> military expenditure in poorer countries is often detrimental to growth, whereas in wealthier countries it is more likely to be beneficial.
I wonder how much of this is that as a very best case for poorer countries, the military expenses are an attempt to guarantee minimal sovereignty and stability. Poor countries which are well-protected client states of a larger power may not need to spend anything on military.
Whereas for wealthy countries, marginal increases in military spending are generally towards force projection. This is often used to decrease costs associated with international trade…so there’s potentially a direct return on additional spending.
For example, our leadership in overthrowing[0] the government of Guatemala to ensure continued access to unconscionably one-sided contracts for the United Fruit Company (now “Dole” fruit company).
The USA still gets >85% of our pineapple from Costa Rica and Guatemala, which was secured via direct forceful subjugation as well as military spending to quietly support favorable factions.
I don’t think all our wars are directly profitable to the winning belligerent, certainly the GWOT has not given USA access to enough resources in the Middle East to offset the cost. But these indirect benefits of forceful interventions absolutely do at least subsidize our military, and may often make the marginal spending above the minimum necessary for sovereignty, profitable.
Small countries generally can’t leverage this “marginal profitability” so all their military spending is purely a cost center. Potentially necessary, but costly.
Even if the wars in the Middle East greatly increased our GDP through deficit spending, or lost money but enriched the powerful owners of defense companies, those profits came from destroying unbelievable amounts of value in other countries. Completely demolished infrastructure and millions of deaths.
I wonder how much richer USA businesses would be if that money had been poured into schools post-9/11 instead of into literal destruction of value overseas. People born then would be graduating now with greatly increased skill and ability. USA businesses would have far greater access to top talent, at significantly lower cost.
I wonder how much richer the world would be if we’d poured that money into creation, building, and education instead of into destruction and partial reconstruction.
Obviously I also wonder how much value the world might be missing out on from the intellectual capacity of South Korea if USA hadn’t spent money on a military intervention there.
The money for the global war on terror was enough to immediately build 50% more schools (reducing class sizes from 30 to 20), pay all K-12 teachers $100,000 (in 2006 dollars), and buy every K-12 student a new high end MacBook every year.
Lord knows how much internet, highways, railways, port facilities, and manufacturing facilities we could have built with that money. Perhaps we wouldn’t have a shipping crisis right now.