Sid,
I believe this is the quote you are looking for, from
"Dismantling Defense: Use Conversion to Create Jobs," The Nation,
7/12/93, pp. 66-68. The quote may not be exact, since I'm taking
it off my disk rather than the printed version that, as always, got
negotiated over down to the last comma. But the point is the same.
As the passage tries to convey, the underlying ideas really come
from the work of Markusen and Yudkin:
"Still, stinginess is not even the most serious problem with
Clinton's proposal. Its basic premise is that the purpose of
conversion is to ease the transition of military-dependent workers
and firms onto the provate economy, with the benevolent forces of
the market handling matters from that point. This fails to
recogize that for all its bad features, ranging from the wasteful
to the nefarious, military spending has also brought substantial
benefits to the economy that the market cannot duplicate.
"As Ann Markusen and Joel Yudkin have documented in
Dismantling the Cold War Economy, the Pentagon provided the
foundation for the postwar development of the aerospace,
communications and electronics industries--the most successful U.S.
industries over this period, both as technological innovators and
as exporters. They flourished because the Pentagon offered
research and development subsidies, guaranteed markets and
protection from foreign competition. In addition, as Reaganomics
demonstrated vividly, increasing the Pentagon's budget through
deficit spending has been a powerful vehicle for boosting the
economy out of recessions, since nearly all of the Pentagon's
largesse is spent in the domestic market rather than on imports.
Military spending, in short, has been America's most effective
industrial and economic stimulus policy. Any realistic conversion
program must replicate these salutary features of the military
budget elsewhere in the economy."
-- Bob Pollin
