War was the economic stimulus of last resort when politicians were so confused in their understanding of economics that they would not allow the government to go into debt except for national emergencies. But Keynes said there are less destructive ways to get money into people’s pockets and stimulate the economy. Workers could be paid to dig ditches and fill them back up, and it would stimulate the economy. What a lagging economy needed was simply demand (available purchasing power).
War, digging ditches, and dropping money from helicopters could all work to stimulate demand and increase purchasing power, but there are better alternatives. Today we have major unmet needs — infrastructure that is falling apart, overcrowded classrooms, energy systems waiting for development, research labs in need of funding. The most cost-effective solution today would be for the government to stimulate the economy by spending on work that actually improves the standard of living of the people.
Diverting a portion of our massive war spending to peaceful use could add jobs, improve living standards, and add infrastructure, while reducing the national debt and balancing the government’s budget by increasing the tax base and government revenues.