The Economics of War

By: Submissions

Will Dendy writes: War can end depressions, encourage the creation of new technologies and drive the human race forwards.

It is frightening to hear such complete fallacies as these becoming increasingly repeated by so-called intelligent and educated people. In the long term, war creates nothing more than destruction, despair and a retardation of the progress of the human race. In this essay, I will dispel the two biggest fallacies regarding war, and suggest far better ways to cure problems than blowing other people apart.

Number 1. War provides employment.

Let’s take 1930s Germany as an example. Every day thousands of people made their way to the factories, whose chimneys are bellowing smoke from the creation millions tanks and guns. Designers and engineers worked feverishly on creating ever more efficient and cheaper ways to kill the enemy. Just a few years before these people were sitting in their homes, unemployed and desperate.

Let’s start with analysing where this money came from to fund this newfound prosperity. In the case of most wars, the money to fund them is borrowed or stolen from the countries population either through taxation or stealth taxation (inflation of the money supply) Germany in the 1930s borrowed eye wateringly vast sums of money to fund their war effort, which immediately put millions of people to work, albeit unproductive. At some point in the future, that money would have to be repaid, which of course means taxation of the countries citizens, there is no way to escape that fact.

So, Imagine I had 50% of my wealth taken away to spend on the creation of a tank. Had I been able to keep the fruits of my labour, I would have demanded a car to take me from A to B most comfortably, stylishly and efficiently. Instead, now we have a large piece of metal designed to kill and destroy other people’s property. So now not only do I not have my shiny new Aston Martin, but also someone in a different country has had his or her car destroyed by our new tank. Or maybe that car never existed, because his or her country decided to make a tank too? Now both tanks are in a million pieces and no Aston Martins came into existence.

So to summarise, this statement is indeed correct, in the same way that digging a hole in a field, burying some food and filling it in provides employment. Employment is only employment if something of value is created.

Number 2. War progresses the human race technologically.

In WWII, people found new ways to bandage wounds, new painkillers and other drugs, new practices to save limbs after damage. Rockets became able to launch explosives further than ever before. Now ask yourself, what use are all of these things in peacetime? I would rather the intelligent people who created these things had used their brain power to find a cure for cancer or heart disease, instead of spend their time fixing injured soldiers or developing new bombs to kill tens of thousands of people.

How about the soldiers themselves? How about all of the education and productive capacity lost when they are blown to pieces by our tank or shot in the head by our guns? How about the fact that one of these soldiers could have been the next Leonardo Di Vinci and created incredible things?

There is no arguing with the fact that many useful things were developed during wartime and the trillions of dollars of borrowed expenditure which goes with it. Maybe ask yourself what could have been created in peacetime with the same vast resources.

So once again, this statement is indeed correct, if your kind of technology can blow up your neighbours house instead of make your own life, and other people’s lives easier and happier.

Perhaps a better way to end a depression is to allow society to purge itself of debt, encourage creativity for productive means and allow free trade between all nations.

To summarise, war is nothing more than a massive misallocation of resources, which in itself causes even more friction between nations and further desperation and frustration, which can easily cause another war. Germany’s hyperinflationary experiences after WWI leading to WWII are a perfect example of this. Not only this, but war is also a fantastic way for rich weapons company owners to profit from the misery and suffering of humanity.

By Will Dendy

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