Matt Barrow wrote:
"Gig 601XL Builder" wrDOTgiaconaATsuddenlink.net wrote in message
...
Matt Barrow wrote:


A recovery had indeed started by '39. But military production for
sale, lend and lease started before that. It is also not 100% clear
that the recovery would have held had the war not happened.

http://www.mises.org/fullstory.asp?control=1262


The government generally can't spend a country out of an economic
downturn without long term negative effects. Historically the one
exception to this is military spending. Since it tends to build
both a nations economic and political position. The one glaring
example where this wasn't true was the USSR 1980s. One where it
was true is the USA 1980s.

That's "Myth #3".

You are going to have to explain that. III in the the link you
posted was talking about wages.

The myths I'm talking about are not in the link above.

The first three myths a
Myth #1: The consumer is two-thirds of the economy: as long as she is
spending, we can avoid recession.
(Hint: Production (and only production), is 100% of the economy)
Myth #2: Lower interest rates and easy credit will promote recovery.
Myth #3: Government spending can promote growth.

#3 includes military spending. I don't know what "historically" you
are talking about, because the 1980's in the US military spending DID
smother the Soviet Union, but it certainly did NOT build our economy.

There were four big REAL (not inflation driven numbers) spurts in the
US economy in the last 105 years: 1922, 1962, 1982, and 2003. Can you
see a pattern in those dates?


Tax cuts probably.

What I probably should have written is that historically military spending
does not damage the economy as much as other government spending. I read a
paper years ago showing some metrics that basically proved out that since
military spending, especially on the hardware side, creates so many high
paying jobs and develops so many offshoots into the country's civilian
economy that it offsets most of the negatives normally associated with
government spending. That is an incredible simplification of what was about
a 100 page paper but you get the idea.