Quote from MandelbrotSet:
I think your idea (though tounge-in-cheek) is brilliant ... and I wish the government had thought of it!
Wrong. US wars are some of the most economically-stimulative endeavors that our domestic economy can experience. Think about it.
If you build a car worth $20,000 and it is driven for 20 years and then crushed for scrap and salvage, that's not that stimulative.
On the other hand, if you build a $20,000 missile and blow it up within 2 months of it's manufacture date, you'll need another $20,000 missile ASAP (not 20 years later) and the missile has no salvage value.
Building on that premise, if you shoot a $20,000 missile at a car that has been depreciated for 10 years (let's say a hypothetical beginning value of $20000 [based off a 20 year, straight line depreciation method with a $2000 salvage value] so car is worth $11K at year 10), the car and missile now don't have any salvage values at all, and you've just destroyed $31K worth of capital that has to be replaced because it just disappeared. A Syrian cab driver then sells his 5 year old toyota to the family of the Iraqi man who was blown to bits along with his car. The Syrian buys a one year old, gently used toyota taxi from UAE, and the UAE cab driver's company sends an order to toyota for a new cab. America produces another $20,000 missile, and employs the workers at the missile factory.
All the while, the pilot that fired the missile gets paid roughly $55K/yr. tax free (while in a combat zone) and is employed and off of unemployment benefits. This pilot is insured under the military, and stands to receive roughly $400K in benefits if he dies in combat. The military demographic is made up predominantly of middle class and lower class men an women (just a fact). The families of these men and women have higher MPC's relative to savings rates (marginal propensities to consume) because the mid and lower income bracketed people have to spend more of their paychecks to pay for living than richer people. If a service member is killed in combat, there will be $400K worth of benefit that starts to enter the economy at a higher rate, relative to savings that if it were a person higher on the economic totem pole.
Everything being said, war is very stimulative. If you want to know by how much, do some math that includes aggregating:
Replacement values of all destoyed properties/objects/munitions/ordinace that intend on being replaced by US or those on the receiving end of things
Tax free wages earned by all US service members and military contractors
Wages earned by employees of companies who produce military and military support goods
Revenues of companies who produce military and military support goods
"DEATH STIMULUS" of roughly $2.1 billion since 2003 (servicemember life insurance amount x # of service member deaths)
Add it all up, and ask yourself..."Can we really afford to farm out our wars?" Then thik about how screwed our economy would be right now if we weren't engaged in a multiple-front war.
War is the greatest business of all time and the sooner you realize that, the sooner you'll achieve enlightenment.
