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Nobel Prize-Winning Economist: “War Is Widely Thought To Be Linked To Economic Good Times … NONSENSE”

George Washington's picture




 
Contrary to a Common Myth, War is Bad for the Economy

Nobel prize winning economist Paul Krugman wrote yesterday:

Military spending does create jobs when the economy is depressed. Indeed, much of the evidence that Keynesian economics works comes from tracking the effects of past military buildups.

(Mr. Krugman has said the same thing many times in the past. And many other influential people have said the same thing.)

I am not a Nobel prize winning economist … but Joseph Stiglitz is.

Stiglitz wrote in 2003:

War is widely thought to be linked to economic good times. The second world war is often said to have brought the world out of depression, and war has since enhanced its reputation as a spur to economic growth. Some even suggest that capitalism needs wars, that without them, recession would always lurk on the horizon.

 

Today, we know that this is nonsense. The 1990s boom showed that peace is economically far better than war. The Gulf war of 1991 demonstrated that wars can actually be bad for an economy.

Stiglitz has also said that this decade’s Iraq war has been very bad for the economy. See this, this and this.

A No-Brainer

This is a no-brainer, if you think about it.

We’ve been in Afghanistan for almost twice as long as World War II. We’ve been in Iraq for years longer than WWII. We’ve been involved in 7 or 8 wars in the last decade. And yet still in a depression. (And see this).

If wars really helped the economy, don’t you think things would have improved by now?

Indeed, the Iraq war alone could end up costing more than World War II. And given the other wars we’ve been involved in this decade, I believe that the total price tag for the so-called “War on Terror” will definitely support that of the “Greatest War”.

Additional Reasons War Is Bad for the Economy

The New Republic noted in 2009:

Conservative Harvard economist Robert Barro has argued that increased military spending during WWII actually depressed other parts of the economy.

 

Also from the right, Robert Higgs has done good work showing that military spending wasn’t the primary source of the recovery and that GDP growth during WWII has been “greatly exaggerated.”

 

And from the left, Larry Summers and Brad Delong argued back in 1988 that “five-sixths of the decline in output relative to the trend that occurred during the Depression had been made up before 1942.”

Economist James Galbraith has shown that war always causes inflation, which hurts the average American:

Inflation applies the law of the jungle to war finance. Prices and profits rise, wages and their purchasing power fall. Thugs, profiteers and the well connected get rich. Working people and the poor make out as they can. Savings erode, through the unseen mechanism of the “inflation tax” — meaning that the government runs a big deficit in nominal terms, but a smaller one when inflation is factored in.

(Ben Bernanke says that inflation is a tax, and Dylan Grice notes that inflation causes societies to prosecute minorities.   And – sorry – but we can’t inflate our way out of our debt trap.)

As I noted last year:

All of the spending on unnecessary wars adds up.

 

The U.S. is adding trillions to its debt burden to finance its multiple wars in Iraq, Afghanistan, Yemen, etc.

 

Two top American economists – Carmen Reinhart and Kenneth Rogoff – show that the more indebted a country is, with a government debt/GDP ratio of 0.9, and external debt/GDP of 0.6 being critical thresholds, the more GDP growth drops materially.

 

Specifically, Reinhart and Rogoff write:

 

The relationship between government debt and real GDP growth is weak for debt/GDP ratios below a threshold of 90 percent of GDP. Above 90 percent, median growth rates fall by one percent, and average growth falls considerably more. We find that the threshold for public debt is similar in advanced and emerging economies…

 

Indeed, it should be obvious to anyone who looks at the issue that deficits do matter.

 

A PhD economist [Michel Chossudovsky] told me:

 

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.

 

You know about America’s unemployment problem. You may have even heard that the U.S. may very well have suffered a permanent destruction of jobs.

 

But did you know that the defense employment sector is booming?

 

As I pointed out in August, public sector spending – and mainly defense spending – has accounted for virtually all of the new job creation in the past 10 years:

 

The U.S. has largely been financing job creation for ten years. Specifically, as the chief economist for BusinessWeek, Michael Mandel, points out, public spending has accounted for virtually all new job creation in the past 10 years:

 

Private sector job growth was almost non-existent over the past ten years. Take a look at this horrifying chart:

 

 War Is Widely Thought To Be Linked To Economic Good Times ... NONSENSE

 

Between May 1999 and May 2009, employment in the private sector sector only rose by 1.1%, by far the lowest 10-year increase in the post-depression period.

 

It’s impossible to overstate how bad this is. Basically speaking, the private sector job machine has almost completely stalled over the past ten years. Take a look at this chart:

 War Is Widely Thought To Be Linked To Economic Good Times ... NONSENSE

 

Over the past 10 years, the private sector has generated roughly 1.1 million additional jobs, or about 100K per year. The public sector created about 2.4 million jobs.

 

But even that gives the private sector too much credit. Remember that the private sector includes health care, social assistance, and education, all areas which receive a lot of government support.

***

 

Most of the industries which had positive job growth over the past ten years were in the HealthEdGov sector. In fact, financial job growth was nearly nonexistent once we take out the health insurers.

 

Let me finish with a final chart.

 

 War Is Widely Thought To Be Linked To Economic Good Times ... NONSENSE

 

Without a decade of growing government support from rising health and education spending and soaring budget deficits, the labor market would have been flat on its back.

Indeed, Former Secretary of Labor Robert Reich lamented last year

America’s biggest — and only major — jobs program is the U.S. military.

Back to my essay:

Raw Story argues that the U.S. is building a largely military economy:

 

The use of the military-industrial complex as a quick, if dubious, way of jump-starting the economy is nothing new, but what is amazing is the divergence between the military economy and the civilian economy, as shown by this New York Times chart.

 

In the past nine years, non-industrial production in the US has declined by some 19 percent. It took about four years for manufacturing to return to levels seen before the 2001 recession — and all those gains were wiped out in the current recession.

 

By contrast, military manufacturing is now 123 percent greater than it was in 2000 — it has more than doubled while the rest of the manufacturing sector has been shrinking…

 

It’s important to note the trajectory — the military economy is nearly three times as large, proportionally to the rest of the economy, as it was at the beginning of the Bush administration. And it is the only manufacturing sector showing any growth. Extrapolate that trend, and what do you get?

The change in leadership in Washington does not appear to be abating that trend…[121]

 

So most of the job creation has been by the public sector. But because the job creation has been financed with loans from China and private banks, trillions in unnecessary interest charges have been incurred by the U.S.And this shows military versus non-military durable goods shipments:

 War Is Widely Thought To Be Linked To Economic Good Times ... NONSENSE

 

[Click here to view full image.]

 

So we’re running up our debt (which will eventually decrease economic growth), but the only jobs we’re creating are military and other public sector jobs.

 

PhD economist Dean Baker points out that America’s massive military spending on unnecessary and unpopular wars lowers economic growth and increases unemployment:

 

Defense spending means that the government is pulling away resources from the uses determined by the market and instead using them to buy weapons and supplies and to pay for soldiers and other military personnel. In standard economic models, defense spending is a direct drain on the economy, reducing efficiency, slowing growth and costing jobs.

 

A few years ago, the Center for Economic and Policy Research commissioned Global Insight, one of the leading economic modeling firms, to project the impact of a sustained increase in defense spending equal to 1.0 percentage point of GDP. This was roughly equal to the cost of the Iraq War.

 

Global Insight’s model projected that after 20 years the economy would be about 0.6 percentage points smaller as a result of the additional defense spending. Slower growth would imply a loss of almost 700,000 jobs compared to a situation in which defense spending had not been increased. Construction and manufacturing were especially big job losers in the projections, losing 210,000 and 90,000 jobs, respectively.

 

The scenario we asked Global Insight [recognized as the most consistently accurate forecasting company in the world] to model turned out to have vastly underestimated the increase in defense spending associated with current policy. In the most recent quarter, defense spending was equal to 5.6 percent of GDP. By comparison, before the September 11th attacks, the Congressional Budget Office projected that defense spending in 2009 would be equal to just 2.4 percent of GDP. Our post-September 11th build-up was equal to 3.2 percentage points of GDP compared to the pre-attack baseline. This means that the Global Insight projections of job loss are far too low…

The projected job loss from this increase in defense spending would be close to 2 million. In other words, the standard economic models that project job loss from efforts to stem global warming also project that the increase in defense spending since 2000 will cost the economy close to 2 million jobs in the long run.

 

The Political Economy Research Institute at the University of Massachusetts, Amherst has also shown that  non-military spending creates more jobs than military spending.

 

So we’re running up our debt – which will eventually decrease economic growth – and creating many fewer jobs than if we spent the money on non-military purposes.

As I wrote last year:

It is ironic that America’s huge military spending is what made us an empire … but our huge military is what is bankrupting us … thus destroying our status as an empire.

Even Admiral Mullen seems to agree:

The Pentagon needs to cut back on spending.

 

“We’re going to have to do that if it’s going to survive at all,” Mullen said, “and do it in a way that is predictable.”

Indeed, Mullen said:

For industry and adequate defense funding to survive … the two must work together. Otherwise, he added, “this wave of debt” will carry over from year to year, and eventually, the defense budget will be cut just to facilitate the debt.

Former Secretary of Defense Robert Gates agrees as well. As David Ignatius wrote in the Washington Post in May:

After a decade of war and financial crisis, America has run up debts that pose a national security problem, not just an economic one.

 

***

 

One of the strongest voices arguing for fiscal responsibility as a national security issue has been Defense Secretary Bob Gates. He gave a landmark speech in Kansas on May 8, invoking President Dwight Eisenhower’s warnings about the dangers of an imbalanced military-industrial state.

 

“Eisenhower was wary of seeing his beloved republic turn into a muscle-bound, garrison state — militarily strong, but economically stagnant and strategically insolvent,” Gates said. He warned that America was in a “parlous fiscal condition” and that the “gusher” of military spending that followed Sept. 11, 2001, must be capped. “We can’t have a strong military if we have a weak economy,” Gates told reporters who covered the Kansas speech.

 

On Thursday the defense secretary reiterated his pitch that Congress must stop shoveling money at the military, telling Pentagon reporters: “The defense budget process should no longer be characterized by ‘business as usual’ within this building — or outside of it.”

While some might want to start another war, America’s top military leaders and economists say that would be a very bad idea.

Indeed, military strategists have known for 2,500 years that prolonged wars are disastrous.

Note 1: Security experts – conservative hawks and liberal doves alike – agree that waging war in the Middle East weakens national security and increases terrorism. See this, this, this, this, this, this and this.

Terrorism – in turn – terrorism is bad for the economy.  Specifically, a study by Harvard and the National Bureau of Economic Research (NBER) points out:

From an economic standpoint, terrorism has been described to have four main effects (see, e.g., US Congress, Joint Economic Committee, 2002). First, the capital stock (human and physical) of a country is reduced as a result of terrorist attacks. Second, the terrorist threat induces higher levels of uncertainty. Third, terrorism promotes increases in counter-terrorism expenditures, drawing resources from productive sectors for use in security. Fourth, terrorism is known to affect negatively specific industries such as tourism.

The Harvard/NBER concludes:

In accordance with the predictions of the model, higher levels of terrorist risks are associated with lower levels of net foreign direct investment positions, even after controlling for other types of country risks. On average, a standard deviation increase in the terrorist risk is associated with a fall in the net foreign direct investment position of about 5 percent of GDP.

So the more unnecessary wars American launches and the more innocent civilians we kill, the less foreign investment in America, the more destruction to our capital stock, the higher the level of uncertainty, the more counter-terrorism expenditures and the less expenditures in more productive sectors, and the greater the hit to tourism and some other industries.

Moreover:

Terrorism has contributed to a decline in the global economy (for example, European Commission, 2001).

So military adventurism increases terrorism which hurts the world economy. And see this.

Note 2: True conservatives are anti-war.

 

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Wed, 11/02/2011 - 03:33 | 1835892 AnAnonymous
AnAnonymous's picture

Made me laugh. Funny as funny. The US citizens nature is eternal. Long string on US citizens providing rationalization for their own acts  down the road after I stated they would etc... So funny... Cant help themselves, they are like an incontinent.

Tue, 11/01/2011 - 19:23 | 1834824 malek
malek's picture

Ahem... while Krugman is comparing apples to oranges, Stiglitz is comparing pumpkins (increased in size by easy credit) to oranges.

Tue, 11/01/2011 - 14:07 | 1833263 Inspector Bird
Inspector Bird's picture

BTW, Krugman is happy that the hypocrisy of some politicians somehow "proves" his point.  It doesn't.  Just because Republicans say that government spending doesn't create jobs, but cutting military spending is bad because it creates jobs, doesn't mean Keynesianism is correct.  It means the Republicans are morons.  By default, it makes Krugman a moron.  Which I suppose he's happy to lay claim to.

Tue, 11/01/2011 - 14:03 | 1833232 Inspector Bird
Inspector Bird's picture

Wait....Ayn Rand was correct to stipulate war is a statist-driven vehicle, that a good capitalist would oppose war?

The fact Krugman keeps believing it's a good thing (that WWII dragged us out of the Depression - HAH) is based on the misperception that the 'goodness' of war is a relative thing.  If the Germans were destroyed, the effort placed by industry in the US to achieve this is what helped us grow.  Well, why wasn't that true in Britain or the USSR?  Sure, both were pretty banged up, but both also were relatively better off than most other nations, such as France, Italy, Belgium, Japan, etc. 

The issue is that OVERALL growth suffered during WWII.   GDP is only one part of measurement of growth and while military industries do add to GDP, they also represent misallocated resources (Bastiat).  So it's fictitious growth.  Growth isn't just what you see, it's what you don't see.  What you don't see with war is what you COULD HAVE SPENT THE MONEY ON.

Few people understand this.

War, and by default military spending that exceeds current and perceived future needs, is a waste of resources.  Not to mention talent.  How many potential entrepreneurs and visionaries were lost in WWII?  What's amazing is that we tend to come out of war and still have enough energy and ability to keep moving forward.  I'd have to say the one, and only, "value" of war is improving the perceptions of what is important.  But even that is quickly lost.  WWII veterans recognized the value of what they achieved.  Their children, to some small degree, and their grandchildren to a much larger degree, scoff at their achievements.

Wed, 11/02/2011 - 03:41 | 1835898 AnAnonymous
AnAnonymous's picture

Wait....Ayn Rand was correct to stipulate war is a statist-driven vehicle, that a good capitalist would oppose war?

///////////////////////////////////////////////////////////////

She was blatantly wrong. Good, bad capitalists? On what ground?

Capitalists look for the optimal return on investment under the form of profits (optimal return could take other forms)

Extorters of the weak issue a demand for violence, to keep the extorted in line. Same with farmers of the poor.

Why should not a good capitalist try to meet this demand with an offer?

And keeping standing armies on the defense is not the best path to profits.
Agressive use of armies is the best path. State or not.

War is an extortion scheme.

Rand was your typical US citizen who demand the dissolution of the state, not because the State is bad but because they want the West to keep dominating the world scene. They observed some time ago that while the success of the west was state based, the State has also reached its peak in efficiency and was closing the point of negative returns.

Which is certainly not true for other places in the world that are lagging in their relation to the State and are still in positive return stage.

US citizens have robbed their way to the top. Theft was glorious. Now they own everything, they can no longer rob, nobody is left to rob from save themselves. And it means that they are the targets for potential robbers who will gain a lot by robbing them.

That is why all these US citizen intellectuals had taken such stances.

US citizen intellectualism.

Tue, 11/01/2011 - 10:59 | 1832283 Fix It Again Timmy
Fix It Again Timmy's picture

Good GDP or Bad GDP - where are we at?

http://www.youtube.com/watch?v=1xAzbw23-ds&feature=related

 

Tue, 11/01/2011 - 10:31 | 1832138 Bansters-in-my-...
Bansters-in-my- feces's picture

I guess i will call krugger,Krugman if I have too.

Tue, 11/01/2011 - 10:25 | 1832098 hivekiller
hivekiller's picture

War is the health of the state. The state is not 'the government'. It's the elite that owns the state. War is the quickest way to alter a nation's way of life and to set up a permanent dictatorship. Thus the endless 'war on terror'.

Tue, 11/01/2011 - 10:23 | 1832086 Bansters-in-my-...
Bansters-in-my- feces's picture

Krugger and many "other" influential people are also HEAVILY invested in the military industrial complex.

Fuck off Krugger.

Ps...somehow the words "economist"and "nobel" seem to be very misleading.

Tue, 11/01/2011 - 10:15 | 1832049 Insiderman
Insiderman's picture

In addition to the economic arguments made in the article, we can't eat, wear, live in or otherwise enjoy the bombs, tanks, planes, etc. that become part of GDP as the result of military spending.  We should always avoid the conclusion that war benefits us in any way other than as a pure defense measure.

Tue, 11/01/2011 - 10:08 | 1832028 XenOrbitalEnginE
XenOrbitalEnginE's picture

Oiii

At last, somethins XOE reads makes him bullish on Aerospace-Defence!  RTN, LMT, BA, GD (or "God", as it's not known.)   None of these small-arms Smith and Willikins.

Tue, 11/01/2011 - 10:06 | 1832015 GCT
GCT's picture

War is nothing more then another tool in your crooked politicians chest of tools to use.  War is not working because the politicians cannot kill people of the world on a grand scale like they used to do all in the name of saving their countries or preserving peace for the world.  Population and resource control is all that modern warfare is all about.

Tue, 11/01/2011 - 09:59 | 1831974 Grand Supercycle
Grand Supercycle's picture

DOW chart showing bearish megaphone pattern warned of downtrend resumption:

http://stockmarket618.files.wordpress.com/2011/10/2011-10-31_dow_dy_x.png

As mentioned for some time, bullish USD weekly chart continues to exert it’s influence and according to my analysis this will continue.

Tue, 11/01/2011 - 09:53 | 1831942 Willzyx
Willzyx's picture

The benefit of war are relative.  War is good for a nations economy, only if you blow up everyone else's economies, relative to your own.

Tue, 11/01/2011 - 09:44 | 1831862 snowball777
snowball777's picture

Each generation should be made to bear the burden of its own wars, instead of carrying them on, at the expense of other generations.

 

No nation could preserve its freedom in the midst of continual warfare.

 

Of all the enemies of public liberty, war is perhaps the most to be dreaded, because it comprises and develops the germ of every other.

 

War should only be declared by the authority of the people, whose toils and treasures are to support its burdens, instead of the government which is to reap its fruits.

 

Tue, 11/01/2011 - 09:34 | 1831783 Alvaro de Esteban
Alvaro de Esteban's picture

Oh my.., GW, again the Nobel Prize winning economists...

And not the latest ones who make some sense sometimes, no...our beloved pro Obama, pro establishment, IMF & WB leftists Krugman & Stiglitz.

 

Tue, 11/01/2011 - 09:26 | 1831732 proLiberty
proLiberty's picture

War is the ultimate in 'broken windows".  It is made worse when government accountants count bombs, bullets and tanks in the GDP, as if making a million dollars worth of new cars has the same economic benefit as making a million dollar armored vehicle.  War also brings enslavement of young men, and the destruction of a certain percent of them, from which nobody will ever benefit from their work and innovation. 

Tue, 11/01/2011 - 09:17 | 1831652 chunga
chunga's picture

 

Not everyone profits from war. I posted this earlier so this will be the last time.

This was read at a funeral I went to Saturday by a fellow Serviceman at the deceased's request. Three uniformed soldiers folding our flag. Taps. Not a dry eye in the Church.

“A Soldier, His Prayer”

Stay with me God. The night is dark.

the night is cold; my little spark

of Courage dies. The night is long;

Be with me God and make me strong.

 

I love a game; I love a fight.

I hate the dark; I love the light.

I love my child; I love my wife.

I am no coward. I love life.

 

Life with its changes of mood and shade

I want to live. I am not afraid

But me and mine are hard to part.

Oh! Unknown God, lift up my heart.

 

You stilled the waters at Dunkirk

And saved your servants. All your work

Is wonderful, Dear God. You strode

Before us down that dreadful road.


We were alone and hope had fled.

We love our country and our dead

And we could not shame them;so we stayed

The course, and were not afraid.


Dear God; that nightmare road, then

That sea; we got there-we were men

My eyes were blind, my feet were torn,

My soul sang like a bird at dawn.


I know that death is but a door.

I know what we are fighting for.

Peace for our kids our brothers freed,

A kinder world, a loving creed.


I but the son my Mother bore.

A simple man and nothing more.

But-God of strength and gentleness

Be pleased and nothing less.


Help me God, when death is near

To mock the haggard face of fear.

That when I fall, if fall I must,

My soul may triumph in the dust.

 

 

 

 

Chaplain Oran Zaebst

1940

102nd Cavalry Regiment

“Essex Troup”

I was so moved, I requested a copy from the Gentleman. It's available for (free) download on scribd with handwritten notes below.

"A Soldier, His Prayer"

 

Any more LEOS who may be deciding to shoot a Veteran with any kind of bullet should read this. Though it would probably mean more to our Country's Veterans past and present.

If you know a Veteran consider passing it on. Many of them fought battles with no opportunity or desire to profit.

 

Tue, 11/01/2011 - 08:38 | 1831337 the tower
the tower's picture

War is extremely profitable for the biggest industry on earth: the weapons industry.

We have wars because Big Money is deeply invested in the weapons industry.

Only if we kill everyone making money of weapons we'll have peace. It's totally OK, cause that's the business they are in, the business of killing, therefore being killed is part of the package.

So, if you know someone in the weapons industry, you know what you have to do.

Tue, 11/01/2011 - 08:59 | 1831477 El Viejo
El Viejo's picture

Absolutely correct and if you want documentation and verification from Dwight Eisenhower beg borrow or steal the video:  "Why We Fight"

Tue, 11/01/2011 - 08:28 | 1831284 rwe2late
rwe2late's picture

Two additional points:

(a) Warfare and militarism promote government secrecy and arbitrary power in the name of “national security”. The war profiteering (legal or not) results from and feeds into more secrecy, concentrated power, and bought politicians. In short, arguably the biggest cost and loss is to liberty, both individual and public. And NOT just in the United States, but globally, military power is used to prop up many despotic governments, from Egypt to Saudi Arabia, from Haiti to Colombia.

(b) The global Pentagon is the world’s worst single polluter and destroyer of the environment, both by manufacturing by-products and use. The military is the single biggest consumer of petroleum. The military promotes the production and uses all sorts of chemical, biological, and nuclear weapons. From agent orange to cluster bombs, from depleted uranium to direct bombardment, the military does it all.

Nonetheless:

We will likely continue to spend double the percentage GDP that others spend on similar healthcare in order to subsidize the insurance and health industries. We’ll allocate trillions more to keep financial speculators afloat. We’ll spend trillions more to kill illiterate peasants half-way around the world, prop up drug mobsters, and enrich warfare merchants. We’ll build more prisons, fewer schools. We’ll pay for more NSA, TSA, and Homeland policing of ourselves. We’ll do with less, so the wealthiest can have more.

Tue, 11/01/2011 - 08:43 | 1831363 CPL
CPL's picture

...because of the US foreign policies which forgot that eventually the people crapped on will eventually come looking for you.

 

US government unfortunately shit so deeply into it's own sandbox, it now has a country that barely tolerates the actions of it's "leadership" and countries that it fucked with.  All that people are starting to understand is they have been screwed globally.

 

This tax year should be interesting, I'm personally not planning on filing a damn thing and I know a few hundred others that are planning the same thing.  If they were worried about funding wars, pensions and bailouts before, wait until no one plays along with the horseshit offered.

Tue, 11/01/2011 - 07:24 | 1831100 apberusdisvet
apberusdisvet's picture

 

The propaganda to lead the sheeple to WWIII is now gaining steam.  The false flags are flying everywhere.  Must distract from the continuing theft from the middle class and the growing fascist takeover.

Tue, 11/01/2011 - 08:56 | 1831456 CPL
CPL's picture

What middle class?

 

And the take over already happened years ago.

 

Best.  Coup.  Ever.

Tue, 11/01/2011 - 07:13 | 1831090 shortus cynicus
shortus cynicus's picture

Current wars are good for perpetuating bad fiat money insanity. That is what Krugman want to say.

The main reason for current long and intentionally very expensive wars is just pumping new fresh printed money into economy: war is a big money laundry operation.

Ben Helicopter wanted to make a drop, but how? Giving cash to banksters accomplish nothing. Giving to average Americans in an envelope would be like loosing a face for fiat regime. So what about giving cash (without repay obligations) directly to military contractors? They can be exempted form accounting by White House, so there is easy way to hide it. FED isn't accountable for anything anyway.

Second "good point" for fiat regime is distraction from fiat money collapse. Just remember, that WWII started preemptive two years earlier because of inflation fears mounted by bursting MEFO Wechsel bubble.

Tue, 11/01/2011 - 04:24 | 1831005 Coldfire
Coldfire's picture

As breaking windows makes work for glassmakers, destroying entire countries made work for the United States government. But guns and butter ultimately made Uncle Scam broke. And for that we should be thankful.

Tue, 11/01/2011 - 08:35 | 1831313 taxpayer102
taxpayer102's picture

@Coldfire

Krugman is a frontman for the Fed and internationl bankers that *loan* money to the U.S. government to wage war.  Wars make bankers rich.

Farrakhan lays it out in his 1995 "Conspiracy of the International Bankers" lecture so every American can understand it.

http://www.youtube.com/watch?v=ZUXRSthM_hE

Tue, 11/01/2011 - 04:14 | 1831001 AnAnonymous
AnAnonymous's picture

If wars really helped the economy, don’t you think things would have improved by now?

//////////////////////////////////////////////////////////

No.

US citizens are propagandists. They are also expansionists. So expect the US propagandists to enable each other's propaganda in order to strengthen it.

Expansion is nothing new. People claiming that it is something new are propagandists.

Expansion stages are well known.

At first, it adds inputs to the economy. So it helps the economy of the expansionist side. Undubiously. Growth based on physical expansion.

Later, another stage: expansion is coming to a halt. At the point, no more inputs are added to the economy. War efforts are now mostly security efforts to prevent withdrawal of inputs. Wars no longer enable no supply lines, they are made to prevent supply lines from being shut down.

It changes totally the perspective: from times one could expect always more, one is now plunged into times where one has to expect always less.

US citizens from USA can not even admit that they stole their way up to the top, that stealing an entire continent from Indians had been key to their rise. They've invented all kinds of rationalization to try to deny most obvious facts.

Krugman, Stilglitz and co are all US citizens. Opposition, divergent thinking do not exist in US type of society because US citizens hate on diversity and have been successful into establishing uniformity and conformity.

Krugman, Stilglitz and co will work in the same direction, trying to cover most obvious facts by cheap and shallow propaganda, US style. Their speech has no value.

This what you expect from US citizens. And this is what you get from US citizens.

Tue, 11/01/2011 - 09:26 | 1831734 spanish inquisition
spanish inquisition's picture

Our country is based on conquest. We are Sparta. It is interesting that with 700 bases around the world that citizens don't think there is a problem. I have wondered in the past when did Germans know they were living in Nazi Germany. I now have an answer, they never did and still don't today, just like the US of A.

War does have a benefit. It creates debt that needs to be borrowed and puts bankers in charge. And I have been thinking that the history books are wrong and the 20th century has been about wars for central bank consolidation. Take a look at who we fought and see that most were a variety of independent banks that became private central banks after the war. Take a look at the axis of evil and who owns their banks..... the US is sending advisors to Uganda with a......100% Government owned central bank...

 

Tue, 11/01/2011 - 09:37 | 1831802 pvzh
pvzh's picture

"when did Germans know they were living in Nazi Germany"

That is easy. They new it after allies "explained" it to them (some time after 1945).

Tue, 11/01/2011 - 08:51 | 1831410 TruthHunter
TruthHunter's picture

Actually they took over a largely depopulated continent. If the Indians hadn't been decimated by disease, they

would've quickly adopted western technology and prevented all but a toe hold in the Americas.

 

Empires rise and fall. There always comes a time to pay the piper.

We are left with the myth of the Noble savage. Perhaps he was ennobled by

hardship.

The fact is oppression, squalor, and cruelty were also rampant.  Our enemies are fond of pinning a criminal label on

the white man when  he was just the agent of history.

 

Tue, 11/01/2011 - 12:54 | 1832867 hivekiller
hivekiller's picture

I'm glad you said adopted western technology because the Injuns weren't intellectually capable of inventing any technology. They were essentially primitive nomadic tribes who for the most part who were constantly waging war on each other. There was plenty of room for everyone but they took to killing the settlers, stealing their animals, and torturing and raping prisoners. In other words, they waged war on whites in the same way they waged war on other tribes. Only whites were superior in terms of technology and military strategy and the injuns lost.

 

Tue, 11/01/2011 - 11:09 | 1832345 Diogenes
Diogenes's picture

"Actually they took over a largely depopulated continent. If the Indians hadn't been decimated by disease, they

would've quickly adopted western technology and prevented all but a toe hold in the Americas."

 

It is only fair to point out that Europeans were not immune to American disease either. Look at the record of the earliest attempts at colonization in the 16th and 17th century. You will see a mortality rate among the settlers of 50% to 90% the first year. Some were wiped out entirely within 2 years.

 

"Empires rise and fall. There always comes a time to pay the piper.

We are left with the myth of the Noble savage. Perhaps he was ennobled by

hardship.

The fact is oppression, squalor, and cruelty were also rampant.  Our enemies are fond of pinning a criminal label on

the white man when  he was just the agent of history."

 

"oppression, squalor, and cruelty were also rampant" in Europe as well as the Americas, in fact all over the world at that time.

 

Tue, 11/01/2011 - 09:27 | 1831745 Chuck Walla
Chuck Walla's picture

Modern civilizations, cultures, always displace the obsolete cultures. Who cries for the Aztec, the Goth, the Druid or the Tuscan? 

Tue, 11/01/2011 - 08:20 | 1831252 Are you kidding
Are you kidding's picture

Yes...we stole an entire continent from cave men...besides, they weren't using it effectively.

As for the war question...you need the right KIND of war.  A constant war, where you spend but don't get anything in return, IS a losing proposition.  You need a WORLD WAR so you can (a. extinguish any debt you already owe them. and (b. Take anything of value they posses.

Tue, 11/01/2011 - 07:38 | 1831123 mjk0259
mjk0259's picture

We don't have that many citizens, mostly illegal aliens now.

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