Paying to avoid war

I periodically post about the idea of paying the Arabs to leave the West Bank and Gaza (also see here). Brian Gongol posted a fascinating analysis of the US Civil War showing that it would have been cheaper to buy out the South rather than it was to fight the war. He begs the question of how much the North expected the war to cost and whether it was rational for the south to fight it at all knowing that they were going to lose. But the math is interesting, nonetheless.

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One Response to Paying to avoid war

  1. ooghe says:

    interesting intellectual exercise, but as you say, raises more questions than answers. one big assumption he makes is actually something you pointed out earlier about the Civil War; which is that it was initally a war about constitutional interpretation before it was pitched in terms of ending slavery, although clearly the context of the constitutional crisis was slavery. A less fantastical counterhistory along those lines might be to ask what would have happened if Lincoln had organized northeastern financiers to retire the debts of the south carolinian landowners whose influence in state legislatures would translate into the secession movement. I’m certain that could have done more cheaply (or, for that matter, why not just bribe the legislators outright), although that assumes the South knew they would otherwise lose everything, that Lincoln had the political power to effect such a deal, and that the deal wouldn’t have ceded political influence to the south completely out of proportion to their economic position.

    Selling every slave to Uncle Sam probably would not have been seen as a good enough deal for the South to truly change, because- as Gongol surely realizes, the slaveowners would still have needed someone to work the plantations for the whole enterprise to still have worth- which, in lieu of slaves, would have meant using the $5 billion to salary former slaves at a time when cotton production was booming and the price of US land was decreasing. The end result was probably much the same post Reconstruction- white landowners conspiring to keep labor costs as low and as racially associated as possible as they moved into textiles. It certainly would have been better in every sense if there had never been a Civil War, but I think for an economic argument to have worked your average southern landowner would have had to have put more economic faith in the northeastern banks than social sympathy for the status quo.

    On a somewhat more topical note, one hypothetically wonders what would have happened if some big political organization had attempted to broker an economic incentive for Saddam Hussein to allow more humanitarian conditions for the Iraqis…

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