“I’m not a Republic Serial villain.”

Apparently Dr. Krugman has borrowed a page from Alan Moore and suggested that a fake alien invasion would end the economic stagnation the world seems to be facing. From the first paragraph of the link:

Paul Krugman is so frustrated by the lack of support for another round of stimulus spending that he’s now calling for a fake alien invasion of the United States to spur a World War II-style defense buildup.

I’m not sure I agree with his analysis, but it is consistent with his argument that the Iraq War served as a spur to the economy:

The fact is that war is, in general, expansionary for the economy, at least in the short run. World War II, remember, ended the Great Depression. The $10 billion or so we’re spending each month in Iraq mainly goes to US-produced goods and services, which means that the war is actually supporting demand. Yes, there would be infinitely better ways to spend the money. But at a time when a shortfall of demand is the problem, the Iraq war nonetheless acts as a sort of WPA, supporting employment directly and indirectly.

So, points to Krugman for consistency. But at some point I have to wonder, with all that money spent (rightly or wrongly) on the Iraq War, the Afghanistan War, the rest of the War on Man-Caused Disaster, Medicare Plan D, ObamaCare, TARP, other bailouts, the 2008 stimulus, the 2009 stimulus, the 2010 stimulus, et cetera et cetera et cetera… when’s all this stimulus going to stimulate? Or are we supposed to keep believing that it’s served to keep us afloat, and without it we’d be in a depression? How much longer are we supposed to believe that?

Just to clarify: Krugman opposed the Iraq War and would (presumably) oppose a fake alien invasion. He obviously does not support war as a means to boost an economy; he’s simply pointing out that, according to some economists, war can provide a short run economic boost.

I just looked at the date. My buddy Scott died in a wreck on this date in 1995. I’ll have to write a post about him soon.

8 comments

  1. Where’s Ozymandias when you need him?

    And I guess we can gin up an invasion of Iran if Prof. Krugman really needs some good old-fashioned war-driven heavily leveraged domestic stimulus. I think my old employer would appreciate it at least, since their principal product would be patrolling the Persian Gulf and raining destruction on Tehran with the air wing.

    I of course have to wonder if the United States’ Chinese creditors would appreciate borrowed dollars being used to disrupt their natural gas supplies .

    Hey, I have a Ph.D. also! Let me come up with some more cockamamie schemes.

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  2. So let me see if I understand what’s being proposed. We should take the money that is being spent now, reinvest it to create goods that are going to go “boom” and do not create interest, destroy others’ (and have our own destroyed) capital such as vehicles, infrastructure and farms, and lose large amounts of human resources (soldiers). Right…

    I vote we invest the monetary and human resources into more productive and efficient venues. And before anyone assumes that I’m some anti-war, liberal, socialist, or WHATEVER you want to label me, I highly respect and have dear friends in the armed forces. And if we were invaded by aliens, we would of course need to defend ourselves. I simply do not agree with the notion that resources devoted to war, boost the economy, rather than resources devoted to investments and capital. And I most certainly have a hard time believing that the World War helped in getting us out of the depression. *Ducks flaming bag of dog poo*

    With that said, for those interested, I would recommend these two books by Robert P. Murphy:
    The Politically Incorrect Guide to Capitalism
    The Politically Incorrect Guide to the Great Depression and the New Deal

    Of course, I would respect any of Mr. V’s comments on such material as I could simply be misguided in my understanding and in my appreciation of these two books. Also, I’m not sure that these books would be APUSH test friendly. Just as a warning…

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  3. There is no doubt that the war left the US far better off than the rest of the world, but I’m not sure the war left the US better off than we would’ve been without the war.

    I’m not sold on the ideer that WWII ended the Depression. From a global perspective it certainly did not; life during the war was far and away worse than life during the Depression. In the US, the numbers certainly looked better during WWII than during the Depression. Employment numbers were up, GDP was up, and people probably felt a greater sense of purpose due to the war, but I’m not sure consumers were actually better off in any real sense.

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  4. Seeing as I’m no longer a blonde, the name didn’t seem as accurate.

    I think that if this hadn’t been the first war in American history that the government did not raise taxes to pay for, the theoretical argument could be made that the US could have come out better off with the war. That aside, the fact remains that we did not make any effort to increase revenue to justify the expense. I think I can say with certainty that the US would have been of better economical standing if we had not gone to war.

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  5. Blonde, you can dye, shave, do whatever you want to your hair and you’ll still be a blonde.

    Also, for clarity’s sake, I think WWII is one of few wars we had to fight. I shudder to think of a world in which America didn’t join the Allies.

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  6. Well I fit in better with my poli sci classes now. There aren’t that many blondes in that career track, it turns out. Except the ones on Fox. But we all know they’re just robots, anyway.

    I don’t think that America could have NOT joined the Allies.

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