HOMO THE SAP

When I was doing news features at the CBC my executive producer pronounced that “war is good for business.” I staggered back. Where did this Neanderthal piece of economics come from? It is true that there always was a notion that the depression came to an end when we went to war. There were jobs for everyone. Business, even with rationing and price controls, was booming.

Back in the middle 40s a UofT professor named Morgan (I don’t remember what faculty or even his first name) wrote a piece called “Homo the Sap.” It was all about that precious notion that war brings prosperity. He torpedoed the idea. You need only look at the state of the British economy in 1945. Britain had not even paid of it’s debt from the firth world war. The only country that seemed to prosper was America, which was the arsenal of democracy and which managed to become the world’s leading economic power as a result of WW2.

Quick jump to the last few days. Japan is suffering more from social and economic dislocation than any country since the war. They will be looking at billions, maybe more, in rebuilding costs. However, it occurred to me that there was a benefit to come from all that misery: reconstruction. I thought it was a bit callous of me to write it until, watching the Lang-O’Leary report on CBC News I heard O’Leary say, as everyone knew he would, that the catastrophic events of the last few days do have a silver lining. Billions will be spent to build new cities and create new better infrastructure. It will be the ultimate “stimulus” campaign that will dwarf the half-hearted stimulus that first Bush (to bail out the banks) then Obama (to bail out the whole country) put into motion. The only problem with the program was that it was stopped before it could get the job done. But that is a question to be debated later.

I think O’Leary is right. The Japanese, who are among the world's great savers, have a gargantuan task ahead of them. The must rebuild an entire section of the country north of Tokyo.

Professor Morgan might have said that we were being truly “Homo the Sap” to believe that prosperity can grow from this chaos. The difference is that when the money is spent there will be something to show for it. There will be new buildings, houses, roads, whole cities. In war, the money is spent of stuff that gets blown to smithereens or become useless in time of peace.

Not so for Japan. They are about to embark on a rebuilding program the likes of which we have not seen since the Marshall Plan rebuilt from the ruins of Europe.

I never though I’d agree with O’Leary. As for Professor Morgan, he said war was not an economic growth machine. It wasted resources. It bankrupted economies. Strange, what seemed to me at the time to be a seminal piece o work could not be tracked down. I tried to Google every possible name and book title. Nothing came up. Sic transit gloria mundi!