Three More Wars

Now Obama is at war in Somalia as well as Libya and Yemen.

14 Comments. Leave new

  • Karkahoolio
    July 8, 2011 12:43 PM

    I’m going to assume that a (modern) war uses/generates a vast quantity of cash.. Most of which gets gobbled up by contractors and such. I wonder how much ends up trickling down to the average Joe. I mean, could there be an argument that the American economy needs wars to stay afloat? That perhaps wars are the preferred method of fiscal stimulus?

    • There is a stimulus effect from total war, like WW2. Not so much from small wars of choice. But all wars cost more than one wins. The benefit is opened markets after winning, assuming that happens.

  • This is a fallacy perpetuated by Keynesians infatuated with central planning. Wars are always bad for the economy, if not for anything else, for the vast destruction of human lives and wealth they cause.

  • It’s funny how right wingers have conflated Keynesian economics with communism…it’s like everything that isn’t their way is communism.

    MEIN LEIBEN FUR DER FUHRER, MEIN LEIBEN FUR SEIN REICH!!!!

    *clears his throat*. . ..oh excuse me there. zas is goot, no? World War II was an epic disaster and human tragedy, regardless of the economics of it. Total war is horrific beyond imagination, one should not glibly discuss it in rational economic terms.

  • “To jaw-jaw is always better than to war-war.” – Churchill

    Maybe they should try it some time.

  • Back in the 18th century, Bernoulli developed a ‘calculus of war’ to see if the expected value of a win exceeded the expected cost of the war. Back then, if a pre-industrial state had great wealth, the cost for an industrial state to wage a war to colonise that state was often far less than the value of the colony the industrial state acquired upon victory. More complicated was the calculus of stealing another European nation’s colony, but the British seem to have worked that one out fairly well.

    Since Bush, Jr., all US wars have been intended to put money into the pockets of the administration and its friends (who tend to put it in Swiss bank accounts, so not much domestic stimulus). So, as far as Republicans are concerned, all Bush’s wars were essential to keep America strong and safe, but Obama’s wars are bankrupting America. And as far as the Democrats are concerned, Obama is finally winning the war on terror (read the NYT), and is keeping America strong and safe, while Bush’s wars just squandered America’s money to no avail. But ultimately, the wars are complete, unmitigated successes from the point of view of the administrations prosecuting them.

    Before, it was different: Clinton only waged war to distract America from his nocturnal escapades, and never thought of getting rich off them. He still got impeached, but acquitted, so ultimate victory after losing the first battle. And Bush, Sr. only wanted re-election, so his wars were a complete failure.

  • @Karkahoolio: Yes Chalmers Johnson in his latest book “Dismantling the Empire” briefly touches on the results of some very recent academic papers assessing the value of “Military Keynsianism”. “Military Keynsianism” is in fact economically stimulating but ONLY when there is weak aggregate demand in the economy, otherwise it crowds out other business transactions. However, “Military Keynsianism” is no more stimulating to the economy then if one had build all those tanks, planes, bombs, ect… and driven them in a hole and blown them up. Most importantly the academic papers on “Military Keynsianism” suggest that if any sum spent on war efforts were instead spent on infrastructure improvements within the economy in question, say via a WPA-like jobs programs, then the return on investment, especially when integrated over long periods of time, has a huge non-linear positive feedback loop on economic health that is absent in the “Military Keynsianism” “solution” to a weak economy.

    But the sad reality remains: war does have a stimulating effect on the economy in times of weak aggregate demand. This does not make war good nor does it justify war, it simply is a depressing fact of reality. Consider it a form a greasing the gears of an economy with human blood. Welcome to Obama’s job’s program.

    The sad reality is human sacrifice, in some form or another, can always be used to jump start anything socioeconomically. Its almost like a magical currency one can use to purchase socioeconomic activity in a way and on a scale that normal currency cannot compete with. As such whenever the powers that be really need to get something done or changed, they will heap up some bodies with much the same attitude one might throw a few new logs on a dying fire to get the flames going again.

    Now the reason Obama’s limited wars don’t have the same effect on the economy that WWII did, was they are not on the same scale. WWII DOMINATED all GDP calculations. Sure they are expensive, but not even on the same scale as WWII in terms of % GDP. By comparison Obama’s limited wars are a blip in terms of % GDP. Thus even if Obama’s wars cost more when adjusted for inflation then WWII (which I don’t think they do but I don’t know the numbers so I could be wrong) they still won’t have the same effect on the economy because the American economy is now larger then it was pre WWII so these wars represent a smaller % of the GDP and therefore a smaller stimulus.

    The saddest thing is by about year 2001, there were only two major things propping up the US economy, at lest in terms of generating aggregate demand domestically: 1) consumer debt and 2) military spending including the constant wars. With the recent collapse, American consumers have now exhausted their debt limits so one of the two legs of the already unstable stool is now gone. This is part of the Great Recession we are now in that simply does not seem to have a viable end in site though its depth my lighten slightly over the next decade. But now what do you think will happen if the US stops or greatly cuts back its military and war spending without creating an equivalent amount of spending in another venue? If you still want your revolution Ted, the near complete and almost irrecoverable economic collapse this will create should fire up all of the masses that it doesn’t actually kill off.

  • @bucephalus: yes wars are always bad but from a purely heartless amoral economic perspective they can be immensely economically stimulating. The problem is when your enemy can destroy your infrastructure the stimulus effect is not so good and can easily become net negative over a long enough time. This is why WWII worked so well (for the US). Sure the US lost tanks, ships, planes, ect… (and of course people, but fuck people we are talking profits and economics here) but no one bombed the US infrastructure, and thus it remained completely intact.

    This is one of very many reasons why the US creates all these bully wars. It picks on countries that cannot fight back beyond IEDing the occasional soldier. Thus these contained bully wars have no economic or infrastructural loss for the US and are economically stimulating (for the US only) . It is all (economically) good (for the US’s congregational-military-industrial complex).

    Also if you want to debate Keynsian v.s. Austrian (more like Austerian) economic philosophy, then pick a time and an appropriate place. Once you have read a couple of books from the Mises Institute and seriously examined the sources used to back up their theses it becomes obvious these people are just hucksters using elaborate acts of sophism to sell policies favoring the status quo and the domination of rentiers and old wealth over the rest of humanity. To their credit they are very intelligent and convincing hucksters, but hucksters all the same.

  • War always makes money, the question is just who makes that money.

  • @Aggie:
    It’s funny how right wingers have conflated Keynesian economics with communism
    I take that jab wasn’t aimed at me, since I’m not a “right-winger”, whatever that’s supposed to mean, nor have I mentioned communism anywhere in my post. Note: you should improve your German if you ever intend to relocate to the Bundesrepublik.

    @someone: And that only if the “heartless amoral economic perspective” only takes into account the profits of the military-industrial machine helping the state wage war (total or partial), and not the immense losses of all business owners, workers and consumers affected by it. Of course, if we add, as we must, the moral cost of war, those calculations will never add up.
    It’s a very bold assertion from yours to call von Mises, Hayek et alii, “hucksters”. I’ll assume you’re a fierce economics scholar who has debunked these “hucksters” in the trade journals.

    @patron: so does theft, if we forget someone had to lose that money before someone “made” it.

  • @bucephalus, No I am not a fierce economics scholar, but one does not need to be to make the statement I made. The Mises Institute only exists because it is funded and propped up heavily by the old wealth status quo. look at their funding sources for yourself if you don’t believe me and you will note this is all old and entrenched wealth trying to keep power in their hands as well as increase it at the expense of the rest of humanity. In a world where economic ideas existed and were funded only based on their merit and not by their ability to prop up corrupt entrenched power, the Austrian school of economics would have disappeared completely by 1990 and been nothing more then a select cult following from roughly 1950 until its demise.

    I am not accusing its original thinkers, such as Mesis and Hayek among others, as being hucksters. Most of these individuals got started on their economics careers before Keynes seminal work and the arguably more important Samuelsonian synthesis that followed Keynes work and united it with the rest of economics making it a valid and complete macroeconomic theory. As such Mesis and Hayek cannot be criticized any more then pre-Darwinian biologists can criticized for theorizing and doing work without taking into account evolution. The generation after them are individuals who have not yet accepted the theory, still a valid position for a revolutionary new idea. However, the generation following that, the current one, is some minority of brilliant sophist hucksters surrounded by a majority of mostly very intelligent and well meaning, but suborn, individuals who have bought into the propaganda and wish to prostalitize others. These later individuals are just like any very intelligent and well meaning born-again Christian wishing to bring forth the message and prostaliitize others so that they may “praise Jesus” and “see the light”.

    When the military-industrial machine helps the state wage war (total or partial) it only crowds out private business interests if the aggrigate demand of the economy equals or exceeds that economies production output. This is almost never the case, and yet when an Austrian economist is asked to create a model explaining his or her perspective on government spending crowding out private spending they create models or hypothetical examples where aggrigate demand matches or exceeds the given economies ability render output. Post-Keynsian economic theory actually agrees with Austrian economic theory about the crowding out effects of government spending when the case of matching or surplus aggregate demand is satisfied.

  • bucephalus….I don’t aim anything at you, stop pretending you’re somebody to me…you’re not.

    However, I find it interesting that you would choose as an internet handle to be named for a horse ridden by an infamous military ruler, some might say that most Republicans are just beasts of burden ridden by their militant masters

  • @Aggie_Dude: You may not have intended to aim anything at bucephalus, but to others it does look like it. I certainly thought you had because bucephalus was the only one who mentioned anything Keynsian before your post.

    Also of note: bucephalus is not a Republican, he is a libertarian. The real kind that does real libertarian things like vote for Ron Paul as an independent presidential candidate instead of the “libertarians” who profess libertarian values and then vote for Republican candidates that plan on giving huge sums of public money to: the military-industrial complex, corporate welfare, and cronies who helped pay to get them elected.

    Also trying to argue against people based on their internet handles is really just the electronic version of ad hominem attacks. It is one thing if someone has a handle like “Hitler_was_right” and you are offended by it and are asking them to change it. But it is another thing entirely to judge a person’s arguments or opinions based off of their handle name. It would be like bucephalus criticizing my arguments by saying that “your choice of the handle ‘someone’ suggests that like all wimpy liberals you like to buy into the safe anonymity and irresponsibility of collectivism.”

    Both you and I may strongly disagree with bucephalus, but that is no reason to lower the level of discourse. Bucephalus doesn’t attack people, resort to ad hominem, ect… (at least not that I have seen) but much like you and I he is passionate about his viewpoints and will defend them when he feels they are being challenged. He represents a rare and important opportunity for intelligent debate about important issues on this blog as a well reasoned person of very different view point from the rest of us. With out him discussions risk the possibility of become just another liberal echo chamber.

  • So what is your definition of theft buce? Is theft when I take your money from your sock drawer? Is it when I lie to you to get you to make bad investments that benefit me? Is it when I make more money than you to do the same job, at the same level? Is it getting benefits from your taxes without contributing to society myself? Is it making money by putting others out of business? The definition of theft could mean a variety of things, and your right theft makes money for someone, while taking someone else war is similar, someone loses family members and of course resources are being stolen, which all wars are fought over.

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