Guns vs. Butter
Debunking a tired myth.
5:07 PM, Apr 23, 2010 • By FREDERICK W. KAGAN
It’s time to set straight a myth that has persisted for many decades, perpetuated most recently by Arianna Huffington in her post, “Guns vs. Butter 2010.” The myth is that, as she put it quoting Eisenhower, “Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and not clothed.” The fact is that the idea that a dollar spent on defense is a dollar not spent on helping Americans is entirely false. Leave aside the debate over the wisdom of American involvement in the world or the desirability of winning ongoing conflicts rather than losing them. The simple fact is that the overwhelming proportion of every dollar spent on defense goes straight back into the American economy.
Defense spending has long been recognized as one of the single strongest stimulants to any economy. World War II brought America out of the Great Depression and into an era of enormous prosperity, just to cite the most obvious example. Current defense spending will not have that effect because it is so small compared to the size of the economy—it hovers at or below 4 percent of GDP.
But forget those statistics and precedents as well and focus on something more concrete. A very large portion of the defense budget goes to paying the salaries of something like 5 million Americans. Since American forces deployed overseas do not live on the local economy, almost all of that money goes either to their families here at home or to the concessions that serve them abroad generally run by U.S. contractors. One can feel about contractors however one pleases, but U.S. contractors are American firms and their earnings and most of their wages also go back into the American economy.
Now let’s consider the ships and missiles of which Eisenhower disapproved. The “buy American” provisions in defense spending bills are extremely strong and hard to break. Arianna Huffington may disapprove of the “military-industrial complex,” but an unassailable fact is that it produces tens of thousands of American jobs. Its vast supply-chain generates income for many larger and smaller firms not directly connected with the Defense Department. Closing military bases has been a wrenching and destructive experience for many local communities. Cancelling large weapons-system purchases puts thousands of highly talented American workers on the street.
The ideological preconception that defense spending is both harmful to the economy and immoral led to one of the most immoral and indefensible political decisions of modern times—the decision to exclude the Defense Department from almost all of the vast stimulus package that washed over every other cabinet department at the start of this administration. The decision was indefensible because there were as many or more “shovel-ready” projects in the unfunded requirements of the Defense Department as there were in any other sector, and funding those projects would have stimulated the economy at least as well as “cash for clunkers.” It was immoral because it forced our servicemen and women, and the civilians who work with them, to continue to operate under conditions of enormous strain with insufficient resources while fighting two wars. You don’t have to approve of the wars to think that the people fighting them should have the resources they need.
Under no circumstances would I advocate spending money on defense—or anything else for that matter—needlessly simply for the purpose of creating jobs or stimulating the economy. But when the military—badly under-resourced for nearly two decades by both Democratic and Republican administrations—is so severely strained and billions of dollars in stimulus money are being sloshed around, refusing to give some of that money to the best and bravest Americans who need it badly—to say nothing of demanding that their budget be cut—is just wrong.
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