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Professor Tyler Cowen Wants the Pentagon to Break a Few Windows. Do You?

Written by Gary North on June 17, 2014

I begin with a statement. Would you say it sounds Keynesian?

The continuing slowness of economic growth in high-income economies has prompted soul-searching among economists. They have looked to weak demand, rising inequality, Chinese competition, over-regulation, inadequate infrastructure and an exhaustion of new technological ideas as possible culprits.An additional explanation of slow growth is now receiving attention, however. It is the persistence and expectation of peace.

The world just hasn’t had that much warfare lately, at least not by historical standards. Some of the recent headlines about Iraq or South Sudan make our world sound like a very bloody place, but today’s casualties pale in light of the tens of millions of people killed in the two world wars in the first half of the 20th century. Even the Vietnam War had many more deaths than any recent war involving an affluent country.

Counterintuitive though it may sound, the greater peacefulness of the world may make the attainment of higher rates of economic growth less urgent and thus less likely.

This sounds Keynesian to me. The fact that it appears in The New York Times also leads me to conclude that it is Keynesian.

But, no, the author assures us, this is not Keynesian at all. “This view does not claim that fighting wars improves economies, as of course the actual conflict brings death and destruction. The claim is also distinct from the Keynesian argument that preparing for war lifts government spending and puts people to work.”

If it walks like a duck, and it quacks like a duck, it takes a lot of evidence for me to conclude that it is not a duck. When it is in the The New Duck Times, that pretty well confirms it.

He goes on.

Rather, the very possibility of war focuses the attention of governments on getting some basic decisions right — whether investing in science or simply liberalizing the economy. Such focus ends up improving a nation’s longer-run prospects.

Does this make sense to you? It makes no sense to me.

It was written by Tyler Cowen, who teaches economics at George Mason University. He is regarded as a free market economist. I do not know why.

It may seem repugnant to find a positive side to war in this regard, but a look at American history suggests we cannot dismiss the idea so easily.

Yes, we can. Quite easily. You would be hard-pressed to find a war in American history that did not raise taxes, raise debt, and kill innocent people. Nevertheless, I have recommended to my friend Tom Woods that he write a series of books on America’s wars. He should also produce video lectures. There are at least 20 of these wars. I want him to cover each war in three chapters: (1) how the government got us into the war; (2) how the government raised taxes and increased debt to fight the war; (3) how the economy was worse off after the war ended, and maybe society, too. Dr. Woods is the right man to write this series. He should use the books by Robert Higgs as the foundation, especially Crisis and Leviathan.

(For the rest of my article, click the link.)

Continue Reading on www.garynorth.com

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5 thoughts on “Professor Tyler Cowen Wants the Pentagon to Break a Few Windows. Do You?

  1. I performed my own economic study as to what hinders growth. It took me all of five minutes of thinking back over my 75 years about good times and bad. Growth is stifled by high taxes, over regulation, over controlled money policy, and lack of confidence in our leadership. Most non-Keynesians already know this. But politicians can't resist stealing other peoples money and doing stupid things. See my blog at http://cranky-conservative.blogspot.com

  2. Our government is the reason for stagnant economic situation. They own land that should be privately owned, they refuse to issue drilling permits on the government land that shouldn't be government land in the first place, they refuse off shore drilling permits when there is naturally oil spills from the pressure becoming too great and the oil bubbles up out in the ocean, the Keystone pipe line is on it's sixth year of delay because the president has not made a decision, (that is under the assumption that it is bad for the environment, even after the environmental studies gave the green light). We should be self sufficient on fossil fuels including natural gas. We like to act as if we have all the answers and when we actually have some of them we want to hold back and order a solar panel from China. Solar is not new and it is economically not feasible. We say go to electric cars and this idea has been around forever, at the same time we say close all the coal fired power plants.
    Another thing that I can't seem to understand is that the democratic party wants Hillary Clinton as president. They say that the people say she is honest. Have they ever heard of what she has been connected with? Vince foster supposedly committed suicide in his office and the body was found in a park. The courts had requested forms from Hillary and Bill during their reign and they were unable to locate them for two years and then they found them on a side table. That table top had not been touched for two years? How about her days with the Rose law firm? I hate to say it but it seems to be other women who line up to see her at her book signing and when asked why they say it is because she is honest. What about that landing under sniper fire that never ever happened? Then Bill told the reporters that she was getting older and that sometimes you get confused. That was in the primaries in 2008, and now she is wanting to be president in 2016, are we supposed to think that her memory has gotten better 8 years later??

  3. I neglected to mention that at the same time the government is giving fictitious numbers on the unemployment rate and neglecting to say that the number of people looking for employment is at the lowest point in history, they tell us how we need to legalize immigrants to take the extra jobs that don't even exist. The government says that minimum wage should be doubled at the same time they want to put 11 to 20 million illegals on the roles. That sounds like the government to me. That is the government that allows people to visit on temporary status and never checks where they are what they are doing and if they ever leave. This is the government who can tell you how many signed up for Obama care but not how many signed up under it for Medicaid They said that 7.1 million had signed up and that means it was a success. They failed to mention that 5 million lost their coverage as a result of Obama care and then a few months later the news came out that that number( 5.1 million) was 2 million off. BY THE WAY WASN'T OBAMA CARE SUPPOSE TO INSURE 20 OR 30 MILLION PEOPLE WHO COULD NOT GET INSURANCE?? bIG DIFFERENCE IN THE NUMBERS.

    • If you are saying we need to have a war to encourage the government to spend money, I think you have lost your mind. We have a 17 trillion dollar deficit and that number is guessing in the short side of an estimate. They have spent more money now than we will ever repay. Did anybody besides me know that we are bankrupt?

  4. CrustyOldGeezer says:

    Over Taxation, OVER Regulation, and UNDER QUALIFIED people holding positions of power and authority in both elected and politically appointed government offices.

    When a politically appointed person is give the cabinet position because of political friendship instead of QUALIFICATIONS, then every person below his knows that the 'leader; is incompetent, which breeds contempt for the person and the organization.

    The top dog gives supervisory positions to friends and family with ZERO qualifications and the end result is PURE INCOMPETENCE at all levels of ALL cabinet hierarchies.

    Take a look at every bureaucracy in the federal government and the proof is wide open for anybody to see.

    Anybody heard of the VA or IRS lately?

    The 'labor board' has exempted itself from any and all laws and ignores Congress.

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