Confirmed: Defense Spending Creates Fewer Jobs Than Other Types of Spending

George Washington's picture

Yesterday, I pointed out
that a study by one of the leading economic modeling companies shows
that military spending increases unemployment and decreases economic

Indeed, an economic paper
published in 2007 by The Political Economy Research Institute at the
University of Massachusetts, Amherst - entitled "The U.S. Employment
Effects of Military and Domestic Spending Priorities" - concludes:

present in Table 1 our estimate of the relative effects of spending $1
billion on alternative uses, including military spending, health care,
education, mass transit, and construction for home weatherization and
infrastructure repair.

[Click for larger image]

table first shows in column 1 the data on the total number of jobs
created by $1 billion in spending for alternative end uses. As we see,
defense spending creates 8,555 total jobs with $1 billion in spending.
This is the fewest number of jobs of any of the alternative uses that
we present. Thus, personal consumption generates 10,779 jobs, 26.2
percent more than defense, health care generates 12,883 jobs, education
generates 17,687, mass transit is at 19,795, and construction for
weatherization/infrastructure is 12,804. From this list we see that
with two of the categories, education and mass transit, the total
number of jobs created with $1 billion in spending is more than twice
as many as with defense.

"Military Keynesianism" - the idea that war is the best economic stimulus - is false.