Tuesday, January 29, 2008

A good offence is the best defence

Peace is the alternative to war. Yet as long as the socio-economic returns of defending a nation’s interest and its territorial integrity exceed the dividends of peace , states will choose war over peace even if they become protracted by nature.

There are three common ways to fund an economy in war times; increasing taxes, decreasing investments , and by incurring public and external debt. Whilst external spending on war shrinks national income, internal government spending can create effects similar to that of military Keynesianism. Wars can provoke shared poverty with governments tending to tax and borrow from the richer (as a means of financing the war) while increasing the income to the poor through military payrolls and subsidies. Such types of income distribution will deepen existing levels of poverty and increase its incidence.

One alternative to this dilemma is wealth creation through military industrialization (the European experience). Reverse engineering and tactical technology transfers can make room for such industrialization. Yet the majority of less developed countries (apart from,India,China and Parkistan and a few former soviet block countries) have so far not found this kind of prosperity through war.

The second alternative, the most probable, is to have sound war strategies accompanied by good economic management. Planners must find way to increase production and growth with what ever resources they could spare for non-war related activities. Cutting wastage, creating efficiency and productivity plus implementing development state mechanisms that provide fundamental infrastructure and guidance for low cost production with higher yields can be seen as primary policies adoptable by an economy in war.

As a stronger economy bares the brunt of war it can also give that little extra edge needed in winning a difficult one . Which makes one good offence in the economic frontier the best defence of all times.