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November 1, 2010

The Economic Recovery Act of 2011: War with Iran?

David Broder of the WP seems to be inciting more preemptive war as the solution for the economy and the Democrats' political problems:

Look back at FDR and the Great Depression. What finally resolved that economic crisis? World War II.

Here is where Obama is likely to prevail. With strong Republican support in Congress for challenging Iran's ambition to become a nuclear power, he can spend much of 2011 and 2012 orchestrating a showdown with the mullahs. This will help him politically because the opposition party will be urging him on. And as tensions rise and we accelerate preparations for war, the economy will improve.

Lots of problems, only one of which is that fact that any war with Iran won't be even close to the scale of World War II in terms of fiscal stimulus. Maybe Broder thinks that's a bad thing.

Washington's Blog doesn't think the economics work, either:

Broder is also plain wrong on the economics.

In a blog entry entitled "Has David Broder Lost His Mind?," Foreign Policy managing editor Blake Hounshell writes that Broder's proposal is "crazy for a number of reasons."

One is that markets don't like tensions, and certainly not the kind that jack up oil prices. Second, World War II brought the United States out of the Great Depression because it was a massive economic stimulus program that mobilized entire sectors of society. Today's American military has all the tools it needs to fight Iran, and there isn't going to be any sort of buildup. Hasn't Broder been reading his own newspaper? The Pentagon is looking to find billions in cuts as it confronts the coming world of budget austerity.

And as I have repeatedly pointed out, "military Keynesianism" - that is, launching wars to stimulate the economy, doesn't work.

Posted by Jay Hancock at 8:50 AM | | Comments (1)
Categories: The Great Recession
        

Comments

It's as though the two wars we are already fighting have slipped his mind. Why going to war with Iran should do the trick when Iraq and Afghanistan haven't is a mystery to me.

Last time we decided to try this stunt, one of my closest friends ended up dead. I'm betting Broder wouldn't discuss this possibility so blithely if the same thing had happened to someone close to him -- or, for that matter, if he knew soldiers on their fourth or fifth deployment who would just like to spend some time at home with their families. They signed up to defend this country, not to play walk-on parts in David Broder's economic fantasies.

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About Jay Hancock
Jay Hancock has been a financial columnist for The Baltimore Sun since 2001. He has also been The Baltimore Sun's diplomatic correspondent in Washington and its chief economics writer. Before moving to Baltimore in 1994 he worked for The Virginian-Pilot of Norfolk and The Daily Press of Newport News.

His columns appear Tuesdays and Sundays.
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