popeyespappy Wrote:Slashing the military budget in half next year would result in millions becoming unemployed overnight and cause an economic downturn that would make the last one look like a trip to Disneyland.
Yeap, this happened in the 1921-22 recession after WW1. It would be worse this time around for two reasons. Minimum wages and Inflation. After WW1 returning soldiers were able to offer their services (labor, etc...) for lower wages, making them competitive. After WW1 the flood of labor and lowered wages, along with the government actively increasing interest rates and lowering inflation, brought about the general decline in prices (an increase in purchasing power). Now with Quantitative Easing, even if they were able to get jobs for lower wages the Fed won't allow deflation to occur... which would lower prices. Even though it would boost purchasing power and lower unemployment. It would be pretty nasty.
Especially if you consider that returning soldiers will now be eligible for fully subsidized health insurance with an income of nothing... unemployment and other entitlements.
...as bad as the military spending needs to stop... the question is how?
I would be fine with scrapping the NSA entirely... for a start!
popeyespappy Wrote:The answer is to increase revenue through raising taxes, spend the money more efficiently on things other than the military, and reduce the rate of growth of government spending. In order to lessen the impact on the economy these things need to be phased in slowly over time. At least a decade. Maybe two or three.
What is the realistic answer though? "Government" and "fiscal responsibility" don't go together.
