|Picture Credit: domaingang.com|
The Bush administration's military expansion has connections to its economic expansion. Large US-based transnational oil companies, looking for increased profits, played an important part in the invasion and occupation of Iraq, which has the world's second largest proven oil reserves. Through the International Monetary Fund, the World Bank and the World Trade Organization, the US exercises economic power over poorer countries and shapes the international trade framework.
However, the US financial position is deteriorating, due largely to its growing trade deficit. The US is more dependent on the rest of the world for capital than at any time in the past 50 years. Analysts argue that the US can neither sustain nor expand its empire under these conditions. Increased military spending and other related costs put further pressure on the weakened economy, through government deficits, reduced social safety nets, unemployment and sinking domestic demand for goods and services outside the military sector.