It is commonly said by statists that war is good for the economy. At best, this reflects a lack of understanding of economics; at worst, it is a bold-faced lie. There are those that benefit from war. Certainly defense industries benefit; however, to equate this to widespread prosperity is misleading.

During war, production and capital is diverted toward the state's preferences (i.e. the war effort) rather than consumer preferences. When paid for through taxes, it represents resources confiscated from the private sector. As in recent times when war is paid for through debt, the results are equally devastating. Instead of being used in the private sector, these resources are instead spent on things that do not align with consumer preferences, do not produce wealth, and are a near total loss. As deficits and debt have swelled, confidence in the dollar has fallen leading to a rise in the cost of foreign goods and the cost of living.

The only beneficiary of war is its perpetrator, the state. Randolph Bourne's dictum "War is the health of the state" rings sound and true. War is the ultimate big government program. It is during war that the state's size and power is the greatest. Liberties are infringed upon in the name of "national security." The state and its intellectual apologists ridicule dissent as unpatriotic. Taxing and inflating the state does what it always does best--destroy.