{"id":8468,"date":"2010-11-04T16:19:57","date_gmt":"2010-11-05T00:19:57","guid":{"rendered":"http:\/\/www.antiwar.com\/blog\/?p=8468"},"modified":"2010-11-05T08:10:59","modified_gmt":"2010-11-05T16:10:59","slug":"wartime-prosperity","status":"publish","type":"post","link":"https:\/\/www.antiwar.com\/blog\/2010\/11\/04\/wartime-prosperity\/","title":{"rendered":"Wartime Prosperity"},"content":{"rendered":"

Recently, the Washington Post\u00e2\u20ac\u2122s<\/em> David Broder<\/a> resurrected the tired and long debunked<\/a> case for wartime prosperity, claiming that \u00e2\u20ac\u0153a showdown with the mullahs\u00e2\u20ac\u009d in Iran would be a boon to the economy. As political economist and historian Robert Higgs has shown time and again with regards to WWII<\/a>, the economy did not fully recover until after the war ended and employment numbers looked good merely because much of the labor force was drafted into the military at below-market wages. While some have rejected<\/a> Broder\u00e2\u20ac\u2122s column, many fail to understand this point.<\/p>\n

In 2003, Higgs responded to a similar argument<\/a> made in the Wall Street Journal<\/em>, calling it a \u00e2\u20ac\u0153hoary fallacy\u00e2\u20ac\u009d and showing instead that \u00e2\u20ac\u0153unemployment fell during the war entirely because of the buildup of the armed forces. In 1940, some 4.62 million persons were actually unemployed (the official count of 7.45 million included 2.83 million employed on various government work projects). During the war, the government, by conscription for the most part, drew some 16 million persons into the armed forces\u00e2\u20ac\u00a6Voila, civilian unemployment nearly disappeared\u00e2\u20ac\u00a6\u00e2\u20ac\u009d<\/p>\n

Higgs concedes that \u00e2\u20ac\u0153officially measured GDP soared during the war. Examination of that increased output shows, however, that it consisted entirely of military goods and services. Real civilian consumption and private investment both fell after 1941, and they did not recover fully until 1946. The privately owned capital stock actually shrank during the war\u00e2\u20ac\u00a6It is high time that we come to appreciate the distinction between the government spending, especially the war spending, that bulks up official GDP figures and the kinds of production that create genuine economic prosperity. As Ludwig von Mises wrote in the aftermath of World War I<\/a>, \u00e2\u20ac\u02dcwar prosperity is like the prosperity that an earthquake or a plague brings.\u00e2\u20ac\u2122\u00e2\u20ac\u009d<\/p>\n

When I asked Higgs for his reaction to Broder\u00e2\u20ac\u2122s column, he said, \u00e2\u20ac\u0153if you mix one part historical superficiality, one part\u00c2\u00a0economic confusion, and one part sheer immorality, you get the combination that\u00c2\u00a0qualifies a journalist\u00c2\u00a0to become known as the dean of the Washington press corps<\/a>.\u00e2\u20ac\u009d<\/p>\n","protected":false},"excerpt":{"rendered":"

Recently, the Washington Post\u00e2\u20ac\u2122s David Broder resurrected the tired and long debunked case for wartime prosperity, claiming that \u00e2\u20ac\u0153a showdown with the mullahs\u00e2\u20ac\u009d in Iran would be a boon to the economy. As political economist and historian Robert Higgs has shown time and again with regards to WWII, the economy did not fully recover until […]<\/p>\n","protected":false},"author":79,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","_seopress_analysis_target_kw":"","_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","_social_image_id":0,"_social_image_url":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3],"tags":[],"coauthors":[],"class_list":["post-8468","post","type-post","status-publish","format-standard","hentry","category-news"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"meta_box":{"disable_donate_message":"","custom_donate_message":"","_social_image_id":false,"_social_image_url":"","subtitle":""},"_links":{"self":[{"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/posts\/8468","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/users\/79"}],"replies":[{"embeddable":true,"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/comments?post=8468"}],"version-history":[{"count":12,"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/posts\/8468\/revisions"}],"predecessor-version":[{"id":8479,"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/posts\/8468\/revisions\/8479"}],"wp:attachment":[{"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/media?parent=8468"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/categories?post=8468"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/tags?post=8468"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/www.antiwar.com\/blog\/wp-json\/wp\/v2\/coauthors?post=8468"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}