Bush says the war with Iraq will cost $75 billion dollars. $75 billion.
I wonder if they considered just paying Saddam $30 billion to leave. I mean, think of the savings!
Bush says the war with Iraq will cost $75 billion dollars. $75 billion.
I wonder if they considered just paying Saddam $30 billion to leave. I mean, think of the savings!
that’s $75B going into the economy… this is not a bad thing right now.
The Economy
I think that’s a fallacious argument. Let’s think about it; who is supposed to benefit from pumping $75 billion into the economy? The citizens, the people, businesses, right? And where does this $75 billion come from? Tax dollars. Tax dollars that come from businesses and people.
If the point is simply to redistribute the wealth, surely we can find a better way to do it than starting a war.
Re: The Economy
Your assumption is that there is no net gain if money travels in a circuit from the people and businesses to the government and then back to the people and businesses. On the contrary, when money moves through these cycles it creates a demand for new resources (both material and personnel), greater quantities of finished product, and research. All of these things add to the value of the economy.
When the economy is slow, both individuals and businesses hold on to their money and demand for the things listed above drops. No business will hire more people or increase production or approve new research when profits are down. Therefore, the quickest way to give certain industries a shot in the arm is for the government to write a big check.
The idea is not to redistribute wealth, the idea is to move some money and create more wealth.
Re: The Economy
You’re right, I don’t believe there is a net gain from money traveling in a circuit. In fact, I firmly believe the second law of thermodynamics applies here, I think it’s impossible for money to travel in a circuit like that without loss. Every transaction results in taxes, some transactions will be fraudulent, some will be for defective goods.
It kills me to say it (grin), but I think Ryan’s comments on this thread are dead on. Take a look at the link he posted.
http://economics.about.com/library/weekly/aa032003a.htm
the broken window fallacy
Not quite. See especially part 2.
Nevermind the fact that that $75B was coerced from taxpayers. That money was removed from the economy at gunpoint, and only returns to it after government bureaucracy takes its cut. And when it does re-enter the economy, it goes not where the market dictates, but where pork or focus groups decide.
The government should’ve held a Fight Saddam IPO. They could’ve raised $75B in no time.
$75 B not in the budget. I was glad to hear that Congress slashed out something like 80% of Bush’s proposed tax cuts. Where was he expecting the money to come from?
Gah. Don’t even get me started.
Hahaha. But if the objective of the war has little to do with removing Saddam, then this reasoning is merely academic.