Transcript [00:00] Every time I say war doesn't create [00:02] wealth, someone always brings up World [00:03] War II. Didn't massive military spending [00:06] end the Great Depression? It may sound [00:08] convincing on the surface, but when you [00:10] look closely at history, that argument [00:12] misses what actually happens. Let's look [00:14] at a wartime economic boom. Yes, during [00:16] World War II, GDP surged. But here is [00:18] the problem with that number. GDP [00:20] measures spending, not well-being. It [00:22] counts a tank the same way it counts the [00:24] house. A number that goes up because of [00:26] weapons production and other military [00:28] spending tells us nothing about [00:30] citizens' quality of life. It just tells [00:32] us where the money went. And wealth, [00:34] properly defined, isn't just about [00:36] spending in the country. It's about all [00:38] the material goods that citizens have [00:39] access to. National statistics might [00:42] look high because the government spends [00:44] trillions of dollars on war needs, but [00:46] the actual standard of living plummets. [00:49] There is no creation of new wealth. [00:51] There is a consumption of existing [00:52] wealth to survive or impose existential [00:55] threats.
Every time I say war doesn't create wealth, someone brings up WWII and the "wartime economic boom." But GDP going up doesn't mean people were better off—GDP counts a tank the same way it counts a house. It just measures spending, not wellbeing.
