussion to understand why:
Finally, spending on defense comes at a tremendous opportunity cost for society. The job multiplier effect for every dollar spent on the military is lower than the job multiplier effect of public spending on any other sector.
And keep in mind, this is all separate from the increasingly common thesis that the Global War on Terror boomeranged back on our society in the form of militarized police, suppression of democratic dissent, and the literal election of Trump and the formation of MAGA politics against the conditions wrought by two decades of US spending on military primacy and its forever wars, which have not ended.
So when you see a homeless person on the street, I implore you to also see the trillion-dollar, globe-spanning commitments to kill foreigners that prevent the government from being able to do anything about the homeless problem other than criminalizing it. In a world of compounding economic insecurity, most of us are one job or medical emergency away from the government doing that to us.
On the rent distress among OECD countries, with the United States in the top five, see this. On record credit defaults, see this.
As I mention in the video, the IRA also offered some funding to households in the form of tax credits, but only if they could afford solar panels or electric vehicles. Even I can’t afford that.