Re: Take a look at this and tell me what you think

From: Michael Lorrey (
Date: Mon Mar 12 2001 - 12:44:43 MST

denis bider wrote:
> Looking at these figures, it seems that war acts as a strong catalyst on
> government expenditure...
> Federal Budget Summary 1901 - 1998
> Can anyone explain the tops, the bottoms, and the periods with fast changes
> in expenditure - up as well as down?

Its rather simple: in peacetime, money spent is generally used to either
build things that last, or else improve the spending of consumers. In
war, the money is generally destroyed at least by a large fraction, but
then again, it also tends to instigate many infrastructure and education
investments that would normally be considered excessive by government in
peacetime that only pay back synergistically as a matter of economic
measurement once the individuals and assets leave the military and are
put to productive economic use.

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