An Evaluation of Military Expenditures in the Light of Keynesian Thought (original) (raw)

Keynesianism is based on the assumption that an increase in public spending will lead to an increase in aggregate demand through a multiplier effect. Government investments will increase aggregate demand and this will stimulate the economy. This Keynesian idea is widely said to have emerged in the 1930s. Following the 1929 Great Depression, governments resorted to public spending to combat rising unemployment and macroeconomic problems. In this period, infrastructure investments that would create public jobs and public expenditures with strong social aspects such as education and health expenditures were predominantly used. Later, military expenditures were used in the 1940s due to World War II. During this period, unemployment in the United States of America (USA) fell to the lowest levels in history thanks to the production of military equipment and products. These experiences in the 1930s and 1940s led to the identification of Keynesianism as social Keynesianism and military Keynesianism. John Maynard Keynes was aware of the impact of military spending, a component of public spending, on employment. However, Keynes argued that employment should be increased through social expenditures such as infrastructure investments, not military expenditures. Keynes was also aware that international financial policies would lead to violence and war. This is why he argued for a more balanced international economic structure to avoid radical ideas and wars in his various works. Today, it can be said that the share of military expenditures in gross domestic product (GDP) is on a downward trend compared to World War II. Nevertheless, military expenditures still constitute a significant share of public expenditures. On the other hand, public expenditures on education and health have declined more rapidly since the 1980s. In today’s world of fundamental problems such as the climate crisis and income inequalities, there is a need to re-evaluate military and social expenditures in line with Keynes’s ideas. Military expenditures lead to lower allocations for education, health and other social expenditures and prevent the allocation of sufficient resources to combat environmental problems. Therefore, some authors argue that resources can be allocated to tackling these problems through transfers from military expenditures. This study discusses how public expenditures should be evaluated in combating today’s problems, taking into account the distinction between military and social Keynesianism.