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Advancing Austrian Economics, Liberty, and Peace

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Making Economic Sense
by Murray Rothbard
(Contents by Publication Date)

Chapter 104
The Glorious Postwar World

Every war in American history has been the occasion for a Great Leap Forward in the power of the State, a leap which, at best, could only be partly rolled back after the war. 

A conflict as seemingly minor as the War of 1812 took the Jacksonians three decades to wash out of American life; and freedom was never able to recover fully from the Civil War and the two World Wars. After the two world wars in particular, statists had a seemingly irresistible argument: America should use the wonder and the glory, the united martial spirit, the singleness of national purpose, to wage wars at home against a battery of domestic ills.

There are always problems aplenty at home against which to mobilize the national will: depression, poverty, injustice, what have you. And that mobilization necessarily means collectivism in action: increased federal power under the commander-in-chief.

After the full-fledged War Collectivism of the first World War, a collectivism that joined Big Business, Big Labor, statist intellectuals, and technocrats under the aegis of Big Government, the youthful planners of that collectivism: the Bernard Baruchs, Herbert Hoovers, and Franklin Roosevelts, spent the rest of their lengthy lives striving to recapture those delightful days, and to fasten them permanently upon peace-time America. The institutions and the rhetoric of wartime collectivism were recaptured during the Hoover and Roosevelt New Deals to "combat" the Great Depression, often with the same institutions and the same people running them.

Thus, Eugene Meyer's War Finance Corporation lending federal money to corporations, which had lingered on during the peacetime 1920s, was renamed the Reconstruction Finance Corporation and enlarged by Hoover in 1932, with the same Eugene Meyer happily running the show, starting from the self-same offices in Washington, D.C. And then, World War II brought back the collectivist planning of World War I. Baruch's War Industries Board was reconstituted as the War Production Board of World War II, and was resurrected once more under General Electric's Charles E. Wilson during the Korean conflict.

The War Labor Board, designed to privilege unions, set wages, and arbitrate disputes, inspired the National Labor Board in the early Roosevelt New Deal, to be succeeded by the National Labor Relations Board under the Wagner Act and to be supplemented by a reprised War Labor Board during World War II.

Particularly dangerous for an acceleration of statism are successful wars; while Korea and Vietnam led to an intensification of State power, they did not generate the lifelong nostalgia, the eagerness to recapture the glory days, of a successful war. No American war has been quite as successful as the Gulf War, particularly if we take the kill ratio of enemy to American, or that kill ratio per day.

We would therefore expect a supercharged atmosphere of bringing the war home to domestic life. In a world where television seems to speed up public responses, that postwar domestic mobilization has already begun. This spirit of domestic war, appropriately enough, was launched by President Bush in his victory address before Congress on March 6, 1991:

In the war just ended, there were clearcut objectives, timetables and, above all, an overriding imperative to achieve results. We must bring that same sense of self-discipline, that same sense of urgency, to the way we meet challenges here at home.

After summarizing some of his current domestic agenda, proposals for "reform and renewal" including "civil rights," highways, aviation, transportation, and a "crime package," and hailing the past year's "historic" Clean Air Act, his "landmark" Americans with Disabilities Act, and his Child Care Act as portents for the future, the president gave Congress a deadline: "If our forces could win the ground war in 100 hours, then surely the Congress can pass this legislation in 100 days."

The president then noted that in his State of the Union address, five weeks before, he had posed this question to Congress: "If we can selflessly confront evil for the sake of good in a land so far away, then surely we can make this land all that it should be." By their victory, the president told us, our troops "transformed a nation at home." The president concluded that "there is much that we must do at home and abroad." And we will do it.

Hold on to your hats, and to your wallets and purses, Mr. and Ms. America, here we go again! 

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