Many believe that military spending is good for the economy.  Nothing could be further from the truth.   Comprehensive, thorough, and painstaking research and modeling over the decades shows the general wisdom to be very false.

General Economic Wisdom

Manufacturing with technology growth is a better path to prosperity than resource-based economies.  Military spending absorbs but only partially contributes to market-based and market-tested technology growth.  Military spending is power oriented rather than achievement oriented.  In fact, resource-based economies tend to be militaristic, mercantilist, and corrupt with limited growth potential.  Two good examples of this today are Russia and Saudi Arabia, both of whom have leaders willing to kill journalists and political opponents to keep their power, and feel free to use their military power to achieve national objectives.  High levels of military spending correlate well with corruption and crime, as even America has killed muckraking journalists Michael Hastings and Gary Webb, who dared to take on the military industrial complex directly.  Militaristic America has a very low rating compared to other G7 countries by Reporters Without Borders, especially on so-called national security issues.

Displaces Economic Manufacturing

Opportunity Cost theory explains why diverting key resources away from the civilian based production cycle leads economies into stagnation.  Resources devoted to power politics are diverted from the normal focus on economic growth of the general civilian economy.  What you aim at is what you get.  The double negative of the destruction of your enemy is still a negative result, not a positive result, a destruction, not a construction.  The military achieves political ends, not economic ends.  Locally it is a good substitute for manufacturing, bringing money into a community, but the source of that money comes from other communities competing in the economic market place, sinking or swimming as products are either improved or become obsolete.  Manufacturing, construction, agriculture, and mining all suffer paying the taxes to support the military sector.  And these vital economic industries also suffer competition for talent with the overpaid engineers, managers, and workers in the military industry.  The whole economy suffers loss of capital investment and manufacturing productivity growth rate when there is a military buildup and prospers when there is a military builddown.  This constant negative of the military economy is easily offset with deficit spending, especially in wartime.  In recent decades in America, ever since Ronald Reagan, Republican presidents have created these deficits by pairing military buildups with tax cuts.  This has made the national debt grow dramatically over this period.

Models Confirm The Story

Modeling of the military economy shows essentially no economic growth results from that part of the economy.  Key resources like capital investment, scientists, and engineers all lead to economic growth in the normal economy, unless they are diverted to the military economy where their growth potential is stymied by the constraints of the military mission.  Manufacturing is turned into a service in the military sector losing almost all its economic growth potential in exchange for devotion to the national defense.  The modeling and studies clearly show the military changes drive changes in the economy.  This shows up in both international comparisons and regional comparisons within a country.  This leads to an accurate new model of long-term economic growth in the United States and Germany.  Thirteen correlations document how this applies to politics and the social decay of empires, even climate change.  Those thirteen correlations include eight that are 99% of a perfect fit and average 97% for all thirteen.  Combined, all these findings lead to new scientifically accurate models of economics and climate change.

Dead End Technology

Technology designed under conditions of secrecy and for too military specific purposes loses two thirds of its usefulness for the civilian economy.  Often such technology is driven to suit the political purposes of congressional committee chairs, party leaders, and the president.  These power figures usually serve the interests of their home state military industries and bases.  The purposes of power usually triumph over true merit-based achievement.  Having the best proposals for new weapons systems is less important than having the political clout of a home state's congressional and presidential delegation.  Only ten percent of the military budget is for research, ninety percent is for hardware, supplies, troops, and the pentagon civilian bureaucracy.  Thus 90% of the military budget acts as inert economic filler for local economies, while most of the research component 10% rarely produces duo use products to use in the civilian economy.

Two Pages showing the 17 major claims of the Peace Economics research:

https://www.academia.edu/37217512/Findings_and_Special_Claims_November_2017_2_pages

Please cite this work as follows:

Reuschlein, Robert. (2018, December 21), "Technology Loser:  Military", Madison, WI:  Real Economy Institute.  Retrieved from: https://www.expertclick.com/NewsRelease/Technology-Loser:-Military,2018165803.aspx

Dr. Peace, Professor Robert Reuschlein, Real Economy Institute

Nominated Vetted 2016, Given Odds 2017, Strongly Considered 2018 Nobel Peace Prize, Possible Favorite in 2019 Nobel Peace Prize Announced October 4th.

Contact: bobreuschlein@gmail.com, Info: www.realeconomy.com