Chapter 208 of 943 · Business Tides: The Newsweek Era of Henry Hazlitt by Henry Hazlitt
This Is the Peace We Bought
December 11, 1950
Over the past five years, the American public has been repeatedly told by the bureaucrats who were throwing its money all over the globe that they were “buying peace.” Every question was dismissed with the breezy answer: “You can’t expect to buy peace cheaply! What we’re getting for the $43,000,000,000 we’ve spent on foreign aid since V-J Day is the biggest bargain this country ever bought!” Passing over the question whether peace can in fact ever be bought with dollars, the American people now see, in Korea, just how much peace they got for their foreign-aid money.
I devoted last week’s article to some of the central fallacies behind our foreign civilian giveaway program. Now let’s look at “arms aid.”
We have already given to Western Europe—as we should have done—a guarantee of our military intervention in case it is attacked. This is in itself a tremendous commitment, unprecedented in our history. We also lightly and casually made similar promises in a dozen remote places of the globe. The one to Korea, for example, was considered of such negligible importance that most Americans never heard of or remembered it until June 25. We have already paid a tremendous price for that unweighed promise and still do not know the total price it will cost us to carry it out. Should we start adding still further commitments when we are not sure we can fulfill those already made?
Unless we attach strict conditions, we may only be deceiving ourselves when we transfer foreign aid from civilian to military projects. The mere fact that our funds are “earmarked” for this or that specific purpose is meaningless. If we pay for part of the military programs of Europe, and these programs are no larger than they would have been without our aid, then our dollars or equipment have merely released that much of the European governments’ own funds for other purposes—say for “welfare” programs or to pay the deficit on nationalized industries. Our contribution has not really gone for defense unless these governments spend the whole of it on defense above the amount they would have spent on defense anyway. And there is of course no certain way of determining what this latter figure would have been.
The contention that we must make heavy gifts of money or equipment to Europe for defense is not primarily military but economic. It rests on the assumption that Europe cannot afford to arm itself. (The Gray report, in fact, warns that we mustn’t push Britain to arm too fast, even with our aid, lest it put too much strain on the pound sterling.) The assumption that European nations cannot afford to arm themselves is untenable. What they are arming against, in fact, are nations with incomparably lower living standards than their own. If Communist aggressors divert enough resources to threaten, Europe must divert enough resources to survive.
If we continue to extend foreign arms aid, we must safeguard it with far stricter conditions than in the past. At least three suggest themselves:
1—The nations of Western Europe are in far greater peril from Russian aggression than the United States. Yet they have been spending an average of only 5 percent of their national incomes on defense and an average of only 18 percent of their governmental budgets (as compared with 36 percent in the U.S.). We should insist that most of the countries receiving arms aid devote a far larger percentage of their incomes and governmental budgets to their own defense.
2—As former President Hoover has insisted, we should “say, and at once, that we shall provide no more money until a definitely unified and sufficient European army is in sight.”
3—We should not give any more military (or civilian) funds to any country that fails to send at least token aid in the Korea conflict. The emergency we have been paying to guard against is already here. If these countries are not willing to fight on our side now, we are not justified in giving them more money in the thin hope that they may be fighting on our side in the sweet by-and-by.
Business Tides: The Newsweek Era of Henry Hazlitt
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