Proof that War Is Bad for the Economy

http://www.zerohedge.com/contributed/proof-war-bad-economy

Preface: Many Americans – including influential economists http://online.wsj.com/article/SB123008280526532053.html and talking heads http://www.washingtonpost.com/wp-dyn/content/article/2010/10/29/AR2010102907404.html - assume that war is good for the economy. Many congressmen assume that cutting pork-barrel military spending would hurt their constituents’ jobs. As demonstrated below, it isn’t true.

Nobel-prize winning economist Joseph Stiglitz says that war is bad for the economy http://www.washingtonsblog.com/2011/11/nobel-prize-winning-economist-war-is-widely-thought-to-be-linked-to-economic-good-times-nonsense.html : Stiglitz wrote in 2003: http://www.guardian.co.uk/politics/2003/jan/22/iraq.economy

War is widely thought to be linked to economic good times. The second world war is often said to have brought the world out of depression, and war has since enhanced its reputation as a spur to economic growth. Some even suggest that capitalism needs wars, that without them, recession would always lurk on the horizon. Today, we know that this is nonsense. The 1990s boom showed that peace is economically far better than war. The Gulf war of 1991 demonstrated that wars can actually be bad for an economy.

Stiglitz has also said that this decade’s Iraq war has been very bad for the economy. See this http://www.spiegel.de/international/spiegel/0,1518,409710,00.html , this http://www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article3419840.ece and this

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And economist Dean Baker notes http://www.cepr.net/content/view/1157/77/ : It is often believed that wars and military spending increases are good for the economy. In fact, most economic models show that military spending diverts resources from productive uses, such as consumption and investment, and ultimately slows economic growth and reduces employment.

War Spending Diverts Stimulus Away from the Real Civilian Economy

The New Republic noted http://www.tnr.com/blog/the-stash/military-spending-fiscal-stimulus in 2009:

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