Costs of War

Many people scorn economists as soulless animals because when they discuss the "costs of war" they are not talking about human life or environmental devastation; they are actually talking about the dollars and cents cost of war.

It is important to at times step back into this amoral circle and investigate how war is paid for. The brilliant economist J.K. Galbraith - a Canadian who was perhaps the most influential economist in WWII America - states that there are three ways to pay for war:

1. Conscription
   
2. Taxation
   
3. Borrowing
   

How a government chooses to pay for its war has very real implications that affect great swaths of society. In World War I, the governments of Europe used Conscription and Borrowing, and we all know the economic devastation wrought by this decision (Great Depression, Rise of Nazism, etc. etc.). World War II, people thought it out a little bit more, and the bulk of the war was paid for with Taxation (whose corrollary is Rationing). Look at the economic situation that rose from those ashes.

I realize that I am not exactly presenting an argument (because 'b' follows 'a' doesn't necessarily mean that 'a' caused 'b'), but am only presenting some 'fast facts'. For a real good analysis written in easy-to-read vernacular, you should check out J.K. Galbraith's "The World Economy Since the Wars".

Bush Junior's decision to pay for the Iraq war through Borrowing (as opposed to Bush Senior who got the rest of the world to pay for the war, which was an intelligent decision) will have ramifications. It simply will. What those are we can't exactly tell, but even the best case scenarios do not bode well. The worst models are downright scary. The Bush Junior administration is playing reactionary economics with the lives of billions of people (including Americans - very much including Americans. Cheney's statement that "Deficits don't matter; Reagan proved that" is indicative of his total disregard (lack of understanding perhaps; I find that hard to believe) of economic principles. Just because deficits are an intelligent policy at one time and place in history, doesn't mean that it is necessarily - or even likely - an intelligent decision for another period in history.

Not all economists believe that people should work for money. Money is a human invention which must be made to work for humans. Stupid and uninformed economic decisions can have serious social consequences.

Good luck!

Thomas

Bush could do like Idi Amin did in Uganda...

"Not enough money? Let's just print some more!"

Don't limit it to "Big Daddy" How do you think South American countries managed to rack up those 1,000%/week inflaton rates?

Back to topic...well, there is all that oil in Iraq...

Since war is so destructive the 'booty' of war is invariably an illusion.

How many billions will it take to get Iraq secured and the oil pumping?

Supposedly we are doing this for the Iraqi people. *cough* *cough*

COSTS:

At this point we have budgeted around 210 billion dollars for Iraq.

20,000 Iraqis dead at a minimum.

1187 Americans dead. (so far)

Turning 3/4ths of the muslim world into viewing us as enemies of Islam and Colonial Imperialists.


Footnote on WWI & WWII.
A large part of the reason for WWII was the reparation payments demanded by the 'victors' of WWI. They expected that war should be profitable, instead of maturely understanding that war is almost without exception expensive not profitable. This bankrupted Germany, causing hyperinflation and no reasonable way out for them. Germany then fell into the arms of a delusional madman and his beliefs, especially when he gave them an easy if false reasoning that the jews were at fault.

The victors of WWI weren't victors in the light of WWII.

War is something you do because you have to, not because you foolishly believe there is a 'profit' in it.
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