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"War ALWAYS Causes Recession"

George Washington's picture




 

Washington's Blog.

PhD economist Marc Faber predicts that the U.S. will launch a war to distract people from the bad economy.

China's largest media outlet - Sohu.com - wrote
in October 2008 that the Rand corporation, a leading U.S. military
advisor, lobbied the Pentagon for a war to be started with a major
foreign power in an attempt to stimulate the American economy:


According
to French media, well-known U.S. think tank RAND Corporation ... has
submitted [to the Pentagon] an evaluation report assessing the wage a
war to shift the feasibility of the current economic crisis...

Continued
deepening of the U.S. sub-prime mortgage crisis and economic downturn,
developed to a certain extent, is likely to trigger a war in order to
achieve the purpose of the crisis passed.

(Google's translation services are crude approximations, but Yihan Dai confirmed the translation of the original).

Is Faber right? Is the Sohu.com report accurate?

I
don't know. For example, I won't take the Sohu.com claim very seriously
until someone can point to the French media source, so that I can
assess it's credibility.

However, "military Keynesianism" - using military spending to stimulate the economy - has been U.S. policy
for half a century. And the economist who coined that term said that
such a policy always and "inexorably" leads to "an actual war" in order
to justify all of the military spending.

Therefore, any studies which disprove the efficacy of war as an economic stimulus -see this and this - are important for balance.

In addition, contrary to popular belief, some writers say that the reason that WWII actually stimulated the U.S. economy was not because of America fighting the war. Specifically, they argue that America's ramped-up production of armaments for the British before the U.S. entered the war was the thing which stimulated our economy.

To
try to sort some of this out, I spoke with a PhD professor of economics
with a background in international conflict in July 2008 to find out
whether war is really good for the economy.

I asked if
conventional wisdom that war is good for the economy is true,
especially given that all of the spending on the war in Iraq seems to
have weakened America's economy (or at least, greatly increased its debt).

The economist explained the seeming paradox:

"War always
causes recession. Well, if it is a very short war, then it may
stimulate the economy in the short-run. But if there is not a quick
victory and it drags on, then wars always put the nation waging war
into a recession and hurt its economy."

Given that America has been fighting both the Afghanistan and Iraq wars longer than it fought WWII, the exception obviously doesn't apply.

Can America go beat up some poorly-armed country to get a quick war?

It is more unlikely than many assume. Given that many believe that the U.S. started the Iraq war based on false pretenses, and that the Iraq war was really about oil (see this, this, this, this and this), I am skeptical that many would buy America's stated justifications for another war.

Indeed, the Sohu.com article – even if wholly untrue – proves my point.

In
addition, even a war against a small, poorly-armed and resource-poor
country could be considered a proxy war. In other words, other
heavily-armed countries might fight the U.S. through local proxies,
dragging the war out for years, just as the U.S. did with Russia in
Afghanistan. America today is not the empire it was even 10 years ago,
and - as Afghanistan and Iraq show - America no longer has the
financial resources to project force and impose its will world-wide.

The bottom line is that anyone advocating for war to help our economy is mistaken.

 

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Mon, 11/16/2009 - 09:21 | 131633 bugs_
bugs_'s picture

Wars always cause the sun to rise.
 
I advocate war to crush our enemies.
The economy does what it wants to do.

Oh George will you abandon this theme?

Mon, 11/16/2009 - 14:20 | 132030 George Washington
George Washington's picture

"Oh George will you abandon this theme?"

Depends ... will the boys abandon their schemes to help the economy through war?

Tue, 11/17/2009 - 03:01 | 132902 Fibozachi
Fibozachi's picture
G-dub ... love your latest series and hope that you continue it; clearly, it has elicited great response.  Thank you for sharing it with us!!  My comments below are not directed at you or anyone else, just a wee bit of preemptive vitriol toward those who love to bash others without either merit or constructive criticism.

 

As for 'war & the economy' ... the bottom line (imho) is that war is in fact a productive entity unto itself for abundantly obvious reasons (ahem, save the NASDAQ, er, I mean Operation Iraqi Freedom ... Afghanistan I: USSR, the list is innumerable).  Yet, war is NOT the whimsical product of a few men or a simple idea.  Rather, it is the direct byproduct of collective social mood having shifted firmly toward the downside, causing the economy/ stock market/ media/ government to each grow darker and more perverse.  To borrow a phrase, the 'waves of war' ARE in fact not only possible to analyze but also to predict. 

 

Just like practicing technical analysis or reading Mandarin, if someone is not well versed or at least similarly inclined toward introspective study therein, then they will most likely write off the concept / methodology because they simply do not understand it.  I have no problem with this, to each their own, in all things.  That said, please don't bash the concept / methodology and in turn effectively prevent others from examining it themselves because 'you' happen to not like its creator, for whatever reason. 

 

And lastly, as a pointed addendum to those who can't help but rip the man and his work: just wondering what, if any, foundationally systematic methodology it is that 'you' employ and also what was 'your' market outlook, let alone target, in 1974, 1976, 1977, 1978 or 1982?  And to be even cuter about it: what were your time, price and sentiment targets for the DJIA/S&P 500 on March 9 or March 19th?  His was for now and here, based explicitly upon a systematically rigorous approach to market analysis almost exclusively centered around not only the Principles of EW but especially the Theory of EW.

 

That said, if you attempt to trade by Elliott alone you will undoubtedly become road kill in very short order as it does NOT address the actual trading issues of execution and management, even though it is excellent for secondary confirmation of identification and isolation and not too shabby on a daily or above for timing although such is effectively both coincidental and lagging.  EW can both help you make amazing calls (and get it right the 3rd or 4th try) as well as make you look/ feel like an idiot when you attempt to count out unclear patterns instead of examining actual trading signals within technical trading indicators, oscillators and the like. 

I firmly believe that this is exactly where / why so many begrudge its very existence; because they are not willing to take the time (years) to gain the experience to truly understand the art of its theory and the nuance of its craft.  We recently wrote on ZH about the "Stochastics Default Club" and believe that this issue with EW is akin to those who "use" the 12, 26, 9 MACD, 14 period RSI and 50 / 200 SMA; they use what they think works simply because others do, while never taking the time to examine / research why!!

 

Without posting copyrighted materials, which are entirely free after taking 30 seconds to register, below is a terribly simply summary; the last link below is a bit more detailed but does require a quick 30 registration to view.

 

Finally, while the founder of Socionomics elicits mass outrage from those who do not ascribe to his work of the past 30 years, please simply take 2 minutes to decide whether Socionomics: is "an amazing no-brainer to understand"; or "a total load of crap + (insert personal slight without merit here)."  The only thing I can promise is that you'll fall within one of those two camps and nowhere in between.  And as always, simply hope to further spur a lively and constructive debate about not only war & the economy but also about various methodologies of TA.  Thanks for taking the time to read my thoughts.

 

Socionomics in a Nutshell   (November 1999)

Elliott Waves and Social Reality (9/11/2001)

 

Much like Condoleezza, RP / EWI predicted that a terrorist attack could / would likely occur, such as (#5 of 5 possibilities) 'foreign terrorists hijacking a commercial airliner and flying it into either a skyscraper or the Pentagon;" except he remembered having done so afterward and unlike Buzzy Krongard didn't need an advance.  He was / had officially recommended being 200% discretionarily short S&P futures before the "random" event occurred.  Has RP / EWI been stubborn and wrong at many passes?  Oh yeah.  And while I couldn't care less what 'you' think about them or practice yourself ... simply take great offense with those who bash the crap out of EW / Socionomics without being versed at all. Rant complete.

 

Socionomics and the Sudden Wave of Violence (Aug/Sept '06)

 

If interested, the Scrooge McDuck vault-sized wealth of material contained within RP's 2 book set on Socionomics is not only voluminous but also equally researched.  For those who still hold that 'fractals', Fibonacci, EW and Socionomics are foolish constructs limited to just financial markets ... oh boy are you missing the bigger picture and on the wrong side of that boat.   In lieu of responding to outright hate mail: I am more than happy to discuss, describe or even debate the merits of these arguments within these pages.  And I hope that GW will continue this excellent and thought-provoking series as many of us continue to exhibit a marked interest in this highly interesting and extremely palpable topic. 

I do apologize for such a long-winded comment ... simply have very strong personal opinions on these issues.

 

Great work getting the convo started GW !!

Mon, 11/16/2009 - 06:17 | 131595 London Banker
London Banker's picture

In Europe it is well acknowledged that war among developed nations impoverishes winners and losers alike.  This has been doctrine for 100 years, since the publication of a little book by Sir Norman Angell, winner of the 1933 Nobel Peace Prize.

From the <a href="http://nobelprize.org/nobel_prizes/peace/laureates/1933/angell-bio.html">Nobel website</a>:

<blockquote>In 1909 he had published a small book, Europe's Optical Illusion, using for the first time the name Norman Angell which he later legalized. In 1910 he expanded this work considerably, retitling it The Great Illusion. This book as translated into twenty-five languages, sold over two million copies, and gave rise to a theory popularly called «Norman Angellism». This theory, as stated in the book's Preface, holds that «military and political power give a nation no commercial advantage, that it is an economic impossibility for one nation to seize or destroy the wealth of another, or for one nation to enrich itself by subjugating another». In the next forty-one years, Angell published forty-one books distinguished for their rationality, clarity, painstaking analysis of fallacies, and earnestness tempered by good humor. His The Fruits of Victory (1921) shows how the results of World War I bore out the propositions explained in The Great Illusion; The Money Game (1928) unmasks the economic warfare which has its roots in the «mercantilist illusion», a misunderstanding of the nature of money, and explains a card game he had invented to make currency problems «visual»; The Unseen Assassins (1932) analyzes some of the implications of patriotism, nationalism, and imperialism and discusses the problem of educating the common man; The Great Illusion: 1933 (1933) applies the thesis of 1909 to 1933 and states the case for cooperation as the basis for civilization; The Menace to Our National Defence (1934) proposes internationalization of civil aviation and collective defense by the air arm; The Great Illusion - Now (1938) updates his basic conception once again; Peace with the Dictators?  (1938) deals with the theme of collective security; The Steep Places (1947) probes the limitations of national sovereignty in an organized society; After All (1951) is the urbane autobiography of a man, adventurous and evangelical, yet studious and reasonable, who is still looking for the formula that will enable men to achieve international peace.</blockquote>

Mon, 11/16/2009 - 06:14 | 131594 Anonymous
Anonymous's picture

In Europe it is well acknowledged that war among developed nations impoverishes winners and losers alike. This has been doctrine for 100 years, since the publication of a little book by Sir Norman Angell, winner of the 1933 Nobel Peace Prize.

From the Nobel website:

In 1909 he had published a small book, Europe's Optical Illusion, using for the first time the name Norman Angell which he later legalized. In 1910 he expanded this work considerably, retitling it The Great Illusion. This book as translated into twenty-five languages, sold over two million copies, and gave rise to a theory popularly called «Norman Angellism». This theory, as stated in the book's Preface, holds that «military and political power give a nation no commercial advantage, that it is an economic impossibility for one nation to seize or destroy the wealth of another, or for one nation to enrich itself by subjugating another». In the next forty-one years, Angell published forty-one books distinguished for their rationality, clarity, painstaking analysis of fallacies, and earnestness tempered by good humor. His The Fruits of Victory (1921) shows how the results of World War I bore out the propositions explained in The Great Illusion; The Money Game (1928) unmasks the economic warfare which has its roots in the «mercantilist illusion», a misunderstanding of the nature of money, and explains a card game he had invented to make currency problems «visual»; The Unseen Assassins (1932) analyzes some of the implications of patriotism, nationalism, and imperialism and discusses the problem of educating the common man; The Great Illusion: 1933 (1933) applies the thesis of 1909 to 1933 and states the case for cooperation as the basis for civilization; The Menace to Our National Defence (1934) proposes internationalization of civil aviation and collective defense by the air arm; The Great Illusion - Now (1938) updates his basic conception once again; Peace with the Dictators? (1938) deals with the theme of collective security; The Steep Places (1947) probes the limitations of national sovereignty in an organized society; After All (1951) is the urbane autobiography of a man, adventurous and evangelical, yet studious and reasonable, who is still looking for the formula that will enable men to achieve international peace.

Mon, 11/16/2009 - 06:02 | 131590 Anonymous
Anonymous's picture

Any developed nation that wages war impoverishes itself along with its victim.

From the Nobel website, an extract of the biography of Sir Norman Angell, who won the Nobel Peace Prize in 1933:

In 1909 he had published a small book, Europe's Optical Illusion, using for the first time the name Norman Angell which he later legalized. In 1910 he expanded this work considerably, retitling it The Great Illusion. This book as translated into twenty-five languages, sold over two million copies, and gave rise to a theory popularly called «Norman Angellism». This theory, as stated in the book's Preface, holds that «military and political power give a nation no commercial advantage, that it is an economic impossibility for one nation to seize or destroy the wealth of another, or for one nation to enrich itself by subjugating another». In the next forty-one years, Angell published forty-one books distinguished for their rationality, clarity, painstaking analysis of fallacies, and earnestness tempered by good humor. His The Fruits of Victory (1921) shows how the results of World War I bore out the propositions explained in The Great Illusion; The Money Game (1928) unmasks the economic warfare which has its roots in the «mercantilist illusion», a misunderstanding of the nature of money, and explains a card game he had invented to make currency problems «visual»; The Unseen Assassins (1932) analyzes some of the implications of patriotism, nationalism, and imperialism and discusses the problem of educating the common man; The Great Illusion: 1933 (1933) applies the thesis of 1909 to 1933 and states the case for cooperation as the basis for civilization; The Menace to Our National Defence (1934) proposes internationalization of civil aviation and collective defense by the air arm; The Great Illusion - Now (1938) updates his basic conception once again; Peace with the Dictators? (1938) deals with the theme of collective security; The Steep Places (1947) probes the limitations of national sovereignty in an organized society; After All (1951) is the urbane autobiography of a man, adventurous and evangelical, yet studious and reasonable, who is still looking for the formula that will enable men to achieve international peace.

Mon, 11/16/2009 - 05:56 | 131589 loup garou
loup garou's picture

GW, I have no idea what “point” you think some ridiculous, year-old, uncorroborated, Chinese propaganda from Alex Jones’ Prison Planet  “proves”… (If you follow the links, eventually you get to one where it is asserted that in June, 2009, Obama “will declare that America is in an economic ‘State of Emergency’ and fight for its very survival, which will require his rule by edict and suspension of all rights and normal laws.”)

As for “Dr. Doom“, at various times he has made numerous predictions about ‘war’ which were all over the board:

1) “It won’t be the traditional war, it will be poison in the water systems of major cities like New York or London.

2) "This economic crisis will be very lengthy and I think the way to come out of it will eventually be war, and this war will be very unpleasant. We have a horrible situation in Afghanistan and in Pakistan and it's obviously not in the interest of the Russians or the Chinese that the Americans succeed in Central Asia and that will lead to more and more tensions.”

3) “Buy a farm and let your girlfriend work on the farm. If the global economy doesn’t recover, usually people go to war.”

4) “So now, for the next 30 years, what we will have is the emerging economies, Brazil, Central Asia, Russia, China, India, you name it, will progress much more than the Western world. The Western world, economically, will be threatened by these new blocks and that will lead to huge geopolitical tension and eventually the war I was referring to.

5) In this one, he predicts war in “5 to 10 years“, but is not clear what exactly he means by “war”, or who will be involved, or why. 

http://seekingalpha.com/article/158971-dr-marc-faber-on-recovery

6)  Here, Dr. Doom says the collapse of capitalism is “inevitable”, and that its collapse will trigger global “wars, massive government-debt defaults, and the impoverishment of large segments of Western society”. 

http://pakalert.wordpress.com/2009/11/02/marc-faber-the-collapse-of-capi...

Evidently, your intention is to be “provocative”, otherwise known as “jerkin’ some chains“.  (I understand that is very much ‘in vogue‘, in certain quarters;)  Or, you’re playing a joke on people, just to see how many fall for it. Either way, you do yourself a disservice with this kind of stuff…

Regardless; instead of scraping the bottom of the barrel, try a more reputable, reliable, consistent, as well as surprising, source:

http://www.blogcatalog.com/blog/little-alex-in-wonderland/204b9b54ea4efa...

Ret. Col. Lawrence Wilkerson, former chief of staff to Bush Administration Secretary of State Colin Powell, on the ‘Military-Industrial-Congressional Complex, perpetual war’s relation to the viability of the American Empire, ‘evil’ dollar hegemony’s inevitable demise and the inherent corruptibility of power preventing  the U.S. ‘from impeaching a president every generation’.

In particular, note Part Three. (“History says we’re going down.”)

I’m sure you’ll find it intriguing.

Mon, 11/16/2009 - 05:30 | 131584 Fibozachi
Fibozachi's picture

For the sake of brevity ... there is a considerable body of work, of which I ascribe, which holds true not only the inverse of "War ALWAYS Causes Recession" but rather that there is a tautological logic to the concept that 'Severe Recession ALWAYS Causes War.'

Moreover, several Socionomists have recently presented rigorously sound details of exactly how and why such severe economic contraction, or rather, how/ why such severe contraction within/ across collective social mood brings about a pattern of commonly recurring shared emotions, which in turn, provide the sentimental ingredients necessary to foster war.

 

GW: I've thoroughly enjoyed your latest series and would love to see you tackle the social science of Socionomics in a future installment.

Mon, 11/16/2009 - 05:50 | 131585 loup garou
loup garou's picture

Absloutely, Fibozachi. (...the "inverse"...)

That, I believe, is the viewpoint of Faber as well.

Mon, 11/16/2009 - 03:22 | 131551 Hephasteus
Hephasteus's picture

War always causes a boom bust cycle. The banking system has to flush both the winner and loser with cash and then the it has to make the winner pay for both it's debts and the loser debts. Because our banking system is THAT fair and doesn't play favorites. Ok sometimes it takes the losers cash away if it doesn't want it to win but thats so rare. LOL

Which right now is the biggest sticking point of the IMF. The feudal lords want a way to war with each other and are trying to develope I guess a handbasket of hell system to make it possible.

Mon, 11/16/2009 - 02:13 | 131536 Anonymous
Anonymous's picture

...and if we also destroy all the farmland with radiation and bioweapons we could have wealth beyond imagination.

Mon, 11/16/2009 - 01:45 | 131523 Anonymous
Anonymous's picture

Nothing would surprise me anymore in this Brave New World we are living in now, but I can't honestly see Obama starting up yet another war before he's out of office in the next 3-7 years. Not only by doing so would he completely damage the Democrat brand amongst the academic university set and minorities that have been the party's bread and butter for 40 years, the current economic state of the country may make it impossible short of massive inflation.

I've susptected for a little while that the reason Obama can't make a hard decision on what to do in Afghanistan is because the country is so broke that he simply can't afford to increase troop levels like he promised to do during the campaign. At the same time, he can't immediately pull out, either, because shutting down bases can cost billions all on their own. Ironically, maintaining the status quo in Afghanistan might be the most fiscally sound thing to do in the short term.

There's a perfect financial storm brewing with the country getting right on the cusp of going over the debt limit; tax revenues falling off a cliff across the country thanks to high unemployment; defense spending, Medicare/Medicaid, Social Security, and now possible expanded healthcare obligations hanging over the budget like the Four Horsemen of the Economic Apocalypse; and the spector of a "stimulus" that completely fell on its ass hanging over any decisions, domestic or military, that the administration would have to make.

With people getting increasingly agitated by all the spending going on, with no oversight or transparency in place to at least reassure them of responsible fiscal management, finding a "new enemy" to go after would probably be political suicide. For someone as emotionally invested in being a "rockstar" as Obama is, I just can't see him willing to take that kind of hit to his ratings, regardless of whether it would stimulate the economy or not.

I think Faber is way off on this, but I guess time will tell.

Mon, 11/16/2009 - 01:30 | 131517 naiverealist
naiverealist's picture

If this is all it takes to stimulate the economy, let's just build tanks and take them out to the desert (Texas or Nevada) and blow them up.  Think of all the lives we would save, and we would be fully supporting the military-industrial complex and the munitions industry.  And think of the benefit of not burning all that oil and gas by not having to ship them over to the Middle East.  Gas would drop by a dollar a gallon.

Let's get real, folks.  Its no longer 1940.  Our problems take intelligence, originality, and constructivity to address, not the testosterone hype of "Give 'em hell, Barry".

Mon, 11/16/2009 - 01:28 | 131514 Anonymous
Anonymous's picture

on a reprehensibly cold hearted analysis,
War is always profitable to someone

the question is where that wealth goes, and does it filter through to the broader economy?

If an empire overtakes oil resources and it results in a cheaper petrol price for its domestic populace, that adds to the overall efficiancy and competitiveness of the nation.

unfortunately, the loss of life and limb, the inefficiencies in health and administration, the revenue leakage through corporations along the supply chain, the money wasted on shoving politically embarrassing issues under the carpet (by hiring mercenaries, paying off foreign militias to swap sides, fomenting resistance and revolutions etc) all add up to a massive net social and financial loss.

and then you have to deal with the loss of allied sympathy and assistance when you've got so much unneccessary blood on your hands.

Mon, 11/16/2009 - 13:58 | 131996 Master Bates
Master Bates's picture

Except that the Iraq war increased the price of oil for the American population...

I would have had less problems with it if we at least got the oil for free.
We couldn't even do that though.

We're building schools in Iraq while ours in the States crumble. 

Mon, 11/16/2009 - 13:58 | 131995 Master Bates
Master Bates's picture

Except that the Iraq war increased the price of oil for the American population...

I would have had less problems with it if we at least got the oil for free.
We couldn't even do that though.

We're building schools in Iraq while ours in the States crumble. 

Mon, 11/16/2009 - 00:18 | 131485 Anonymous
Anonymous's picture

Didn't Bastiat's parable of the broken window from "That Which Is Seen and That Which Is Unseen"(http://en.wikisource.org/wiki/That_Which_Is_Seen,_and_That_Which_Is_Not_...) demolish the "war is good for the economy" rubbish in 1850?

Mon, 11/16/2009 - 00:08 | 131476 Catullus
Catullus's picture

It's a very simple argument to beat:  you are using resources to produce something that will only be destroyed.  Any stimulus is necessarily temporary.  And it's really the overall problem with Keynesianism is general:  there is no focus on what is actually being produced.  All spending is just an amorphous blob called "production" and "labor".  Hence the classic example of digging holes and filling them to create jobs. 

But even if you want to concede some arguments from military Keynesianism, the issue is not a "short war", but the expectation that it will be a long war.  That the stimulative effects will be more than temporary.  Thus far, this "temporary stimulus" seems to be the major criticism of the Keynesians of the US stimulus efforts.  They call for gigantic new increases in programs that would last decades. 

Mon, 11/16/2009 - 00:01 | 131470 Anonymous
Anonymous's picture

Venezuela and Cuba would be pushovers.

Sun, 11/15/2009 - 23:50 | 131467 milbank
milbank's picture

War doesn't bring recession until it's fourth year. At that point it always does.

Sun, 11/15/2009 - 23:45 | 131464 Mazarin
Mazarin's picture

When wars were fought by burley men with giant cohones and clear motives, the victor TOOK the country conquered, enslaved its people, and extracted enormous profits - that is a recipe for enrichment not recession. If America is going to fight wars, it ought to fight them to win and be forthright about its motives: to subjugate foreign peoples and usurp the profits from their assets and endeavors. On the contrary, nothing is more expensive and depleting to a kingdom than a war prosecuted without focus of motive and victory. Pseudo-wars instigated by non-fighting political suits with cloudy objectives are a sure way to bankrupt a nation. Long live the $2 trillion Operation Iraqi Freedom!

Sun, 11/15/2009 - 23:31 | 131454 Daedal
Daedal's picture

Brings a whole new meaning to the term "Green Shoots."

Let's break this down to the most common denominator: Killing people in the name of economic prosperity. Whoever is a proponant of that is not mistaken, they are quite simply insane. How about they just kill wheover is unemployed; get that unemployment rate to 'better than expected' territory in no time.

Mon, 11/16/2009 - 13:54 | 131990 Master Bates
Master Bates's picture

Instead of killing the unemployed (disproportionately members of Gen Y) we should kill the baby boomer generation that has destroyed the American economy over the last 30 years or so by outsourcing its jobs and living off of debt.

Then, we kill the people responsible for the crisis, AND stop the social security entitlement crisis coming up.

Mon, 11/16/2009 - 09:09 | 131631 Anonymous
Anonymous's picture

It's off to the FEMA, debtors detention camps with them. At least they'll get 3 squares and a warm roof over their heads.

Mon, 11/16/2009 - 00:46 | 131497 Anonymous
Anonymous's picture

I suspect that a book could be written (on different levels) in response to your comment.

The main question, in my opinion, to those who say war helps us economically is this?
How can production of something that continually depreciates, only consumes (not even a friendly wave to you in the morning), and when used destroys other people's wealth be considered "good for the economy".
If it is true that it is good for the economy then let's just stay home and throw rocks through each other's windows and we'll have zero unemployment and build wealth at the same time.
I think we intuitively know that war is mostly good for the upper echelon.

Those who can't make money from value-added exports make money from the export of war.

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