The Daily Telegraph, 25 February, Roget Bootle
Economic pressure was one of the ways in which the West hoped Russia would be brought to heel after its invasion of Ukraine. Yet last year the Russian economy grew by 3.6pc, far faster than most countries in Europe.
What’s more, this year Russia is likely to grow by about 3pc What on earth has happened? At the risk of being accused of teaching grandmothers to suck eggs, let me go back to basics. Extra expenditure unleashed by a war can give a boost to the economy.
This is what happened to Germany in the 1930s. There was also a huge increase in war production in the US, initially to meet export orders including from the UK, and subsequently to equip its own massively expanded armed forces.
This expenditure was a key factor in lifting those economies out of the Great Depression. If an economy enters a war with unemployed resources, including labour, then the extra production of war materiel is effectively free. It employs resources which would otherwise be unused.
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