Patches O'Houlihan said:
Yeah but they are "creating green jobs"!! "Conservatives" fall off the rails on military spending, though. Lots of "conservatives" say (correctly) that government spending doesn't create wealth or jobs. But then when you say the meat cleaver needs to be applied to the defense budget, oh my they shriek and say that you can't cut the military because, by golly, that would hurt the economy! I'm all ears if anyone can explain to me what magic economic pixie dust exists on one form of government spending but not on another.
"The U.S. Navy angered Republicans by spending $26 a gallon
for biofuels for this week's Great Green Fleet demonstration, but the Air Force
received little attention when it paid twice as much per gallon to test
synthetic jet fuel last month."
"The cost of the Air Force demonstration -
$639,000 - was far less eye-catching than the $12 million the Navy spent
for biofuels to power a carrier strike group on alternative energy for a
I'm glad the military can afford it. Who is paying for this...?
Good point, spending is spending, and additional dollars in the economy are additional dollars in the economy. the effect trickles down- as defense contractor execs put in purchase orders for equipment and supplies and spend their bonuses on foreign cars and fine dining, which in turn goes to the car salesman to spend at applebees and farmer joe to buy manure.
But on the types of government spending, I'd say different stimulus for different purposes. While infrastructure improvements (i.g. building a bridge, fixing a road, building a building, remodeling congressional offices, laying optical cable, etc) can create jobs in the short term and put money in the economy, the jobs created and stimulus effect may end once the project is complete. Japan learned that lesson the hard way building all sorts of public works during the busted bubble (including a couple prestige projects and many bridges to nowhere, literally). So short term, some degree of stimulus (i'll keep my opinion to myself on the cost-benefit analysis), but long term, doesn't do much to directly impact the economy.
Seems to me that stimulus directed towards R&D, education, training, developing new industries, etc., would have less of an immediate impact on jobs and cash in hand for people to spend, but helps in the longer run by helping create or improve industries and opportunities for growth that may not have developed as quickly, or really, at all. So short term, not much stimulus, and long term, potentially stronger than capital investment in infrastructure, but more uncertain stimulus effect.