Milford chronicle., 1953-04-17
2EA(E&
An Editorial
n The Wall Street Journal

Monday
On Friday June 49, 1885, the Dow Jones industrial aver.
ages stood at 224ss Over the end the North Korean
army marched south and President Truman intervened
first with the Air Forces and then with United States troops
On Monday the stock market averages dropped 20 2l3ol
BY the middle Of the week they 2O9ll Three weeks
later they were down to 1878.
Friday March 27. the Dow Jones industrial averages
closed 1878 Over the week there was renewed hope
that the Korean might soon end Monday the industrial
averages dropped 426 to 2ss.07.
Some people noting this concurrence between peace news
and the stock maretand forgetting what happened when
war beganhave already begun talk of peace scare
as if war were bullish and peace were bearish.
In Washington of the Federal economic forecasters
speak of the trouble. making possibilities of peace in
Korea 1t might reduce government defense spending and
SO they say be hurtfu to te economy cause downturn
in business
Whenever nation shifts from war to peace or TO an
armed truce there period os unsettng uncertainty just
as there when shifts from peace to war; The stock mar
ket usually declines upon either This is not eac
ton to peace war; It is barometer of the peoples eau
I dous reaction to prospects of great change
Today this uncertainty Of great many people has un-
doubedy been intensified by the absurd philosophy long
held in Washington and long preached by some self
anointed political economists that prosperity is made by
government spending and that peace stops
ing the prosperity viii collapse That the idea is dotic
seems to be no deterrent to the argument
1t quite likely of course that if the Korean war should
be settled and other tensions should be eased there will
be decline our government spending for In
dustries that make goods purely for war will have little
less business But to conclude that this will be bad for
nations economy to indulge the rawest kind of double
think.
In the first place. those who fret over reduced government
spending ignore the fact less government spending
makes possible lesser tax burden The government will
spend less money goods useless for anything except de-
structiOn and the citizens will have money to spend
for economically useful goods invest in new tools for
making them For those who like to be practical we note
that such soft spots as there the economy are in
consumer goods which the people, robbed by taxes and
initiation, have not enough money to buy
But more importantly; those who preach that war
economy is prosperous economy are blind to the abb
surdity to which their reasoning leads
If were true that nation were made prosperous b
putting large part of its national product into then
we would have indeed discovered the millennium We
could get more and prosperous by taking more and
more men away from useful and putting them into
unlform by taking and of our machines OFF f
useful production and putting them into production Of
things to be blown up The bigger the armies the less we
would have to worry about unemployment the bigger the
war the less about surplus productive capacity"
AS matter of fact if this ides ynede anv sense at
could do the whole thing much simpler We could hire half
the population to make balloons and the other half to m
plode them with pins and the resulting level of employment
and economic activity would be stupendous
The truth that economy is the most destructive
OF all It brings initiation, the price ndces and stock
market averages show, but this the most bearh Of ali
economic signs, for imitation in its worst form is the po
mechanisms warning Of spreading chaos and coming DOW
erty The war economy destructive even blows nothing
up for It makes useless the work Of vast quantities Of men
and machines.
ANY promise Of peace harbinger not only Of hope but
OF richer prosperity for peace the essential soil for all
economic progress It has been only the periods Of peace
that have made this nation strong enough and prosperous
enough to survive all its wars and unlike 50 nanv other
nations emerge afterwards still not bankrupt
It is possible that peace will come to Korea and il Is also
possible that here will be decline in business But anv
eyeing of Of business viii come because of the peace
It win come if it does because this country has been strong
enough as it has already shown to take this war n IL
stride People have found since june 1880 that no matter
how enegecaly they bought and boarded thew could nor