Guns or butter. Butter or guns. If you take both, you’ll run out of funds. For generations, the economic textbooks taught that a country had to choose between fighting well or living well. Yet for the last 100 years, the United States didn’t make that choice. Quite the contrary: The butter came along with the guns. Thus the adjurations by present-day officeholders and politicians to “sacrifice” must refer to matters immaterial.
There are other kinds of sacrifice, of course. There’s the sacrifice of listening to George Bush’s jejune prattle, that repetitive baby talk of his about Good versus Evil. If he God-blesses me one more time, I will throw up.
But economic suffering because of war? I don’t think so. War has been ver-ry, ver-ry good to us, you betchum. The casual and thoughtless enthusiasm with which many respond when war is in the offing may be owing to a seldom-stated but perhaps long, half-remembered association of war and good times. War-and modern war most of all-is hell. But not for America.
There was a brief business slump immediately after America entered World War I in the spring of 1917, a short hiatus in the huge prosperity surge that began with the commencement of hostilities in Europe in 1914. Then the good times went on rolling and rolling, if you don’t count the brief recession of 1920, right up to the Great Depression.
It remains a historically accurate piece of folk wisdom that it wasn’t Franklin Roosevelt’s New Deal which ended the Great Depression, but Adolf Hitler’s war to conquer the world which put the country back on its feet. It’s a testimony to the unfathomable productive resources of 1940’s America that, after building all those planes, tanks and warships, and after shipping all those munitions and foodstuffs abroad, and-most amazing of all-after withdrawing something like 13 million males from the work force, people in the United States ate better and lived better during the Second World War than they had for years.
In 1950, the Korean War came along as a perfect little corrective to a slumping economy. Then there was Vietnam, a war in which only those of us unlucky enough to fight suffered, while everybody else got paid more and lived higher than ever before-plus discovering the pleasures of recreational drug taking and fucking one’s brains out without having to worry about S.T.D’.s. For the majority, wartime America in the late 60’s and early 70’s was as good as it would ever get until the 90’s came along.
Finally there was the Gulf War, a small, quick conflict that was followed by a short, sharp recession, a decade of laughably low gas prices, the concomitant rise of gas-slurping S.U.V.’s and what for purse-proud Americans should pass as giddy prosperity the likes of which nobody had seen before. Associating the Gulf War with the subsequent prosperity may be a case of the post hoc, ergo propter hoc fallacy, but even if the one didn’t bring on the other, the Gulf War cost the United States nothing in terms of money. Our allies, dear people that they are, sent us checks to cover our expenses, and only ragheads got killed (pardon the use of a term on the new, wartime verboten -language list).
For other countries, war in a time of weapons of mass destruction has been as terrible as war generally is. For America, though, it’s been good for business, a bracing economic stimulative better than anything Congress can cook up-unless, it need hardly be said, it’s your child or mate who’s been killed in action. For that, for other people’s loved ones who die or come home with the head wounds, we wear a ribbon, drop a flower on a memorial, burn a candle, fly the flag, or sit at home and pat our wallets while the TV news readers give out with their patriotic schmaltz to coax the tears out of us. They are wet and salty and make us feel warmly sad. Oh, what fun it is to weep for others!
Now that we have another war-well, a war of sorts-will it also confer wealth and happiness on those who aren’t killed or maimed and don’t work in very high-rise buildings? Ever since the mass murder downtown, we’ve been told that our economy is in shabby shape, and that we’re in a recession or almost in a recession or sure as heck going to be in a recession. As an economic digestif , this little war so far isn’t costing enough to bring us up out of the doldrums, but are we in the doldrums?
In the past few years, recessions have come to be defined as two consecutive quarters in which the gross domestic product shrinks. But the numbers used by the priests of the economy bounce around, then get revised and changed months after they were announced and the bad news pronounced from the steps of the high altar. If it doesn’t feel like a recession, is it a recession? Is a recession a precisely definable set of conditions, or is it a state of mind? Obviously it isn’t a state of mind if millions of people are out of work, wandering hither and thither looking for jobs and mortgage money. Maybe that’s coming, but we’re not there yet. A lot of people are still working and buying an awful amount of stuff. They may not be buying as much as they were a year ago, but we’re not to the point that you can shoot a cannon down the main aisle at Wal-Mart and not hit anybody. There’s an absence of wailing and lamentation in the streets, except about those whom terrorism has murdered. By the standards of the past half century, an unemployment rate hovering around the 5 or even 6 percent level is abnormally low.
Six weeks from now, if people continue to lose their jobs by the hundreds of thousands, we may have a recession on our hands. However, at the moment, what we have is a lot of question marks. How sick are we, and who or what made us that way if we are sick? For months and months, Alan Greenspan and Wall Street have been saying we’re sick, we’re in recession-well, we’re going into recession. We gotta do something; we gotta cut the interest rates! Help, help, be a patriot, buy something, buy anything, don’t just stand there with your purse closed and your credit cards in the top bureau drawer at home! Buy a flag, for Chrissakes, and wave it. We need the bucks.
Is this hysteria in high places, or do the people in high places know some things they’re not advertising, things which scare them? Heretofore, with the coming of war, the men and women in charge of the public fisc wanted to raise taxes, sell war bonds, encourage civilian savings and discourage non-military government spending. They believed there was a limit to how much butter you could have with your guns. But not now. Not with this wartime administration. This time, the people in high places want to lower taxes, get people to spend, not save, and pour new money into civilian programs-and far from issuing war bonds, they’ve discontinued the 30-year Treasury bond. The policies used to handle the finances of past wars are unused. First we had the New Economy, which didn’t work. Are we now going into the New War Economy-and if so, will that work?
Conceded: This isn’t World War II or Vietnam. It’s not a big war, but it seems to entail significant new expenses in foreign commitments, home defense and anti-terrorist regulations that must cut productivity and raise costs. How does this get paid for? By cutting taxes? Never before has the United States or Great Britain or any country with an intelligent understanding of how to manage its finances proposed to cut taxes as it goes to war.
Either this war is not for real, or Mr. Greenspan, who’s nobody’s fool, and his associates are aware of something the wider public is not, or we’re looking at an upcoming mess. In the meantime, put on your Uncle Sam outfit, buy something, burn it and buy it again.