War stimulates the economy

[Anonymouse]

As Mises pointed out, you may begin with a single axiom – man acts – and deduce all the fundamental truths of economic science.

[Anonymouse]

Originally Posted by The One and Only...

Why do you have Ron Popeil as your avatar?

My mom got ripped off by Mr. Popeil. She bought the machine, and we set it in a corner and forgot about it.

[The One and Only...]

Yay!!! An Austrian economist!!!

[Anonymouse]

Originally Posted by The One and Only...

Yay!!! An Austrian economist!!!

Yes, and nothing less.

[KevinTheOmnivore]

Group hug!!!

[mburbank]

Returning to the original point of this thread, is war good for the economy, Our president recently weighed in with his own carefully reasoned answer.

"The march to war affected the people's confidence. It's hard to make investment. See, if you're a small business owner or a large business owner and you're thinking about investing, you've got to be optimistic when you invest. Except when you're marching to war, it's not a very optimistic thought, is it? In other words, it's the opposite of optimistic when you're thinking you're going to war." —Springfield, Mo., Feb. 9, 2004

[KevinTheOmnivore]

It seems the focus has been on World War II, which is a pretty narrow attempt to answer the question.

I think it can be said that specific sectors thrive during war, particularly war industries. Prior to the War of 1812 for example, Treasury Sec. Galadin and Thomas Jefferson theorized that America would never really need a strong navy, so Galadin had the navy stripped down to essentially small gun boats that patroled the shores. He was very fiscally conservative, and figured that America would never get embroiled in a naval war. Oops.

So Madison becomes president, War of 1812 kicks up, British and French piracy, etc. etc., and we have no capable response mechanism. The navy is built up again to fight the war, and (theoretically) they did well. I'd have to research some more to see if any certain companies thrived, though.