War Bonds

A constant in movies about WWII was war bonds--buying them was patriotic, and rallies were often headlined by Hollywood stars.

Senator Ben Nelson has watched too many old movies, I suspect. He has decided that we should reprise war bonds instead of raising taxes to pay for our many wars. He says:

"We need shared sacrifice and fiscal discipline in financing the war effort. I don't believe our first instinct should always be a rush to tax. The government has gone to great lengths to address the economic downturn, and adding new taxes right now could undermine those efforts. We need to work to reduce federal spending wherever possible and reduce the growth in spending to finance the important missions in Afghanistan and Iraq."

So one has to wonder, does Ben Nelson have any idea what-so-ever of how war bonds work? Does he think people buy them and just hang them on the wall? They are bonds, after all, meant to be redeemed at some point, with interest paid.

He seems to be under the impression that past wars were paid for with bonds alone; not so. Income taxes were raised to pay for wars time and again. Before WWII only about 10% of Americans paid income taxes; by 1944 nearly everyone did.

War bonds are just a way to involve civilians and to postpone payment on a war; they are not a way to avoid paying for it.

I will agree with Nelson's plan, on one condition--all funding for our wars come from bonds alone, and they be interest-free. Redeemable, say, in 20 years. No money from general funds to fund the wars.

Then we'll see how patriotic our war hawks really are, if they are willing to put their money where their quite commodious mouths are.