David Broder’s October 31st op-ed on how Obama might spark an economic recovery by preparing for war with Iran has received much derision from various quarters (summarized in today’s Daily Talking Points).
But I’d like to highlight that Broder’s argument shows how thoroughly out of tune he is with the macroeconomic effects of government spending, and that this isn’t the first time he’s linked war spending to FDR’s New Deal.
Dean Baker at the Center for Economic and Policy Research debunks Broder’s assumption that war spending is different than any other kind of public expenditure.
Sorry Mr. Broder, outside of Fox on 15th the world does not work this way. War affects the economy the same way that other government spending affects the economy. It does not have some mystical impact as Broder seems to think.
But Broder does seem to see a “mystical relationship” between wars and boosting the economy.
In an August 2003 oped in The Washington Post, titled “W’s New Deal?,” Broder wrote:
Roosevelt made his changes under the spur of the Great Depression and World War II. Bush has the impetus of 9/11 to thank for the doctrine of preemptive wars, used to justify the attack on Iraq, and for the creation of the Homeland Security Department, one of the biggest restructurings of government since the New Deal.
I can’t say for sure how the creation of the Homeland Security Department and the ongoing wars in Afghanistan and Iraq measures up to the New Deal in terms of total spending. But remember, President Bush’s term ended with the start of the biggest financial crisis since the Great Depression. So it’s tough to say that Broder’s bizarre endorsement of war spending works out for the better.
Broder concluded in 2003 that the risks are high and success is not guaranteed when pursuing a policy of public spending on the scale Bush advocated in 2003 or FDR employed during the Great Depression. Having seen how the Bush administration ended–an administration with no shortage of war spending–it’s astonishing to see Broder rehash this argument.