Is War Good For the Economy?

Wars are expensive propositions, especially the sort of all or nothing idea envisioned by the War Party’s editorial board commandos. As the war in Iraq continues there are doubts on whether or not we can afford it, especially since the government finances war by borrowing and printing money rather than increasing taxes directly. Justin Raimondo explains, “When the costs are obscured, the question of whether war is worth it becomes distorted.” Since raising taxes is not politically popular, Congress has to find another way to spend. The Fed creates new money through the Treasury Department, and in exchange Congress leaves the Fed to operate as they please. The result of this situation is inflation, therefore, inflation finances war.

American savings will be eaten by inflation and the equity they worked hard to save will go down the drain. As the Federal Reserve pumps more and more money into circulation, desperate to avoid the crisis of the Warfare State, the only ones that benefit from the war are the banks, the most government protected industry of all, who will be the first to be bailed out of any crisis that occurs. Raimondo describes this issue perfectly when he states that, “The idea that warfare helps the economy is a prime example of bizarre logic… nature and logic are inverted, so that up is down, freedom is slavery, and ignorance is strength.” In conclusion, war does not benefit the economy.

Raimondo, Justin. "Is War Good For the Economy?" Weblog post. Antiwar.com. 26 June 2008. Web. 3 May 2011.