Would a Major war Help the US Economy?

[Exarch]

i've often heard the saying that war is good for the local economy; helps commodity prices, generates employment (in war factories) support for government, in much the same way WW2 and FDR's policies helped pull the USA out of the Great Depression;
theoretically, would a Major war help the US economy in its current state?

i'm not talking a minor conflict like in a-stan or iraq-states that didnt require the American society to go through total war-i'm talking about a Major War.

Discuss

[GeneralChaos]

Wars do not really help the economy. All the money that would be spent on bullets/bombs/training soldiers is money that could have been spent on infrastructure, cultural/scientific development, or who knows whatever other constructive pursuits. And with Afghanistan/Iraq, the US would probably instate a draft and take skilled labor and retrain them as infantry. I can't really see what a war would do that couldn't be done through investing -in- society and not against it.

[Fluttershy]

Wars do not really help the economy. All the money that would be spent on bullets/bombs/training soldiers is money that could have been spent on infrastructure, cultural/scientific development, or who knows whatever other constructive pursuits. And with Afghanistan/Iraq, the US would probably instate a draft and take skilled labor and retrain them as infantry. I can't really see what a war would do that couldn't be done through investing -in- society and not against it.

few things trigger more scientific development then war

[Azog 150]

In the long run, if the US did something similar like it did in the World Wars (aka, sit out of it, sending supplies and loans, making countries in debt to them and then possibly join in a bit later putting them in a position of great economic power) then yes.

However, these days I don't even think it would be possible for the US to stay out of a war. They have bases and much influence right around the world, with a network of puppet states and allies which would drag them in if they tried to stay out. Plus the worlds economies are so intertwined it would be very difficult to stay out without protecting your economic interests.

[Helm]

WW1 and WW2 did wonders for the British Empire.

[Big War Bird]

WW1 and WW2 did wonders for the British Empire.

In making it vanish into thin air, it was wonderous!

[removeduser_487563287433]

Depends if it won. Certainly wouldn't suggest that Iraq or Afghanistan has helped the US economy (although they certainly did benefit certain companies linked to the Bush administration).

In making it vanish into thin air, it was wonderous!

Not great with sarcasm, are you?

[Big War Bird]

Not great with sarcasm, are you?

You're not the sharp yourself since you didn't catch I was agreeing with the above post.

[♔Goodguy1066♔]

Britain used to be the biggest, most powerful empire in the world untill 1914. I think that pretty much sums up this thread.

[CtrlAltDe1337]

Yes it would. WWII pulled the US out of the Great Depression, after all, and its not hard to see why. Factories began cranking out massive amounts of war materials, which generated a lot of productivity and jobs (plus a lot of people got drafted and sent overseas, so that reduces your labor pool). But, it would go along with higher taxes and huge government deficits, so I wouldn't suggest we start a war to end our economic troubles (plus that isn't very moral).

[Enemy of the State]

Why start a war? Just build large battleships, send them out to sea, blow them up and build new ones.

[Helm]

It helps if you can get other nations to take much of the losses on your behalf.

[Ramashan]

In WWII the US had to create the infrastructure for the war time industry. This led to the need to have some many more workers to fill the jobs being created. Right now, our infrastructure, no matter how aged exists, the wars we fight don't take quite as much material, and much of the supplies are coming in from all over the world.

With nuclear weapon lurking in the wings I don't think we'll ever get to a Total War economy before everything goes back to the stone ages.

[roy34543]

Actually lol, one of the big reasons a war helps the economy is that it shoves out all the people that arent particularly good at surviving.

[BNS]

Using economic resources to build war machines, instead of say consumer goods or private investments, which will most likely be destroyed and used to destroy wealth is in no logical way a net positive (childish Keynesian delusions aside).

Secondly FDR's policies did not save the U.S. economy their gradual repeal during and after the war is what saved it.

i'm not talking a minor conflict like in a-stan or iraq-states that didnt require the American society to go through total war-i'm talking about a Major War.

Why make that distinction? Iraq and Afghanistan most be doing small wonders to our economy according to this logic. Perhaps it's time to escalate the conflict with Iran, our economy needs it now, in the long run we are all dead anyways.

[Turtules]

Actually lol, one of the big reasons a war helps the economy is that it shoves out all the people that arent particularly good at surviving.

Honestly....I HAVE to give you rep for this...Ive never laughed so hard at an interwebz post.

[MathiasOfAthens]

Economy and industry tend to get boosts during the war. If the nation is successful as the US was during the 1st and 2nd World Wars than they will collect payments from other nations. However, what most likely occurs is after the war is over there are a lot of trained soldiers around without a mission. The after effects of the Napoleonic Wars on the British economy and the surge in unemployment is very similar to the US economy today.

[TheKwas]

Depends on the condition of the economy before the war. If the economy is in a liquidity trap, then yes war can act as a major boost to the economy. BNS's anti-intellectual comments aside, it would work as a keynesian stimulus that would get the economy out of the liquidity trap. This is what happened with WWII and America.

The rest of the time, it's a terrible idea.

[BNS]

Depends on the condition of the economy before the war. If the economy is in a liquidity trap, then yes war can act as a major boost to the economy. BNS's anti-intellectual comments aside, it would work as a keynesian stimulus that would get the economy out of the liquidity trap. This is what happened with WWII and America.

The rest of the time, it's a terrible idea.

Oh forgive me! Perhaps you can point out the break in my logic. Speaking of logic how is it a good idea sometimes and other times not, the multiplier effect is still there isn't it?

[TheKwas]

Oh forgive me! Perhaps you can point out the break in my logic. Speaking of logic how is it a good idea sometimes and other times not, the multiplier effect is still there isn't it?

Exactly how much have you read on Keynesianism, if you don't even know when and why he proposed stimulus spending? Spitting on the name of one of the most univerally-respected economists of the 20th century shouldn't be done lightly and in ignorance.

Anyways, the difference lies in the paradox of thrift. A recession spirals downward because of the paradox of thrift: An exogenous shock causes the economy to shrink, which in turn causes everyone in the economy to consume less (which is rational for each individual), which then in turns causes production to shrink even more: It's a negative feedback loop. Excessive saving with low consumption creates general glut and under-utilization of existing resources.

To make use of these resources, the government can spend money on the behalf of the collective to crowd-out private saving and increase consumption, putting the glut and underutilized resources to work. If there's no general glut, the government multiplier is just canceling out private spending at full force, but in a recession private spending is not occuring at normal levels, so government spending can't cancel out something that's not happening.

And that's Macroeconomics 101.